IWD vs. IVW: What’s The Difference?

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

The expense ratio of IWD is 0.01 percentage points higher than IVW’s (0.19% vs. 0.18%). IWD also has a higher exposure to the financial services sector and a higher standard deviation. Overall, IWD has provided lower returns than IVW over the past ten years.

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

Summary

IWD IVW
Name iShares Russell 1000 Value ETF iShares S&P 500 Growth ETF
Category Large Value Large Growth
Issuer iShares iShares
AUM 54.1B 35.72B
Avg. Return 11.40% 16.74%
Div. Yield 1.57% 0.61%
Expense Ratio 0.19% 0.18%

The iShares Russell 1000 Value ETF (IWD) is a Large Value fund that is issued by iShares. It currently has 54.1B total assets under management and has yielded an average annual return of 11.40% over the past 10 years. The fund has a dividend yield of 1.57% with an expense ratio of 0.19%.

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%.

IWD’s dividend yield is 0.96% higher than that of IVW (1.57% vs. 0.61%). Also, IWD yielded on average 5.34% less per year over the past decade (11.40% vs. 16.74%). The expense ratio of IWD is 0.01 percentage points higher than IVW’s (0.19% vs. 0.18%).

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Fund Composition

Industry Exposure

IWD vs. IVW - Industry Exposure

IWD IVW
Technology 10.28% 37.8%
Industrials 11.77% 5.72%
Energy 4.76% 0.06%
Communication Services 8.67% 15.44%
Utilities 4.88% 0.47%
Healthcare 17.78% 11.88%
Consumer Defensive 7.76% 3.84%
Real Estate 4.94% 1.11%
Financial Services 20.43% 6.78%
Consumer Cyclical 5.62% 15.25%
Basic Materials 3.1% 1.65%

The iShares Russell 1000 Value ETF (IWD) has the most exposure to the Financial Services sector at 20.43%. This is followed by Healthcare and Industrials at 17.78% and 11.77% respectively. Energy (4.76%), Utilities (4.88%), and Real Estate (4.94%) only make up 14.58% of the fund’s total assets.

IWD’s mid-section with moderate exposure is comprised of Consumer Cyclical, Consumer Defensive, Communication Services, Technology, and Industrials stocks at 5.62%, 7.76%, 8.67%, 10.28%, and 11.77%.

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%.

IWD is 13.65% more exposed to the Financial Services sector than IVW (20.43% vs 6.78%). IWD’s exposure to Healthcare and Industrials stocks is 5.90% higher and 6.05% higher respectively (17.78% vs. 11.88% and 11.77% vs. 5.72%). In total, Energy, Utilities, and Real Estate also make up 12.94% more of the fund’s holdings compared to IVW (14.58% vs. 1.64%).

Holdings

IWD - Holdings

IWD Holdings Weight
Berkshire Hathaway Inc Class B 2.58%
JPMorgan Chase & Co 2.25%
Johnson & Johnson 2.24%
UnitedHealth Group Inc 1.78%
Procter & Gamble Co 1.71%
The Walt Disney Co 1.5%
Bank of America Corp 1.43%
Comcast Corp Class A 1.33%
Exxon Mobil Corp 1.2%
Pfizer Inc 1.18%

IWD’s Top Holdings are Berkshire Hathaway Inc Class B, JPMorgan Chase & Co, Johnson & Johnson, UnitedHealth Group Inc, and Procter & Gamble Co at 2.58%, 2.25%, 2.24%, 1.78%, and 1.71%.

The Walt Disney Co (1.5%), Bank of America Corp (1.43%), and Comcast Corp Class A (1.33%) have a slightly smaller but still significant weight. Exxon Mobil Corp and Pfizer Inc are also represented in the IWD’s holdings at 1.2% and 1.18%.

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%.

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Risk Analysis

IWD IVW
Mean Return 1.03 1.44
R-squared 92.38 93.82
Std. Deviation 14.35 13.77
Alpha -3.23 2.19
Beta 1.02 0.98
Sharpe Ratio 0.81 1.21
Treynor Ratio 11.06 17.24

The iShares Russell 1000 Value ETF (IWD) has a Beta of 1.02 with a Sharpe Ratio of 0.81 and a Standard Deviation of 14.35. Its Mean Return is 1.03 while IWD’s Alpha is -3.23. Furthermore, the fund has a R-squared of 92.38 and a Treynor Ratio of 11.06.

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

IWD’s Mean Return is 0.41 points lower than that of IVW and its R-squared is 1.44 points lower. With a Standard Deviation of 14.35, IWD is slightly more volatile than IVW. The Alpha and Beta of IWD are 5.42 points lower and 0.04 points higher than IVW’s Alpha and Beta.

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Performance

Annual Returns

IWD vs. IVW - Annual Returns

Year IWD IVW
2020 2.67% 33.21%
2019 26.34% 30.91%
2018 -8.4% -0.17%
2017 13.47% 27.2%
2016 17.09% 6.74%
2015 -3.95% 5.33%
2014 13.21% 14.67%
2013 32.18% 32.48%
2012 17.28% 14.39%
2011 0.21% 4.49%
2010 15.3% 14.84%

IWD had its best year in 2013 with an annual return of 32.18%. IWD’s worst year over the past decade yielded -8.4% and occurred in 2018. In most years the iShares Russell 1000 Value ETF provided moderate returns such as in 2014, 2017, and 2010 where annual returns amounted to 13.21%, 13.47%, and 15.3% respectively.

The year 2020 was the strongest year for IVW, returning 33.21% on an annual basis. The poorest year for IVW in the last ten years was 2018, with a yield of -0.17%. Most years the iShares S&P 500 Growth ETF has given investors modest returns, such as in 2012, 2014, and 2010, when gains were 14.39%, 14.67%, and 14.84% respectively.

Portfolio Growth

IWD vs. IVW - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IWD $10,000 $30,746 11.40%
IVW $10,000 $51,915 16.74%

A $10,000 investment in IWD would have resulted in a final balance of $30,746. This is a profit of $20,746 over 11 years and amounts to a compound annual growth rate (CAGR) of 11.40%.

With a $10,000 investment in IVW, the end total would have been $51,915. This equates to a $41,915 profit over 11 years and a compound annual growth rate (CAGR) of 16.74%.

IWD’s CAGR is 5.34 percentage points lower than that of IVW and as a result, would have yielded $21,169 less on a $10,000 investment. Thus, IWD performed worse than IVW by 5.34% annually.


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