US-listed · NYSE Arca · FIF-eligible (above NZ$50K)
iShares IWM iShares Russell 2000 ETF
Tracks the Russell 2000 Index — ~2,000 US small-cap stocks. The most-traded small-cap ETF.
Updated Reviewed quarterly
About this fund
What is IWM?
IWM is the US-listed ticker for iShares Russell 2000 ETF, issued by iShares. Tracks the Russell 2000 Index — ~2,000 US small-cap stocks. The most-traded small-cap ETF. TER is 0.19% per year, with a trailing 12-month distribution yield of approximately 1.4%. Distributions are paid quarterly.
How to buy
Where can I buy IWM from New Zealand?
Hatch NZ-built. US$3 flat per trade, ~0.5% FX.
Stake Commission-free US shares; ~0.7% FX.
Sharesies NZ + AU + US in one account; tiered subscription pricing.
Interactive Brokers Tiered commissions; FX margin ~0.002% (lowest published of platforms reviewed).
See the full platform comparison for fees, minimums, and supported markets across all 11 NZ-accessible brokers.
NZ tax
How is IWM taxed for NZ investors?
IWM is US-listed, so it sits in the Foreign Investment Fund (FIF) regime once your overseas-share holdings exceed NZ$50,000 cost basis. Below that threshold, the FIF regime does not apply and you pay tax on dividends only.
Above NZ$50K cost basis, most NZ retail investors use the Fair Dividend Rate (FDR) method — deemed income = 5% × opening market value × your marginal tax rate. FDR vs CV method →
US dividends carry 15% US withholding tax under the NZ–US tax treaty (file a W-8BEN with your broker; without it, the rate is 30%). The 15% can be claimed as a foreign tax credit on your IR3.
Tax outcomes depend on your portfolio size, marginal rate, and FDR-vs-CV election. See PIE vs FIF for the full comparison and consult a registered NZ tax adviser for personalised guidance.
FAQ
Common questions about IWM
What is the IWM ETF? ⌄
IWM is the iShares Russell 2000 ETF — it tracks the Russell 2000 Index, holding approximately 2,000 small-cap US stocks (the smallest 2,000 of the Russell 3000). TER is 0.19%, distributions paid quarterly. Yield ~1.4%. The most-traded small-cap ETF; deep liquidity for institutional and retail use.
IWM vs VTI — why hold small-caps separately? ⌄
VTI (Vanguard Total Stock Market) already includes small-caps — they're roughly 6-8% of total US equity market cap. IWM pure-plays small-caps. Holding IWM on top of VTI overweights small-caps; some investors do this for the historical small-cap premium ("Fama-French" risk factor). Whether the historical premium persists is contested in academic finance.
Can NZ residents buy IWM? ⌄
Yes. IWM is available via Hatch, Stake, Sharesies (US market), and Interactive Brokers. Above NZ$50,000 cost basis FIF rules apply (FDR method most common). Note: small-caps are higher-volatility than large-caps; FDR's flat 5% × MV calculation can produce particularly poor after-tax outcomes in down years for small-cap-heavy portfolios.
IWM vs IJR or VB — alternatives? ⌄
IWM tracks Russell 2000. IJR (iShares Core S&P Small-Cap) tracks the S&P SmallCap 600 — slightly different, with a profitability screen that has historically slightly outperformed Russell 2000. VB (Vanguard Small-Cap) tracks the CRSP US Small Cap Index. All three give broad small-cap exposure; IWM has the deepest liquidity, IJR the highest historical return, VB the lowest TER (0.05% vs 0.19%).
Related ETFs and resources
VTI — Vanguard Total Stock Market
Already includes small-caps; consider before adding IWM as an overweight.
AVUV — Avantis US Small Cap Value
Active small-cap value tilt; targets the small + value premium together.
VOO — Vanguard S&P 500 (large-cap)
Large-cap counterpart for a multi-cap-tilt portfolio.
FIF tax explained
Why FDR floor + small-cap volatility = poor after-tax outcomes in down years.