IVW vs. IWN: What’s The Difference?

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

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

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

Summary

IVW IWN
Name iShares S&P 500 Growth ETF iShares Russell 2000 Value ETF
Category Large Growth Small Value
Issuer iShares iShares
AUM 35.72B 15.48B
Avg. Return 16.74% 10.96%
Div. Yield 0.61% 1.26%
Expense Ratio 0.18% 0.24%

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 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%.

IVW’s dividend yield is 0.65% lower than that of IWN (0.61% vs. 1.26%). Also, IVW yielded on average 5.77% more per year over the past decade (16.74% vs. 10.96%). The expense ratio of IVW is 0.06 percentage points lower than IWN’s (0.18% vs. 0.24%).

Fund Composition

Industry Exposure

IVW vs. IWN - Industry Exposure

IVW IWN
Technology 37.8% 6.02%
Industrials 5.72% 14.58%
Energy 0.06% 5.84%
Communication Services 15.44% 4.17%
Utilities 0.47% 4.69%
Healthcare 11.88% 10.94%
Consumer Defensive 3.84% 3.77%
Real Estate 1.11% 14.36%
Financial Services 6.78% 22.97%
Consumer Cyclical 15.25% 8.39%
Basic Materials 1.65% 4.29%

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 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%.

IVW is 31.78% more exposed to the Technology sector than IWN (37.8% vs 6.02%). IVW’s exposure to Communication Services and Consumer Cyclical stocks is 11.27% higher and 6.86% higher respectively (15.44% vs. 4.17% and 15.25% vs. 8.39%). In total, Utilities, Real Estate, and Basic Materials also make up 20.11% less of the fund’s holdings compared to IWN (3.23% vs. 23.34%).

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%.

IWN - Holdings

IWN Holdings Weight
AMC Entertainment Holdings Inc Class A 1.06%
Tenet Healthcare Corp 0.47%
Stag Industrial Inc 0.47%
Ovintiv Inc 0.45%
EMCOR Group Inc 0.42%
Valley National Bancorp 0.37%
Chesapeake Energy Corp Ordinary Shares – New 0.37%
Agree Realty Corp 0.36%
Macy’s Inc 0.35%
Essent Group Ltd 0.35%

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

IVW IWN
Mean Return 1.44 1.01
R-squared 93.82 72.64
Std. Deviation 13.77 19.28
Alpha 2.19 -6.32
Beta 0.98 1.21
Sharpe Ratio 1.21 0.59
Treynor Ratio 17.24 8.3

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

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

IVW’s Mean Return is 0.43 points higher than that of IWN and its R-squared is 21.18 points higher. With a Standard Deviation of 13.77, IVW is slightly less volatile than IWN. The Alpha and Beta of IVW are 8.51 points higher and 0.23 points lower than IWN’s Alpha and Beta.

Performance

Annual Returns

IVW vs. IWN - Annual Returns

Year IVW IWN
2020 33.21% 4.5%
2019 30.91% 22.17%
2018 -0.17% -12.94%
2017 27.2% 7.73%
2016 6.74% 31.64%
2015 5.33% -7.53%
2014 14.67% 4.13%
2013 32.48% 34.3%
2012 14.39% 17.92%
2011 4.49% -5.64%
2010 14.84% 24.29%

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 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

IVW vs. IWN - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IVW $10,000 $51,915 16.74%
IWN $10,000 $28,189 10.96%

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 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%.

IVW’s CAGR is 5.77 percentage points higher than that of IWN and as a result, would have yielded $23,726 more on a $10,000 investment. Thus, IVW outperformed IWN by 5.77% annually.


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