IWF vs. IUSB: What’s The Difference?

The iShares Russell 1000 Growth ETF (IWF) and the iShares Core Total USD Bond Market ETF (IUSB) are both among the Top 100 ETFs. IWF is a iShares Large Growth fund and IUSB is a iShares N/A fund. So, what’s the difference between IWF and IUSB? And which fund is better?

The expense ratio of IWF is 0.13 percentage points higher than IUSB’s (0.19% vs. 0.06%). IWF also has a high exposure to the technology sector while IUSB is mostly comprised of AAA bonds. Overall, IWF has provided higher returns than IUSB over the past ten years.

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

Summary

IWF IUSB
Name iShares Russell 1000 Growth ETF iShares Core Total USD Bond Market ETF
Category Large Growth N/A
Issuer iShares iShares
AUM 72.16B 14.49B
Avg. Return 17.72% 4.13%
Div. Yield 0.52% 2.1%
Expense Ratio 0.19% 0.06%

The iShares Russell 1000 Growth ETF (IWF) is a Large Growth fund that is issued by iShares. It currently has 72.16B total assets under management and has yielded an average annual return of 17.72% over the past 10 years. The fund has a dividend yield of 0.52% with an expense ratio of 0.19%.

The iShares Core Total USD Bond Market ETF (IUSB) is a N/A fund that is issued by iShares. It currently has 14.49B total assets under management and has yielded an average annual return of 4.13% over the past 10 years. The fund has a dividend yield of 2.1% with an expense ratio of 0.06%.

IWF’s dividend yield is 1.58% lower than that of IUSB (0.52% vs. 2.1%). Also, IWF yielded on average 13.60% more per year over the past decade (17.72% vs. 4.13%). The expense ratio of IWF is 0.13 percentage points higher than IUSB’s (0.19% vs. 0.06%).

Fund Composition

Holdings

IWF - Holdings

IWF Holdings Weight
Apple Inc 10.51%
Microsoft Corp 9.85%
Amazon.com Inc 6.63%
Facebook Inc Class A 3.91%
Alphabet Inc Class A 3.2%
Alphabet Inc Class C 3.03%
Tesla Inc 2.45%
NVIDIA Corp 2.14%
Visa Inc Class A 1.91%
The Home Depot Inc 1.62%

IWF’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 10.51%, 9.85%, 6.63%, 3.91%, and 3.2%.

Alphabet Inc Class C (3.03%), Tesla Inc (2.45%), and NVIDIA Corp (2.14%) have a slightly smaller but still significant weight. Visa Inc Class A and The Home Depot Inc are also represented in the IWF’s holdings at 1.91% and 1.62%.

IUSB - Holdings

IUSB Bond Sectors Weight
AAA 58.32%
BBB 16.98%
A 12.27%
BB 4.33%
AA 3.36%
B 2.8%
Others 1.01%
Below B 0.92%
US Government 0.0%

IUSB’s Top Bond Sectors are ratings of AAA, BBB, A, BB, and AA at 58.32%, 16.98%, 12.27%, 4.33%, and 3.36%. The fund is less weighted towards B (2.8%), Others (1.01%), and Below B (0.92%) rated bonds.

Risk Analysis

IWF IUSB
Mean Return 1.48 0
R-squared 92.93 0
Std. Deviation 14.42 0
Alpha 2.16 0
Beta 1.03 0
Sharpe Ratio 1.19 0
Treynor Ratio 17.1 0

The iShares Russell 1000 Growth ETF (IWF) has a Treynor Ratio of 17.1 with a Sharpe Ratio of 1.19 and a R-squared of 92.93. Its Mean Return is 1.48 while IWF’s Beta is 1.03. Furthermore, the fund has a Alpha of 2.16 and a Standard Deviation of 14.42.

The iShares Core Total USD Bond Market ETF (IUSB) has a Standard Deviation of 0 with a Mean Return of 0 and a Treynor Ratio of 0. Its Sharpe Ratio is 0 while IUSB’s Alpha is 0. Furthermore, the fund has a R-squared of 0 and a Beta of 0.

IWF’s Mean Return is 1.48 points higher than that of IUSB and its R-squared is 92.93 points higher. With a Standard Deviation of 14.42, IWF is slightly more volatile than IUSB. The Alpha and Beta of IWF are 2.16 points higher and 1.03 points higher than IUSB’s Alpha and Beta.

Performance

Annual Returns

IWF vs. IUSB - Annual Returns

Year IWF IUSB
2020 38.21% 7.59%
2019 36.08% 9.26%
2018 -1.68% -0.38%
2017 29.96% 4.06%
2016 6.92% 3.78%
2015 5.48% 0.46%
2014 12.84% 0.0%
2013 33.19% 0.0%
2012 15.03% 0.0%
2011 2.47% 0.0%
2010 16.47% 0.0%

IWF had its best year in 2020 with an annual return of 38.21%. IWF’s worst year over the past decade yielded -1.68% and occurred in 2018. In most years the iShares Russell 1000 Growth ETF provided moderate returns such as in 2014, 2012, and 2010 where annual returns amounted to 12.84%, 15.03%, and 16.47% respectively.

The year 2019 was the strongest year for IUSB, returning 9.26% on an annual basis. The poorest year for IUSB in the last ten years was 2018, with a yield of -0.38%. Most years the iShares Core Total USD Bond Market ETF has given investors modest returns, such as in 2011, 2010, and 2015, when gains were 0.0%, 0.0%, and 0.46% respectively.

Portfolio Growth

IWF vs. IUSB - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IWF $10,000 $27,102 17.72%
IUSB $10,000 $12,704 4.13%

A $10,000 investment in IWF would have resulted in a final balance of $27,102. This is a profit of $17,102 over 6 years and amounts to a compound annual growth rate (CAGR) of 17.72%.

With a $10,000 investment in IUSB, the end total would have been $12,704. This equates to a $2,704 profit over 6 years and a compound annual growth rate (CAGR) of 4.13%.

IWF’s CAGR is 13.60 percentage points higher than that of IUSB and as a result, would have yielded $14,398 more on a $10,000 investment. Thus, IWF outperformed IUSB by 13.60% annually.


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