The iShares Core MSCI Total International Stock ETF (IXUS) and the Vanguard Small-Cap Value Index Fund ETF Shares (VBR) are both among the Top 100 ETFs. IXUS is a iShares Foreign Large Blend fund and VBR is a Vanguard Small Value fund. So, what’s the difference between IXUS and VBR? And which fund is better?
The expense ratio of IXUS is 0.02 percentage points higher than VBR’s (0.09% vs. 0.07%). IXUS also has a lower exposure to the financial services sector and a lower standard deviation. Overall, IXUS has provided lower returns than VBR over the past ten years.
In this article, we’ll compare IXUS vs. VBR. We’ll look at portfolio growth and risk metrics, as well as at their performance and annual returns. Moreover, I’ll also discuss IXUS’s and VBR’s industry exposure, fund composition, and holdings and examine how these affect their overall returns.
Summary
| IXUS | VBR | |
| Name | iShares Core MSCI Total International Stock ETF | Vanguard Small-Cap Value Index Fund ETF Shares |
| Category | Foreign Large Blend | Small Value |
| Issuer | iShares | Vanguard |
| AUM | 29.54B | 48.08B |
| Avg. Return | 6.09% | 12.28% |
| Div. Yield | 2.13% | 1.6% |
| 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 Value Index Fund ETF Shares (VBR) is a Small Value fund that is issued by Vanguard. It currently has 48.08B total assets under management and has yielded an average annual return of 12.28% over the past 10 years. The fund has a dividend yield of 1.6% with an expense ratio of 0.07%.
IXUS’s dividend yield is 0.53% higher than that of VBR (2.13% vs. 1.6%). Also, IXUS yielded on average 6.20% less per year over the past decade (6.09% vs. 12.28%). The expense ratio of IXUS is 0.02 percentage points higher than VBR’s (0.09% vs. 0.07%).
Fund Composition
Industry Exposure
| IXUS | VBR | |
| Technology | 13.24% | 8.39% |
| Industrials | 12.78% | 18.44% |
| Energy | 4.39% | 5.15% |
| Communication Services | 7.09% | 1.77% |
| Utilities | 2.95% | 3.65% |
| Healthcare | 9.29% | 7.16% |
| Consumer Defensive | 8.19% | 4.36% |
| Real Estate | 3.66% | 10.92% |
| Financial Services | 17.34% | 20.04% |
| Consumer Cyclical | 12.57% | 13.82% |
| Basic Materials | 8.5% | 6.31% |
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 Value Index Fund ETF Shares (VBR) has the most exposure to the Financial Services sector at 20.04%. This is followed by Industrials and Consumer Cyclical at 18.44% and 13.82% respectively. Utilities (3.65%), Consumer Defensive (4.36%), and Energy (5.15%) only make up 13.16% of the fund’s total assets.
VBR’s mid-section with moderate exposure is comprised of Basic Materials, Healthcare, Technology, Real Estate, and Consumer Cyclical stocks at 6.31%, 7.16%, 8.39%, 10.92%, and 13.82%.
IXUS is 2.70% less exposed to the Financial Services sector than VBR (17.34% vs 20.04%). IXUS’s exposure to Technology and Industrials stocks is 4.85% higher and 5.66% lower respectively (13.24% vs. 8.39% and 12.78% vs. 18.44%). In total, Real Estate, Energy, and Communication Services also make up 2.70% less of the fund’s holdings compared to VBR (15.14% vs. 17.84%).
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%.
| VBR Holdings | Weight |
| Diamondback Energy Inc | 0.55% |
| VICI Properties Inc Ordinary Shares | 0.54% |
| IDEX Corp | 0.54% |
| Nuance Communications Inc | 0.5% |
| Molina Healthcare Inc | 0.48% |
| Signature Bank | 0.46% |
| Novavax Inc | 0.44% |
| Howmet Aerospace Inc | 0.44% |
| Apollo Global Management Inc Class A | 0.42% |
| Brown & Brown Inc | 0.41% |
VBR’s Top Holdings are Diamondback Energy Inc, VICI Properties Inc Ordinary Shares, IDEX Corp, Nuance Communications Inc, and Molina Healthcare Inc at 0.55%, 0.54%, 0.54%, 0.5%, and 0.48%.
Signature Bank (0.46%), Novavax Inc (0.44%), and Howmet Aerospace Inc (0.44%) have a slightly smaller but still significant weight. Apollo Global Management Inc Class A and Brown & Brown Inc are also represented in the VBR’s holdings at 0.42% and 0.41%.
Risk Analysis
| IXUS | VBR | |
| Mean Return | 0 | 1.08 |
| R-squared | 0 | 82.2 |
| Std. Deviation | 0 | 18.37 |
| Alpha | 0 | -5.09 |
| Beta | 0 | 1.23 |
| Sharpe Ratio | 0 | 0.67 |
| Treynor Ratio | 0 | 9.15 |
The iShares Core MSCI Total International Stock ETF (IXUS) has a R-squared of 0 with a Beta of 0 and a Alpha of 0. Its Sharpe Ratio is 0 while IXUS’s Mean Return is 0. Furthermore, the fund has a Standard Deviation of 0 and a Treynor Ratio of 0.
The Vanguard Small-Cap Value Index Fund ETF Shares (VBR) has a Beta of 1.23 with a R-squared of 82.2 and a Treynor Ratio of 9.15. Its Mean Return is 1.08 while VBR’s Standard Deviation is 18.37. Furthermore, the fund has a Sharpe Ratio of 0.67 and a Alpha of -5.09.
IXUS’s Mean Return is 1.08 points lower than that of VBR and its R-squared is 82.20 points lower. With a Standard Deviation of 0, IXUS is slightly less volatile than VBR. The Alpha and Beta of IXUS are 5.09 points higher and 1.23 points lower than VBR’s Alpha and Beta.
Performance
Annual Returns
| Year | IXUS | VBR |
| 2020 | 11.14% | 5.82% |
| 2019 | 21.85% | 22.76% |
| 2018 | -14.55% | -12.22% |
| 2017 | 28.08% | 11.79% |
| 2016 | 4.66% | 24.8% |
| 2015 | -4.62% | -4.67% |
| 2014 | -3.96% | 10.55% |
| 2013 | 15.85% | 36.57% |
| 2012 | 0.0% | 18.78% |
| 2011 | 0.0% | -4.05% |
| 2010 | 0.0% | 24.97% |
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 VBR, returning 36.57% on an annual basis. The poorest year for VBR in the last ten years was 2018, with a yield of -12.22%. Most years the Vanguard Small-Cap Value Index Fund ETF Shares has given investors modest returns, such as in 2014, 2017, and 2012, when gains were 10.55%, 11.79%, and 18.78% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IXUS | $10,000 | $14,209 | 6.09% |
| VBR | $10,000 | $16,765 | 12.28% |
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 VBR, the end total would have been $16,765. This equates to a $6,765 profit over 7 years and a compound annual growth rate (CAGR) of 12.28%.
IXUS’s CAGR is 6.20 percentage points lower than that of VBR and as a result, would have yielded $2,556 less on a $10,000 investment. Thus, IXUS performed worse than VBR by 6.20% annually.
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