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IWR vs. SCHF: What’s The Difference?

The iShares Russell Mid-Cap ETF (IWR) and the Schwab International Equity ETF (SCHF) are both among the Top 100 ETFs. IWR is a iShares Mid-Cap Blend fund and SCHF is a Schwab ETFs Foreign Large Blend fund. So, what’s the difference between IWR and SCHF? And which fund is better?

The expense ratio of IWR is 0.13 percentage points higher than SCHF’s (0.19% vs. 0.06%). IWR also has a higher exposure to the technology sector and a higher standard deviation. Overall, IWR has provided higher returns than SCHF over the past ten years.

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

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Summary

IWRSCHF
NameiShares Russell Mid-Cap ETFSchwab International Equity ETF
CategoryMid-Cap BlendForeign Large Blend
IssueriSharesSchwab ETFs
AUM29.84B26.99B
Avg. Return14.15%6.43%
Div. Yield0.99%2.16%
Expense Ratio0.19%0.06%

The iShares Russell Mid-Cap ETF (IWR) is a Mid-Cap Blend fund that is issued by iShares. It currently has 29.84B total assets under management and has yielded an average annual return of 14.15% over the past 10 years. The fund has a dividend yield of 0.99% with an expense ratio of 0.19%.

The Schwab International Equity ETF (SCHF) is a Foreign Large Blend fund that is issued by Schwab ETFs. It currently has 26.99B total assets under management and has yielded an average annual return of 6.43% over the past 10 years. The fund has a dividend yield of 2.16% with an expense ratio of 0.06%.

IWR’s dividend yield is 1.17% lower than that of SCHF (0.99% vs. 2.16%). Also, IWR yielded on average 7.72% more per year over the past decade (14.15% vs. 6.43%). The expense ratio of IWR is 0.13 percentage points higher than SCHF’s (0.19% vs. 0.06%).

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Fund Composition

Industry Exposure

IWR vs. SCHF - Industry Exposure

IWRSCHF
Technology19.67%11.55%
Industrials14.54%14.86%
Energy3.48%4.23%
Communication Services4.64%5.65%
Utilities4.46%3.09%
Healthcare11.76%11.05%
Consumer Defensive3.82%9.41%
Real Estate8.31%3.17%
Financial Services11.64%17.85%
Consumer Cyclical13.59%10.87%
Basic Materials4.1%8.26%

The iShares Russell Mid-Cap ETF (IWR) has the most exposure to the Technology sector at 19.67%. This is followed by Industrials and Consumer Cyclical at 14.54% and 13.59% respectively. Consumer Defensive (3.82%), Basic Materials (4.1%), and Utilities (4.46%) only make up 12.38% of the fund’s total assets.

IWR’s mid-section with moderate exposure is comprised of Communication Services, Real Estate, Financial Services, Healthcare, and Consumer Cyclical stocks at 4.64%, 8.31%, 11.64%, 11.76%, and 13.59%.

The Schwab International Equity ETF (SCHF) has the most exposure to the Financial Services sector at 17.85%. This is followed by Industrials and Technology at 14.86% and 11.55% respectively. Real Estate (3.17%), Energy (4.23%), and Communication Services (5.65%) only make up 13.05% of the fund’s total assets.

SCHF’s mid-section with moderate exposure is comprised of Basic Materials, Consumer Defensive, Consumer Cyclical, Healthcare, and Technology stocks at 8.26%, 9.41%, 10.87%, 11.05%, and 11.55%.

IWR is 8.12% more exposed to the Technology sector than SCHF (19.67% vs 11.55%). IWR’s exposure to Industrials and Consumer Cyclical stocks is 0.32% lower and 2.72% higher respectively (14.54% vs. 14.86% and 13.59% vs. 10.87%). In total, Consumer Defensive, Basic Materials, and Utilities also make up 8.38% less of the fund’s holdings compared to SCHF (12.38% vs. 20.76%).

Holdings

IWR - Holdings

IWR HoldingsWeight
IDEXX Laboratories Inc0.51%
DocuSign Inc0.51%
Twitter Inc0.48%
Chipotle Mexican Grill Inc0.47%
Roku Inc Class A0.44%
Marvell Technology Inc0.44%
DexCom Inc0.44%
Trane Technologies PLC0.43%
MSCI Inc0.43%
Carrier Global Corp Ordinary Shares0.43%

IWR’s Top Holdings are IDEXX Laboratories Inc, DocuSign Inc, Twitter Inc, Chipotle Mexican Grill Inc, and Roku Inc Class A at 0.51%, 0.51%, 0.48%, 0.47%, and 0.44%.

Marvell Technology Inc (0.44%), DexCom Inc (0.44%), and Trane Technologies PLC (0.43%) have a slightly smaller but still significant weight. MSCI Inc and Carrier Global Corp Ordinary Shares are also represented in the IWR’s holdings at 0.43% and 0.43%.

SCHF - Holdings

SCHF HoldingsWeight
Nestle SA1.66%
Samsung Electronics Co Ltd1.6%
ASML Holding NV1.29%
Roche Holding AG1.24%
Toyota Motor Corp1.02%
LVMH Moet Hennessy Louis Vuitton SE0.93%
Novartis AG0.92%
Shopify Inc A0.78%
AstraZeneca PLC0.75%
SAP SE0.74%

SCHF’s Top Holdings are Nestle SA, Samsung Electronics Co Ltd, ASML Holding NV, Roche Holding AG, and Toyota Motor Corp at 1.66%, 1.6%, 1.29%, 1.24%, and 1.02%.

LVMH Moet Hennessy Louis Vuitton SE (0.93%), Novartis AG (0.92%), and Shopify Inc A (0.78%) have a slightly smaller but still significant weight. AstraZeneca PLC and SAP SE are also represented in the SCHF’s holdings at 0.75% and 0.74%.

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Risk Analysis

IWRSCHF
Mean Return1.170.58
R-squared91.5298.16
Std. Deviation15.6615.08
Alpha-2.80.53
Beta1.110.99
Sharpe Ratio0.860.42
Treynor Ratio11.725.39

The iShares Russell Mid-Cap ETF (IWR) has a Mean Return of 1.17 with a R-squared of 91.52 and a Beta of 1.11. Its Standard Deviation is 15.66 while IWR’s Sharpe Ratio is 0.86. Furthermore, the fund has a Alpha of -2.8 and a Treynor Ratio of 11.72.

The Schwab International Equity ETF (SCHF) has a Mean Return of 0.58 with a Beta of 0.99 and a Standard Deviation of 15.08. Its R-squared is 98.16 while SCHF’s Sharpe Ratio is 0.42. Furthermore, the fund has a Treynor Ratio of 5.39 and a Alpha of 0.53.

IWR’s Mean Return is 0.59 points higher than that of SCHF and its R-squared is 6.64 points lower. With a Standard Deviation of 15.66, IWR is slightly more volatile than SCHF. The Alpha and Beta of IWR are 3.33 points lower and 0.12 points higher than SCHF’s Alpha and Beta.

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Performance

Annual Returns

IWR vs. SCHF - Annual Returns

YearIWRSCHF
202016.91%9.86%
201930.31%22.15%
2018-9.13%-14.39%
201718.32%25.83%
201613.58%2.88%
2015-2.57%-2.44%
201413.03%-4.44%
201334.5%20.03%
201217.13%17.12%
2011-1.67%-12.32%
201025.25%8.6%

IWR had its best year in 2013 with an annual return of 34.5%. IWR’s worst year over the past decade yielded -9.13% and occurred in 2018. In most years the iShares Russell Mid-Cap ETF provided moderate returns such as in 2016, 2020, and 2012 where annual returns amounted to 13.58%, 16.91%, and 17.13% respectively.

The year 2017 was the strongest year for SCHF, returning 25.83% on an annual basis. The poorest year for SCHF in the last ten years was 2018, with a yield of -14.39%. Most years the Schwab International Equity ETF has given investors modest returns, such as in 2016, 2010, and 2020, when gains were 2.88%, 8.6%, and 9.86% respectively.

Portfolio Growth

IWR vs. SCHF - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
IWR$10,000$31,73714.15%
SCHF$10,000$17,0896.43%

A $10,000 investment in IWR would have resulted in a final balance of $31,737. This is a profit of $21,737 over 10 years and amounts to a compound annual growth rate (CAGR) of 14.15%.

With a $10,000 investment in SCHF, the end total would have been $17,089. This equates to a $7,089 profit over 10 years and a compound annual growth rate (CAGR) of 6.43%.

IWR’s CAGR is 7.72 percentage points higher than that of SCHF and as a result, would have yielded $14,648 more on a $10,000 investment. Thus, IWR outperformed SCHF by 7.72% annually.


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