The iShares Core S&P Mid-Cap ETF (IJH) and the Vanguard FTSE Europe Index Fund ETF Shares (VGK) are both among the Top 100 ETFs. IJH is a iShares Mid-Cap Blend fund and VGK is a Vanguard Europe Stock fund. So, what’s the difference between IJH and VGK? And which fund is better?
The expense ratio of IJH is 0.03 percentage points lower than VGK’s (0.05% vs. 0.08%). IJH also has a higher exposure to the industrials sector and a higher standard deviation. Overall, IJH has provided higher returns than VGK over the past ten years.
In this article, we’ll compare IJH vs. VGK. We’ll look at risk metrics and fund composition, as well as at their portfolio growth and annual returns. Moreover, I’ll also discuss IJH’s and VGK’s industry exposure, performance, and holdings and examine how these affect their overall returns.
|Name||iShares Core S&P Mid-Cap ETF||Vanguard FTSE Europe Index Fund ETF Shares|
|Category||Mid-Cap Blend||Europe Stock|
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 Vanguard FTSE Europe Index Fund ETF Shares (VGK) is a Europe Stock fund that is issued by Vanguard. It currently has 25.7B total assets under management and has yielded an average annual return of 6.68% over the past 10 years. The fund has a dividend yield of 2.52% with an expense ratio of 0.08%.
IJH’s dividend yield is 1.45% lower than that of VGK (1.07% vs. 2.52%). Also, IJH yielded on average 6.82% more per year over the past decade (13.50% vs. 6.68%). The expense ratio of IJH is 0.03 percentage points lower than VGK’s (0.05% vs. 0.08%).
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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 Vanguard FTSE Europe Index Fund ETF Shares (VGK) has the most exposure to the Financial Services sector at 15.85%. This is followed by Industrials and Healthcare at 15.58% and 13.76% respectively. Utilities (3.89%), Energy (4.3%), and Communication Services (5.09%) only make up 13.28% of the fund’s total assets.
VGK’s mid-section with moderate exposure is comprised of Basic Materials, Technology, Consumer Defensive, Consumer Cyclical, and Healthcare stocks at 7.67%, 8.3%, 11.39%, 11.6%, and 13.76%.
IJH is 2.51% more exposed to the Industrials sector than VGK (18.09% vs 15.58%). IJH’s exposure to Consumer Cyclical and Financial Services stocks is 3.31% higher and 1.00% lower respectively (14.91% vs. 11.6% and 14.85% vs. 15.85%). In total, Energy, Utilities, and Consumer Defensive also make up 10.16% less of the fund’s holdings compared to VGK (9.42% vs. 19.58%).
|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%.
|ASML Holding NV||2.2%|
|Roche Holding AG||2.13%|
|LVMH Moet Hennessy Louis Vuitton SE||1.58%|
|Novo Nordisk A/S B||1.09%|
VGK’s Top Holdings are Nestle SA, ASML Holding NV, Roche Holding AG, LVMH Moet Hennessy Louis Vuitton SE, and Novartis AG at 2.82%, 2.2%, 2.13%, 1.58%, and 1.55%.
AstraZeneca PLC (1.27%), SAP SE (1.25%), and Unilever PLC (1.23%) have a slightly smaller but still significant weight. Novo Nordisk A/S B and Siemens AG are also represented in the VGK’s holdings at 1.09% and 0.96%.
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The iShares Core S&P Mid-Cap ETF (IJH) has a Beta of 1.15 with a R-squared of 86.39 and a Sharpe Ratio of 0.77. Its Treynor Ratio is 10.55 while IJH’s Alpha is -4.01. Furthermore, the fund has a Mean Return of 1.13 and a Standard Deviation of 16.8.
The Vanguard FTSE Europe Index Fund ETF Shares (VGK) has a Sharpe Ratio of 0.4 with a Standard Deviation of 16.65 and a Mean Return of 0.61. Its R-squared is 92.76 while VGK’s Treynor Ratio is 5.12. Furthermore, the fund has a Beta of 1.06 and a Alpha of 0.45.
IJH’s Mean Return is 0.52 points higher than that of VGK and its R-squared is 6.37 points lower. With a Standard Deviation of 16.8, IJH is slightly more volatile than VGK. The Alpha and Beta of IJH are 4.46 points lower and 0.09 points higher than VGK’s Alpha and Beta.
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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 VGK, returning 27.06% on an annual basis. The poorest year for VGK in the last ten years was 2018, with a yield of -14.79%. Most years the Vanguard FTSE Europe Index Fund ETF Shares has given investors modest returns, such as in 2016, 2010, and 2020, when gains were -0.59%, 5.01%, and 6.5% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
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 VGK, the end total would have been $18,350. This equates to a $8,350 profit over 11 years and a compound annual growth rate (CAGR) of 6.68%.
IJH’s CAGR is 6.82 percentage points higher than that of VGK and as a result, would have yielded $18,916 more on a $10,000 investment. Thus, IJH outperformed VGK by 6.82% annually.
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