The SPDR S&P MIDCAP 400 ETF Trust (MDY) and the iShares Core Total USD Bond Market ETF (IUSB) are both among the Top 100 ETFs. MDY is a SPDR State Street Global Advisors Mid-Cap Blend fund and IUSB is a iShares N/A fund. So, what’s the difference between MDY and IUSB? And which fund is better?
The expense ratio of MDY is 0.17 percentage points higher than IUSB’s (0.23% vs. 0.06%). MDY also has a high exposure to the industrials sector while IUSB is mostly comprised of AAA bonds. Overall, MDY has provided higher returns than IUSB over the past 6 years.
In this article, we’ll compare MDY vs. IUSB. We’ll look at holdings and performance, as well as at their fund composition and annual returns. Moreover, I’ll also discuss MDY’s and IUSB’s risk metrics, industry exposure, and portfolio growth and examine how these affect their overall returns.
|Name||SPDR S&P MIDCAP 400 ETF Trust||iShares Core Total USD Bond Market ETF|
|Issuer||SPDR State Street Global Advisors||iShares|
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 iShares Core Total USD Bond Market ETF (IUSB) is a N/A fund that is issued by iShares. It currently has 14.49B total assets under management and has yielded an average annual return of 4.13% over the past 10 years. The fund has a dividend yield of 2.1% with an expense ratio of 0.06%.
MDY’s dividend yield is 1.16% lower than that of IUSB (0.94% vs. 2.1%). Also, MDY yielded on average 9.16% more per year over the past decade (13.29% vs. 4.13%). The expense ratio of MDY is 0.17 percentage points higher than IUSB’s (0.23% vs. 0.06%).
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|Molina Healthcare Inc||0.63%|
|Fair Isaac Corp||0.62%|
|XPO Logistics Inc||0.61%|
|SolarEdge Technologies Inc||0.61%|
|Camden Property Trust||0.55%|
|FactSet Research Systems Inc||0.54%|
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%.
|IUSB Bond Sectors||Weight|
IUSB’s Top Bond Sectors are ratings of AAA, BBB, A, BB, and AA at 58.32%, 16.98%, 12.27%, 4.33%, and 3.36%. The fund is less weighted towards B (2.8%), Others (1.01%), and Below B (0.92%) rated bonds.
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The SPDR S&P MIDCAP 400 ETF Trust (MDY) has a Mean Return of 1.08 with a Treynor Ratio of 9.97 and a Alpha of -4.1. Its Beta is 1.15 while MDY’s Standard Deviation is 16.83. Furthermore, the fund has a Sharpe Ratio of 0.73 and a R-squared of 86.66.
The iShares Core Total USD Bond Market ETF (IUSB) has a Beta of 0 with a Mean Return of 0 and a Sharpe Ratio of 0. Its Treynor Ratio is 0 while IUSB’s Alpha is 0. Furthermore, the fund has a R-squared of 0 and a Standard Deviation of 0.
MDY’s Mean Return is 1.08 points higher than that of IUSB and its R-squared is 86.66 points higher. With a Standard Deviation of 16.83, MDY is slightly more volatile than IUSB. The Alpha and Beta of MDY are 4.10 points lower and 1.15 points higher than IUSB’s Alpha and Beta.
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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 2019 was the strongest year for IUSB, returning 9.26% on an annual basis. The poorest year for IUSB in the last ten years was 2018, with a yield of -0.38%. Most years the iShares Core Total USD Bond Market ETF has given investors modest returns, such as in 2011, 2010, and 2015, when gains were 0.0%, 0.0%, and 0.46% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in MDY would have resulted in a final balance of $17,250. This is a profit of $7,250 over 6 years and amounts to a compound annual growth rate (CAGR) of 13.29%.
With a $10,000 investment in IUSB, the end total would have been $12,704. This equates to a $2,704 profit over 6 years and a compound annual growth rate (CAGR) of 4.13%.
MDY’s CAGR is 9.16 percentage points higher than that of IUSB and as a result, would have yielded $4,546 more on a $10,000 investment. Thus, MDY outperformed IUSB by 9.16% annually.
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