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IXUS vs. XLV: What’s The Difference?

The iShares Core MSCI Total International Stock ETF (IXUS) and the Health Care Select Sector SPDR Fund (XLV) are both among the Top 100 ETFs. IXUS is a iShares Foreign Large Blend fund and XLV is a SPDR State Street Global Advisors Health fund. So, what’s the difference between IXUS and XLV? And which fund is better?

The expense ratio of IXUS is 0.03 percentage points lower than XLV’s (0.09% vs. 0.12%). IXUS also has a higher exposure to the financial services sector and a lower standard deviation. Overall, IXUS has provided lower returns than XLV over the past ten years.

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

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Summary

IXUSXLV
NameiShares Core MSCI Total International Stock ETFHealth Care Select Sector SPDR Fund
CategoryForeign Large BlendHealth
IssueriSharesSPDR State Street Global Advisors
AUM29.54B27.88B
Avg. Return6.09%15.02%
Div. Yield2.13%1.4%
Expense Ratio0.09%0.12%

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 Health Care Select Sector SPDR Fund (XLV) is a Health fund that is issued by SPDR State Street Global Advisors. It currently has 27.88B total assets under management and has yielded an average annual return of 15.02% over the past 10 years. The fund has a dividend yield of 1.4% with an expense ratio of 0.12%.

IXUS’s dividend yield is 0.73% higher than that of XLV (2.13% vs. 1.4%). Also, IXUS yielded on average 8.94% less per year over the past decade (6.09% vs. 15.02%). The expense ratio of IXUS is 0.03 percentage points lower than XLV’s (0.09% vs. 0.12%).

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Fund Composition

Industry Exposure

IXUS vs. XLV - Industry Exposure

IXUSXLV
Technology13.24%0.0%
Industrials12.78%0.0%
Energy4.39%0.0%
Communication Services7.09%0.0%
Utilities2.95%0.0%
Healthcare9.29%100.0%
Consumer Defensive8.19%0.0%
Real Estate3.66%0.0%
Financial Services17.34%0.0%
Consumer Cyclical12.57%0.0%
Basic Materials8.5%0.0%

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 Health Care Select Sector SPDR Fund (XLV) has the most exposure to the Healthcare sector at 100.0%. This is followed by Technology and Industrials at 0.0% and 0.0% respectively. Consumer Cyclical (0.0%), Financial Services (0.0%), and Real Estate (0.0%) only make up 0.00% of the fund’s total assets.

XLV’s mid-section with moderate exposure is comprised of Consumer Defensive, Utilities, Communication Services, Energy, and Industrials stocks at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%.

IXUS is 17.34% more exposed to the Financial Services sector than XLV (17.34% vs 0.0%). IXUS’s exposure to Technology and Industrials stocks is 13.24% higher and 12.78% higher respectively (13.24% vs. 0.0% and 12.78% vs. 0.0%). In total, Real Estate, Energy, and Communication Services also make up 15.14% more of the fund’s holdings compared to XLV (15.14% vs. 0.00%).

Holdings

IXUS - Holdings

IXUS HoldingsWeight
Taiwan Semiconductor Manufacturing Co Ltd1.64%
Tencent Holdings Ltd1.35%
Alibaba Group Holding Ltd Ordinary Shares1.34%
Nestle SA1.1%
Samsung Electronics Co Ltd1.06%
ASML Holding NV0.9%
Roche Holding AG0.81%
LVMH Moet Hennessy Louis Vuitton SE0.67%
Novartis AG0.62%
Toyota Motor Corp0.59%

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%.

XLV - Holdings

XLV HoldingsWeight
Johnson & Johnson9.19%
UnitedHealth Group Inc8.01%
Pfizer Inc4.64%
Abbott Laboratories4.36%
AbbVie Inc4.21%
Thermo Fisher Scientific Inc4.2%
Merck & Co Inc4.17%
Eli Lilly and Co3.87%
Danaher Corp3.61%
Medtronic PLC3.54%

XLV’s Top Holdings are Johnson & Johnson, UnitedHealth Group Inc, Pfizer Inc, Abbott Laboratories, and AbbVie Inc at 9.19%, 8.01%, 4.64%, 4.36%, and 4.21%.

Thermo Fisher Scientific Inc (4.2%), Merck & Co Inc (4.17%), and Eli Lilly and Co (3.87%) have a slightly smaller but still significant weight. Danaher Corp and Medtronic PLC are also represented in the XLV’s holdings at 3.61% and 3.54%.

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Risk Analysis

IXUSXLV
Mean Return01.27
R-squared058.19
Std. Deviation012.94
Alpha07.75
Beta00.7
Sharpe Ratio01.13
Treynor Ratio021.1

The iShares Core MSCI Total International Stock ETF (IXUS) has a Standard Deviation of 0 with a Mean Return of 0 and a Alpha of 0. Its R-squared is 0 while IXUS’s Sharpe Ratio is 0. Furthermore, the fund has a Beta of 0 and a Treynor Ratio of 0.

The Health Care Select Sector SPDR Fund (XLV) has a Mean Return of 1.27 with a Standard Deviation of 12.94 and a Beta of 0.7. Its R-squared is 58.19 while XLV’s Alpha is 7.75. Furthermore, the fund has a Sharpe Ratio of 1.13 and a Treynor Ratio of 21.1.

IXUS’s Mean Return is 1.27 points lower than that of XLV and its R-squared is 58.19 points lower. With a Standard Deviation of 0, IXUS is slightly less volatile than XLV. The Alpha and Beta of IXUS are 7.75 points lower and 0.70 points lower than XLV’s Alpha and Beta.

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Performance

Annual Returns

IXUS vs. XLV - Annual Returns

YearIXUSXLV
202011.14%13.33%
201921.85%20.63%
2018-14.55%6.3%
201728.08%21.7%
20164.66%-2.83%
2015-4.62%6.82%
2014-3.96%25.17%
201315.85%41.24%
20120.0%17.56%
20110.0%12.44%
20100.0%2.91%

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 XLV, returning 41.24% on an annual basis. The poorest year for XLV in the last ten years was 2016, with a yield of -2.83%. Most years the Health Care Select Sector SPDR Fund has given investors modest returns, such as in 2011, 2020, and 2012, when gains were 12.44%, 13.33%, and 17.56% respectively.

Portfolio Growth

IXUS vs. XLV - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
IXUS$10,000$14,2096.09%
XLV$10,000$22,97715.02%

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 XLV, the end total would have been $22,977. This equates to a $12,977 profit over 7 years and a compound annual growth rate (CAGR) of 15.02%.

IXUS’s CAGR is 8.94 percentage points lower than that of XLV and as a result, would have yielded $8,768 less on a $10,000 investment. Thus, IXUS performed worse than XLV by 8.94% annually.


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