IVW vs. IWB: What’s The Difference?

The iShares S&P 500 Growth ETF (IVW) and the iShares Russell 1000 ETF (IWB) are both among the Top 100 ETFs. IVW is a iShares Large Growth fund and IWB is a iShares Large Blend fund. So, what’s the difference between IVW and IWB? And which fund is better?

The expense ratio of IVW is 0.03 percentage points higher than IWB’s (0.18% vs. 0.15%). IVW also has a higher exposure to the technology sector and a lower standard deviation. Overall, IVW has provided higher returns than IWB over the past ten years.

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

Summary

IVW IWB
Name iShares S&P 500 Growth ETF iShares Russell 1000 ETF
Category Large Growth Large Blend
Issuer iShares iShares
AUM 35.72B 30.54B
Avg. Return 16.74% 14.64%
Div. Yield 0.61% 1.14%
Expense Ratio 0.18% 0.15%

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 Russell 1000 ETF (IWB) is a Large Blend fund that is issued by iShares. It currently has 30.54B total assets under management and has yielded an average annual return of 14.64% over the past 10 years. The fund has a dividend yield of 1.14% with an expense ratio of 0.15%.

IVW’s dividend yield is 0.53% lower than that of IWB (0.61% vs. 1.14%). Also, IVW yielded on average 2.10% more per year over the past decade (16.74% vs. 14.64%). The expense ratio of IVW is 0.03 percentage points higher than IWB’s (0.18% vs. 0.15%).

Fund Composition

Industry Exposure

IVW vs. IWB - Industry Exposure

IVW IWB
Technology 37.8% 25.33%
Industrials 5.72% 8.88%
Energy 0.06% 2.44%
Communication Services 15.44% 10.83%
Utilities 0.47% 2.36%
Healthcare 11.88% 13.35%
Consumer Defensive 3.84% 5.97%
Real Estate 1.11% 3.34%
Financial Services 6.78% 13.64%
Consumer Cyclical 15.25% 11.85%
Basic Materials 1.65% 2.02%

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 Russell 1000 ETF (IWB) has the most exposure to the Technology sector at 25.33%. This is followed by Financial Services and Healthcare at 13.64% and 13.35% respectively. Utilities (2.36%), Energy (2.44%), and Real Estate (3.34%) only make up 8.14% of the fund’s total assets.

IWB’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Healthcare stocks at 5.97%, 8.88%, 10.83%, 11.85%, and 13.35%.

IVW is 12.47% more exposed to the Technology sector than IWB (37.8% vs 25.33%). IVW’s exposure to Communication Services and Consumer Cyclical stocks is 4.61% higher and 3.40% higher respectively (15.44% vs. 10.83% and 15.25% vs. 11.85%). In total, Utilities, Real Estate, and Basic Materials also make up 4.49% less of the fund’s holdings compared to IWB (3.23% vs. 7.72%).

Holdings

IVW - Holdings

IVW Holdings Weight
Apple Inc 11.46%
Microsoft Corp 10.75%
Amazon.com Inc 7.14%
Facebook Inc Class A 4.28%
Alphabet Inc Class A 4.06%
Alphabet Inc Class C 3.86%
Tesla Inc 2.65%
NVIDIA Corp 2.43%
PayPal Holdings Inc 1.62%
Adobe Inc 1.49%

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%.

IWB - Holdings

IWB Holdings Weight
Apple Inc 5.45%
Microsoft Corp 5.11%
Amazon.com Inc 3.43%
Facebook Inc Class A 2.03%
Alphabet Inc Class A 1.93%
Alphabet Inc Class C 1.82%
Tesla Inc 1.27%
Berkshire Hathaway Inc Class B 1.24%
NVIDIA Corp 1.11%
JPMorgan Chase & Co 1.09%

IWB’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 5.45%, 5.11%, 3.43%, 2.03%, and 1.93%.

Alphabet Inc Class C (1.82%), Tesla Inc (1.27%), and Berkshire Hathaway Inc Class B (1.24%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the IWB’s holdings at 1.11% and 1.09%.

Risk Analysis

IVW IWB
Mean Return 1.44 1.27
R-squared 93.82 99.73
Std. Deviation 13.77 13.87
Alpha 2.19 -0.38
Beta 0.98 1.02
Sharpe Ratio 1.21 1.05
Treynor Ratio 17.24 14.31

The iShares S&P 500 Growth ETF (IVW) has a R-squared of 93.82 with a Treynor Ratio of 17.24 and a Sharpe Ratio of 1.21. Its Alpha is 2.19 while IVW’s Standard Deviation is 13.77. Furthermore, the fund has a Mean Return of 1.44 and a Beta of 0.98.

The iShares Russell 1000 ETF (IWB) has a Treynor Ratio of 14.31 with a R-squared of 99.73 and a Standard Deviation of 13.87. Its Beta is 1.02 while IWB’s Sharpe Ratio is 1.05. Furthermore, the fund has a Alpha of -0.38 and a Mean Return of 1.27.

IVW’s Mean Return is 0.17 points higher than that of IWB and its R-squared is 5.91 points lower. With a Standard Deviation of 13.77, IVW is slightly less volatile than IWB. The Alpha and Beta of IVW are 2.57 points higher and 0.04 points lower than IWB’s Alpha and Beta.

Performance

Annual Returns

IVW vs. IWB - Annual Returns

Year IVW IWB
2020 33.21% 20.8%
2019 30.91% 31.26%
2018 -0.17% -4.91%
2017 27.2% 21.53%
2016 6.74% 11.91%
2015 5.33% 0.82%
2014 14.67% 13.08%
2013 32.48% 32.93%
2012 14.39% 16.27%
2011 4.49% 1.36%
2010 14.84% 15.94%

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 IWB, returning 32.93% on an annual basis. The poorest year for IWB in the last ten years was 2018, with a yield of -4.91%. Most years the iShares Russell 1000 ETF has given investors modest returns, such as in 2014, 2010, and 2012, when gains were 13.08%, 15.94%, and 16.27% respectively.

Portfolio Growth

IVW vs. IWB - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IVW $10,000 $51,915 16.74%
IWB $10,000 $42,462 14.64%

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 IWB, the end total would have been $42,462. This equates to a $32,462 profit over 11 years and a compound annual growth rate (CAGR) of 14.64%.

IVW’s CAGR is 2.10 percentage points higher than that of IWB and as a result, would have yielded $9,453 more on a $10,000 investment. Thus, IVW outperformed IWB by 2.10% annually.


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