The iShares Core S&P Mid-Cap ETF (IJH) and the Schwab U.S. TIPS ETF (SCHP) are both among the Top 100 ETFs. IJH is a iShares Mid-Cap Blend fund and SCHP is a Schwab ETFs Inflation-Protected Bond fund. So, what’s the difference between IJH and SCHP? And which fund is better?
IJH and SCHP have the same expense ratio: 0.05%. IJH also has a high exposure to the industrials sector while SCHP is mostly comprised of AAA bonds. Overall, IJH has provided higher returns than SCHP over the past ten years.
In this article, we’ll compare IJH vs. SCHP. We’ll look at annual returns and fund composition, as well as at their industry exposure and holdings. Moreover, I’ll also discuss IJH’s and SCHP’s performance, portfolio growth, and risk metrics and examine how these affect their overall returns.
Summary
| IJH | SCHP | |
| Name | iShares Core S&P Mid-Cap ETF | Schwab U.S. TIPS ETF |
| Category | Mid-Cap Blend | Inflation-Protected Bond |
| Issuer | iShares | Schwab ETFs |
| AUM | 63.4B | 18.41B |
| Avg. Return | 13.50% | 3.92% |
| Div. Yield | 1.07% | 1.97% |
| Expense Ratio | 0.05% | 0.05% |
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. TIPS ETF (SCHP) is a Inflation-Protected Bond fund that is issued by Schwab ETFs. It currently has 18.41B total assets under management and has yielded an average annual return of 3.92% over the past 10 years. The fund has a dividend yield of 1.97% with an expense ratio of 0.05%.
IJH’s dividend yield is 0.90% lower than that of SCHP (1.07% vs. 1.97%). Also, IJH yielded on average 9.58% more per year over the past decade (13.50% vs. 3.92%). IJH and SCHP have the same expense ratio: 0.05%.
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%.
| SCHP Bond Sectors | Weight |
| AAA | 100.0% |
| Others | 0.0% |
| Below B | 0.0% |
| B | 0.0% |
| BB | 0.0% |
| BBB | 0.0% |
| A | 0.0% |
| AA | 0.0% |
| US Government | 0.0% |
SCHP’s Top Bond Sectors are ratings of AAA, Others, Below B, B, and BB at 100.0%, 0.0%, 0.0%, 0.0%, and 0.0%. The fund is less weighted towards BBB (0.0%), A (0.0%), and AA (0.0%) rated bonds.
Risk Analysis
| IJH | SCHP | |
| Mean Return | 1.13 | 0.28 |
| R-squared | 86.39 | 66.16 |
| Std. Deviation | 16.8 | 4.32 |
| Alpha | -4.01 | -0.5 |
| Beta | 1.15 | 1.17 |
| Sharpe Ratio | 0.77 | 0.64 |
| Treynor Ratio | 10.55 | 2.31 |
The iShares Core S&P Mid-Cap ETF (IJH) has a Sharpe Ratio of 0.77 with a Standard Deviation of 16.8 and a Alpha of -4.01. Its Treynor Ratio is 10.55 while IJH’s Mean Return is 1.13. Furthermore, the fund has a Beta of 1.15 and a R-squared of 86.39.
The Schwab U.S. TIPS ETF (SCHP) has a Beta of 1.17 with a Standard Deviation of 4.32 and a Sharpe Ratio of 0.64. Its Alpha is -0.5 while SCHP’s Treynor Ratio is 2.31. Furthermore, the fund has a Mean Return of 0.28 and a R-squared of 66.16.
IJH’s Mean Return is 0.85 points higher than that of SCHP and its R-squared is 20.23 points higher. With a Standard Deviation of 16.8, IJH is slightly more volatile than SCHP. The Alpha and Beta of IJH are 3.51 points lower and 0.02 points lower than SCHP’s Alpha and Beta.
Performance
Annual Returns
| Year | IJH | SCHP |
| 2020 | 13.61% | 10.94% |
| 2019 | 26.14% | 8.36% |
| 2018 | -11.14% | -1.31% |
| 2017 | 16.19% | 2.95% |
| 2016 | 20.63% | 4.6% |
| 2015 | -2.23% | -1.5% |
| 2014 | 9.64% | 3.56% |
| 2013 | 33.4% | -8.66% |
| 2012 | 17.76% | 6.83% |
| 2011 | -1.89% | 13.38% |
| 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 2011 was the strongest year for SCHP, returning 13.38% on an annual basis. The poorest year for SCHP in the last ten years was 2013, with a yield of -8.66%. Most years the Schwab U.S. TIPS ETF has given investors modest returns, such as in 2017, 2014, and 2016, when gains were 2.95%, 3.56%, and 4.6% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IJH | $10,000 | $29,487 | 13.50% |
| SCHP | $10,000 | $14,418 | 3.92% |
A $10,000 investment in IJH would have resulted in a final balance of $29,487. This is a profit of $19,487 over 10 years and amounts to a compound annual growth rate (CAGR) of 13.50%.
With a $10,000 investment in SCHP, the end total would have been $14,418. This equates to a $4,418 profit over 10 years and a compound annual growth rate (CAGR) of 3.92%.
IJH’s CAGR is 9.58 percentage points higher than that of SCHP and as a result, would have yielded $15,069 more on a $10,000 investment. Thus, IJH outperformed SCHP by 9.58% annually.
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