Skip to content

ITOT vs. VOE: What’s The Difference?

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

The expense ratio of ITOT is 0.04 percentage points lower than VOE’s (0.03% vs. 0.07%). ITOT also has a higher exposure to the technology sector and a lower standard deviation. Overall, ITOT has provided higher returns than VOE over the past ten years.

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

ITOTVOE
NameiShares Core S&P Total U.S. Stock Market ETFVanguard Mid-Cap Value Index Fund ETF Shares
CategoryLarge BlendMid-Cap Value
IssueriSharesVanguard
AUM41.97B26.78B
Avg. Return14.59%12.52%
Div. Yield1.2%1.87%
Expense Ratio0.03%0.07%

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 Vanguard Mid-Cap Value Index Fund ETF Shares (VOE) is a Mid-Cap Value fund that is issued by Vanguard. It currently has 26.78B total assets under management and has yielded an average annual return of 12.52% over the past 10 years. The fund has a dividend yield of 1.87% with an expense ratio of 0.07%.

ITOT’s dividend yield is 0.67% lower than that of VOE (1.2% vs. 1.87%). Also, ITOT yielded on average 2.07% more per year over the past decade (14.59% vs. 12.52%). The expense ratio of ITOT is 0.04 percentage points lower than VOE’s (0.03% vs. 0.07%).

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. VOE - Industry Exposure

ITOTVOE
Technology24.49%9.85%
Industrials9.21%9.4%
Energy2.51%5.69%
Communication Services10.54%5.27%
Utilities2.35%10.93%
Healthcare13.59%7.04%
Consumer Defensive5.79%4.85%
Real Estate3.67%11.48%
Financial Services13.69%18.26%
Consumer Cyclical11.69%11.8%
Basic Materials2.47%5.44%

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 Vanguard Mid-Cap Value Index Fund ETF Shares (VOE) has the most exposure to the Financial Services sector at 18.26%. This is followed by Consumer Cyclical and Real Estate at 11.8% and 11.48% respectively. Communication Services (5.27%), Basic Materials (5.44%), and Energy (5.69%) only make up 16.40% of the fund’s total assets.

VOE’s mid-section with moderate exposure is comprised of Healthcare, Industrials, Technology, Utilities, and Real Estate stocks at 7.04%, 9.4%, 9.85%, 10.93%, and 11.48%.

ITOT is 14.64% more exposed to the Technology sector than VOE (24.49% vs 9.85%). ITOT’s exposure to Financial Services and Healthcare stocks is 4.57% lower and 6.55% higher respectively (13.69% vs. 18.26% and 13.59% vs. 7.04%). In total, Basic Materials, Energy, and Real Estate also make up 13.96% less of the fund’s holdings compared to VOE (8.65% vs. 22.61%).

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%.

VOE - Holdings

VOE HoldingsWeight
Carrier Global Corp Ordinary Shares1.28%
International Flavors & Fragrances Inc1.13%
Motorola Solutions Inc1.12%
Discover Financial Services1.09%
Welltower Inc1.05%
Corteva Inc0.99%
Valero Energy Corp0.97%
Corning Inc0.95%
Willis Towers Watson PLC0.9%
D.R. Horton Inc0.89%

VOE’s Top Holdings are Carrier Global Corp Ordinary Shares, International Flavors & Fragrances Inc, Motorola Solutions Inc, Discover Financial Services, and Welltower Inc at 1.28%, 1.13%, 1.12%, 1.09%, and 1.05%.

Corteva Inc (0.99%), Valero Energy Corp (0.97%), and Corning Inc (0.95%) have a slightly smaller but still significant weight. Willis Towers Watson PLC and D.R. Horton Inc are also represented in the VOE’s holdings at 0.9% and 0.89%.

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

ITOTVOE
Mean Return1.271.05
R-squared99.488.76
Std. Deviation14.0215.98
Alpha-0.54-3.77
Beta1.031.11
Sharpe Ratio1.040.75
Treynor Ratio14.1310.19

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

The Vanguard Mid-Cap Value Index Fund ETF Shares (VOE) has a Treynor Ratio of 10.19 with a Standard Deviation of 15.98 and a Alpha of -3.77. Its Beta is 1.11 while VOE’s Mean Return is 1.05. Furthermore, the fund has a R-squared of 88.76 and a Sharpe Ratio of 0.75.

ITOT’s Mean Return is 0.22 points higher than that of VOE and its R-squared is 10.64 points higher. With a Standard Deviation of 14.02, ITOT is slightly less volatile than VOE. The Alpha and Beta of ITOT are 3.23 points higher and 0.08 points lower than VOE’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. VOE - Annual Returns

YearITOTVOE
202020.75%2.5%
201930.87%27.98%
2018-5.27%-12.41%
201721.23%17.05%
201612.59%15.26%
20150.96%-1.8%
201413.01%13.98%
201332.67%37.65%
201215.98%16.04%
20111.55%-0.32%
201016.15%21.83%

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 2013 was the strongest year for VOE, returning 37.65% on an annual basis. The poorest year for VOE in the last ten years was 2018, with a yield of -12.41%. Most years the Vanguard Mid-Cap Value Index Fund ETF Shares has given investors modest returns, such as in 2014, 2016, and 2012, when gains were 13.98%, 15.26%, and 16.04% respectively.

Portfolio Growth

ITOT vs. VOE - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
ITOT$10,000$42,31014.59%
VOE$10,000$33,65512.52%

A $10,000 investment in ITOT would have resulted in a final balance of $42,310. This is a profit of $32,310 over 11 years and amounts to a compound annual growth rate (CAGR) of 14.59%.

With a $10,000 investment in VOE, the end total would have been $33,655. This equates to a $23,655 profit over 11 years and a compound annual growth rate (CAGR) of 12.52%.

ITOT’s CAGR is 2.07 percentage points higher than that of VOE and as a result, would have yielded $8,655 more on a $10,000 investment. Thus, ITOT outperformed VOE by 2.07% 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.