IJH vs. VGT: What’s The Difference?

The iShares Core S&P Mid-Cap ETF (IJH) and the Vanguard Information Technology Index Fund ETF Shares (VGT) are both among the Top 100 ETFs. IJH is a iShares Mid-Cap Blend fund and VGT is a Vanguard Technology fund. So, what’s the difference between IJH and VGT? And which fund is better?

The expense ratio of IJH is 0.05 percentage points lower than VGT’s (0.05% vs. 0.1%). IJH also has a higher exposure to the industrials sector and a higher standard deviation. Overall, IJH has provided lower returns than VGT over the past ten years.

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

Summary

IJH VGT
Name iShares Core S&P Mid-Cap ETF Vanguard Information Technology Index Fund ETF Shares
Category Mid-Cap Blend Technology
Issuer iShares Vanguard
AUM 63.4B 54.13B
Avg. Return 13.50% 20.84%
Div. Yield 1.07% 0.66%
Expense Ratio 0.05% 0.1%

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 Information Technology Index Fund ETF Shares (VGT) is a Technology fund that is issued by Vanguard. It currently has 54.13B total assets under management and has yielded an average annual return of 20.84% over the past 10 years. The fund has a dividend yield of 0.66% with an expense ratio of 0.1%.

IJH’s dividend yield is 0.41% higher than that of VGT (1.07% vs. 0.66%). Also, IJH yielded on average 7.34% less per year over the past decade (13.50% vs. 20.84%). The expense ratio of IJH is 0.05 percentage points lower than VGT’s (0.05% vs. 0.1%).

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Fund Composition

Industry Exposure

IJH vs. VGT - Industry Exposure

IJH VGT
Technology 14.81% 88.89%
Industrials 18.09% 1.67%
Energy 2.5% 0.0%
Communication Services 1.57% 0.61%
Utilities 2.9% 0.0%
Healthcare 10.89% 0.0%
Consumer Defensive 4.02% 0.0%
Real Estate 10.04% 0.0%
Financial Services 14.85% 8.83%
Consumer Cyclical 14.91% 0.0%
Basic Materials 5.42% 0.0%

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 Information Technology Index Fund ETF Shares (VGT) has the most exposure to the Technology sector at 88.89%. This is followed by Financial Services and Industrials at 8.83% and 1.67% respectively. Consumer Cyclical (0.0%), Real Estate (0.0%), and Consumer Defensive (0.0%) only make up 0.00% of the fund’s total assets.

VGT’s mid-section with moderate exposure is comprised of Healthcare, Utilities, Energy, Communication Services, and Industrials stocks at 0.0%, 0.0%, 0.0%, 0.61%, and 1.67%.

IJH is 16.42% more exposed to the Industrials sector than VGT (18.09% vs 1.67%). IJH’s exposure to Consumer Cyclical and Financial Services stocks is 14.91% higher and 6.02% higher respectively (14.91% vs. 0.0% and 14.85% vs. 8.83%). In total, Energy, Utilities, and Consumer Defensive also make up 9.42% more of the fund’s holdings compared to VGT (9.42% vs. 0.00%).

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%.

VGT - Holdings

VGT Holdings Weight
Apple Inc 19.58%
Microsoft Corp 16.53%
NVIDIA Corp 4.22%
Visa Inc Class A 3.16%
PayPal Holdings Inc 2.76%
Mastercard Inc Class A 2.76%
Adobe Inc 2.39%
Intel Corp 1.94%
Salesforce.com Inc 1.91%
Cisco Systems Inc 1.9%

VGT’s Top Holdings are Apple Inc, Microsoft Corp, NVIDIA Corp, Visa Inc Class A, and PayPal Holdings Inc at 19.58%, 16.53%, 4.22%, 3.16%, and 2.76%.

Mastercard Inc Class A (2.76%), Adobe Inc (2.39%), and Intel Corp (1.94%) have a slightly smaller but still significant weight. Salesforce.com Inc and Cisco Systems Inc are also represented in the VGT’s holdings at 1.91% and 1.9%.

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Risk Analysis

IJH VGT
Mean Return 1.13 1.76
R-squared 86.39 74.84
Std. Deviation 16.8 16.61
Alpha -4.01 10.41
Beta 1.15 1.02
Sharpe Ratio 0.77 1.23
Treynor Ratio 10.55 20.55

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

The Vanguard Information Technology Index Fund ETF Shares (VGT) has a Alpha of 10.41 with a Standard Deviation of 16.61 and a Beta of 1.02. Its R-squared is 74.84 while VGT’s Sharpe Ratio is 1.23. Furthermore, the fund has a Mean Return of 1.76 and a Treynor Ratio of 20.55.

IJH’s Mean Return is 0.63 points lower than that of VGT and its R-squared is 11.55 points higher. With a Standard Deviation of 16.8, IJH is slightly more volatile than VGT. The Alpha and Beta of IJH are 14.42 points lower and 0.13 points higher than VGT’s Alpha and Beta.

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Performance

Annual Returns

IJH vs. VGT - Annual Returns

Year IJH VGT
2020 13.61% 45.94%
2019 26.14% 48.68%
2018 -11.14% 2.52%
2017 16.19% 37.07%
2016 20.63% 13.73%
2015 -2.23% 5.02%
2014 9.64% 18.01%
2013 33.4% 30.91%
2012 17.76% 14.05%
2011 -1.89% 0.52%
2010 26.38% 12.74%

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 2019 was the strongest year for VGT, returning 48.68% on an annual basis. The poorest year for VGT in the last ten years was 2011, with a yield of 0.52%. Most years the Vanguard Information Technology Index Fund ETF Shares has given investors modest returns, such as in 2016, 2012, and 2014, when gains were 13.73%, 14.05%, and 18.01% respectively.

Portfolio Growth

IJH vs. VGT - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IJH $10,000 $37,266 13.50%
VGT $10,000 $72,718 20.84%

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 VGT, the end total would have been $72,718. This equates to a $62,718 profit over 11 years and a compound annual growth rate (CAGR) of 20.84%.

IJH’s CAGR is 7.34 percentage points lower than that of VGT and as a result, would have yielded $35,452 less on a $10,000 investment. Thus, IJH performed worse than VGT by 7.34% annually.


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