The iShares Russell 1000 Growth ETF (IWF) and the iShares MSCI USA Min Vol Factor ETF (USMV) are both among the Top 100 ETFs. IWF is a iShares Large Growth fund and USMV is a iShares Large Blend fund. So, what’s the difference between IWF and USMV? And which fund is better?
The expense ratio of IWF is 0.04 percentage points higher than USMV’s (0.19% vs. 0.15%). IWF also has a higher exposure to the technology sector and a higher standard deviation. Overall, IWF has provided higher returns than USMV over the past ten years.
In this article, we’ll compare IWF vs. USMV. We’ll look at annual returns and risk metrics, as well as at their industry exposure and holdings. Moreover, I’ll also discuss IWF’s and USMV’s fund composition, performance, and portfolio growth and examine how these affect their overall returns.
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Summary
| IWF | USMV | |
| Name | iShares Russell 1000 Growth ETF | iShares MSCI USA Min Vol Factor ETF |
| Category | Large Growth | Large Blend |
| Issuer | iShares | iShares |
| AUM | 72.16B | 27.6B |
| Avg. Return | 17.72% | 13.89% |
| Div. Yield | 0.52% | 1.5% |
| Expense Ratio | 0.19% | 0.15% |
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 MSCI USA Min Vol Factor ETF (USMV) is a Large Blend fund that is issued by iShares. It currently has 27.6B total assets under management and has yielded an average annual return of 13.89% over the past 10 years. The fund has a dividend yield of 1.5% with an expense ratio of 0.15%.
IWF’s dividend yield is 0.98% lower than that of USMV (0.52% vs. 1.5%). Also, IWF yielded on average 3.83% more per year over the past decade (17.72% vs. 13.89%). The expense ratio of IWF is 0.04 percentage points higher than USMV’s (0.19% vs. 0.15%).
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Fund Composition
Industry Exposure
| IWF | USMV | |
| Technology | 39.29% | 20.53% |
| Industrials | 6.19% | 10.51% |
| Energy | 0.28% | 0.21% |
| Communication Services | 12.82% | 11.03% |
| Utilities | 0.03% | 6.93% |
| Healthcare | 9.23% | 18.42% |
| Consumer Defensive | 4.31% | 12.82% |
| Real Estate | 1.85% | 2.73% |
| Financial Services | 7.36% | 9.65% |
| Consumer Cyclical | 17.62% | 5.53% |
| Basic Materials | 1.01% | 1.65% |
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 MSCI USA Min Vol Factor ETF (USMV) has the most exposure to the Technology sector at 20.53%. This is followed by Healthcare and Consumer Defensive at 18.42% and 12.82% respectively. Basic Materials (1.65%), Real Estate (2.73%), and Consumer Cyclical (5.53%) only make up 9.91% of the fund’s total assets.
USMV’s mid-section with moderate exposure is comprised of Utilities, Financial Services, Industrials, Communication Services, and Consumer Defensive stocks at 6.93%, 9.65%, 10.51%, 11.03%, and 12.82%.
IWF is 18.76% more exposed to the Technology sector than USMV (39.29% vs 20.53%). IWF’s exposure to Consumer Cyclical and Communication Services stocks is 12.09% higher and 1.79% higher respectively (17.62% vs. 5.53% and 12.82% vs. 11.03%). In total, Energy, Basic Materials, and Real Estate also make up 1.45% less of the fund’s holdings compared to USMV (3.14% vs. 4.59%).
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%.
| USMV Holdings | Weight |
| Eli Lilly and Co | 1.64% |
| Microsoft Corp | 1.62% |
| T-Mobile US Inc | 1.51% |
| Accenture PLC Class A | 1.51% |
| Visa Inc Class A | 1.49% |
| Waste Management Inc | 1.45% |
| Adobe Inc | 1.45% |
| The Kroger Co | 1.44% |
| Johnson & Johnson | 1.42% |
| Gilead Sciences Inc | 1.42% |
USMV’s Top Holdings are Eli Lilly and Co, Microsoft Corp, T-Mobile US Inc, Accenture PLC Class A, and Visa Inc Class A at 1.64%, 1.62%, 1.51%, 1.51%, and 1.49%.
Waste Management Inc (1.45%), Adobe Inc (1.45%), and The Kroger Co (1.44%) have a slightly smaller but still significant weight. Johnson & Johnson and Gilead Sciences Inc are also represented in the USMV’s holdings at 1.42% and 1.42%.
Risk Analysis
| IWF | USMV | |
| 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 Alpha of 2.16 with a Standard Deviation of 14.42 and a Treynor Ratio of 17.1. Its Mean Return is 1.48 while IWF’s Sharpe Ratio is 1.19. Furthermore, the fund has a Beta of 1.03 and a R-squared of 92.93.
The iShares MSCI USA Min Vol Factor ETF (USMV) has a Treynor Ratio of 0 with a Standard Deviation of 0 and a R-squared of 0. Its Beta is 0 while USMV’s Mean Return is 0. Furthermore, the fund has a Sharpe Ratio of 0 and a Alpha of 0.
IWF’s Mean Return is 1.48 points higher than that of USMV and its R-squared is 92.93 points higher. With a Standard Deviation of 14.42, IWF is slightly more volatile than USMV. The Alpha and Beta of IWF are 2.16 points higher and 1.03 points higher than USMV’s Alpha and Beta.
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Performance
Annual Returns
| Year | IWF | USMV |
| 2020 | 38.21% | 5.6% |
| 2019 | 36.08% | 27.77% |
| 2018 | -1.68% | 1.36% |
| 2017 | 29.96% | 18.97% |
| 2016 | 6.92% | 10.5% |
| 2015 | 5.48% | 5.5% |
| 2014 | 12.84% | 16.34% |
| 2013 | 33.19% | 25.11% |
| 2012 | 15.03% | 11.04% |
| 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 USMV, returning 27.77% on an annual basis. The poorest year for USMV in the last ten years was 2011, with a yield of 0.0%. Most years the iShares MSCI USA Min Vol Factor ETF has given investors modest returns, such as in 2020, 2016, and 2012, when gains were 5.6%, 10.5%, and 11.04% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IWF | $10,000 | $40,733 | 17.72% |
| USMV | $10,000 | $27,607 | 13.89% |
A $10,000 investment in IWF would have resulted in a final balance of $40,733. This is a profit of $30,733 over 8 years and amounts to a compound annual growth rate (CAGR) of 17.72%.
With a $10,000 investment in USMV, the end total would have been $27,607. This equates to a $17,607 profit over 8 years and a compound annual growth rate (CAGR) of 13.89%.
IWF’s CAGR is 3.83 percentage points higher than that of USMV and as a result, would have yielded $13,126 more on a $10,000 investment. Thus, IWF outperformed USMV by 3.83% annually.
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