The iShares Core S&P Mid-Cap ETF (IJH) and the Dimensional U.S. Core Equity 2 ETF (DFAC) are both among the Top 100 ETFs. IJH is a iShares Mid-Cap Blend fund and DFAC is a Dimensional Fund Advisors Large Blend fund. So, what’s the difference between IJH and DFAC? And which fund is better?
The expense ratio of IJH is 0.14 percentage points lower than DFAC’s (0.05% vs. 0.19%). IJH also has a higher exposure to the industrials sector and a higher standard deviation. Overall, IJH has provided lower returns than DFAC over the past ten years.
In this article, we’ll compare IJH vs. DFAC. We’ll look at risk metrics and annual returns, as well as at their portfolio growth and industry exposure. Moreover, I’ll also discuss IJH’s and DFAC’s performance, holdings, and fund composition and examine how these affect their overall returns.
Summary
| IJH | DFAC | |
| Name | iShares Core S&P Mid-Cap ETF | Dimensional U.S. Core Equity 2 ETF |
| Category | Mid-Cap Blend | Large Blend |
| Issuer | iShares | Dimensional Fund Advisors |
| AUM | 63.4B | 13.53B |
| Avg. Return | 13.50% | 13.93% |
| Div. Yield | 1.07% | 1.0% |
| Expense Ratio | 0.05% | 0.19% |
The iShares Core S&P Mid-Cap ETF (IJH) is a Mid-Cap Blend fund that is issued by iShares. It currently has 63.4B total assets under management and has yielded an average annual return of 13.50% over the past 10 years. The fund has a dividend yield of 1.07% with an expense ratio of 0.05%.
The Dimensional U.S. Core Equity 2 ETF (DFAC) is a Large Blend fund that is issued by Dimensional Fund Advisors. It currently has 13.53B total assets under management and has yielded an average annual return of 13.93% over the past 10 years. The fund has a dividend yield of 1.0% with an expense ratio of 0.19%.
IJH’s dividend yield is 0.07% higher than that of DFAC (1.07% vs. 1.0%). Also, IJH yielded on average 0.43% less per year over the past decade (13.50% vs. 13.93%). The expense ratio of IJH is 0.14 percentage points lower than DFAC’s (0.05% vs. 0.19%).
Fund Composition
Industry Exposure
| IJH | DFAC | |
| Technology | 14.81% | 22.81% |
| Industrials | 18.09% | 14.13% |
| Energy | 2.5% | 2.67% |
| Communication Services | 1.57% | 7.63% |
| Utilities | 2.9% | 1.54% |
| Healthcare | 10.89% | 12.09% |
| Consumer Defensive | 4.02% | 5.94% |
| Real Estate | 10.04% | 0.37% |
| Financial Services | 14.85% | 16.17% |
| Consumer Cyclical | 14.91% | 13.09% |
| Basic Materials | 5.42% | 3.56% |
The iShares Core S&P Mid-Cap ETF (IJH) has the most exposure to the Industrials sector at 18.09%. This is followed by Consumer Cyclical and Financial Services at 14.91% and 14.85% respectively. Energy (2.5%), Utilities (2.9%), and Consumer Defensive (4.02%) only make up 9.42% of the fund’s total assets.
IJH’s mid-section with moderate exposure is comprised of Basic Materials, Real Estate, Healthcare, Technology, and Financial Services stocks at 5.42%, 10.04%, 10.89%, 14.81%, and 14.85%.
The Dimensional U.S. Core Equity 2 ETF (DFAC) has the most exposure to the Technology sector at 22.81%. This is followed by Financial Services and Industrials at 16.17% and 14.13% respectively. Utilities (1.54%), Energy (2.67%), and Basic Materials (3.56%) only make up 7.77% of the fund’s total assets.
DFAC’s mid-section with moderate exposure is comprised of Consumer Defensive, Communication Services, Healthcare, Consumer Cyclical, and Industrials stocks at 5.94%, 7.63%, 12.09%, 13.09%, and 14.13%.
IJH is 3.96% more exposed to the Industrials sector than DFAC (18.09% vs 14.13%). IJH’s exposure to Consumer Cyclical and Financial Services stocks is 1.82% higher and 1.32% lower respectively (14.91% vs. 13.09% and 14.85% vs. 16.17%). In total, Energy, Utilities, and Consumer Defensive also make up 0.73% less of the fund’s holdings compared to DFAC (9.42% vs. 10.15%).
Holdings
| IJH Holdings | Weight |
| Bio-Techne Corp | 0.8% |
| Molina Healthcare Inc | 0.68% |
| Cognex Corp | 0.68% |
| Fair Isaac Corp | 0.64% |
| Camden Property Trust | 0.62% |
| XPO Logistics Inc | 0.6% |
| Masimo Corp | 0.59% |
| SolarEdge Technologies Inc | 0.57% |
| FactSet Research Systems Inc | 0.57% |
| Graco Inc | 0.56% |
IJH’s Top Holdings are Bio-Techne Corp, Molina Healthcare Inc, Cognex Corp, Fair Isaac Corp, and Camden Property Trust at 0.8%, 0.68%, 0.68%, 0.64%, and 0.62%.
XPO Logistics Inc (0.6%), Masimo Corp (0.59%), and SolarEdge Technologies Inc (0.57%) have a slightly smaller but still significant weight. FactSet Research Systems Inc and Graco Inc are also represented in the IJH’s holdings at 0.57% and 0.56%.
| DFAC Holdings | Weight |
| Apple Inc | 4.7% |
| Microsoft Corp | 3.81% |
| Amazon.com Inc | 2.39% |
| Johnson & Johnson | 1.05% |
| Facebook Inc Class A | 1.05% |
| JPMorgan Chase & Co | 1.0% |
| Alphabet Inc Class C | 0.85% |
| Alphabet Inc Class A | 0.84% |
| Berkshire Hathaway Inc Class B | 0.75% |
| Visa Inc Class A | 0.74% |
DFAC’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Johnson & Johnson, and Facebook Inc Class A at 4.7%, 3.81%, 2.39%, 1.05%, and 1.05%.
JPMorgan Chase & Co (1.0%), Alphabet Inc Class C (0.85%), and Alphabet Inc Class A (0.84%) have a slightly smaller but still significant weight. Berkshire Hathaway Inc Class B and Visa Inc Class A are also represented in the DFAC’s holdings at 0.75% and 0.74%.
Risk Analysis
| IJH | DFAC | |
| Mean Return | 1.13 | 1.19 |
| R-squared | 86.39 | 95.1 |
| Std. Deviation | 16.8 | 15.55 |
| Alpha | -4.01 | -2.75 |
| Beta | 1.15 | 1.12 |
| Sharpe Ratio | 0.77 | 0.88 |
| Treynor Ratio | 10.55 | 11.85 |
The iShares Core S&P Mid-Cap ETF (IJH) has a Standard Deviation of 16.8 with a Treynor Ratio of 10.55 and a Sharpe Ratio of 0.77. Its Alpha is -4.01 while IJH’s Beta is 1.15. Furthermore, the fund has a R-squared of 86.39 and a Mean Return of 1.13.
The Dimensional U.S. Core Equity 2 ETF (DFAC) has a Beta of 1.12 with a R-squared of 95.1 and a Mean Return of 1.19. Its Alpha is -2.75 while DFAC’s Standard Deviation is 15.55. Furthermore, the fund has a Sharpe Ratio of 0.88 and a Treynor Ratio of 11.85.
IJH’s Mean Return is 0.06 points lower than that of DFAC and its R-squared is 8.71 points lower. With a Standard Deviation of 16.8, IJH is slightly more volatile than DFAC. The Alpha and Beta of IJH are 1.26 points lower and 0.03 points higher than DFAC’s Alpha and Beta.
Performance
Annual Returns
| Year | IJH | DFAC |
| 2020 | 13.61% | 15.8% |
| 2019 | 26.14% | 29.54% |
| 2018 | -11.14% | -9.43% |
| 2017 | 16.19% | 18.82% |
| 2016 | 20.63% | 16.31% |
| 2015 | -2.23% | -2.53% |
| 2014 | 9.64% | 9.56% |
| 2013 | 33.4% | 37.55% |
| 2012 | 17.76% | 17.93% |
| 2011 | -1.89% | -1.96% |
| 2010 | 26.38% | 21.67% |
IJH had its best year in 2013 with an annual return of 33.4%. IJH’s worst year over the past decade yielded -11.14% and occurred in 2018. In most years the iShares Core S&P Mid-Cap ETF provided moderate returns such as in 2020, 2017, and 2012 where annual returns amounted to 13.61%, 16.19%, and 17.76% respectively.
The year 2013 was the strongest year for DFAC, returning 37.55% on an annual basis. The poorest year for DFAC in the last ten years was 2018, with a yield of -9.43%. Most years the Dimensional U.S. Core Equity 2 ETF has given investors modest returns, such as in 2020, 2016, and 2012, when gains were 15.8%, 16.31%, and 17.93% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IJH | $10,000 | $37,266 | 13.50% |
| DFAC | $10,000 | $38,796 | 13.93% |
A $10,000 investment in IJH would have resulted in a final balance of $37,266. This is a profit of $27,266 over 11 years and amounts to a compound annual growth rate (CAGR) of 13.50%.
With a $10,000 investment in DFAC, the end total would have been $38,796. This equates to a $28,796 profit over 11 years and a compound annual growth rate (CAGR) of 13.93%.
IJH’s CAGR is 0.43 percentage points lower than that of DFAC and as a result, would have yielded $1,530 less on a $10,000 investment. Thus, IJH performed worse than DFAC by 0.43% annually.
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