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

The expense ratio of SCHF is 0.17 percentage points lower than MDY’s (0.06% vs. 0.23%). SCHF also has a higher exposure to the financial services sector and a lower standard deviation. Overall, SCHF has provided lower returns than MDY over the past 10 years.

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

Summary

SCHFMDY
NameSchwab International Equity ETFSPDR S&P MIDCAP 400 ETF Trust
CategoryForeign Large BlendMid-Cap Blend
IssuerSchwab ETFsSPDR State Street Global Advisors
AUM26.99B21.31B
Avg. Return6.43%13.29%
Div. Yield2.16%0.94%
Expense Ratio0.06%0.23%

The Schwab International Equity ETF (SCHF) is a Foreign Large Blend fund that is issued by Schwab ETFs. It currently has 26.99B total assets under management and has yielded an average annual return of 6.43% over the past 10 years. The fund has a dividend yield of 2.16% with an expense ratio of 0.06%.

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%.

SCHF’s dividend yield is 1.22% higher than that of MDY (2.16% vs. 0.94%). Also, SCHF yielded on average 6.86% less per year over the past decade (6.43% vs. 13.29%). The expense ratio of SCHF is 0.17 percentage points lower than MDY’s (0.06% vs. 0.23%).

Fund Composition

Industry Exposure

SCHF vs. MDY - Industry Exposure

SCHFMDY
Technology11.55%14.74%
Industrials14.86%17.88%
Energy4.23%2.52%
Communication Services5.65%1.63%
Utilities3.09%2.84%
Healthcare11.05%11.17%
Consumer Defensive9.41%4.2%
Real Estate3.17%9.66%
Financial Services17.85%15.2%
Consumer Cyclical10.87%14.89%
Basic Materials8.26%5.27%

The Schwab International Equity ETF (SCHF) has the most exposure to the Financial Services sector at 17.85%. This is followed by Industrials and Technology at 14.86% and 11.55% respectively. Real Estate (3.17%), Energy (4.23%), and Communication Services (5.65%) only make up 13.05% of the fund’s total assets.

SCHF’s mid-section with moderate exposure is comprised of Basic Materials, Consumer Defensive, Consumer Cyclical, Healthcare, and Technology stocks at 8.26%, 9.41%, 10.87%, 11.05%, and 11.55%.

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%.

SCHF is 2.65% more exposed to the Financial Services sector than MDY (17.85% vs 15.2%). SCHF’s exposure to Industrials and Technology stocks is 3.02% lower and 3.19% lower respectively (14.86% vs. 17.88% and 11.55% vs. 14.74%). In total, Real Estate, Energy, and Communication Services also make up 0.76% less of the fund’s holdings compared to MDY (13.05% vs. 13.81%).

Holdings

SCHF - Holdings

SCHF HoldingsWeight
Nestle SA1.66%
Samsung Electronics Co Ltd1.6%
ASML Holding NV1.29%
Roche Holding AG1.24%
Toyota Motor Corp1.02%
LVMH Moet Hennessy Louis Vuitton SE0.93%
Novartis AG0.92%
Shopify Inc A0.78%
AstraZeneca PLC0.75%
SAP SE0.74%

SCHF’s Top Holdings are Nestle SA, Samsung Electronics Co Ltd, ASML Holding NV, Roche Holding AG, and Toyota Motor Corp at 1.66%, 1.6%, 1.29%, 1.24%, and 1.02%.

LVMH Moet Hennessy Louis Vuitton SE (0.93%), Novartis AG (0.92%), and Shopify Inc A (0.78%) have a slightly smaller but still significant weight. AstraZeneca PLC and SAP SE are also represented in the SCHF’s holdings at 0.75% and 0.74%.

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%.

Risk Analysis

SCHFMDY
Mean Return0.581.08
R-squared98.1686.66
Std. Deviation15.0816.83
Alpha0.53-4.1
Beta0.991.15
Sharpe Ratio0.420.73
Treynor Ratio5.399.97

The Schwab International Equity ETF (SCHF) has a Sharpe Ratio of 0.42 with a Mean Return of 0.58 and a Alpha of 0.53. Its Beta is 0.99 while SCHF’s R-squared is 98.16. Furthermore, the fund has a Treynor Ratio of 5.39 and a Standard Deviation of 15.08.

The SPDR S&P MIDCAP 400 ETF Trust (MDY) has a Alpha of -4.1 with a R-squared of 86.66 and a Mean Return of 1.08. 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 Treynor Ratio of 9.97.

SCHF’s Mean Return is 0.50 points lower than that of MDY and its R-squared is 11.50 points higher. With a Standard Deviation of 15.08, SCHF is slightly less volatile than MDY. The Alpha and Beta of SCHF are 4.63 points higher and 0.16 points lower than MDY’s Alpha and Beta.

Performance

Annual Returns

SCHF vs. MDY - Annual Returns

YearSCHFMDY
20209.86%13.51%
201922.15%25.86%
2018-14.39%-11.28%
201725.83%15.89%
20162.88%20.33%
2015-2.44%-2.4%
2014-4.44%9.42%
201320.03%33.08%
201217.12%17.58%
2011-12.32%-1.99%
20108.6%26.17%

SCHF had its best year in 2017 with an annual return of 25.83%. SCHF’s worst year over the past decade yielded -14.39% and occurred in 2018. In most years the Schwab International Equity ETF provided moderate returns such as in 2016, 2010, and 2020 where annual returns amounted to 2.88%, 8.6%, and 9.86% respectively.

The year 2013 was the strongest year for MDY, returning 33.08% on an annual basis. The poorest year for MDY in the last ten years was 2018, with a yield of -11.28%. Most years the SPDR S&P MIDCAP 400 ETF Trust has given investors modest returns, such as in 2020, 2017, and 2012, when gains were 13.51%, 15.89%, and 17.58% respectively.

Portfolio Growth

SCHF vs. MDY - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
SCHF$10,000$17,0896.43%
MDY$10,000$28,94813.29%

A $10,000 investment in SCHF would have resulted in a final balance of $17,089. This is a profit of $7,089 over 10 years and amounts to a compound annual growth rate (CAGR) of 6.43%.

With a $10,000 investment in MDY, the end total would have been $28,948. This equates to a $18,948 profit over 10 years and a compound annual growth rate (CAGR) of 13.29%.

SCHF’s CAGR is 6.86 percentage points lower than that of MDY and as a result, would have yielded $11,859 less on a $10,000 investment. Thus, SCHF performed worse than MDY by 6.86% annually.

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