The iShares Russell Mid-Cap ETF (IWR) and the Vanguard Large-Cap Index Fund ETF Shares (VV) are both among the Top 100 ETFs. IWR is a iShares Mid-Cap Blend fund and VV is a Vanguard Large Blend fund. So, what’s the difference between IWR and VV? And which fund is better?
The expense ratio of IWR is 0.15 percentage points higher than VV’s (0.19% vs. 0.04%). IWR also has a lower exposure to the technology sector and a higher standard deviation. Overall, IWR has provided lower returns than VV over the past ten years.
In this article, we’ll compare IWR vs. VV. We’ll look at holdings and risk metrics, as well as at their annual returns and performance. Moreover, I’ll also discuss IWR’s and VV’s industry exposure, portfolio growth, and fund composition and examine how these affect their overall returns.
Summary
| IWR | VV | |
| Name | iShares Russell Mid-Cap ETF | Vanguard Large-Cap Index Fund ETF Shares |
| Category | Mid-Cap Blend | Large Blend |
| Issuer | iShares | Vanguard |
| AUM | 29.84B | 37.65B |
| Avg. Return | 14.15% | 14.75% |
| Div. Yield | 0.99% | 1.26% |
| Expense Ratio | 0.19% | 0.04% |
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 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%.
IWR’s dividend yield is 0.27% lower than that of VV (0.99% vs. 1.26%). Also, IWR yielded on average 0.60% less per year over the past decade (14.15% vs. 14.75%). The expense ratio of IWR is 0.15 percentage points higher than VV’s (0.19% vs. 0.04%).
Fund Composition
Industry Exposure
| IWR | VV | |
| Technology | 19.67% | 25.38% |
| Industrials | 14.54% | 8.39% |
| Energy | 3.48% | 2.62% |
| Communication Services | 4.64% | 11.68% |
| Utilities | 4.46% | 2.35% |
| Healthcare | 11.76% | 13.22% |
| Consumer Defensive | 3.82% | 6.06% |
| Real Estate | 8.31% | 2.7% |
| Financial Services | 11.64% | 13.82% |
| Consumer Cyclical | 13.59% | 11.65% |
| Basic Materials | 4.1% | 2.13% |
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 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%.
IWR is 5.71% less exposed to the Technology sector than VV (19.67% vs 25.38%). IWR’s exposure to Industrials and Consumer Cyclical stocks is 6.15% higher and 1.94% higher respectively (14.54% vs. 8.39% and 13.59% vs. 11.65%). In total, Consumer Defensive, Basic Materials, and Utilities also make up 1.84% more of the fund’s holdings compared to VV (12.38% vs. 10.54%).
Holdings
| IWR Holdings | Weight |
| IDEXX Laboratories Inc | 0.51% |
| DocuSign Inc | 0.51% |
| Twitter Inc | 0.48% |
| Chipotle Mexican Grill Inc | 0.47% |
| Roku Inc Class A | 0.44% |
| Marvell Technology Inc | 0.44% |
| DexCom Inc | 0.44% |
| Trane Technologies PLC | 0.43% |
| MSCI Inc | 0.43% |
| Carrier Global Corp Ordinary Shares | 0.43% |
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%.
| 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
| IWR | VV | |
| Mean Return | 1.17 | 1.24 |
| R-squared | 91.52 | 99.86 |
| Std. Deviation | 15.66 | 13.75 |
| Alpha | -2.8 | -0.08 |
| Beta | 1.11 | 1.01 |
| Sharpe Ratio | 0.86 | 1.04 |
| Treynor Ratio | 11.72 | 14.14 |
The iShares Russell Mid-Cap ETF (IWR) has a Standard Deviation of 15.66 with a Sharpe Ratio of 0.86 and a Alpha of -2.8. Its Beta is 1.11 while IWR’s R-squared is 91.52. Furthermore, the fund has a Treynor Ratio of 11.72 and a Mean Return of 1.17.
The Vanguard Large-Cap Index Fund ETF Shares (VV) has a Alpha of -0.08 with a R-squared of 99.86 and a Standard Deviation of 13.75. Its Mean Return is 1.24 while VV’s Sharpe Ratio is 1.04. Furthermore, the fund has a Beta of 1.01 and a Treynor Ratio of 14.14.
IWR’s Mean Return is 0.07 points lower than that of VV and its R-squared is 8.34 points lower. With a Standard Deviation of 15.66, IWR is slightly more volatile than VV. The Alpha and Beta of IWR are 2.72 points lower and 0.10 points higher than VV’s Alpha and Beta.
Performance
Annual Returns
| Year | IWR | VV |
| 2020 | 16.91% | 20.99% |
| 2019 | 30.31% | 31.39% |
| 2018 | -9.13% | -4.44% |
| 2017 | 18.32% | 22.03% |
| 2016 | 13.58% | 11.65% |
| 2015 | -2.57% | 1.07% |
| 2014 | 13.03% | 13.39% |
| 2013 | 34.5% | 32.65% |
| 2012 | 17.13% | 16.09% |
| 2011 | -1.67% | 1.58% |
| 2010 | 25.25% | 15.81% |
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 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
| Fund | Initial Balance | Final Balance | CAGR |
| IWR | $10,000 | $39,751 | 14.15% |
| VV | $10,000 | $42,970 | 14.75% |
A $10,000 investment in IWR would have resulted in a final balance of $39,751. This is a profit of $29,751 over 11 years and amounts to a compound annual growth rate (CAGR) of 14.15%.
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%.
IWR’s CAGR is 0.60 percentage points lower than that of VV and as a result, would have yielded $3,219 less on a $10,000 investment. Thus, IWR performed worse than VV by 0.60% annually.
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