Skip to content

ITOT vs. SCHG: What’s The Difference?

The iShares Core S&P Total U.S. Stock Market ETF (ITOT) and the Schwab U.S. Large-Cap Growth ETF (SCHG) are both among the Top 100 ETFs. ITOT is a iShares Large Blend fund and SCHG is a Schwab ETFs Large Growth fund. So, what’s the difference between ITOT and SCHG? And which fund is better?

The expense ratio of ITOT is 0.01 percentage points lower than SCHG’s (0.03% vs. 0.04%). ITOT also has a lower exposure to the technology sector and a lower standard deviation. Overall, ITOT has provided lower returns than SCHG over the past ten years.

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

TIP: Keep track of all your investments with Personal Capital. I use this amazing tool to aggregate all investments in one place and make sure I'm on track to financial freedom. Oh, and did I mention it's free? Try it out here (link to Personal Capital).

Summary

ITOTSCHG
NameiShares Core S&P Total U.S. Stock Market ETFSchwab U.S. Large-Cap Growth ETF
CategoryLarge BlendLarge Growth
IssueriSharesSchwab ETFs
AUM41.97B15.16B
Avg. Return14.59%17.81%
Div. Yield1.2%0.43%
Expense Ratio0.03%0.04%

The iShares Core S&P Total U.S. Stock Market ETF (ITOT) is a Large Blend fund that is issued by iShares. It currently has 41.97B total assets under management and has yielded an average annual return of 14.59% over the past 10 years. The fund has a dividend yield of 1.2% with an expense ratio of 0.03%.

The Schwab U.S. Large-Cap Growth ETF (SCHG) is a Large Growth fund that is issued by Schwab ETFs. It currently has 15.16B total assets under management and has yielded an average annual return of 17.81% over the past 10 years. The fund has a dividend yield of 0.43% with an expense ratio of 0.04%.

ITOT’s dividend yield is 0.77% higher than that of SCHG (1.2% vs. 0.43%). Also, ITOT yielded on average 3.22% less per year over the past decade (14.59% vs. 17.81%). The expense ratio of ITOT is 0.01 percentage points lower than SCHG’s (0.03% vs. 0.04%).

FYI: The best way I've found to invest in ETFs is through M1 Finance. It's free and you even get an instant line of credit! Have a look here (link to M1 Finance).

Fund Composition

Industry Exposure

ITOT vs. SCHG - Industry Exposure

ITOTSCHG
Technology24.49%39.21%
Industrials9.21%3.01%
Energy2.51%0.2%
Communication Services10.54%17.07%
Utilities2.35%0.0%
Healthcare13.59%12.05%
Consumer Defensive5.79%2.15%
Real Estate3.67%1.64%
Financial Services13.69%7.98%
Consumer Cyclical11.69%15.01%
Basic Materials2.47%1.68%

The iShares Core S&P Total U.S. Stock Market ETF (ITOT) has the most exposure to the Technology sector at 24.49%. This is followed by Financial Services and Healthcare at 13.69% and 13.59% respectively. Basic Materials (2.47%), Energy (2.51%), and Real Estate (3.67%) only make up 8.65% of the fund’s total assets.

ITOT’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Healthcare stocks at 5.79%, 9.21%, 10.54%, 11.69%, and 13.59%.

The Schwab U.S. Large-Cap Growth ETF (SCHG) has the most exposure to the Technology sector at 39.21%. This is followed by Communication Services and Consumer Cyclical at 17.07% and 15.01% respectively. Energy (0.2%), Real Estate (1.64%), and Basic Materials (1.68%) only make up 3.52% of the fund’s total assets.

SCHG’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Financial Services, Healthcare, and Consumer Cyclical stocks at 2.15%, 3.01%, 7.98%, 12.05%, and 15.01%.

ITOT is 14.72% less exposed to the Technology sector than SCHG (24.49% vs 39.21%). ITOT’s exposure to Financial Services and Healthcare stocks is 5.71% higher and 1.54% higher respectively (13.69% vs. 7.98% and 13.59% vs. 12.05%). In total, Basic Materials, Energy, and Real Estate also make up 5.13% more of the fund’s holdings compared to SCHG (8.65% vs. 3.52%).

Holdings

ITOT - Holdings

ITOT HoldingsWeight
Apple Inc5.07%
Microsoft Corp4.75%
Amazon.com Inc3.16%
Facebook Inc Class A1.89%
Alphabet Inc Class A1.79%
Alphabet Inc Class C1.71%
Tesla Inc1.17%
Berkshire Hathaway Inc Class B1.17%
NVIDIA Corp1.08%
JPMorgan Chase & Co1.02%

ITOT’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 5.07%, 4.75%, 3.16%, 1.89%, and 1.79%.

Alphabet Inc Class C (1.71%), Tesla Inc (1.17%), and Berkshire Hathaway Inc Class B (1.17%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the ITOT’s holdings at 1.08% and 1.02%.

SCHG - Holdings

SCHG HoldingsWeight
Apple Inc11.49%
Microsoft Corp10.91%
Amazon.com Inc7.89%
Facebook Inc A4.45%
Alphabet Inc A3.93%
Alphabet Inc Class C3.82%
Tesla Inc2.8%
NVIDIA Corp2.67%
Visa Inc Class A2.12%
UnitedHealth Group Inc2.02%

SCHG’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc A, and Alphabet Inc A at 11.49%, 10.91%, 7.89%, 4.45%, and 3.93%.

Alphabet Inc Class C (3.82%), Tesla Inc (2.8%), and NVIDIA Corp (2.67%) have a slightly smaller but still significant weight. Visa Inc Class A and UnitedHealth Group Inc are also represented in the SCHG’s holdings at 2.12% and 2.02%.

NOTE: The easiest way to add diversification to your portfolio is to invest in real estate through Fundrise. You can become private real estate investor without the burden of property management! Check it out here (link to Fundrise).

Risk Analysis

ITOTSCHG
Mean Return1.271.46
R-squared99.492.92
Std. Deviation14.0214.78
Alpha-0.541.97
Beta1.031.05
Sharpe Ratio1.041.14
Treynor Ratio14.1316.3

The iShares Core S&P Total U.S. Stock Market ETF (ITOT) has a Sharpe Ratio of 1.04 with a R-squared of 99.4 and a Beta of 1.03. Its Alpha is -0.54 while ITOT’s Treynor Ratio is 14.13. Furthermore, the fund has a Mean Return of 1.27 and a Standard Deviation of 14.02.

The Schwab U.S. Large-Cap Growth ETF (SCHG) has a Standard Deviation of 14.78 with a Alpha of 1.97 and a Mean Return of 1.46. Its Beta is 1.05 while SCHG’s Sharpe Ratio is 1.14. Furthermore, the fund has a Treynor Ratio of 16.3 and a R-squared of 92.92.

ITOT’s Mean Return is 0.19 points lower than that of SCHG and its R-squared is 6.48 points higher. With a Standard Deviation of 14.02, ITOT is slightly less volatile than SCHG. The Alpha and Beta of ITOT are 2.51 points lower and 0.02 points lower than SCHG’s Alpha and Beta.

FYI: Another great way to get exposure to the real estate sector is by investing in real estate debt. Groundfloor offers fantastic short-term, high-yield bonds that can add diversification to your portfolio!

Performance

Annual Returns

ITOT vs. SCHG - Annual Returns

YearITOTSCHG
202020.75%39.13%
201930.87%36.21%
2018-5.27%-1.35%
201721.23%28.04%
201612.59%6.76%
20150.96%3.26%
201413.01%15.74%
201332.67%33.96%
201215.98%17.02%
20111.55%-0.67%
201016.15%16.83%

ITOT had its best year in 2013 with an annual return of 32.67%. ITOT’s worst year over the past decade yielded -5.27% and occurred in 2018. In most years the iShares Core S&P Total U.S. Stock Market ETF provided moderate returns such as in 2014, 2012, and 2010 where annual returns amounted to 13.01%, 15.98%, and 16.15% respectively.

The year 2020 was the strongest year for SCHG, returning 39.13% on an annual basis. The poorest year for SCHG in the last ten years was 2018, with a yield of -1.35%. Most years the Schwab U.S. Large-Cap Growth ETF has given investors modest returns, such as in 2014, 2010, and 2012, when gains were 15.74%, 16.83%, and 17.02% respectively.

Portfolio Growth

ITOT vs. SCHG - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
ITOT$10,000$36,42714.59%
SCHG$10,000$47,55617.81%

A $10,000 investment in ITOT would have resulted in a final balance of $36,427. This is a profit of $26,427 over 10 years and amounts to a compound annual growth rate (CAGR) of 14.59%.

With a $10,000 investment in SCHG, the end total would have been $47,556. This equates to a $37,556 profit over 10 years and a compound annual growth rate (CAGR) of 17.81%.

ITOT’s CAGR is 3.22 percentage points lower than that of SCHG and as a result, would have yielded $11,129 less on a $10,000 investment. Thus, ITOT performed worse than SCHG by 3.22% annually.


Current recommendations:

Over the past years, I have discovered several tools and products that have helped me tremendously on my path to financial freedom:

P.S.: The links below are affiliate links, which means I receive a small commission at no extra cost to you when you sign up for one of the services. Thank you for your support!

1)Personal Capital is simply the best tool out there to track your net worth and plan for financial freedom. Just their retirement planner alone has become an invaluable tool to keep myself on track financially. Try it out, it's free!

2) Take a look at M1 Finance, my favorite broker. I love how easy it is to invest and maintain my portfolio with them. I can set up automatic transfers, rebalance my portfolio with one click and even borrow up to 35% of my assets at super low interest rates!

3) Fundrise is by far the best way I've found to invest in Real Estate. You can diversify your portfolio by investing in their eREITs or even allocate capital to individual properties (without the hassle of managing tenants!).

4) Groundfloor is another great way to get exposure to the real estate sector by investing in short-term, high-yield real estate debt. Current returns are >10% and you can get started with just $10.

5) If you are interested in startup investing, check out Mainvest. I've started allocating a small amount of assets to invest in and support small businesses. Return targets are between 10-25% and you can start with just $100!

To see all of my most up-to-date recommendations, check out the Recommended Tools section.

Leave a Reply

Your email address will not be published.