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IVE vs. VLUE: What’s The Difference?

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

The expense ratio of IVE is 0.03 percentage points higher than VLUE’s (0.18% vs. 0.15%). IVE also has a higher exposure to the financial services sector and a higher standard deviation. Overall, IVE has provided higher returns than VLUE over the past 7 years.

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

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Summary

IVEVLUE
NameiShares S&P 500 Value ETFiShares MSCI USA Value Factor ETF
CategoryLarge ValueLarge Value
IssueriSharesiShares
AUM22.4B15.95B
Avg. Return11.68%8.91%
Div. Yield1.88%1.89%
Expense Ratio0.18%0.15%

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 USA Value Factor ETF (VLUE) is a Large Value fund that is issued by iShares. It currently has 15.95B total assets under management and has yielded an average annual return of 8.91% over the past 10 years. The fund has a dividend yield of 1.89% with an expense ratio of 0.15%.

IVE’s dividend yield is 0.01% lower than that of VLUE (1.88% vs. 1.89%). Also, IVE yielded on average 2.77% more per year over the past decade (11.68% vs. 8.91%). The expense ratio of IVE is 0.03 percentage points higher than VLUE’s (0.18% vs. 0.15%).

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Fund Composition

Industry Exposure

IVE vs. VLUE - Industry Exposure

IVEVLUE
Technology9.41%26.89%
Industrials12.19%9.14%
Energy5.43%2.42%
Communication Services6.4%10.39%
Utilities4.82%2.68%
Healthcare15.4%14.31%
Consumer Defensive9.23%7.22%
Real Estate4.38%3.19%
Financial Services22.06%10.96%
Consumer Cyclical7.68%10.66%
Basic Materials2.99%2.14%

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 USA Value Factor ETF (VLUE) has the most exposure to the Technology sector at 26.89%. This is followed by Healthcare and Financial Services at 14.31% and 10.96% respectively. Energy (2.42%), Utilities (2.68%), and Real Estate (3.19%) only make up 8.29% of the fund’s total assets.

VLUE’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Financial Services stocks at 7.22%, 9.14%, 10.39%, 10.66%, and 10.96%.

IVE is 11.10% more exposed to the Financial Services sector than VLUE (22.06% vs 10.96%). IVE’s exposure to Healthcare and Industrials stocks is 1.09% higher and 3.05% higher respectively (15.4% vs. 14.31% and 12.19% vs. 9.14%). In total, Real Estate, Utilities, and Energy also make up 6.34% more of the fund’s holdings compared to VLUE (14.63% vs. 8.29%).

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%.

VLUE - Holdings

VLUE HoldingsWeight
AT&T Inc7.13%
Intel Corp6.14%
General Motors Co3.19%
Micron Technology Inc3.14%
Cisco Systems Inc3.05%
International Business Machines Corp2.76%
Target Corp2.38%
Citigroup Inc2.32%
Ford Motor Co2.23%
Pfizer Inc2.17%

VLUE’s Top Holdings are AT&T Inc, Intel Corp, General Motors Co, Micron Technology Inc, and Cisco Systems Inc at 7.13%, 6.14%, 3.19%, 3.14%, and 3.05%.

International Business Machines Corp (2.76%), Target Corp (2.38%), and Citigroup Inc (2.32%) have a slightly smaller but still significant weight. Ford Motor Co and Pfizer Inc are also represented in the VLUE’s holdings at 2.23% and 2.17%.

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Risk Analysis

IVEVLUE
Mean Return1.050
R-squared92.080
Std. Deviation14.30
Alpha-2.90
Beta1.010
Sharpe Ratio0.830
Treynor Ratio11.410

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

The iShares MSCI USA Value Factor ETF (VLUE) has a Standard Deviation of 0 with a Treynor Ratio of 0 and a Sharpe Ratio of 0. Its Beta is 0 while VLUE’s R-squared is 0. Furthermore, the fund has a Alpha of 0 and a Mean Return of 0.

IVE’s Mean Return is 1.05 points higher than that of VLUE and its R-squared is 92.08 points higher. With a Standard Deviation of 14.3, IVE is slightly more volatile than VLUE. The Alpha and Beta of IVE are 2.90 points lower and 1.01 points higher than VLUE’s Alpha and Beta.

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Performance

Annual Returns

IVE vs. VLUE - Annual Returns

YearIVEVLUE
20201.24%-0.32%
201931.71%27.47%
2018-9.09%-11.18%
201715.19%21.97%
201617.17%15.68%
2015-3.24%-3.54%
201412.14%12.29%
201331.69%0.0%
201217.45%0.0%
2011-0.63%0.0%
201014.9%0.0%

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 VLUE, returning 27.47% on an annual basis. The poorest year for VLUE in the last ten years was 2018, with a yield of -11.18%. Most years the iShares MSCI USA Value Factor ETF has given investors modest returns, such as in 2012, 2011, and 2010, when gains were 0.0%, 0.0%, and 0.0% respectively.

Portfolio Growth

IVE vs. VLUE - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
IVE$10,000$17,75211.68%
VLUE$10,000$17,2478.91%

A $10,000 investment in IVE would have resulted in a final balance of $17,752. This is a profit of $7,752 over 7 years and amounts to a compound annual growth rate (CAGR) of 11.68%.

With a $10,000 investment in VLUE, the end total would have been $17,247. This equates to a $7,247 profit over 7 years and a compound annual growth rate (CAGR) of 8.91%.

IVE’s CAGR is 2.77 percentage points higher than that of VLUE and as a result, would have yielded $505 more on a $10,000 investment. Thus, IVE outperformed VLUE by 2.77% annually.


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