The iShares Core S&P Mid-Cap ETF (IJH) and the Schwab U.S. Dividend Equity ETF (SCHD) are both among the Top 100 ETFs. IJH is a iShares Mid-Cap Blend fund and SCHD is a Schwab ETFs Large Value fund. So, what’s the difference between IJH and SCHD? And which fund is better?
The expense ratio of IJH is 0.01 percentage points lower than SCHD’s (0.05% vs. 0.06%). IJH also has a higher exposure to the industrials sector and a higher standard deviation. Overall, IJH has provided lower returns than SCHD over the past ten years.
In this article, we’ll compare IJH vs. SCHD. We’ll look at portfolio growth and holdings, as well as at their risk metrics and fund composition. Moreover, I’ll also discuss IJH’s and SCHD’s annual returns, industry exposure, and performance and examine how these affect their overall returns.
|Name||iShares Core S&P Mid-Cap ETF||Schwab U.S. Dividend Equity ETF|
|Category||Mid-Cap Blend||Large Value|
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 Schwab U.S. Dividend Equity ETF (SCHD) is a Large Value fund that is issued by Schwab ETFs. It currently has 26B total assets under management and has yielded an average annual return of 14.80% over the past 10 years. The fund has a dividend yield of 2.89% with an expense ratio of 0.06%.
IJH’s dividend yield is 1.82% lower than that of SCHD (1.07% vs. 2.89%). Also, IJH yielded on average 1.30% less per year over the past decade (13.50% vs. 14.80%). The expense ratio of IJH is 0.01 percentage points lower than SCHD’s (0.05% vs. 0.06%).
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 Schwab U.S. Dividend Equity ETF (SCHD) has the most exposure to the Financial Services sector at 21.69%. This is followed by Industrials and Technology at 18.05% and 16.26% respectively. Utilities (0.0%), Energy (1.87%), and Basic Materials (2.13%) only make up 4.00% of the fund’s total assets.
SCHD’s mid-section with moderate exposure is comprised of Communication Services, Consumer Cyclical, Healthcare, Consumer Defensive, and Technology stocks at 4.96%, 8.36%, 12.64%, 14.04%, and 16.26%.
IJH is 0.04% more exposed to the Industrials sector than SCHD (18.09% vs 18.05%). IJH’s exposure to Consumer Cyclical and Financial Services stocks is 6.55% higher and 6.84% lower respectively (14.91% vs. 8.36% and 14.85% vs. 21.69%). In total, Energy, Utilities, and Consumer Defensive also make up 6.49% less of the fund’s holdings compared to SCHD (9.42% vs. 15.91%).
|Molina Healthcare Inc||0.68%|
|Fair Isaac Corp||0.64%|
|Camden Property Trust||0.62%|
|XPO Logistics Inc||0.6%|
|SolarEdge Technologies Inc||0.57%|
|FactSet Research Systems Inc||0.57%|
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%.
|Merck & Co Inc||4.24%|
|The Home Depot Inc||4.19%|
|Texas Instruments Inc||4.16%|
|Verizon Communications Inc||3.96%|
|Cisco Systems Inc||3.96%|
SCHD’s Top Holdings are Merck & Co Inc, The Home Depot Inc, Texas Instruments Inc, Broadcom Inc, and Amgen Inc at 4.24%, 4.19%, 4.16%, 4.15%, and 4.11%.
PepsiCo Inc (4.09%), BlackRock Inc (4.05%), and Pfizer Inc (3.97%) have a slightly smaller but still significant weight. Verizon Communications Inc and Cisco Systems Inc are also represented in the SCHD’s holdings at 3.96% and 3.96%.
The iShares Core S&P Mid-Cap ETF (IJH) has a Mean Return of 1.13 with a R-squared of 86.39 and a Standard Deviation of 16.8. Its Beta is 1.15 while IJH’s Sharpe Ratio is 0.77. Furthermore, the fund has a Treynor Ratio of 10.55 and a Alpha of -4.01.
The Schwab U.S. Dividend Equity ETF (SCHD) has a R-squared of 0 with a Alpha of 0 and a Beta of 0. Its Treynor Ratio is 0 while SCHD’s Mean Return is 0. Furthermore, the fund has a Standard Deviation of 0 and a Sharpe Ratio of 0.
IJH’s Mean Return is 1.13 points higher than that of SCHD and its R-squared is 86.39 points higher. With a Standard Deviation of 16.8, IJH is slightly more volatile than SCHD. The Alpha and Beta of IJH are 4.01 points lower and 1.15 points higher than SCHD’s Alpha and Beta.
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 SCHD, returning 32.9% on an annual basis. The poorest year for SCHD in the last ten years was 2018, with a yield of -5.46%. Most years the Schwab U.S. Dividend Equity ETF has given investors modest returns, such as in 2012, 2014, and 2020, when gains were 11.4%, 11.66%, and 15.11% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in IJH would have resulted in a final balance of $25,522. This is a profit of $15,522 over 8 years and amounts to a compound annual growth rate (CAGR) of 13.50%.
With a $10,000 investment in SCHD, the end total would have been $28,823. This equates to a $18,823 profit over 8 years and a compound annual growth rate (CAGR) of 14.80%.
IJH’s CAGR is 1.30 percentage points lower than that of SCHD and as a result, would have yielded $3,301 less on a $10,000 investment. Thus, IJH performed worse than SCHD by 1.30% annually.
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