The iShares S&P 500 Growth ETF (IVW) and the iShares MSCI EAFE Value ETF (EFV) are both among the Top 100 ETFs. IVW is a iShares Large Growth fund and EFV is a iShares Foreign Large Value fund. So, what’s the difference between IVW and EFV? And which fund is better?
The expense ratio of IVW is 0.21 percentage points lower than EFV’s (0.18% vs. 0.39%). IVW also has a higher exposure to the technology sector and a lower standard deviation. Overall, IVW has provided higher returns than EFV over the past ten years.
In this article, we’ll compare IVW vs. EFV. We’ll look at portfolio growth and annual returns, as well as at their risk metrics and fund composition. Moreover, I’ll also discuss IVW’s and EFV’s performance, holdings, and industry exposure and examine how these affect their overall returns.
|Name||iShares S&P 500 Growth ETF||iShares MSCI EAFE Value ETF|
|Category||Large Growth||Foreign Large Value|
The iShares S&P 500 Growth ETF (IVW) is a Large Growth fund that is issued by iShares. It currently has 35.72B total assets under management and has yielded an average annual return of 16.74% over the past 10 years. The fund has a dividend yield of 0.61% with an expense ratio of 0.18%.
The iShares MSCI EAFE Value ETF (EFV) is a Foreign Large Value fund that is issued by iShares. It currently has 14.37B total assets under management and has yielded an average annual return of 3.99% over the past 10 years. The fund has a dividend yield of 2.94% with an expense ratio of 0.39%.
IVW’s dividend yield is 2.33% lower than that of EFV (0.61% vs. 2.94%). Also, IVW yielded on average 12.74% more per year over the past decade (16.74% vs. 3.99%). The expense ratio of IVW is 0.21 percentage points lower than EFV’s (0.18% vs. 0.39%).
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).
The iShares S&P 500 Growth ETF (IVW) has the most exposure to the Technology sector at 37.8%. This is followed by Communication Services and Consumer Cyclical at 15.44% and 15.25% respectively. Utilities (0.47%), Real Estate (1.11%), and Basic Materials (1.65%) only make up 3.23% of the fund’s total assets.
IVW’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Financial Services, Healthcare, and Consumer Cyclical stocks at 3.84%, 5.72%, 6.78%, 11.88%, and 15.25%.
The iShares MSCI EAFE Value ETF (EFV) has the most exposure to the Financial Services sector at 26.55%. This is followed by Industrials and Basic Materials at 11.6% and 9.59% respectively. Real Estate (5.06%), Utilities (6.14%), and Communication Services (6.46%) only make up 17.66% of the fund’s total assets.
EFV’s mid-section with moderate exposure is comprised of Energy, Consumer Defensive, Consumer Cyclical, Healthcare, and Basic Materials stocks at 6.6%, 6.82%, 9.0%, 9.19%, and 9.59%.
IVW is 34.82% more exposed to the Technology sector than EFV (37.8% vs 2.98%). IVW’s exposure to Communication Services and Consumer Cyclical stocks is 8.98% higher and 6.25% higher respectively (15.44% vs. 6.46% and 15.25% vs. 9.0%). In total, Utilities, Real Estate, and Basic Materials also make up 17.56% less of the fund’s holdings compared to EFV (3.23% vs. 20.79%).
|Facebook Inc Class A||4.28%|
|Alphabet Inc Class A||4.06%|
|Alphabet Inc Class C||3.86%|
|PayPal Holdings Inc||1.62%|
IVW’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 11.46%, 10.75%, 7.14%, 4.28%, and 4.06%.
Alphabet Inc Class C (3.86%), Tesla Inc (2.65%), and NVIDIA Corp (2.43%) have a slightly smaller but still significant weight. PayPal Holdings Inc and Adobe Inc are also represented in the IVW’s holdings at 1.62% and 1.49%.
|Toyota Motor Corp||2.21%|
|Commonwealth Bank of Australia||1.59%|
|HSBC Holdings PLC||1.4%|
|Rio Tinto PLC||1.1%|
EFV’s Top Holdings are Novartis AG, Toyota Motor Corp, Commonwealth Bank of Australia, Siemens AG, and Sanofi SA at 2.41%, 2.21%, 1.59%, 1.45%, and 1.42%.
HSBC Holdings PLC (1.4%), TotalEnergies SE (1.35%), and Allianz SE (1.23%) have a slightly smaller but still significant weight. GlaxoSmithKline PLC and Rio Tinto PLC are also represented in the EFV’s holdings at 1.18% and 1.1%.
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).
The iShares S&P 500 Growth ETF (IVW) has a R-squared of 93.82 with a Standard Deviation of 13.77 and a Alpha of 2.19. Its Treynor Ratio is 17.24 while IVW’s Sharpe Ratio is 1.21. Furthermore, the fund has a Beta of 0.98 and a Mean Return of 1.44.
The iShares MSCI EAFE Value ETF (EFV) has a Standard Deviation of 16.53 with a Beta of 1.05 and a R-squared of 92.15. Its Alpha is -1.77 while EFV’s Sharpe Ratio is 0.26. Furthermore, the fund has a Mean Return of 0.42 and a Treynor Ratio of 2.92.
IVW’s Mean Return is 1.02 points higher than that of EFV and its R-squared is 1.67 points higher. With a Standard Deviation of 13.77, IVW is slightly less volatile than EFV. The Alpha and Beta of IVW are 3.96 points higher and 0.07 points lower than EFV’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!
IVW had its best year in 2020 with an annual return of 33.21%. IVW’s worst year over the past decade yielded -0.17% and occurred in 2018. In most years the iShares S&P 500 Growth ETF provided moderate returns such as in 2012, 2014, and 2010 where annual returns amounted to 14.39%, 14.67%, and 14.84% respectively.
The year 2013 was the strongest year for EFV, returning 22.61% on an annual basis. The poorest year for EFV in the last ten years was 2018, with a yield of -14.88%. Most years the iShares MSCI EAFE Value ETF has given investors modest returns, such as in 2020, 2010, and 2016, when gains were -2.78%, 3.18%, and 4.87% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in IVW would have resulted in a final balance of $51,915. This is a profit of $41,915 over 11 years and amounts to a compound annual growth rate (CAGR) of 16.74%.
With a $10,000 investment in EFV, the end total would have been $14,134. This equates to a $4,134 profit over 11 years and a compound annual growth rate (CAGR) of 3.99%.
IVW’s CAGR is 12.74 percentage points higher than that of EFV and as a result, would have yielded $37,781 more on a $10,000 investment. Thus, IVW outperformed EFV by 12.74% annually.
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.