The iShares Core MSCI Total International Stock ETF (IXUS) and the Vanguard Small-Cap Growth Index Fund ETF Shares (VBK) are both among the Top 100 ETFs. IXUS is a iShares Foreign Large Blend fund and VBK is a Vanguard Small Growth fund. So, what’s the difference between IXUS and VBK? And which fund is better?
The expense ratio of IXUS is 0.02 percentage points higher than VBK’s (0.09% vs. 0.07%). IXUS also has a higher exposure to the financial services sector and a lower standard deviation. Overall, IXUS has provided lower returns than VBK over the past ten years.
In this article, we’ll compare IXUS vs. VBK. We’ll look at portfolio growth and fund composition, as well as at their industry exposure and performance. Moreover, I’ll also discuss IXUS’s and VBK’s annual returns, risk metrics, and holdings and examine how these affect their overall returns.
Summary
| IXUS | VBK | |
| Name | iShares Core MSCI Total International Stock ETF | Vanguard Small-Cap Growth Index Fund ETF Shares |
| Category | Foreign Large Blend | Small Growth |
| Issuer | iShares | Vanguard |
| AUM | 29.54B | 37.89B |
| Avg. Return | 6.09% | 16.53% |
| Div. Yield | 2.13% | 0.45% |
| Expense Ratio | 0.09% | 0.07% |
The iShares Core MSCI Total International Stock ETF (IXUS) is a Foreign Large Blend fund that is issued by iShares. It currently has 29.54B total assets under management and has yielded an average annual return of 6.09% over the past 10 years. The fund has a dividend yield of 2.13% with an expense ratio of 0.09%.
The Vanguard Small-Cap Growth Index Fund ETF Shares (VBK) is a Small Growth fund that is issued by Vanguard. It currently has 37.89B total assets under management and has yielded an average annual return of 16.53% over the past 10 years. The fund has a dividend yield of 0.45% with an expense ratio of 0.07%.
IXUS’s dividend yield is 1.68% higher than that of VBK (2.13% vs. 0.45%). Also, IXUS yielded on average 10.44% less per year over the past decade (6.09% vs. 16.53%). The expense ratio of IXUS is 0.02 percentage points higher than VBK’s (0.09% vs. 0.07%).
Fund Composition
Industry Exposure
| IXUS | VBK | |
| Technology | 13.24% | 27.87% |
| Industrials | 12.78% | 13.19% |
| Energy | 4.39% | 1.77% |
| Communication Services | 7.09% | 3.24% |
| Utilities | 2.95% | 0.32% |
| Healthcare | 9.29% | 23.24% |
| Consumer Defensive | 8.19% | 3.83% |
| Real Estate | 3.66% | 7.87% |
| Financial Services | 17.34% | 4.05% |
| Consumer Cyclical | 12.57% | 12.13% |
| Basic Materials | 8.5% | 2.49% |
The iShares Core MSCI Total International Stock ETF (IXUS) has the most exposure to the Financial Services sector at 17.34%. This is followed by Technology and Industrials at 13.24% and 12.78% respectively. Real Estate (3.66%), Energy (4.39%), and Communication Services (7.09%) only make up 15.14% of the fund’s total assets.
IXUS’s mid-section with moderate exposure is comprised of Consumer Defensive, Basic Materials, Healthcare, Consumer Cyclical, and Industrials stocks at 8.19%, 8.5%, 9.29%, 12.57%, and 12.78%.
The Vanguard Small-Cap Growth Index Fund ETF Shares (VBK) has the most exposure to the Technology sector at 27.87%. This is followed by Healthcare and Industrials at 23.24% and 13.19% respectively. Energy (1.77%), Basic Materials (2.49%), and Communication Services (3.24%) only make up 7.50% of the fund’s total assets.
VBK’s mid-section with moderate exposure is comprised of Consumer Defensive, Financial Services, Real Estate, Consumer Cyclical, and Industrials stocks at 3.83%, 4.05%, 7.87%, 12.13%, and 13.19%.
IXUS is 13.29% more exposed to the Financial Services sector than VBK (17.34% vs 4.05%). IXUS’s exposure to Technology and Industrials stocks is 14.63% lower and 0.41% lower respectively (13.24% vs. 27.87% and 12.78% vs. 13.19%). In total, Real Estate, Energy, and Communication Services also make up 2.26% more of the fund’s holdings compared to VBK (15.14% vs. 12.88%).
Holdings
| IXUS Holdings | Weight |
| Taiwan Semiconductor Manufacturing Co Ltd | 1.64% |
| Tencent Holdings Ltd | 1.35% |
| Alibaba Group Holding Ltd Ordinary Shares | 1.34% |
| Nestle SA | 1.1% |
| Samsung Electronics Co Ltd | 1.06% |
| ASML Holding NV | 0.9% |
| Roche Holding AG | 0.81% |
| LVMH Moet Hennessy Louis Vuitton SE | 0.67% |
| Novartis AG | 0.62% |
| Toyota Motor Corp | 0.59% |
IXUS’s Top Holdings are Taiwan Semiconductor Manufacturing Co Ltd, Tencent Holdings Ltd, Alibaba Group Holding Ltd Ordinary Shares, Nestle SA, and Samsung Electronics Co Ltd at 1.64%, 1.35%, 1.34%, 1.1%, and 1.06%.
ASML Holding NV (0.9%), Roche Holding AG (0.81%), and LVMH Moet Hennessy Louis Vuitton SE (0.67%) have a slightly smaller but still significant weight. Novartis AG and Toyota Motor Corp are also represented in the IXUS’s holdings at 0.62% and 0.59%.
| VBK Holdings | Weight |
| Charles River Laboratories International Inc | 0.78% |
| Pool Corp | 0.73% |
| Bio-Techne Corp | 0.73% |
| Avantor Inc | 0.73% |
| PerkinElmer Inc | 0.72% |
| Entegris Inc | 0.7% |
| PTC Inc | 0.62% |
| Fair Isaac Corp | 0.57% |
| Bill.com Holdings Inc Ordinary Shares | 0.56% |
| Avalara Inc | 0.55% |
VBK’s Top Holdings are Charles River Laboratories International Inc, Pool Corp, Bio-Techne Corp, Avantor Inc, and PerkinElmer Inc at 0.78%, 0.73%, 0.73%, 0.73%, and 0.72%.
Entegris Inc (0.7%), PTC Inc (0.62%), and Fair Isaac Corp (0.57%) have a slightly smaller but still significant weight. Bill.com Holdings Inc Ordinary Shares and Avalara Inc are also represented in the VBK’s holdings at 0.56% and 0.55%.
Risk Analysis
| IXUS | VBK | |
| Mean Return | 0 | 1.22 |
| R-squared | 0 | 80.56 |
| Std. Deviation | 0 | 17.95 |
| Alpha | 0 | -2.81 |
| Beta | 0 | 1.18 |
| Sharpe Ratio | 0 | 0.78 |
| Treynor Ratio | 0 | 11.18 |
The iShares Core MSCI Total International Stock ETF (IXUS) has a Alpha of 0 with a R-squared of 0 and a Treynor Ratio of 0. Its Mean Return is 0 while IXUS’s Sharpe Ratio is 0. Furthermore, the fund has a Beta of 0 and a Standard Deviation of 0.
The Vanguard Small-Cap Growth Index Fund ETF Shares (VBK) has a Alpha of -2.81 with a R-squared of 80.56 and a Mean Return of 1.22. Its Beta is 1.18 while VBK’s Sharpe Ratio is 0.78. Furthermore, the fund has a Standard Deviation of 17.95 and a Treynor Ratio of 11.18.
IXUS’s Mean Return is 1.22 points lower than that of VBK and its R-squared is 80.56 points lower. With a Standard Deviation of 0, IXUS is slightly less volatile than VBK. The Alpha and Beta of IXUS are 2.81 points higher and 1.18 points lower than VBK’s Alpha and Beta.
Performance
Annual Returns
| Year | IXUS | VBK |
| 2020 | 11.14% | 35.29% |
| 2019 | 21.85% | 32.75% |
| 2018 | -14.55% | -5.68% |
| 2017 | 28.08% | 21.9% |
| 2016 | 4.66% | 10.74% |
| 2015 | -4.62% | -2.51% |
| 2014 | -3.96% | 4.02% |
| 2013 | 15.85% | 38.18% |
| 2012 | 0.0% | 17.67% |
| 2011 | 0.0% | -1.43% |
| 2010 | 0.0% | 30.87% |
IXUS had its best year in 2017 with an annual return of 28.08%. IXUS’s worst year over the past decade yielded -14.55% and occurred in 2018. In most years the iShares Core MSCI Total International Stock ETF provided moderate returns such as in 2011, 2010, and 2016 where annual returns amounted to 0.0%, 0.0%, and 4.66% respectively.
The year 2013 was the strongest year for VBK, returning 38.18% on an annual basis. The poorest year for VBK in the last ten years was 2018, with a yield of -5.68%. Most years the Vanguard Small-Cap Growth Index Fund ETF Shares has given investors modest returns, such as in 2016, 2012, and 2017, when gains were 10.74%, 17.67%, and 21.9% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IXUS | $10,000 | $14,209 | 6.09% |
| VBK | $10,000 | $23,189 | 16.53% |
A $10,000 investment in IXUS would have resulted in a final balance of $14,209. This is a profit of $4,209 over 7 years and amounts to a compound annual growth rate (CAGR) of 6.09%.
With a $10,000 investment in VBK, the end total would have been $23,189. This equates to a $13,189 profit over 7 years and a compound annual growth rate (CAGR) of 16.53%.
IXUS’s CAGR is 10.44 percentage points lower than that of VBK and as a result, would have yielded $8,980 less on a $10,000 investment. Thus, IXUS performed worse than VBK by 10.44% annually.
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