The iShares S&P 500 Value ETF (IVE) and the iShares Russell 2000 Value ETF (IWN) are both among the Top 100 ETFs. IVE is a iShares Large Value fund and IWN is a iShares Small Value fund. So, what’s the difference between IVE and IWN? And which fund is better?

The expense ratio of IVE is 0.06 percentage points lower than IWN’s (0.18% vs. 0.24%). IVE also has a lower exposure to the financial services sector and a lower standard deviation. Overall, IVE has provided higher returns than IWN over the past 11 years.

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

Summary

IVEIWN
NameiShares S&P 500 Value ETFiShares Russell 2000 Value ETF
CategoryLarge ValueSmall Value
IssueriSharesiShares
AUM22.4B15.48B
Avg. Return11.68%10.96%
Div. Yield1.88%1.26%
Expense Ratio0.18%0.24%

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 Russell 2000 Value ETF (IWN) is a Small Value fund that is issued by iShares. It currently has 15.48B total assets under management and has yielded an average annual return of 10.96% over the past 10 years. The fund has a dividend yield of 1.26% with an expense ratio of 0.24%.

IVE’s dividend yield is 0.62% higher than that of IWN (1.88% vs. 1.26%). Also, IVE yielded on average 0.72% more per year over the past decade (11.68% vs. 10.96%). The expense ratio of IVE is 0.06 percentage points lower than IWN’s (0.18% vs. 0.24%).

Fund Composition

Industry Exposure

IVE vs. IWN - Industry Exposure

IVEIWN
Technology9.41%6.02%
Industrials12.19%14.58%
Energy5.43%5.84%
Communication Services6.4%4.17%
Utilities4.82%4.69%
Healthcare15.4%10.94%
Consumer Defensive9.23%3.77%
Real Estate4.38%14.36%
Financial Services22.06%22.97%
Consumer Cyclical7.68%8.39%
Basic Materials2.99%4.29%

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 Russell 2000 Value ETF (IWN) has the most exposure to the Financial Services sector at 22.97%. This is followed by Industrials and Real Estate at 14.58% and 14.36% respectively. Communication Services (4.17%), Basic Materials (4.29%), and Utilities (4.69%) only make up 13.15% of the fund’s total assets.

IWN’s mid-section with moderate exposure is comprised of Energy, Technology, Consumer Cyclical, Healthcare, and Real Estate stocks at 5.84%, 6.02%, 8.39%, 10.94%, and 14.36%.

IVE is 0.91% less exposed to the Financial Services sector than IWN (22.06% vs 22.97%). IVE’s exposure to Healthcare and Industrials stocks is 4.46% higher and 2.39% lower respectively (15.4% vs. 10.94% and 12.19% vs. 14.58%). In total, Real Estate, Utilities, and Energy also make up 10.26% less of the fund’s holdings compared to IWN (14.63% vs. 24.89%).

Holdings

IVE - Holdings

IVE HoldingsWeight
Berkshire Hathaway Inc Class B3.05%
JPMorgan Chase & Co2.65%
The Walt Disney Co1.85%
Bank of America Corp1.67%
Johnson & Johnson1.57%
Exxon Mobil Corp1.41%
Pfizer Inc1.38%
Cisco Systems Inc1.35%
Verizon Communications Inc1.33%
Intel Corp1.25%

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%.

IWN - Holdings

IWN HoldingsWeight
AMC Entertainment Holdings Inc Class A1.06%
Tenet Healthcare Corp0.47%
Stag Industrial Inc0.47%
Ovintiv Inc0.45%
EMCOR Group Inc0.42%
Valley National Bancorp0.37%
Chesapeake Energy Corp Ordinary Shares – New0.37%
Agree Realty Corp0.36%
Macy’s Inc0.35%
Essent Group Ltd0.35%

IWN’s Top Holdings are AMC Entertainment Holdings Inc Class A, Tenet Healthcare Corp, Stag Industrial Inc, Ovintiv Inc, and EMCOR Group Inc at 1.06%, 0.47%, 0.47%, 0.45%, and 0.42%.

Valley National Bancorp (0.37%), Chesapeake Energy Corp Ordinary Shares – New (0.37%), and Agree Realty Corp (0.36%) have a slightly smaller but still significant weight. Macy’s Inc and Essent Group Ltd are also represented in the IWN’s holdings at 0.35% and 0.35%.

Risk Analysis

IVEIWN
Mean Return1.051.01
R-squared92.0872.64
Std. Deviation14.319.28
Alpha-2.9-6.32
Beta1.011.21
Sharpe Ratio0.830.59
Treynor Ratio11.418.3

The iShares S&P 500 Value ETF (IVE) has a Beta of 1.01 with a R-squared of 92.08 and a Standard Deviation of 14.3. Its Sharpe Ratio is 0.83 while IVE’s Mean Return is 1.05. Furthermore, the fund has a Alpha of -2.9 and a Treynor Ratio of 11.41.

The iShares Russell 2000 Value ETF (IWN) has a Mean Return of 1.01 with a Sharpe Ratio of 0.59 and a Treynor Ratio of 8.3. Its Beta is 1.21 while IWN’s Standard Deviation is 19.28. Furthermore, the fund has a Alpha of -6.32 and a R-squared of 72.64.

IVE’s Mean Return is 0.04 points higher than that of IWN and its R-squared is 19.44 points higher. With a Standard Deviation of 14.3, IVE is slightly less volatile than IWN. The Alpha and Beta of IVE are 3.42 points higher and 0.20 points lower than IWN’s Alpha and Beta.

Performance

Annual Returns

IVE vs. IWN - Annual Returns

YearIVEIWN
20201.24%4.5%
201931.71%22.17%
2018-9.09%-12.94%
201715.19%7.73%
201617.17%31.64%
2015-3.24%-7.53%
201412.14%4.13%
201331.69%34.3%
201217.45%17.92%
2011-0.63%-5.64%
201014.9%24.29%

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 2013 was the strongest year for IWN, returning 34.3% on an annual basis. The poorest year for IWN in the last ten years was 2018, with a yield of -12.94%. Most years the iShares Russell 2000 Value ETF has given investors modest returns, such as in 2020, 2017, and 2012, when gains were 4.5%, 7.73%, and 17.92% respectively.

Portfolio Growth

IVE vs. IWN - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
IVE$10,000$31,35011.68%
IWN$10,000$28,18910.96%

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 IWN, the end total would have been $28,189. This equates to a $18,189 profit over 11 years and a compound annual growth rate (CAGR) of 10.96%.

IVE’s CAGR is 0.72 percentage points higher than that of IWN and as a result, would have yielded $3,161 more on a $10,000 investment. Thus, IVE outperformed IWN by 0.72% annually.

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