The iShares Core MSCI Total International Stock ETF (IXUS) and the Vanguard Health Care Index Fund ETF Shares (VHT) are both among the Top 100 ETFs. IXUS is a iShares Foreign Large Blend fund and VHT is a Vanguard Health fund. So, what’s the difference between IXUS and VHT? And which fund is better?
The expense ratio of IXUS is 0.01 percentage points lower than VHT’s (0.09% vs. 0.1%). IXUS also has a higher exposure to the financial services sector and a lower standard deviation. Overall, IXUS has provided lower returns than VHT over the past ten years.
In this article, we’ll compare IXUS vs. VHT. We’ll look at portfolio growth and holdings, as well as at their risk metrics and annual returns. Moreover, I’ll also discuss IXUS’s and VHT’s industry exposure, performance, and fund composition and examine how these affect their overall returns.
Summary
| IXUS | VHT | |
| Name | iShares Core MSCI Total International Stock ETF | Vanguard Health Care Index Fund ETF Shares |
| Category | Foreign Large Blend | Health |
| Issuer | iShares | Vanguard |
| AUM | 29.54B | 17.94B |
| Avg. Return | 6.09% | 16.04% |
| Div. Yield | 2.13% | 1.15% |
| Expense Ratio | 0.09% | 0.1% |
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 Health Care Index Fund ETF Shares (VHT) is a Health fund that is issued by Vanguard. It currently has 17.94B total assets under management and has yielded an average annual return of 16.04% over the past 10 years. The fund has a dividend yield of 1.15% with an expense ratio of 0.1%.
IXUS’s dividend yield is 0.98% higher than that of VHT (2.13% vs. 1.15%). Also, IXUS yielded on average 9.95% less per year over the past decade (6.09% vs. 16.04%). The expense ratio of IXUS is 0.01 percentage points lower than VHT’s (0.09% vs. 0.1%).
Fund Composition
Industry Exposure
| IXUS | VHT | |
| Technology | 13.24% | 0.05% |
| Industrials | 12.78% | 0.05% |
| Energy | 4.39% | 0.0% |
| Communication Services | 7.09% | 0.0% |
| Utilities | 2.95% | 0.0% |
| Healthcare | 9.29% | 99.57% |
| Consumer Defensive | 8.19% | 0.0% |
| Real Estate | 3.66% | 0.0% |
| Financial Services | 17.34% | 0.02% |
| Consumer Cyclical | 12.57% | 0.0% |
| Basic Materials | 8.5% | 0.31% |
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 Health Care Index Fund ETF Shares (VHT) has the most exposure to the Healthcare sector at 99.57%. This is followed by Basic Materials and Technology at 0.31% and 0.05% respectively. Real Estate (0.0%), Consumer Defensive (0.0%), and Utilities (0.0%) only make up 0.00% of the fund’s total assets.
VHT’s mid-section with moderate exposure is comprised of Communication Services, Energy, Financial Services, Industrials, and Technology stocks at 0.0%, 0.0%, 0.02%, 0.05%, and 0.05%.
IXUS is 17.32% more exposed to the Financial Services sector than VHT (17.34% vs 0.02%). IXUS’s exposure to Technology and Industrials stocks is 13.19% higher and 12.73% higher respectively (13.24% vs. 0.05% and 12.78% vs. 0.05%). In total, Real Estate, Energy, and Communication Services also make up 15.14% more of the fund’s holdings compared to VHT (15.14% vs. 0.00%).
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%.
| VHT Holdings | Weight |
| Johnson & Johnson | 7.34% |
| UnitedHealth Group Inc | 6.44% |
| Pfizer Inc | 3.7% |
| Abbott Laboratories | 3.48% |
| Thermo Fisher Scientific Inc | 3.37% |
| AbbVie Inc | 3.37% |
| Merck & Co Inc | 3.33% |
| Eli Lilly and Co | 3.17% |
| Danaher Corp | 2.91% |
| Medtronic PLC | 2.83% |
VHT’s Top Holdings are Johnson & Johnson, UnitedHealth Group Inc, Pfizer Inc, Abbott Laboratories, and Thermo Fisher Scientific Inc at 7.34%, 6.44%, 3.7%, 3.48%, and 3.37%.
AbbVie Inc (3.37%), Merck & Co Inc (3.33%), and Eli Lilly and Co (3.17%) have a slightly smaller but still significant weight. Danaher Corp and Medtronic PLC are also represented in the VHT’s holdings at 2.91% and 2.83%.
Risk Analysis
| IXUS | VHT | |
| Mean Return | 0 | 1.33 |
| R-squared | 0 | 59.86 |
| Std. Deviation | 0 | 13.58 |
| Alpha | 0 | 7.99 |
| Beta | 0 | 0.75 |
| Sharpe Ratio | 0 | 1.13 |
| Treynor Ratio | 0 | 20.74 |
The iShares Core MSCI Total International Stock ETF (IXUS) has a Treynor Ratio of 0 with a Beta of 0 and a Sharpe Ratio of 0. Its Alpha is 0 while IXUS’s Standard Deviation is 0. Furthermore, the fund has a Mean Return of 0 and a R-squared of 0.
The Vanguard Health Care Index Fund ETF Shares (VHT) has a Alpha of 7.99 with a Treynor Ratio of 20.74 and a Mean Return of 1.33. Its Standard Deviation is 13.58 while VHT’s Sharpe Ratio is 1.13. Furthermore, the fund has a Beta of 0.75 and a R-squared of 59.86.
IXUS’s Mean Return is 1.33 points lower than that of VHT and its R-squared is 59.86 points lower. With a Standard Deviation of 0, IXUS is slightly less volatile than VHT. The Alpha and Beta of IXUS are 7.99 points lower and 0.75 points lower than VHT’s Alpha and Beta.
Performance
Annual Returns
| Year | IXUS | VHT |
| 2020 | 11.14% | 18.21% |
| 2019 | 21.85% | 21.97% |
| 2018 | -14.55% | 5.55% |
| 2017 | 28.08% | 23.34% |
| 2016 | 4.66% | -3.33% |
| 2015 | -4.62% | 7.22% |
| 2014 | -3.96% | 25.38% |
| 2013 | 15.85% | 42.67% |
| 2012 | 0.0% | 19.1% |
| 2011 | 0.0% | 10.57% |
| 2010 | 0.0% | 5.75% |
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 VHT, returning 42.67% on an annual basis. The poorest year for VHT in the last ten years was 2016, with a yield of -3.33%. Most years the Vanguard Health Care Index Fund ETF Shares has given investors modest returns, such as in 2011, 2020, and 2012, when gains were 10.57%, 18.21%, and 19.1% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IXUS | $10,000 | $14,209 | 6.09% |
| VHT | $10,000 | $24,392 | 16.04% |
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 VHT, the end total would have been $24,392. This equates to a $14,392 profit over 7 years and a compound annual growth rate (CAGR) of 16.04%.
IXUS’s CAGR is 9.95 percentage points lower than that of VHT and as a result, would have yielded $10,183 less on a $10,000 investment. Thus, IXUS performed worse than VHT by 9.95% annually.
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