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IWF vs. IWD: What’s The Difference?

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

IWF and IWD have the same expense ratio: 0.19%. IWF also has a higher exposure to the technology sector and a higher standard deviation. Overall, IWF has provided higher returns than IWD over the past ten years.

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

Introduction To Mutual Funds
Introduction To Mutual Funds
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Summary

IWFIWD
NameiShares Russell 1000 Growth ETFiShares Russell 1000 Value ETF
CategoryLarge GrowthLarge Value
IssueriSharesiShares
AUM72.16B54.1B
Avg. Return17.72%11.40%
Div. Yield0.52%1.57%
Expense Ratio0.19%0.19%

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 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%.

IWF’s dividend yield is 1.05% lower than that of IWD (0.52% vs. 1.57%). Also, IWF yielded on average 6.32% more per year over the past decade (17.72% vs. 11.40%). IWF and IWD have the same expense ratio: 0.19%.

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Fund Composition

Industry Exposure

IWF vs. IWD - Industry Exposure

IWFIWD
Technology39.29%10.28%
Industrials6.19%11.77%
Energy0.28%4.76%
Communication Services12.82%8.67%
Utilities0.03%4.88%
Healthcare9.23%17.78%
Consumer Defensive4.31%7.76%
Real Estate1.85%4.94%
Financial Services7.36%20.43%
Consumer Cyclical17.62%5.62%
Basic Materials1.01%3.1%

The iShares Russell 1000 Growth ETF (IWF) has the most exposure to the Technology sector at 39.29%. This is followed by Consumer Cyclical and Communication Services at 17.62% and 12.82% respectively. Energy (0.28%), Basic Materials (1.01%), and Real Estate (1.85%) only make up 3.14% of the fund’s total assets.

IWF’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Financial Services, Healthcare, and Communication Services stocks at 4.31%, 6.19%, 7.36%, 9.23%, and 12.82%.

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%.

IWF is 29.01% more exposed to the Technology sector than IWD (39.29% vs 10.28%). IWF’s exposure to Consumer Cyclical and Communication Services stocks is 12.00% higher and 4.15% higher respectively (17.62% vs. 5.62% and 12.82% vs. 8.67%). In total, Energy, Basic Materials, and Real Estate also make up 9.66% less of the fund’s holdings compared to IWD (3.14% vs. 12.80%).

Holdings

IWF - Holdings

IWF HoldingsWeight
Apple Inc10.51%
Microsoft Corp9.85%
Amazon.com Inc6.63%
Facebook Inc Class A3.91%
Alphabet Inc Class A3.2%
Alphabet Inc Class C3.03%
Tesla Inc2.45%
NVIDIA Corp2.14%
Visa Inc Class A1.91%
The Home Depot Inc1.62%

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%.

IWD - Holdings

IWD HoldingsWeight
Berkshire Hathaway Inc Class B2.58%
JPMorgan Chase & Co2.25%
Johnson & Johnson2.24%
UnitedHealth Group Inc1.78%
Procter & Gamble Co1.71%
The Walt Disney Co1.5%
Bank of America Corp1.43%
Comcast Corp Class A1.33%
Exxon Mobil Corp1.2%
Pfizer Inc1.18%

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%.

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Risk Analysis

IWFIWD
Mean Return1.481.03
R-squared92.9392.38
Std. Deviation14.4214.35
Alpha2.16-3.23
Beta1.031.02
Sharpe Ratio1.190.81
Treynor Ratio17.111.06

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

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

IWF’s Mean Return is 0.45 points higher than that of IWD and its R-squared is 0.55 points higher. With a Standard Deviation of 14.42, IWF is slightly more volatile than IWD. The Alpha and Beta of IWF are 5.39 points higher and 0.01 points higher than IWD’s Alpha and Beta.

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Performance

Annual Returns

IWF vs. IWD - Annual Returns

YearIWFIWD
202038.21%2.67%
201936.08%26.34%
2018-1.68%-8.4%
201729.96%13.47%
20166.92%17.09%
20155.48%-3.95%
201412.84%13.21%
201333.19%32.18%
201215.03%17.28%
20112.47%0.21%
201016.47%15.3%

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 2013 was the strongest year for IWD, returning 32.18% on an annual basis. The poorest year for IWD in the last ten years was 2018, with a yield of -8.4%. Most years the iShares Russell 1000 Value ETF has given investors modest returns, such as in 2014, 2017, and 2010, when gains were 13.21%, 13.47%, and 15.3% respectively.

Portfolio Growth

IWF vs. IWD - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
IWF$10,000$55,92017.72%
IWD$10,000$30,74611.40%

A $10,000 investment in IWF would have resulted in a final balance of $55,920. This is a profit of $45,920 over 11 years and amounts to a compound annual growth rate (CAGR) of 17.72%.

With a $10,000 investment in IWD, the end total would have been $30,746. This equates to a $20,746 profit over 11 years and a compound annual growth rate (CAGR) of 11.40%.

IWF’s CAGR is 6.32 percentage points higher than that of IWD and as a result, would have yielded $25,174 more on a $10,000 investment. Thus, IWF outperformed IWD by 6.32% annually.


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