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IJR vs. IWD: What’s The Difference?

The iShares Core S&P Small-Cap ETF (IJR) and the iShares Russell 1000 Value ETF (IWD) are both among the Top 100 ETFs. IJR is a iShares Small Blend fund and IWD is a iShares Large Value fund. So, what’s the difference between IJR and IWD? And which fund is better?

The expense ratio of IJR is 0.13 percentage points lower than IWD’s (0.06% vs. 0.19%). IJR also has a higher exposure to the industrials sector and a higher standard deviation. Overall, IJR has provided higher returns than IWD over the past ten years.

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

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Summary

IJRIWD
NameiShares Core S&P Small-Cap ETFiShares Russell 1000 Value ETF
CategorySmall BlendLarge Value
IssueriSharesiShares
AUM68.64B54.1B
Avg. Return13.97%11.40%
Div. Yield0.96%1.57%
Expense Ratio0.06%0.19%

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 Russell 1000 Value ETF (IWD) is a Large Value fund that is issued by iShares. It currently has 54.1B total assets under management and has yielded an average annual return of 11.40% over the past 10 years. The fund has a dividend yield of 1.57% with an expense ratio of 0.19%.

IJR’s dividend yield is 0.61% lower than that of IWD (0.96% vs. 1.57%). Also, IJR yielded on average 2.57% more per year over the past decade (13.97% vs. 11.40%). The expense ratio of IJR is 0.13 percentage points lower than IWD’s (0.06% vs. 0.19%).

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Fund Composition

Industry Exposure

IJR vs. IWD - Industry Exposure

IJRIWD
Technology14.32%10.28%
Industrials17.31%11.77%
Energy4.0%4.76%
Communication Services2.59%8.67%
Utilities1.8%4.88%
Healthcare11.55%17.78%
Consumer Defensive4.01%7.76%
Real Estate9.55%4.94%
Financial Services15.91%20.43%
Consumer Cyclical13.61%5.62%
Basic Materials5.34%3.1%

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 Russell 1000 Value ETF (IWD) has the most exposure to the Financial Services sector at 20.43%. This is followed by Healthcare and Industrials at 17.78% and 11.77% respectively. Energy (4.76%), Utilities (4.88%), and Real Estate (4.94%) only make up 14.58% of the fund’s total assets.

IWD’s mid-section with moderate exposure is comprised of Consumer Cyclical, Consumer Defensive, Communication Services, Technology, and Industrials stocks at 5.62%, 7.76%, 8.67%, 10.28%, and 11.77%.

IJR is 5.54% more exposed to the Industrials sector than IWD (17.31% vs 11.77%). IJR’s exposure to Financial Services and Technology stocks is 4.52% lower and 4.04% higher respectively (15.91% vs. 20.43% and 14.32% vs. 10.28%). In total, Communication Services, Energy, and Consumer Defensive also make up 10.59% less of the fund’s holdings compared to IWD (10.60% vs. 21.19%).

Holdings

IJR - Holdings

IJR HoldingsWeight
BlackRock Cash Funds Treasury SL Agency1.08%
GameStop Corp Class A0.86%
Omnicell Inc0.61%
Stamps.com Inc0.58%
Saia Inc0.57%
Power Integrations Inc0.57%
Exponent Inc0.54%
NeoGenomics Inc0.53%
Chart Industries Inc0.53%
Macy’s Inc0.51%

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%.

IWD - Holdings

IWD HoldingsWeight
Berkshire Hathaway Inc Class B2.58%
JPMorgan Chase & Co2.25%
Johnson & Johnson2.24%
UnitedHealth Group Inc1.78%
Procter & Gamble Co1.71%
The Walt Disney Co1.5%
Bank of America Corp1.43%
Comcast Corp Class A1.33%
Exxon Mobil Corp1.2%
Pfizer Inc1.18%

IWD’s Top Holdings are Berkshire Hathaway Inc Class B, JPMorgan Chase & Co, Johnson & Johnson, UnitedHealth Group Inc, and Procter & Gamble Co at 2.58%, 2.25%, 2.24%, 1.78%, and 1.71%.

The Walt Disney Co (1.5%), Bank of America Corp (1.43%), and Comcast Corp Class A (1.33%) have a slightly smaller but still significant weight. Exxon Mobil Corp and Pfizer Inc are also represented in the IWD’s holdings at 1.2% and 1.18%.

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Risk Analysis

IJRIWD
Mean Return1.211.03
R-squared76.0392.38
Std. Deviation18.6814.35
Alpha-3.7-3.23
Beta1.21.02
Sharpe Ratio0.740.81
Treynor Ratio10.7711.06

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

The iShares Russell 1000 Value ETF (IWD) has a Sharpe Ratio of 0.81 with a Treynor Ratio of 11.06 and a R-squared of 92.38. Its Standard Deviation is 14.35 while IWD’s Alpha is -3.23. Furthermore, the fund has a Mean Return of 1.03 and a Beta of 1.02.

IJR’s Mean Return is 0.18 points higher than that of IWD and its R-squared is 16.35 points lower. With a Standard Deviation of 18.68, IJR is slightly more volatile than IWD. The Alpha and Beta of IJR are 0.47 points lower and 0.18 points higher than IWD’s Alpha and Beta.

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Performance

Annual Returns

IJR vs. IWD - Annual Returns

YearIJRIWD
202011.24%2.67%
201922.79%26.34%
2018-8.43%-8.4%
201713.2%13.47%
201626.49%17.09%
2015-2.0%-3.95%
20145.67%13.21%
201341.36%32.18%
201216.28%17.28%
20110.9%0.21%
201026.14%15.3%

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 2013 was the strongest year for IWD, returning 32.18% on an annual basis. The poorest year for IWD in the last ten years was 2018, with a yield of -8.4%. Most years the iShares Russell 1000 Value ETF has given investors modest returns, such as in 2014, 2017, and 2010, when gains were 13.21%, 13.47%, and 15.3% respectively.

Portfolio Growth

IJR vs. IWD - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
IJR$10,000$38,80013.97%
IWD$10,000$30,74611.40%

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 IWD, the end total would have been $30,746. This equates to a $20,746 profit over 11 years and a compound annual growth rate (CAGR) of 11.40%.

IJR’s CAGR is 2.57 percentage points higher than that of IWD and as a result, would have yielded $8,054 more on a $10,000 investment. Thus, IJR outperformed IWD by 2.57% annually.


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