The iShares S&P 500 Value ETF (IVE) and the iShares MSCI ACWI ETF (ACWI) are both among the Top 100 ETFs. IVE is a iShares Large Value fund and ACWI is a iShares N/A fund. So, what’s the difference between IVE and ACWI? And which fund is better?
The expense ratio of IVE is 0.14 percentage points lower than ACWI’s (0.18% vs. 0.32%). IVE also has a higher exposure to the financial services sector and a higher standard deviation. Overall, IVE has provided higher returns than ACWI over the past 11 years.
In this article, we’ll compare IVE vs. ACWI. We’ll look at risk metrics and holdings, as well as at their industry exposure and fund composition. Moreover, I’ll also discuss IVE’s and ACWI’s portfolio growth, annual returns, and performance and examine how these affect their overall returns.
Summary
| IVE | ACWI | |
| Name | iShares S&P 500 Value ETF | iShares MSCI ACWI ETF |
| Category | Large Value | N/A |
| Issuer | iShares | iShares |
| AUM | 22.4B | 16.85B |
| Avg. Return | 11.68% | 10.21% |
| Div. Yield | 1.88% | 1.39% |
| Expense Ratio | 0.18% | 0.32% |
The iShares S&P 500 Value ETF (IVE) is a Large Value fund that is issued by iShares. It currently has 22.4B total assets under management and has yielded an average annual return of 11.68% over the past 10 years. The fund has a dividend yield of 1.88% with an expense ratio of 0.18%.
The iShares MSCI ACWI ETF (ACWI) is a N/A fund that is issued by iShares. It currently has 16.85B total assets under management and has yielded an average annual return of 10.21% over the past 10 years. The fund has a dividend yield of 1.39% with an expense ratio of 0.32%.
IVE’s dividend yield is 0.49% higher than that of ACWI (1.88% vs. 1.39%). Also, IVE yielded on average 1.47% more per year over the past decade (11.68% vs. 10.21%). The expense ratio of IVE is 0.14 percentage points lower than ACWI’s (0.18% vs. 0.32%).
Fund Composition
Industry Exposure
| IVE | ACWI | |
| Technology | 9.41% | 20.41% |
| Industrials | 12.19% | 9.65% |
| Energy | 5.43% | 3.48% |
| Communication Services | 6.4% | 9.87% |
| Utilities | 4.82% | 2.61% |
| Healthcare | 15.4% | 11.74% |
| Consumer Defensive | 9.23% | 7.15% |
| Real Estate | 4.38% | 2.75% |
| Financial Services | 22.06% | 15.58% |
| Consumer Cyclical | 7.68% | 12.01% |
| Basic Materials | 2.99% | 4.73% |
The iShares S&P 500 Value ETF (IVE) has the most exposure to the Financial Services sector at 22.06%. This is followed by Healthcare and Industrials at 15.4% and 12.19% respectively. Real Estate (4.38%), Utilities (4.82%), and Energy (5.43%) only make up 14.63% of the fund’s total assets.
IVE’s mid-section with moderate exposure is comprised of Communication Services, Consumer Cyclical, Consumer Defensive, Technology, and Industrials stocks at 6.4%, 7.68%, 9.23%, 9.41%, and 12.19%.
The iShares MSCI ACWI ETF (ACWI) has the most exposure to the Technology sector at 20.41%. This is followed by Financial Services and Consumer Cyclical at 15.58% and 12.01% respectively. Real Estate (2.75%), Energy (3.48%), and Basic Materials (4.73%) only make up 10.96% of the fund’s total assets.
ACWI’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Healthcare, and Consumer Cyclical stocks at 7.15%, 9.65%, 9.87%, 11.74%, and 12.01%.
IVE is 6.48% more exposed to the Financial Services sector than ACWI (22.06% vs 15.58%). IVE’s exposure to Healthcare and Industrials stocks is 3.66% higher and 2.54% higher respectively (15.4% vs. 11.74% and 12.19% vs. 9.65%). In total, Real Estate, Utilities, and Energy also make up 5.79% more of the fund’s holdings compared to ACWI (14.63% vs. 8.84%).
Holdings
| IVE Holdings | Weight |
| Berkshire Hathaway Inc Class B | 3.05% |
| JPMorgan Chase & Co | 2.65% |
| The Walt Disney Co | 1.85% |
| Bank of America Corp | 1.67% |
| Johnson & Johnson | 1.57% |
| Exxon Mobil Corp | 1.41% |
| Pfizer Inc | 1.38% |
| Cisco Systems Inc | 1.35% |
| Verizon Communications Inc | 1.33% |
| Intel Corp | 1.25% |
IVE’s Top Holdings are Berkshire Hathaway Inc Class B, JPMorgan Chase & Co, The Walt Disney Co, Bank of America Corp, and Johnson & Johnson at 3.05%, 2.65%, 1.85%, 1.67%, and 1.57%.
Exxon Mobil Corp (1.41%), Pfizer Inc (1.38%), and Cisco Systems Inc (1.35%) have a slightly smaller but still significant weight. Verizon Communications Inc and Intel Corp are also represented in the IVE’s holdings at 1.33% and 1.25%.
| ACWI Holdings | Weight |
| Apple Inc | 3.44% |
| Microsoft Corp | 2.91% |
| Amazon.com Inc | 2.21% |
| Facebook Inc A | 1.25% |
| Alphabet Inc Class C | 1.12% |
| Alphabet Inc A | 1.09% |
| Taiwan Semiconductor Manufacturing Co Ltd | 0.79% |
| Tesla Inc | 0.78% |
| NVIDIA Corp | 0.74% |
| JPMorgan Chase & Co | 0.71% |
ACWI’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc A, and Alphabet Inc Class C at 3.44%, 2.91%, 2.21%, 1.25%, and 1.12%.
Alphabet Inc A (1.09%), Taiwan Semiconductor Manufacturing Co Ltd (0.79%), and Tesla Inc (0.78%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the ACWI’s holdings at 0.74% and 0.71%.
Risk Analysis
| IVE | ACWI | |
| Mean Return | 1.05 | 0.89 |
| R-squared | 92.08 | 99.96 |
| Std. Deviation | 14.3 | 14.05 |
| Alpha | -2.9 | 0.15 |
| Beta | 1.01 | 1 |
| Sharpe Ratio | 0.83 | 0.71 |
| Treynor Ratio | 11.41 | 9.45 |
The iShares S&P 500 Value ETF (IVE) has a R-squared of 92.08 with a Mean Return of 1.05 and a Beta of 1.01. Its Treynor Ratio is 11.41 while IVE’s Standard Deviation is 14.3. Furthermore, the fund has a Sharpe Ratio of 0.83 and a Alpha of -2.9.
The iShares MSCI ACWI ETF (ACWI) has a Sharpe Ratio of 0.71 with a Standard Deviation of 14.05 and a Treynor Ratio of 9.45. Its Alpha is 0.15 while ACWI’s R-squared is 99.96. Furthermore, the fund has a Mean Return of 0.89 and a Beta of 1.
IVE’s Mean Return is 0.16 points higher than that of ACWI and its R-squared is 7.88 points lower. With a Standard Deviation of 14.3, IVE is slightly more volatile than ACWI. The Alpha and Beta of IVE are 3.05 points lower and 0.01 points higher than ACWI’s Alpha and Beta.
Performance
Annual Returns
| Year | IVE | ACWI |
| 2020 | 1.24% | 16.38% |
| 2019 | 31.71% | 26.7% |
| 2018 | -9.09% | -9.15% |
| 2017 | 15.19% | 24.35% |
| 2016 | 17.17% | 8.22% |
| 2015 | -3.24% | -2.39% |
| 2014 | 12.14% | 4.64% |
| 2013 | 31.69% | 22.91% |
| 2012 | 17.45% | 15.99% |
| 2011 | -0.63% | -7.6% |
| 2010 | 14.9% | 12.31% |
IVE had its best year in 2019 with an annual return of 31.71%. IVE’s worst year over the past decade yielded -9.09% and occurred in 2018. In most years the iShares S&P 500 Value ETF provided moderate returns such as in 2014, 2010, and 2017 where annual returns amounted to 12.14%, 14.9%, and 15.19% respectively.
The year 2019 was the strongest year for ACWI, returning 26.7% on an annual basis. The poorest year for ACWI in the last ten years was 2018, with a yield of -9.15%. Most years the iShares MSCI ACWI ETF has given investors modest returns, such as in 2016, 2010, and 2012, when gains were 8.22%, 12.31%, and 15.99% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IVE | $10,000 | $31,350 | 11.68% |
| ACWI | $10,000 | $27,241 | 10.21% |
A $10,000 investment in IVE would have resulted in a final balance of $31,350. This is a profit of $21,350 over 11 years and amounts to a compound annual growth rate (CAGR) of 11.68%.
With a $10,000 investment in ACWI, the end total would have been $27,241. This equates to a $17,241 profit over 11 years and a compound annual growth rate (CAGR) of 10.21%.
IVE’s CAGR is 1.47 percentage points higher than that of ACWI and as a result, would have yielded $4,109 more on a $10,000 investment. Thus, IVE outperformed ACWI by 1.47% annually.
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