The iShares Core S&P Mid-Cap ETF (IJH) and the iShares National Muni Bond ETF (MUB) are both among the Top 100 ETFs. IJH is a iShares Mid-Cap Blend fund and MUB is a iShares Muni National Interm fund. So, what’s the difference between IJH and MUB? And which fund is better?
The expense ratio of IJH is 0.02 percentage points lower than MUB’s (0.05% vs. 0.07%). IJH also has a high exposure to the industrials sector while MUB is mostly comprised of AA bonds. Overall, IJH has provided higher returns than MUB over the past ten years.
In this article, we’ll compare IJH vs. MUB. We’ll look at risk metrics and industry exposure, as well as at their fund composition and annual returns. Moreover, I’ll also discuss IJH’s and MUB’s performance, portfolio growth, and holdings and examine how these affect their overall returns.
Summary
| IJH | MUB | |
| Name | iShares Core S&P Mid-Cap ETF | iShares National Muni Bond ETF |
| Category | Mid-Cap Blend | Muni National Interm |
| Issuer | iShares | iShares |
| AUM | 63.4B | 22.71B |
| Avg. Return | 13.50% | 4.04% |
| Div. Yield | 1.07% | 1.96% |
| Expense Ratio | 0.05% | 0.07% |
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 National Muni Bond ETF (MUB) is a Muni National Interm fund that is issued by iShares. It currently has 22.71B total assets under management and has yielded an average annual return of 4.04% over the past 10 years. The fund has a dividend yield of 1.96% with an expense ratio of 0.07%.
IJH’s dividend yield is 0.89% lower than that of MUB (1.07% vs. 1.96%). Also, IJH yielded on average 9.46% more per year over the past decade (13.50% vs. 4.04%). The expense ratio of IJH is 0.02 percentage points lower than MUB’s (0.05% vs. 0.07%).
Fund Composition
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%.
| MUB Bond Sectors | Weight |
| AA | 60.38% |
| AAA | 18.39% |
| A | 15.04% |
| BBB | 6.0% |
| Others | 0.17% |
| BB | 0.02% |
| Below B | 0.0% |
| B | 0.0% |
| US Government | 0.0% |
MUB’s Top Bond Sectors are ratings of AA, AAA, A, BBB, and Others at 60.38%, 18.39%, 15.04%, 6.0%, and 0.17%. The fund is less weighted towards BB (0.02%), Below B (0.0%), and B (0.0%) rated bonds.
Risk Analysis
| IJH | MUB | |
| Mean Return | 1.13 | 0.32 |
| R-squared | 86.39 | 99 |
| Std. Deviation | 16.8 | 3.68 |
| Alpha | -4.01 | -0.46 |
| Beta | 1.15 | 1.01 |
| Sharpe Ratio | 0.77 | 0.88 |
| Treynor Ratio | 10.55 | 3.2 |
The iShares Core S&P Mid-Cap ETF (IJH) has a Alpha of -4.01 with a R-squared of 86.39 and a Mean Return of 1.13. Its Treynor Ratio is 10.55 while IJH’s Beta is 1.15. Furthermore, the fund has a Sharpe Ratio of 0.77 and a Standard Deviation of 16.8.
The iShares National Muni Bond ETF (MUB) has a Alpha of -0.46 with a Mean Return of 0.32 and a R-squared of 99. Its Beta is 1.01 while MUB’s Treynor Ratio is 3.2. Furthermore, the fund has a Sharpe Ratio of 0.88 and a Standard Deviation of 3.68.
IJH’s Mean Return is 0.81 points higher than that of MUB and its R-squared is 12.61 points lower. With a Standard Deviation of 16.8, IJH is slightly more volatile than MUB. The Alpha and Beta of IJH are 3.55 points lower and 0.14 points higher than MUB’s Alpha and Beta.
Performance
Annual Returns
| Year | IJH | MUB |
| 2020 | 13.61% | 4.87% |
| 2019 | 26.14% | 7.28% |
| 2018 | -11.14% | 0.86% |
| 2017 | 16.19% | 4.61% |
| 2016 | 20.63% | 0.06% |
| 2015 | -2.23% | 2.99% |
| 2014 | 9.64% | 8.61% |
| 2013 | 33.4% | -3.26% |
| 2012 | 17.76% | 6.14% |
| 2011 | -1.89% | 10.85% |
| 2010 | 26.38% | 1.4% |
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 2011 was the strongest year for MUB, returning 10.85% on an annual basis. The poorest year for MUB in the last ten years was 2013, with a yield of -3.26%. Most years the iShares National Muni Bond ETF has given investors modest returns, such as in 2015, 2017, and 2020, when gains were 2.99%, 4.61%, and 4.87% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IJH | $10,000 | $37,266 | 13.50% |
| MUB | $10,000 | $15,333 | 4.04% |
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 MUB, the end total would have been $15,333. This equates to a $5,333 profit over 11 years and a compound annual growth rate (CAGR) of 4.04%.
IJH’s CAGR is 9.46 percentage points higher than that of MUB and as a result, would have yielded $21,933 more on a $10,000 investment. Thus, IJH outperformed MUB by 9.46% annually.
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