The iShares Russell 1000 Growth ETF (IWF) and the iShares National Muni Bond ETF (MUB) are both among the Top 100 ETFs. IWF is a iShares Large Growth fund and MUB is a iShares Muni National Interm fund. So, what’s the difference between IWF and MUB? And which fund is better?
The expense ratio of IWF is 0.12 percentage points higher than MUB’s (0.19% vs. 0.07%). IWF also has a high exposure to the technology sector while MUB is mostly comprised of AA bonds. Overall, IWF has provided higher returns than MUB over the past ten years.
In this article, we’ll compare IWF vs. MUB. We’ll look at industry exposure and annual returns, as well as at their fund composition and risk metrics. Moreover, I’ll also discuss IWF’s and MUB’s holdings, portfolio growth, and performance and examine how these affect their overall returns.
|Name||iShares Russell 1000 Growth ETF||iShares National Muni Bond ETF|
|Category||Large Growth||Muni National Interm|
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 National Muni Bond ETF (MUB) is a Muni National Interm fund that is issued by iShares. It currently has 22.71B total assets under management and has yielded an average annual return of 4.04% over the past 10 years. The fund has a dividend yield of 1.96% with an expense ratio of 0.07%.
IWF’s dividend yield is 1.44% lower than that of MUB (0.52% vs. 1.96%). Also, IWF yielded on average 13.69% more per year over the past decade (17.72% vs. 4.04%). The expense ratio of IWF is 0.12 percentage points higher than MUB’s (0.19% vs. 0.07%).
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|Facebook Inc Class A||3.91%|
|Alphabet Inc Class A||3.2%|
|Alphabet Inc Class C||3.03%|
|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%.
|MUB Bond Sectors||Weight|
MUB’s Top Bond Sectors are ratings of AA, AAA, A, BBB, and Others at 60.38%, 18.39%, 15.04%, 6.0%, and 0.17%. The fund is less weighted towards BB (0.02%), Below B (0.0%), and B (0.0%) rated bonds.
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The iShares Russell 1000 Growth ETF (IWF) has a Beta of 1.03 with a Alpha of 2.16 and a R-squared of 92.93. Its Treynor Ratio is 17.1 while IWF’s Mean Return is 1.48. Furthermore, the fund has a Standard Deviation of 14.42 and a Sharpe Ratio of 1.19.
The iShares National Muni Bond ETF (MUB) has a Beta of 1.01 with a Treynor Ratio of 3.2 and a Sharpe Ratio of 0.88. Its Standard Deviation is 3.68 while MUB’s Mean Return is 0.32. Furthermore, the fund has a Alpha of -0.46 and a R-squared of 99.
IWF’s Mean Return is 1.16 points higher than that of MUB and its R-squared is 6.07 points lower. With a Standard Deviation of 14.42, IWF is slightly more volatile than MUB. The Alpha and Beta of IWF are 2.62 points higher and 0.02 points higher than MUB’s Alpha and Beta.
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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 2011 was the strongest year for MUB, returning 10.85% on an annual basis. The poorest year for MUB in the last ten years was 2013, with a yield of -3.26%. Most years the iShares National Muni Bond ETF has given investors modest returns, such as in 2015, 2017, and 2020, when gains were 2.99%, 4.61%, and 4.87% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
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 MUB, the end total would have been $15,333. This equates to a $5,333 profit over 11 years and a compound annual growth rate (CAGR) of 4.04%.
IWF’s CAGR is 13.69 percentage points higher than that of MUB and as a result, would have yielded $40,587 more on a $10,000 investment. Thus, IWF outperformed MUB by 13.69% annually.
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