The iShares Core S&P Mid-Cap ETF (IJH) and the Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares (VTIP) are both among the Top 100 ETFs. IJH is a iShares Mid-Cap Blend fund and VTIP is a Vanguard Inflation-Protected Bond fund. So, what’s the difference between IJH and VTIP? And which fund is better?
IJH and VTIP have the same expense ratio: 0.05%. IJH also has a high exposure to the industrials sector while VTIP is mostly comprised of AAA bonds. Overall, IJH has provided higher returns than VTIP over the past ten years.
In this article, we’ll compare IJH vs. VTIP. We’ll look at risk metrics and fund composition, as well as at their portfolio growth and performance. Moreover, I’ll also discuss IJH’s and VTIP’s industry exposure, annual returns, and holdings and examine how these affect their overall returns.
Summary
| IJH | VTIP | |
| Name | iShares Core S&P Mid-Cap ETF | Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares |
| Category | Mid-Cap Blend | Inflation-Protected Bond |
| Issuer | iShares | Vanguard |
| AUM | 63.4B | 50.67B |
| Avg. Return | 13.50% | 1.79% |
| Div. Yield | 1.07% | 1.35% |
| 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 Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares (VTIP) is a Inflation-Protected Bond fund that is issued by Vanguard. It currently has 50.67B total assets under management and has yielded an average annual return of 1.79% over the past 10 years. The fund has a dividend yield of 1.35% with an expense ratio of 0.05%.
IJH’s dividend yield is 0.28% lower than that of VTIP (1.07% vs. 1.35%). Also, IJH yielded on average 11.71% more per year over the past decade (13.50% vs. 1.79%). IJH and VTIP 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%.
| VTIP Bond Sectors | Weight |
| AAA | 99.87% |
| Others | 0.13% |
| Below B | 0.0% |
| B | 0.0% |
| BB | 0.0% |
| BBB | 0.0% |
| A | 0.0% |
| AA | 0.0% |
| US Government | 0.0% |
VTIP’s Top Bond Sectors are ratings of AAA, Others, Below B, B, and BB at 99.87%, 0.13%, 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 | VTIP | |
| Mean Return | 1.13 | 0 |
| R-squared | 86.39 | 0 |
| Std. Deviation | 16.8 | 0 |
| Alpha | -4.01 | 0 |
| Beta | 1.15 | 0 |
| Sharpe Ratio | 0.77 | 0 |
| Treynor Ratio | 10.55 | 0 |
The iShares Core S&P Mid-Cap ETF (IJH) has a Sharpe Ratio of 0.77 with a Alpha of -4.01 and a R-squared of 86.39. Its Standard Deviation is 16.8 while IJH’s Beta is 1.15. Furthermore, the fund has a Treynor Ratio of 10.55 and a Mean Return of 1.13.
The Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares (VTIP) has a Sharpe Ratio of 0 with a R-squared of 0 and a Mean Return of 0. Its Alpha is 0 while VTIP’s Standard Deviation is 0. Furthermore, the fund has a Treynor Ratio of 0 and a Beta of 0.
IJH’s Mean Return is 1.13 points higher than that of VTIP and its R-squared is 86.39 points higher. With a Standard Deviation of 16.8, IJH is slightly more volatile than VTIP. The Alpha and Beta of IJH are 4.01 points lower and 1.15 points higher than VTIP’s Alpha and Beta.
Performance
Annual Returns
| Year | IJH | VTIP |
| 2020 | 13.61% | 4.97% |
| 2019 | 26.14% | 4.83% |
| 2018 | -11.14% | 0.54% |
| 2017 | 16.19% | 0.82% |
| 2016 | 20.63% | 2.71% |
| 2015 | -2.23% | -0.15% |
| 2014 | 9.64% | -1.17% |
| 2013 | 33.4% | -1.55% |
| 2012 | 17.76% | 0.0% |
| 2011 | -1.89% | 0.0% |
| 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 2020 was the strongest year for VTIP, returning 4.97% on an annual basis. The poorest year for VTIP in the last ten years was 2013, with a yield of -1.55%. Most years the Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares has given investors modest returns, such as in 2011, 2010, and 2018, when gains were 0.0%, 0.0%, and 0.54% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IJH | $10,000 | $19,132 | 13.50% |
| VTIP | $10,000 | $11,305 | 1.79% |
A $10,000 investment in IJH would have resulted in a final balance of $19,132. This is a profit of $9,132 over 7 years and amounts to a compound annual growth rate (CAGR) of 13.50%.
With a $10,000 investment in VTIP, the end total would have been $11,305. This equates to a $1,305 profit over 7 years and a compound annual growth rate (CAGR) of 1.79%.
IJH’s CAGR is 11.71 percentage points higher than that of VTIP and as a result, would have yielded $7,827 more on a $10,000 investment. Thus, IJH outperformed VTIP by 11.71% annually.
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