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MDY vs. BIV: What’s The Difference?

The SPDR S&P MIDCAP 400 ETF Trust (MDY) and the Vanguard Intermediate-Term Bond Index Fund ETF Shares (BIV) are both among the Top 100 ETFs. MDY is a SPDR State Street Global Advisors Mid-Cap Blend fund and BIV is a Vanguard Intermediate-Term Bond fund. So, what’s the difference between MDY and BIV? And which fund is better?

The expense ratio of MDY is 0.18 percentage points higher than BIV’s (0.23% vs. 0.05%). MDY also has a high exposure to the industrials sector while BIV is mostly comprised of AAA bonds. Overall, MDY has provided higher returns than BIV over the past 11 years.

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

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Summary

MDYBIV
NameSPDR S&P MIDCAP 400 ETF TrustVanguard Intermediate-Term Bond Index Fund ETF Shares
CategoryMid-Cap BlendIntermediate-Term Bond
IssuerSPDR State Street Global AdvisorsVanguard
AUM21.31B39.05B
Avg. Return13.29%5.31%
Div. Yield0.94%2.06%
Expense Ratio0.23%0.05%

The SPDR S&P MIDCAP 400 ETF Trust (MDY) is a Mid-Cap Blend fund that is issued by SPDR State Street Global Advisors. It currently has 21.31B total assets under management and has yielded an average annual return of 13.29% over the past 10 years. The fund has a dividend yield of 0.94% with an expense ratio of 0.23%.

The Vanguard Intermediate-Term Bond Index Fund ETF Shares (BIV) is a Intermediate-Term Bond fund that is issued by Vanguard. It currently has 39.05B total assets under management and has yielded an average annual return of 5.31% over the past 10 years. The fund has a dividend yield of 2.06% with an expense ratio of 0.05%.

MDY’s dividend yield is 1.12% lower than that of BIV (0.94% vs. 2.06%). Also, MDY yielded on average 7.97% more per year over the past decade (13.29% vs. 5.31%). The expense ratio of MDY is 0.18 percentage points higher than BIV’s (0.23% vs. 0.05%).

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Fund Composition

Holdings

MDY - Holdings

MDY HoldingsWeight
Bio-Techne Corp0.75%
Molina Healthcare Inc0.63%
Cognex Corp0.63%
Fair Isaac Corp0.62%
XPO Logistics Inc0.61%
SolarEdge Technologies Inc0.61%
Signature Bank0.6%
Graco Inc0.55%
Camden Property Trust0.55%
FactSet Research Systems Inc0.54%

MDY’s Top Holdings are Bio-Techne Corp, Molina Healthcare Inc, Cognex Corp, Fair Isaac Corp, and XPO Logistics Inc at 0.75%, 0.63%, 0.63%, 0.62%, and 0.61%.

SolarEdge Technologies Inc (0.61%), Signature Bank (0.6%), and Graco Inc (0.55%) have a slightly smaller but still significant weight. Camden Property Trust and FactSet Research Systems Inc are also represented in the MDY’s holdings at 0.55% and 0.54%.

BIV - Holdings

BIV Bond SectorsWeight
AAA54.51%
BBB25.24%
A16.97%
AA3.1%
Others0.15%
Below B0.03%
B0.0%
BB0.0%
US Government0.0%

BIV’s Top Bond Sectors are ratings of AAA, BBB, A, AA, and Others at 54.51%, 25.24%, 16.97%, 3.1%, and 0.15%. The fund is less weighted towards Below B (0.03%), B (0.0%), and BB (0.0%) rated bonds.

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Risk Analysis

MDYBIV
Mean Return1.080.35
R-squared86.6695.12
Std. Deviation16.834.09
Alpha-4.1-0.07
Beta1.151.33
Sharpe Ratio0.730.89
Treynor Ratio9.972.72

The SPDR S&P MIDCAP 400 ETF Trust (MDY) has a Sharpe Ratio of 0.73 with a Beta of 1.15 and a Standard Deviation of 16.83. Its R-squared is 86.66 while MDY’s Treynor Ratio is 9.97. Furthermore, the fund has a Alpha of -4.1 and a Mean Return of 1.08.

The Vanguard Intermediate-Term Bond Index Fund ETF Shares (BIV) has a Standard Deviation of 4.09 with a Mean Return of 0.35 and a Treynor Ratio of 2.72. Its Sharpe Ratio is 0.89 while BIV’s Beta is 1.33. Furthermore, the fund has a R-squared of 95.12 and a Alpha of -0.07.

MDY’s Mean Return is 0.73 points higher than that of BIV and its R-squared is 8.46 points lower. With a Standard Deviation of 16.83, MDY is slightly more volatile than BIV. The Alpha and Beta of MDY are 4.03 points lower and 0.18 points lower than BIV’s Alpha and Beta.

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Performance

Annual Returns

MDY vs. BIV - Annual Returns

YearMDYBIV
202013.51%9.71%
201925.86%10.19%
2018-11.28%-0.09%
201715.89%3.8%
201620.33%2.86%
2015-2.4%1.23%
20149.42%7.0%
201333.08%-3.44%
201217.58%7.02%
2011-1.99%10.62%
201026.17%9.55%

MDY had its best year in 2013 with an annual return of 33.08%. MDY’s worst year over the past decade yielded -11.28% and occurred in 2018. In most years the SPDR S&P MIDCAP 400 ETF Trust provided moderate returns such as in 2020, 2017, and 2012 where annual returns amounted to 13.51%, 15.89%, and 17.58% respectively.

The year 2011 was the strongest year for BIV, returning 10.62% on an annual basis. The poorest year for BIV in the last ten years was 2013, with a yield of -3.44%. Most years the Vanguard Intermediate-Term Bond Index Fund ETF Shares has given investors modest returns, such as in 2017, 2014, and 2012, when gains were 3.8%, 7.0%, and 7.02% respectively.

Portfolio Growth

MDY vs. BIV - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
MDY$10,000$36,52413.29%
BIV$10,000$17,4925.31%

A $10,000 investment in MDY would have resulted in a final balance of $36,524. This is a profit of $26,524 over 11 years and amounts to a compound annual growth rate (CAGR) of 13.29%.

With a $10,000 investment in BIV, the end total would have been $17,492. This equates to a $7,492 profit over 11 years and a compound annual growth rate (CAGR) of 5.31%.

MDY’s CAGR is 7.97 percentage points higher than that of BIV and as a result, would have yielded $19,032 more on a $10,000 investment. Thus, MDY outperformed BIV by 7.97% annually.


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