IJH vs. MTUM: What’s The Difference?

The iShares Core S&P Mid-Cap ETF (IJH) and the iShares MSCI USA Momentum Factor ETF (MTUM) are both among the Top 100 ETFs. IJH is a iShares Mid-Cap Blend fund and MTUM is a iShares Large Growth fund. So, what’s the difference between IJH and MTUM? And which fund is better?

The expense ratio of IJH is 0.10 percentage points lower than MTUM’s (0.05% vs. 0.15%). IJH also has a higher exposure to the industrials sector and a higher standard deviation. Overall, IJH has provided lower returns than MTUM over the past ten years.

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

Summary

IJH MTUM
Name iShares Core S&P Mid-Cap ETF iShares MSCI USA Momentum Factor ETF
Category Mid-Cap Blend Large Growth
Issuer iShares iShares
AUM 63.4B 14.53B
Avg. Return 13.50% 17.37%
Div. Yield 1.07% 0.44%
Expense Ratio 0.05% 0.15%

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 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%.

IJH’s dividend yield is 0.63% higher than that of MTUM (1.07% vs. 0.44%). Also, IJH yielded on average 3.87% less per year over the past decade (13.50% vs. 17.37%). The expense ratio of IJH is 0.10 percentage points lower than MTUM’s (0.05% vs. 0.15%).

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Fund Composition

Industry Exposure

IJH vs. MTUM - Industry Exposure

IJH MTUM
Technology 14.81% 15.24%
Industrials 18.09% 12.47%
Energy 2.5% 1.77%
Communication Services 1.57% 13.18%
Utilities 2.9% 0.19%
Healthcare 10.89% 6.41%
Consumer Defensive 4.02% 2.88%
Real Estate 10.04% 0.43%
Financial Services 14.85% 34.32%
Consumer Cyclical 14.91% 9.96%
Basic Materials 5.42% 3.15%

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 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%.

IJH is 5.62% more exposed to the Industrials sector than MTUM (18.09% vs 12.47%). IJH’s exposure to Consumer Cyclical and Financial Services stocks is 4.95% higher and 19.47% lower respectively (14.91% vs. 9.96% and 14.85% vs. 34.32%). In total, Energy, Utilities, and Consumer Defensive also make up 4.58% more of the fund’s holdings compared to MTUM (9.42% vs. 4.84%).

Holdings

IJH - 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%.

MTUM - Holdings

MTUM Holdings Weight
Tesla Inc 5.63%
The Walt Disney Co 4.39%
JPMorgan Chase & Co 4.35%
Berkshire Hathaway Inc Class B 4.34%
Bank of America Corp 3.81%
PayPal Holdings Inc 3.76%
Wells Fargo & Co 3.05%
Applied Materials Inc 3.05%
Moderna Inc 2.89%
Alphabet Inc Class C 2.84%

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

IJH MTUM
Mean Return 1.13 0
R-squared 86.39 0
Std. Deviation 16.8 0
Alpha -4.01 0
Beta 1.15 0
Sharpe Ratio 0.77 0
Treynor Ratio 10.55 0

The iShares Core S&P Mid-Cap ETF (IJH) has a Beta of 1.15 with a Sharpe Ratio of 0.77 and a Alpha of -4.01. Its Treynor Ratio is 10.55 while IJH’s R-squared is 86.39. Furthermore, the fund has a Standard Deviation of 16.8 and a Mean Return of 1.13.

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

IJH’s Mean Return is 1.13 points higher than that of MTUM and its R-squared is 86.39 points higher. With a Standard Deviation of 16.8, IJH is slightly more volatile than MTUM. The Alpha and Beta of IJH are 4.01 points lower and 1.15 points higher than MTUM’s Alpha and Beta.

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Performance

Annual Returns

IJH vs. MTUM - Annual Returns

Year IJH MTUM
2020 13.61% 29.69%
2019 26.14% 27.57%
2018 -11.14% -1.77%
2017 16.19% 37.6%
2016 20.63% 4.89%
2015 -2.23% 9.12%
2014 9.64% 14.48%
2013 33.4% 0.0%
2012 17.76% 0.0%
2011 -1.89% 0.0%
2010 26.38% 0.0%

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 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

IJH vs. MTUM - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IJH $10,000 $19,132 13.50%
MTUM $10,000 $29,301 17.37%

A $10,000 investment in IJH would have resulted in a final balance of $19,132. This is a profit of $9,132 over 7 years and amounts to a compound annual growth rate (CAGR) of 13.50%.

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%.

IJH’s CAGR is 3.87 percentage points lower than that of MTUM and as a result, would have yielded $10,169 less on a $10,000 investment. Thus, IJH performed worse than MTUM by 3.87% annually.


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