The SPDR Dow Jones Industrial Average ETF Trust (DIA) and the Vanguard Small-Cap Value Index Fund ETF Shares (VBR) are both among the Top 100 ETFs. DIA is a SPDR State Street Global Advisors Large Value fund and VBR is a Vanguard Small Value fund. So, what’s the difference between DIA and VBR? And which fund is better?
The expense ratio of DIA is 0.09 percentage points higher than VBR’s (0.16% vs. 0.07%). DIA also has a higher exposure to the financial services sector and a lower standard deviation. Overall, DIA has provided higher returns than VBR over the past 11 years.
In this article, we’ll compare DIA vs. VBR. We’ll look at holdings and risk metrics, as well as at their portfolio growth and performance. Moreover, I’ll also discuss DIA’s and VBR’s fund composition, industry exposure, and annual returns and examine how these affect their overall returns.
|Name||SPDR Dow Jones Industrial Average ETF Trust||Vanguard Small-Cap Value Index Fund ETF Shares|
|Category||Large Value||Small Value|
|Issuer||SPDR State Street Global Advisors||Vanguard|
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 Vanguard Small-Cap Value Index Fund ETF Shares (VBR) is a Small Value fund that is issued by Vanguard. It currently has 48.08B total assets under management and has yielded an average annual return of 12.28% over the past 10 years. The fund has a dividend yield of 1.6% with an expense ratio of 0.07%.
DIA’s dividend yield is 0.01% higher than that of VBR (1.61% vs. 1.6%). Also, DIA yielded on average 1.07% more per year over the past decade (13.35% vs. 12.28%). The expense ratio of DIA is 0.09 percentage points higher than VBR’s (0.16% vs. 0.07%).
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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 Vanguard Small-Cap Value Index Fund ETF Shares (VBR) has the most exposure to the Financial Services sector at 20.04%. This is followed by Industrials and Consumer Cyclical at 18.44% and 13.82% respectively. Utilities (3.65%), Consumer Defensive (4.36%), and Energy (5.15%) only make up 13.16% of the fund’s total assets.
VBR’s mid-section with moderate exposure is comprised of Basic Materials, Healthcare, Technology, Real Estate, and Consumer Cyclical stocks at 6.31%, 7.16%, 8.39%, 10.92%, and 13.82%.
DIA is 0.64% more exposed to the Financial Services sector than VBR (20.68% vs 20.04%). DIA’s exposure to Healthcare and Technology stocks is 10.76% higher and 8.93% higher respectively (17.92% vs. 7.16% and 17.32% vs. 8.39%). In total, Utilities, Basic Materials, and Energy also make up 11.90% less of the fund’s holdings compared to VBR (3.21% vs. 15.11%).
|UnitedHealth Group Inc||7.63%|
|Goldman Sachs Group Inc||7.23%|
|The Home Depot Inc||6.07%|
|Visa Inc Class A||4.45%|
|Honeywell International Inc||4.18%|
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%.
|Diamondback Energy Inc||0.55%|
|VICI Properties Inc Ordinary Shares||0.54%|
|Nuance Communications Inc||0.5%|
|Molina Healthcare Inc||0.48%|
|Howmet Aerospace Inc||0.44%|
|Apollo Global Management Inc Class A||0.42%|
|Brown & Brown Inc||0.41%|
VBR’s Top Holdings are Diamondback Energy Inc, VICI Properties Inc Ordinary Shares, IDEX Corp, Nuance Communications Inc, and Molina Healthcare Inc at 0.55%, 0.54%, 0.54%, 0.5%, and 0.48%.
Signature Bank (0.46%), Novavax Inc (0.44%), and Howmet Aerospace Inc (0.44%) have a slightly smaller but still significant weight. Apollo Global Management Inc Class A and Brown & Brown Inc are also represented in the VBR’s holdings at 0.42% and 0.41%.
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The SPDR Dow Jones Industrial Average ETF Trust (DIA) has a Sharpe Ratio of 0.94 with a Alpha of -0.94 and a Mean Return of 1.13. Its Beta is 0.97 while DIA’s Standard Deviation is 13.68. Furthermore, the fund has a R-squared of 93.31 and a Treynor Ratio of 13.07.
The Vanguard Small-Cap Value Index Fund ETF Shares (VBR) has a Treynor Ratio of 9.15 with a Beta of 1.23 and a Alpha of -5.09. Its Sharpe Ratio is 0.67 while VBR’s Mean Return is 1.08. Furthermore, the fund has a R-squared of 82.2 and a Standard Deviation of 18.37.
DIA’s Mean Return is 0.05 points higher than that of VBR and its R-squared is 11.11 points higher. With a Standard Deviation of 13.68, DIA is slightly less volatile than VBR. The Alpha and Beta of DIA are 4.15 points higher and 0.26 points lower than VBR’s Alpha and Beta.
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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 2013 was the strongest year for VBR, returning 36.57% on an annual basis. The poorest year for VBR in the last ten years was 2018, with a yield of -12.22%. Most years the Vanguard Small-Cap Value Index Fund ETF Shares has given investors modest returns, such as in 2014, 2017, and 2012, when gains were 10.55%, 11.79%, and 18.78% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in DIA would have resulted in a final balance of $37,965. This is a profit of $27,965 over 11 years and amounts to a compound annual growth rate (CAGR) of 13.35%.
With a $10,000 investment in VBR, the end total would have been $32,611. This equates to a $22,611 profit over 11 years and a compound annual growth rate (CAGR) of 12.28%.
DIA’s CAGR is 1.07 percentage points higher than that of VBR and as a result, would have yielded $5,354 more on a $10,000 investment. Thus, DIA outperformed VBR by 1.07% annually.
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