IWF vs. VV: What’s The Difference?

The iShares Russell 1000 Growth ETF (IWF) and the Vanguard Large-Cap Index Fund ETF Shares (VV) are both among the Top 100 ETFs. IWF is a iShares Large Growth fund and VV is a Vanguard Large Blend fund. So, what’s the difference between IWF and VV? And which fund is better?

The expense ratio of IWF is 0.15 percentage points higher than VV’s (0.19% vs. 0.04%). IWF also has a higher exposure to the technology sector and a higher standard deviation. Overall, IWF has provided higher returns than VV over the past ten years.

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

Summary

IWF VV
Name iShares Russell 1000 Growth ETF Vanguard Large-Cap Index Fund ETF Shares
Category Large Growth Large Blend
Issuer iShares Vanguard
AUM 72.16B 37.65B
Avg. Return 17.72% 14.75%
Div. Yield 0.52% 1.26%
Expense Ratio 0.19% 0.04%

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 Vanguard Large-Cap Index Fund ETF Shares (VV) is a Large Blend fund that is issued by Vanguard. It currently has 37.65B total assets under management and has yielded an average annual return of 14.75% over the past 10 years. The fund has a dividend yield of 1.26% with an expense ratio of 0.04%.

IWF’s dividend yield is 0.74% lower than that of VV (0.52% vs. 1.26%). Also, IWF yielded on average 2.98% more per year over the past decade (17.72% vs. 14.75%). The expense ratio of IWF is 0.15 percentage points higher than VV’s (0.19% vs. 0.04%).

Fund Composition

Industry Exposure

IWF vs. VV - Industry Exposure

IWF VV
Technology 39.29% 25.38%
Industrials 6.19% 8.39%
Energy 0.28% 2.62%
Communication Services 12.82% 11.68%
Utilities 0.03% 2.35%
Healthcare 9.23% 13.22%
Consumer Defensive 4.31% 6.06%
Real Estate 1.85% 2.7%
Financial Services 7.36% 13.82%
Consumer Cyclical 17.62% 11.65%
Basic Materials 1.01% 2.13%

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 Vanguard Large-Cap Index Fund ETF Shares (VV) has the most exposure to the Technology sector at 25.38%. This is followed by Financial Services and Healthcare at 13.82% and 13.22% respectively. Utilities (2.35%), Energy (2.62%), and Real Estate (2.7%) only make up 7.67% of the fund’s total assets.

VV’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Consumer Cyclical, Communication Services, and Healthcare stocks at 6.06%, 8.39%, 11.65%, 11.68%, and 13.22%.

IWF is 13.91% more exposed to the Technology sector than VV (39.29% vs 25.38%). IWF’s exposure to Consumer Cyclical and Communication Services stocks is 5.97% higher and 1.14% higher respectively (17.62% vs. 11.65% and 12.82% vs. 11.68%). In total, Energy, Basic Materials, and Real Estate also make up 4.31% less of the fund’s holdings compared to VV (3.14% vs. 7.45%).

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%.

VV - Holdings

VV Holdings Weight
Apple Inc 5.7%
Microsoft Corp 5.35%
Amazon.com Inc 3.87%
Facebook Inc Class A 2.19%
Alphabet Inc Class A 1.93%
Alphabet Inc Class C 1.81%
Tesla Inc 1.37%
Berkshire Hathaway Inc Class B 1.3%
NVIDIA Corp 1.24%
JPMorgan Chase & Co 1.24%

VV’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 5.7%, 5.35%, 3.87%, 2.19%, and 1.93%.

Alphabet Inc Class C (1.81%), Tesla Inc (1.37%), and Berkshire Hathaway Inc Class B (1.3%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the VV’s holdings at 1.24% and 1.24%.

Risk Analysis

IWF VV
Mean Return 1.48 1.24
R-squared 92.93 99.86
Std. Deviation 14.42 13.75
Alpha 2.16 -0.08
Beta 1.03 1.01
Sharpe Ratio 1.19 1.04
Treynor Ratio 17.1 14.14

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

The Vanguard Large-Cap Index Fund ETF Shares (VV) has a Mean Return of 1.24 with a Sharpe Ratio of 1.04 and a R-squared of 99.86. Its Beta is 1.01 while VV’s Standard Deviation is 13.75. Furthermore, the fund has a Treynor Ratio of 14.14 and a Alpha of -0.08.

IWF’s Mean Return is 0.24 points higher than that of VV and its R-squared is 6.93 points lower. With a Standard Deviation of 14.42, IWF is slightly more volatile than VV. The Alpha and Beta of IWF are 2.24 points higher and 0.02 points higher than VV’s Alpha and Beta.

Performance

Annual Returns

IWF vs. VV - Annual Returns

Year IWF VV
2020 38.21% 20.99%
2019 36.08% 31.39%
2018 -1.68% -4.44%
2017 29.96% 22.03%
2016 6.92% 11.65%
2015 5.48% 1.07%
2014 12.84% 13.39%
2013 33.19% 32.65%
2012 15.03% 16.09%
2011 2.47% 1.58%
2010 16.47% 15.81%

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 VV, returning 32.65% on an annual basis. The poorest year for VV in the last ten years was 2018, with a yield of -4.44%. Most years the Vanguard Large-Cap Index Fund ETF Shares has given investors modest returns, such as in 2014, 2010, and 2012, when gains were 13.39%, 15.81%, and 16.09% respectively.

Portfolio Growth

IWF vs. VV - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IWF $10,000 $55,920 17.72%
VV $10,000 $42,970 14.75%

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 VV, the end total would have been $42,970. This equates to a $32,970 profit over 11 years and a compound annual growth rate (CAGR) of 14.75%.

IWF’s CAGR is 2.98 percentage points higher than that of VV and as a result, would have yielded $12,950 more on a $10,000 investment. Thus, IWF outperformed VV by 2.98% annually.


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