IWP vs. VOE: What’s The Difference?

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

The expense ratio of IWP is 0.17 percentage points higher than VOE’s (0.24% vs. 0.07%). IWP also has a higher exposure to the technology sector and a higher standard deviation. Overall, IWP has provided higher returns than VOE over the past 11 years.

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

Summary

IWP VOE
Name iShares Russell Mid-Cap Growth ETF Vanguard Mid-Cap Value Index Fund ETF Shares
Category Mid-Cap Growth Mid-Cap Value
Issuer iShares Vanguard
AUM 15.7B 26.78B
Avg. Return 16.75% 12.52%
Div. Yield 0.26% 1.87%
Expense Ratio 0.24% 0.07%

The iShares Russell Mid-Cap Growth ETF (IWP) is a Mid-Cap Growth fund that is issued by iShares. It currently has 15.7B total assets under management and has yielded an average annual return of 16.75% over the past 10 years. The fund has a dividend yield of 0.26% with an expense ratio of 0.24%.

The Vanguard Mid-Cap Value Index Fund ETF Shares (VOE) is a Mid-Cap Value fund that is issued by Vanguard. It currently has 26.78B total assets under management and has yielded an average annual return of 12.52% over the past 10 years. The fund has a dividend yield of 1.87% with an expense ratio of 0.07%.

IWP’s dividend yield is 1.61% lower than that of VOE (0.26% vs. 1.87%). Also, IWP yielded on average 4.23% more per year over the past decade (16.75% vs. 12.52%). The expense ratio of IWP is 0.17 percentage points higher than VOE’s (0.24% vs. 0.07%).

Fund Composition

Industry Exposure

IWP vs. VOE - Industry Exposure

IWP VOE
Technology 33.88% 9.85%
Industrials 14.09% 9.4%
Energy 1.51% 5.69%
Communication Services 6.32% 5.27%
Utilities 0.16% 10.93%
Healthcare 16.79% 7.04%
Consumer Defensive 2.32% 4.85%
Real Estate 2.46% 11.48%
Financial Services 4.52% 18.26%
Consumer Cyclical 16.09% 11.8%
Basic Materials 1.86% 5.44%

The iShares Russell Mid-Cap Growth ETF (IWP) has the most exposure to the Technology sector at 33.88%. This is followed by Healthcare and Consumer Cyclical at 16.79% and 16.09% respectively. Energy (1.51%), Basic Materials (1.86%), and Consumer Defensive (2.32%) only make up 5.69% of the fund’s total assets.

IWP’s mid-section with moderate exposure is comprised of Real Estate, Financial Services, Communication Services, Industrials, and Consumer Cyclical stocks at 2.46%, 4.52%, 6.32%, 14.09%, and 16.09%.

The Vanguard Mid-Cap Value Index Fund ETF Shares (VOE) has the most exposure to the Financial Services sector at 18.26%. This is followed by Consumer Cyclical and Real Estate at 11.8% and 11.48% respectively. Communication Services (5.27%), Basic Materials (5.44%), and Energy (5.69%) only make up 16.40% of the fund’s total assets.

VOE’s mid-section with moderate exposure is comprised of Healthcare, Industrials, Technology, Utilities, and Real Estate stocks at 7.04%, 9.4%, 9.85%, 10.93%, and 11.48%.

IWP is 24.03% more exposed to the Technology sector than VOE (33.88% vs 9.85%). IWP’s exposure to Healthcare and Consumer Cyclical stocks is 9.75% higher and 4.29% higher respectively (16.79% vs. 7.04% and 16.09% vs. 11.8%). In total, Energy, Basic Materials, and Consumer Defensive also make up 10.29% less of the fund’s holdings compared to VOE (5.69% vs. 15.98%).

Holdings

IWP - Holdings

IWP Holdings Weight
IDEXX Laboratories Inc 1.3%
DocuSign Inc 1.3%
Roku Inc Class A 1.29%
Match Group Inc 1.06%
Chipotle Mexican Grill Inc 1.06%
Pinterest Inc 1.05%
Veeva Systems Inc Class A 1.04%
Palantir Technologies Inc Ordinary Shares – Class A 1.04%
Lululemon Athletica Inc 1.01%
DexCom Inc 1.0%

IWP’s Top Holdings are IDEXX Laboratories Inc, DocuSign Inc, Roku Inc Class A, Match Group Inc, and Chipotle Mexican Grill Inc at 1.3%, 1.3%, 1.29%, 1.06%, and 1.06%.

Pinterest Inc (1.05%), Veeva Systems Inc Class A (1.04%), and Palantir Technologies Inc Ordinary Shares – Class A (1.04%) have a slightly smaller but still significant weight. Lululemon Athletica Inc and DexCom Inc are also represented in the IWP’s holdings at 1.01% and 1.0%.

VOE - Holdings

VOE Holdings Weight
Carrier Global Corp Ordinary Shares 1.28%
International Flavors & Fragrances Inc 1.13%
Motorola Solutions Inc 1.12%
Discover Financial Services 1.09%
Welltower Inc 1.05%
Corteva Inc 0.99%
Valero Energy Corp 0.97%
Corning Inc 0.95%
Willis Towers Watson PLC 0.9%
D.R. Horton Inc 0.89%

VOE’s Top Holdings are Carrier Global Corp Ordinary Shares, International Flavors & Fragrances Inc, Motorola Solutions Inc, Discover Financial Services, and Welltower Inc at 1.28%, 1.13%, 1.12%, 1.09%, and 1.05%.

Corteva Inc (0.99%), Valero Energy Corp (0.97%), and Corning Inc (0.95%) have a slightly smaller but still significant weight. Willis Towers Watson PLC and D.R. Horton Inc are also represented in the VOE’s holdings at 0.9% and 0.89%.

Risk Analysis

IWP VOE
Mean Return 1.27 1.05
R-squared 87.01 88.76
Std. Deviation 16.05 15.98
Alpha -1.03 -3.77
Beta 1.1 1.11
Sharpe Ratio 0.91 0.75
Treynor Ratio 12.98 10.19

The iShares Russell Mid-Cap Growth ETF (IWP) has a Mean Return of 1.27 with a Beta of 1.1 and a R-squared of 87.01. Its Alpha is -1.03 while IWP’s Standard Deviation is 16.05. Furthermore, the fund has a Sharpe Ratio of 0.91 and a Treynor Ratio of 12.98.

The Vanguard Mid-Cap Value Index Fund ETF Shares (VOE) has a Mean Return of 1.05 with a Alpha of -3.77 and a Beta of 1.11. Its Treynor Ratio is 10.19 while VOE’s R-squared is 88.76. Furthermore, the fund has a Sharpe Ratio of 0.75 and a Standard Deviation of 15.98.

IWP’s Mean Return is 0.22 points higher than that of VOE and its R-squared is 1.75 points lower. With a Standard Deviation of 16.05, IWP is slightly more volatile than VOE. The Alpha and Beta of IWP are 2.74 points higher and 0.01 points lower than VOE’s Alpha and Beta.

Performance

Annual Returns

IWP vs. VOE - Annual Returns

Year IWP VOE
2020 35.29% 2.5%
2019 35.14% 27.98%
2018 -4.95% -12.41%
2017 24.98% 17.05%
2016 7.15% 15.26%
2015 -0.39% -1.8%
2014 11.68% 13.98%
2013 35.44% 37.65%
2012 15.62% 16.04%
2011 -1.82% -0.32%
2010 26.1% 21.83%

IWP had its best year in 2013 with an annual return of 35.44%. IWP’s worst year over the past decade yielded -4.95% and occurred in 2018. In most years the iShares Russell Mid-Cap Growth ETF provided moderate returns such as in 2014, 2012, and 2017 where annual returns amounted to 11.68%, 15.62%, and 24.98% respectively.

The year 2013 was the strongest year for VOE, returning 37.65% on an annual basis. The poorest year for VOE in the last ten years was 2018, with a yield of -12.41%. Most years the Vanguard Mid-Cap Value Index Fund ETF Shares has given investors modest returns, such as in 2014, 2016, and 2012, when gains were 13.98%, 15.26%, and 16.04% respectively.

Portfolio Growth

IWP vs. VOE - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IWP $10,000 $50,191 16.75%
VOE $10,000 $33,655 12.52%

A $10,000 investment in IWP would have resulted in a final balance of $50,191. This is a profit of $40,191 over 11 years and amounts to a compound annual growth rate (CAGR) of 16.75%.

With a $10,000 investment in VOE, the end total would have been $33,655. This equates to a $23,655 profit over 11 years and a compound annual growth rate (CAGR) of 12.52%.

IWP’s CAGR is 4.23 percentage points higher than that of VOE and as a result, would have yielded $16,536 more on a $10,000 investment. Thus, IWP outperformed VOE by 4.23% annually.


Current recommendations:

Over the past years, I have discovered several tools and products that have helped me tremendously on my path to financial freedom:

P.S.: The links below are affiliate links, which means I receive a small commission at no extra cost to you when you sign up for one of the services. Thank you for your support!

1) Take a look at M1 Finance, my favorite broker. I love how easy it is to invest and maintain my portfolio with them. I can set up automatic transfers, rebalance my portfolio with one click and even borrow up to 35% of my assets at super low interest rates!

2) Fundrise is by far the best way I've found to invest in Real Estate. You can diversify your portfolio by investing in their eREITs or even allocate capital to individual properties (without the hassle of managing tenants!).

3) If you are interested in crypto, check out Gemini. I've started allocating a small amount of assets to the growing crypto space and Gemini has just been a breeze to use. Once you register, make sure to also open an Active Trader account to buy crypto at the lowest fees on the market (just 0.03%!).

To see all of my most up-to-date recommendations, check out the Recommended Tools section.

Leave a Reply