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DIA vs. MTUM: What’s The Difference?

The SPDR Dow Jones Industrial Average ETF Trust (DIA) and the iShares MSCI USA Momentum Factor ETF (MTUM) are both among the Top 100 ETFs. DIA is a SPDR State Street Global Advisors Large Value fund and MTUM is a iShares Large Growth fund. So, what’s the difference between DIA and MTUM? And which fund is better?

The expense ratio of DIA is 0.01 percentage points higher than MTUM’s (0.16% vs. 0.15%). DIA also has a lower exposure to the financial services sector and a higher standard deviation. Overall, DIA has provided lower returns than MTUM over the past ten years.

In this article, we’ll compare DIA vs. MTUM. We’ll look at risk metrics and portfolio growth, as well as at their holdings and performance. Moreover, I’ll also discuss DIA’s and MTUM’s industry exposure, fund composition, and annual returns and examine how these affect their overall returns.

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Summary

DIAMTUM
NameSPDR Dow Jones Industrial Average ETF TrustiShares MSCI USA Momentum Factor ETF
CategoryLarge ValueLarge Growth
IssuerSPDR State Street Global AdvisorsiShares
AUM30.46B14.53B
Avg. Return13.35%17.37%
Div. Yield1.61%0.44%
Expense Ratio0.16%0.15%

The SPDR Dow Jones Industrial Average ETF Trust (DIA) is a Large Value fund that is issued by SPDR State Street Global Advisors. It currently has 30.46B total assets under management and has yielded an average annual return of 13.35% over the past 10 years. The fund has a dividend yield of 1.61% with an expense ratio of 0.16%.

The iShares MSCI USA Momentum Factor ETF (MTUM) is a Large Growth fund that is issued by iShares. It currently has 14.53B total assets under management and has yielded an average annual return of 17.37% over the past 10 years. The fund has a dividend yield of 0.44% with an expense ratio of 0.15%.

DIA’s dividend yield is 1.17% higher than that of MTUM (1.61% vs. 0.44%). Also, DIA yielded on average 4.02% less per year over the past decade (13.35% vs. 17.37%). The expense ratio of DIA is 0.01 percentage points higher than MTUM’s (0.16% vs. 0.15%).

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Fund Composition

Industry Exposure

DIA vs. MTUM - Industry Exposure

DIAMTUM
Technology17.32%15.24%
Industrials16.7%12.47%
Energy2.0%1.77%
Communication Services4.42%13.18%
Utilities0.0%0.19%
Healthcare17.92%6.41%
Consumer Defensive6.3%2.88%
Real Estate0.0%0.43%
Financial Services20.68%34.32%
Consumer Cyclical13.44%9.96%
Basic Materials1.21%3.15%

The SPDR Dow Jones Industrial Average ETF Trust (DIA) has the most exposure to the Financial Services sector at 20.68%. This is followed by Healthcare and Technology at 17.92% and 17.32% respectively. Utilities (0.0%), Basic Materials (1.21%), and Energy (2.0%) only make up 3.21% of the fund’s total assets.

DIA’s mid-section with moderate exposure is comprised of Communication Services, Consumer Defensive, Consumer Cyclical, Industrials, and Technology stocks at 4.42%, 6.3%, 13.44%, 16.7%, and 17.32%.

The iShares MSCI USA Momentum Factor ETF (MTUM) has the most exposure to the Financial Services sector at 34.32%. This is followed by Technology and Communication Services at 15.24% and 13.18% respectively. Real Estate (0.43%), Energy (1.77%), and Consumer Defensive (2.88%) only make up 5.08% of the fund’s total assets.

MTUM’s mid-section with moderate exposure is comprised of Basic Materials, Healthcare, Consumer Cyclical, Industrials, and Communication Services stocks at 3.15%, 6.41%, 9.96%, 12.47%, and 13.18%.

DIA is 13.64% less exposed to the Financial Services sector than MTUM (20.68% vs 34.32%). DIA’s exposure to Healthcare and Technology stocks is 11.51% higher and 2.08% higher respectively (17.92% vs. 6.41% and 17.32% vs. 15.24%). In total, Utilities, Basic Materials, and Energy also make up 1.90% less of the fund’s holdings compared to MTUM (3.21% vs. 5.11%).

Holdings

DIA - Holdings

DIA HoldingsWeight
UnitedHealth Group Inc7.63%
Goldman Sachs Group Inc7.23%
The Home Depot Inc6.07%
Microsoft Corp5.16%
Salesforce.com Inc4.65%
Amgen Inc4.64%
Boeing Co4.56%
Visa Inc Class A4.45%
McDonald’s Corp4.4%
Honeywell International Inc4.18%

DIA’s Top Holdings are UnitedHealth Group Inc, Goldman Sachs Group Inc, The Home Depot Inc, Microsoft Corp, and Salesforce.com Inc at 7.63%, 7.23%, 6.07%, 5.16%, and 4.65%.

Amgen Inc (4.64%), Boeing Co (4.56%), and Visa Inc Class A (4.45%) have a slightly smaller but still significant weight. McDonald’s Corp and Honeywell International Inc are also represented in the DIA’s holdings at 4.4% and 4.18%.

MTUM - Holdings

MTUM HoldingsWeight
Tesla Inc5.63%
The Walt Disney Co4.39%
JPMorgan Chase & Co4.35%
Berkshire Hathaway Inc Class B4.34%
Bank of America Corp3.81%
PayPal Holdings Inc3.76%
Wells Fargo & Co3.05%
Applied Materials Inc3.05%
Moderna Inc2.89%
Alphabet Inc Class C2.84%

MTUM’s Top Holdings are Tesla Inc, The Walt Disney Co, JPMorgan Chase & Co, Berkshire Hathaway Inc Class B, and Bank of America Corp at 5.63%, 4.39%, 4.35%, 4.34%, and 3.81%.

PayPal Holdings Inc (3.76%), Wells Fargo & Co (3.05%), and Applied Materials Inc (3.05%) have a slightly smaller but still significant weight. Moderna Inc and Alphabet Inc Class C are also represented in the MTUM’s holdings at 2.89% and 2.84%.

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Risk Analysis

DIAMTUM
Mean Return1.130
R-squared93.310
Std. Deviation13.680
Alpha-0.940
Beta0.970
Sharpe Ratio0.940
Treynor Ratio13.070

The SPDR Dow Jones Industrial Average ETF Trust (DIA) has a Mean Return of 1.13 with a R-squared of 93.31 and a Treynor Ratio of 13.07. Its Sharpe Ratio is 0.94 while DIA’s Alpha is -0.94. Furthermore, the fund has a Standard Deviation of 13.68 and a Beta of 0.97.

The iShares MSCI USA Momentum Factor ETF (MTUM) has a Alpha of 0 with a Sharpe Ratio of 0 and a Standard Deviation of 0. Its R-squared is 0 while MTUM’s Treynor Ratio is 0. Furthermore, the fund has a Beta of 0 and a Mean Return of 0.

DIA’s Mean Return is 1.13 points higher than that of MTUM and its R-squared is 93.31 points higher. With a Standard Deviation of 13.68, DIA is slightly more volatile than MTUM. The Alpha and Beta of DIA are 0.94 points lower and 0.97 points higher than MTUM’s Alpha and Beta.

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Performance

Annual Returns

DIA vs. MTUM - Annual Returns

YearDIAMTUM
20209.63%29.69%
201925.09%27.57%
2018-3.6%-1.77%
201727.97%37.6%
201616.28%4.89%
20150.1%9.12%
20149.88%14.48%
201329.41%0.0%
201210.04%0.0%
20118.21%0.0%
201013.87%0.0%

DIA had its best year in 2013 with an annual return of 29.41%. DIA’s worst year over the past decade yielded -3.6% and occurred in 2018. In most years the SPDR Dow Jones Industrial Average ETF Trust provided moderate returns such as in 2014, 2012, and 2010 where annual returns amounted to 9.88%, 10.04%, and 13.87% respectively.

The year 2017 was the strongest year for MTUM, returning 37.6% on an annual basis. The poorest year for MTUM in the last ten years was 2018, with a yield of -1.77%. Most years the iShares MSCI USA Momentum Factor ETF has given investors modest returns, such as in 2010, 2016, and 2015, when gains were 0.0%, 4.89%, and 9.12% respectively.

Portfolio Growth

DIA vs. MTUM - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
DIA$10,000$21,63613.35%
MTUM$10,000$29,30117.37%

A $10,000 investment in DIA would have resulted in a final balance of $21,636. This is a profit of $11,636 over 7 years and amounts to a compound annual growth rate (CAGR) of 13.35%.

With a $10,000 investment in MTUM, the end total would have been $29,301. This equates to a $19,301 profit over 7 years and a compound annual growth rate (CAGR) of 17.37%.

DIA’s CAGR is 4.02 percentage points lower than that of MTUM and as a result, would have yielded $7,665 less on a $10,000 investment. Thus, DIA performed worse than MTUM by 4.02% annually.


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