MDY vs. VLUE: What’s The Difference?

The SPDR S&P MIDCAP 400 ETF Trust (MDY) and the iShares MSCI USA Value Factor ETF (VLUE) are both among the Top 100 ETFs. MDY is a SPDR State Street Global Advisors Mid-Cap Blend fund and VLUE is a iShares Large Value fund. So, what’s the difference between MDY and VLUE? And which fund is better?

The expense ratio of MDY is 0.08 percentage points higher than VLUE’s (0.23% vs. 0.15%). MDY also has a higher exposure to the industrials sector and a higher standard deviation. Overall, MDY has provided higher returns than VLUE over the past 7 years.

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

Summary

MDY VLUE
Name SPDR S&P MIDCAP 400 ETF Trust iShares MSCI USA Value Factor ETF
Category Mid-Cap Blend Large Value
Issuer SPDR State Street Global Advisors iShares
AUM 21.31B 15.95B
Avg. Return 13.29% 8.91%
Div. Yield 0.94% 1.89%
Expense Ratio 0.23% 0.15%

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 MSCI USA Value Factor ETF (VLUE) is a Large Value fund that is issued by iShares. It currently has 15.95B total assets under management and has yielded an average annual return of 8.91% over the past 10 years. The fund has a dividend yield of 1.89% with an expense ratio of 0.15%.

MDY’s dividend yield is 0.95% lower than that of VLUE (0.94% vs. 1.89%). Also, MDY yielded on average 4.38% more per year over the past decade (13.29% vs. 8.91%). The expense ratio of MDY is 0.08 percentage points higher than VLUE’s (0.23% vs. 0.15%).

Fund Composition

Industry Exposure

MDY vs. VLUE - Industry Exposure

MDY VLUE
Technology 14.74% 26.89%
Industrials 17.88% 9.14%
Energy 2.52% 2.42%
Communication Services 1.63% 10.39%
Utilities 2.84% 2.68%
Healthcare 11.17% 14.31%
Consumer Defensive 4.2% 7.22%
Real Estate 9.66% 3.19%
Financial Services 15.2% 10.96%
Consumer Cyclical 14.89% 10.66%
Basic Materials 5.27% 2.14%

The SPDR S&P MIDCAP 400 ETF Trust (MDY) has the most exposure to the Industrials sector at 17.88%. This is followed by Financial Services and Consumer Cyclical at 15.2% and 14.89% respectively. Energy (2.52%), Utilities (2.84%), and Consumer Defensive (4.2%) only make up 9.56% of the fund’s total assets.

MDY’s mid-section with moderate exposure is comprised of Basic Materials, Real Estate, Healthcare, Technology, and Consumer Cyclical stocks at 5.27%, 9.66%, 11.17%, 14.74%, and 14.89%.

The iShares MSCI USA Value Factor ETF (VLUE) has the most exposure to the Technology sector at 26.89%. This is followed by Healthcare and Financial Services at 14.31% and 10.96% respectively. Energy (2.42%), Utilities (2.68%), and Real Estate (3.19%) only make up 8.29% of the fund’s total assets.

VLUE’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Financial Services stocks at 7.22%, 9.14%, 10.39%, 10.66%, and 10.96%.

MDY is 8.74% more exposed to the Industrials sector than VLUE (17.88% vs 9.14%). MDY’s exposure to Financial Services and Consumer Cyclical stocks is 4.24% higher and 4.23% higher respectively (15.2% vs. 10.96% and 14.89% vs. 10.66%). In total, Energy, Utilities, and Consumer Defensive also make up 2.76% less of the fund’s holdings compared to VLUE (9.56% vs. 12.32%).

Holdings

MDY - Holdings

MDY Holdings Weight
Bio-Techne Corp 0.75%
Molina Healthcare Inc 0.63%
Cognex Corp 0.63%
Fair Isaac Corp 0.62%
XPO Logistics Inc 0.61%
SolarEdge Technologies Inc 0.61%
Signature Bank 0.6%
Graco Inc 0.55%
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%.

VLUE - Holdings

VLUE Holdings Weight
AT&T Inc 7.13%
Intel Corp 6.14%
General Motors Co 3.19%
Micron Technology Inc 3.14%
Cisco Systems Inc 3.05%
International Business Machines Corp 2.76%
Target Corp 2.38%
Citigroup Inc 2.32%
Ford Motor Co 2.23%
Pfizer Inc 2.17%

VLUE’s Top Holdings are AT&T Inc, Intel Corp, General Motors Co, Micron Technology Inc, and Cisco Systems Inc at 7.13%, 6.14%, 3.19%, 3.14%, and 3.05%.

International Business Machines Corp (2.76%), Target Corp (2.38%), and Citigroup Inc (2.32%) have a slightly smaller but still significant weight. Ford Motor Co and Pfizer Inc are also represented in the VLUE’s holdings at 2.23% and 2.17%.

Risk Analysis

MDY VLUE
Mean Return 1.08 0
R-squared 86.66 0
Std. Deviation 16.83 0
Alpha -4.1 0
Beta 1.15 0
Sharpe Ratio 0.73 0
Treynor Ratio 9.97 0

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

The iShares MSCI USA Value Factor ETF (VLUE) has a Beta of 0 with a Alpha of 0 and a Sharpe Ratio of 0. Its Mean Return is 0 while VLUE’s R-squared is 0. Furthermore, the fund has a Standard Deviation of 0 and a Treynor Ratio of 0.

MDY’s Mean Return is 1.08 points higher than that of VLUE and its R-squared is 86.66 points higher. With a Standard Deviation of 16.83, MDY is slightly more volatile than VLUE. The Alpha and Beta of MDY are 4.10 points lower and 1.15 points higher than VLUE’s Alpha and Beta.

Performance

Annual Returns

MDY vs. VLUE - Annual Returns

Year MDY VLUE
2020 13.51% -0.32%
2019 25.86% 27.47%
2018 -11.28% -11.18%
2017 15.89% 21.97%
2016 20.33% 15.68%
2015 -2.4% -3.54%
2014 9.42% 12.29%
2013 33.08% 0.0%
2012 17.58% 0.0%
2011 -1.99% 0.0%
2010 26.17% 0.0%

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 VLUE, returning 27.47% on an annual basis. The poorest year for VLUE in the last ten years was 2018, with a yield of -11.18%. Most years the iShares MSCI USA Value Factor ETF has given investors modest returns, such as in 2012, 2011, and 2010, when gains were 0.0%, 0.0%, and 0.0% respectively.

Portfolio Growth

MDY vs. VLUE - Portfolio Growth

Fund Initial Balance Final Balance CAGR
MDY $10,000 $18,875 13.29%
VLUE $10,000 $17,247 8.91%

A $10,000 investment in MDY would have resulted in a final balance of $18,875. This is a profit of $8,875 over 7 years and amounts to a compound annual growth rate (CAGR) of 13.29%.

With a $10,000 investment in VLUE, the end total would have been $17,247. This equates to a $7,247 profit over 7 years and a compound annual growth rate (CAGR) of 8.91%.

MDY’s CAGR is 4.38 percentage points higher than that of VLUE and as a result, would have yielded $1,628 more on a $10,000 investment. Thus, MDY outperformed VLUE by 4.38% annually.


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