The iShares Russell 1000 Growth ETF (IWF) and the Schwab U.S. Large-Cap Growth ETF (SCHG) are both among the Top 100 ETFs. IWF is a iShares Large Growth fund and SCHG is a Schwab ETFs Large Growth fund. So, what’s the difference between IWF and SCHG? And which fund is better?
The expense ratio of IWF is 0.15 percentage points higher than SCHG’s (0.19% vs. 0.04%). IWF also has a higher exposure to the technology sector and a lower standard deviation. Overall, IWF has provided lower returns than SCHG over the past ten years.
In this article, we’ll compare IWF vs. SCHG. We’ll look at risk metrics and portfolio growth, as well as at their annual returns and fund composition. Moreover, I’ll also discuss IWF’s and SCHG’s holdings, performance, and industry exposure and examine how these affect their overall returns.
|Name||iShares Russell 1000 Growth ETF||Schwab U.S. Large-Cap Growth ETF|
|Category||Large Growth||Large Growth|
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 Schwab U.S. Large-Cap Growth ETF (SCHG) is a Large Growth fund that is issued by Schwab ETFs. It currently has 15.16B total assets under management and has yielded an average annual return of 17.81% over the past 10 years. The fund has a dividend yield of 0.43% with an expense ratio of 0.04%.
IWF’s dividend yield is 0.09% higher than that of SCHG (0.52% vs. 0.43%). Also, IWF yielded on average 0.09% less per year over the past decade (17.72% vs. 17.81%). The expense ratio of IWF is 0.15 percentage points higher than SCHG’s (0.19% vs. 0.04%).
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 Schwab U.S. Large-Cap Growth ETF (SCHG) has the most exposure to the Technology sector at 39.21%. This is followed by Communication Services and Consumer Cyclical at 17.07% and 15.01% respectively. Energy (0.2%), Real Estate (1.64%), and Basic Materials (1.68%) only make up 3.52% of the fund’s total assets.
SCHG’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Financial Services, Healthcare, and Consumer Cyclical stocks at 2.15%, 3.01%, 7.98%, 12.05%, and 15.01%.
IWF is 0.08% more exposed to the Technology sector than SCHG (39.29% vs 39.21%). IWF’s exposure to Consumer Cyclical and Communication Services stocks is 2.61% higher and 4.25% lower respectively (17.62% vs. 15.01% and 12.82% vs. 17.07%). In total, Energy, Basic Materials, and Real Estate also make up 0.38% less of the fund’s holdings compared to SCHG (3.14% vs. 3.52%).
|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%.
|Facebook Inc A||4.45%|
|Alphabet Inc A||3.93%|
|Alphabet Inc Class C||3.82%|
|Visa Inc Class A||2.12%|
|UnitedHealth Group Inc||2.02%|
SCHG’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc A, and Alphabet Inc A at 11.49%, 10.91%, 7.89%, 4.45%, and 3.93%.
Alphabet Inc Class C (3.82%), Tesla Inc (2.8%), and NVIDIA Corp (2.67%) have a slightly smaller but still significant weight. Visa Inc Class A and UnitedHealth Group Inc are also represented in the SCHG’s holdings at 2.12% and 2.02%.
The iShares Russell 1000 Growth ETF (IWF) has a Alpha of 2.16 with a R-squared of 92.93 and a Mean Return of 1.48. Its Sharpe Ratio is 1.19 while IWF’s Treynor Ratio is 17.1. Furthermore, the fund has a Standard Deviation of 14.42 and a Beta of 1.03.
The Schwab U.S. Large-Cap Growth ETF (SCHG) has a Mean Return of 1.46 with a R-squared of 92.92 and a Standard Deviation of 14.78. Its Beta is 1.05 while SCHG’s Sharpe Ratio is 1.14. Furthermore, the fund has a Treynor Ratio of 16.3 and a Alpha of 1.97.
IWF’s Mean Return is 0.02 points higher than that of SCHG and its R-squared is 0.01 points higher. With a Standard Deviation of 14.42, IWF is slightly less volatile than SCHG. The Alpha and Beta of IWF are 0.19 points higher and 0.02 points lower than SCHG’s Alpha and Beta.
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 2020 was the strongest year for SCHG, returning 39.13% on an annual basis. The poorest year for SCHG in the last ten years was 2018, with a yield of -1.35%. Most years the Schwab U.S. Large-Cap Growth ETF has given investors modest returns, such as in 2014, 2010, and 2012, when gains were 15.74%, 16.83%, and 17.02% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in IWF would have resulted in a final balance of $48,012. This is a profit of $38,012 over 10 years and amounts to a compound annual growth rate (CAGR) of 17.72%.
With a $10,000 investment in SCHG, the end total would have been $47,556. This equates to a $37,556 profit over 10 years and a compound annual growth rate (CAGR) of 17.81%.
IWF’s CAGR is 0.09 percentage points lower than that of SCHG and as a result, would have yielded $456 more on a $10,000 investment. Thus, IWF performed worse than SCHG by 0.09% annually.
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