IJR vs. IVW: What’s The Difference?

The iShares Core S&P Small-Cap ETF (IJR) and the iShares S&P 500 Growth ETF (IVW) are both among the Top 100 ETFs. IJR is a iShares Small Blend fund and IVW is a iShares Large Growth fund. So, what’s the difference between IJR and IVW? And which fund is better?

The expense ratio of IJR is 0.12 percentage points lower than IVW’s (0.06% vs. 0.18%). IJR also has a higher exposure to the industrials sector and a higher standard deviation. Overall, IJR has provided lower returns than IVW over the past ten years.

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

Summary

IJR IVW
Name iShares Core S&P Small-Cap ETF iShares S&P 500 Growth ETF
Category Small Blend Large Growth
Issuer iShares iShares
AUM 68.64B 35.72B
Avg. Return 13.97% 16.74%
Div. Yield 0.96% 0.61%
Expense Ratio 0.06% 0.18%

The iShares Core S&P Small-Cap ETF (IJR) is a Small Blend fund that is issued by iShares. It currently has 68.64B total assets under management and has yielded an average annual return of 13.97% over the past 10 years. The fund has a dividend yield of 0.96% with an expense ratio of 0.06%.

The iShares S&P 500 Growth ETF (IVW) is a Large Growth fund that is issued by iShares. It currently has 35.72B total assets under management and has yielded an average annual return of 16.74% over the past 10 years. The fund has a dividend yield of 0.61% with an expense ratio of 0.18%.

IJR’s dividend yield is 0.35% higher than that of IVW (0.96% vs. 0.61%). Also, IJR yielded on average 2.77% less per year over the past decade (13.97% vs. 16.74%). The expense ratio of IJR is 0.12 percentage points lower than IVW’s (0.06% vs. 0.18%).

Fund Composition

Industry Exposure

IJR vs. IVW - Industry Exposure

IJR IVW
Technology 14.32% 37.8%
Industrials 17.31% 5.72%
Energy 4.0% 0.06%
Communication Services 2.59% 15.44%
Utilities 1.8% 0.47%
Healthcare 11.55% 11.88%
Consumer Defensive 4.01% 3.84%
Real Estate 9.55% 1.11%
Financial Services 15.91% 6.78%
Consumer Cyclical 13.61% 15.25%
Basic Materials 5.34% 1.65%

The iShares Core S&P Small-Cap ETF (IJR) has the most exposure to the Industrials sector at 17.31%. This is followed by Financial Services and Technology at 15.91% and 14.32% respectively. Communication Services (2.59%), Energy (4.0%), and Consumer Defensive (4.01%) only make up 10.60% of the fund’s total assets.

IJR’s mid-section with moderate exposure is comprised of Basic Materials, Real Estate, Healthcare, Consumer Cyclical, and Technology stocks at 5.34%, 9.55%, 11.55%, 13.61%, and 14.32%.

The iShares S&P 500 Growth ETF (IVW) has the most exposure to the Technology sector at 37.8%. This is followed by Communication Services and Consumer Cyclical at 15.44% and 15.25% respectively. Utilities (0.47%), Real Estate (1.11%), and Basic Materials (1.65%) only make up 3.23% of the fund’s total assets.

IVW’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Financial Services, Healthcare, and Consumer Cyclical stocks at 3.84%, 5.72%, 6.78%, 11.88%, and 15.25%.

IJR is 11.59% more exposed to the Industrials sector than IVW (17.31% vs 5.72%). IJR’s exposure to Financial Services and Technology stocks is 9.13% higher and 23.48% lower respectively (15.91% vs. 6.78% and 14.32% vs. 37.8%). In total, Communication Services, Energy, and Consumer Defensive also make up 8.74% less of the fund’s holdings compared to IVW (10.60% vs. 19.34%).

Holdings

IJR - Holdings

IJR Holdings Weight
BlackRock Cash Funds Treasury SL Agency 1.08%
GameStop Corp Class A 0.86%
Omnicell Inc 0.61%
Stamps.com Inc 0.58%
Saia Inc 0.57%
Power Integrations Inc 0.57%
Exponent Inc 0.54%
NeoGenomics Inc 0.53%
Chart Industries Inc 0.53%
Macy’s Inc 0.51%

IJR’s Top Holdings are BlackRock Cash Funds Treasury SL Agency, GameStop Corp Class A, Omnicell Inc, Stamps.com Inc, and Saia Inc at 1.08%, 0.86%, 0.61%, 0.58%, and 0.57%.

Power Integrations Inc (0.57%), Exponent Inc (0.54%), and NeoGenomics Inc (0.53%) have a slightly smaller but still significant weight. Chart Industries Inc and Macy’s Inc are also represented in the IJR’s holdings at 0.53% and 0.51%.

IVW - Holdings

IVW Holdings Weight
Apple Inc 11.46%
Microsoft Corp 10.75%
Amazon.com Inc 7.14%
Facebook Inc Class A 4.28%
Alphabet Inc Class A 4.06%
Alphabet Inc Class C 3.86%
Tesla Inc 2.65%
NVIDIA Corp 2.43%
PayPal Holdings Inc 1.62%
Adobe Inc 1.49%

IVW’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 11.46%, 10.75%, 7.14%, 4.28%, and 4.06%.

Alphabet Inc Class C (3.86%), Tesla Inc (2.65%), and NVIDIA Corp (2.43%) have a slightly smaller but still significant weight. PayPal Holdings Inc and Adobe Inc are also represented in the IVW’s holdings at 1.62% and 1.49%.

Risk Analysis

IJR IVW
Mean Return 1.21 1.44
R-squared 76.03 93.82
Std. Deviation 18.68 13.77
Alpha -3.7 2.19
Beta 1.2 0.98
Sharpe Ratio 0.74 1.21
Treynor Ratio 10.77 17.24

The iShares Core S&P Small-Cap ETF (IJR) has a Treynor Ratio of 10.77 with a Standard Deviation of 18.68 and a Mean Return of 1.21. Its Alpha is -3.7 while IJR’s Beta is 1.2. Furthermore, the fund has a R-squared of 76.03 and a Sharpe Ratio of 0.74.

The iShares S&P 500 Growth ETF (IVW) has a R-squared of 93.82 with a Sharpe Ratio of 1.21 and a Treynor Ratio of 17.24. Its Alpha is 2.19 while IVW’s Standard Deviation is 13.77. Furthermore, the fund has a Mean Return of 1.44 and a Beta of 0.98.

IJR’s Mean Return is 0.23 points lower than that of IVW and its R-squared is 17.79 points lower. With a Standard Deviation of 18.68, IJR is slightly more volatile than IVW. The Alpha and Beta of IJR are 5.89 points lower and 0.22 points higher than IVW’s Alpha and Beta.

Performance

Annual Returns

IJR vs. IVW - Annual Returns

Year IJR IVW
2020 11.24% 33.21%
2019 22.79% 30.91%
2018 -8.43% -0.17%
2017 13.2% 27.2%
2016 26.49% 6.74%
2015 -2.0% 5.33%
2014 5.67% 14.67%
2013 41.36% 32.48%
2012 16.28% 14.39%
2011 0.9% 4.49%
2010 26.14% 14.84%

IJR had its best year in 2013 with an annual return of 41.36%. IJR’s worst year over the past decade yielded -8.43% and occurred in 2018. In most years the iShares Core S&P Small-Cap ETF provided moderate returns such as in 2020, 2017, and 2012 where annual returns amounted to 11.24%, 13.2%, and 16.28% respectively.

The year 2020 was the strongest year for IVW, returning 33.21% on an annual basis. The poorest year for IVW in the last ten years was 2018, with a yield of -0.17%. Most years the iShares S&P 500 Growth ETF has given investors modest returns, such as in 2012, 2014, and 2010, when gains were 14.39%, 14.67%, and 14.84% respectively.

Portfolio Growth

IJR vs. IVW - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IJR $10,000 $38,800 13.97%
IVW $10,000 $51,915 16.74%

A $10,000 investment in IJR would have resulted in a final balance of $38,800. This is a profit of $28,800 over 11 years and amounts to a compound annual growth rate (CAGR) of 13.97%.

With a $10,000 investment in IVW, the end total would have been $51,915. This equates to a $41,915 profit over 11 years and a compound annual growth rate (CAGR) of 16.74%.

IJR’s CAGR is 2.77 percentage points lower than that of IVW and as a result, would have yielded $13,115 less on a $10,000 investment. Thus, IJR performed worse than IVW by 2.77% annually.


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