SCHF vs. VV: What’s The Difference?

The Schwab International Equity ETF (SCHF) and the Vanguard Large-Cap Index Fund ETF Shares (VV) are both among the Top 100 ETFs. SCHF is a Schwab ETFs Foreign Large Blend fund and VV is a Vanguard Large Blend fund. So, what’s the difference between SCHF and VV? And which fund is better?

The expense ratio of SCHF is 0.02 percentage points higher than VV’s (0.06% vs. 0.04%). SCHF also has a higher exposure to the financial services sector and a higher standard deviation. Overall, SCHF has provided lower returns than VV over the past 10 years.

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

Summary

SCHF VV
Name Schwab International Equity ETF Vanguard Large-Cap Index Fund ETF Shares
Category Foreign Large Blend Large Blend
Issuer Schwab ETFs Vanguard
AUM 26.99B 37.65B
Avg. Return 6.43% 14.75%
Div. Yield 2.16% 1.26%
Expense Ratio 0.06% 0.04%

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 Vanguard Large-Cap Index Fund ETF Shares (VV) is a Large Blend fund that is issued by Vanguard. It currently has 37.65B total assets under management and has yielded an average annual return of 14.75% over the past 10 years. The fund has a dividend yield of 1.26% with an expense ratio of 0.04%.

SCHF’s dividend yield is 0.90% higher than that of VV (2.16% vs. 1.26%). Also, SCHF yielded on average 8.32% less per year over the past decade (6.43% vs. 14.75%). The expense ratio of SCHF is 0.02 percentage points higher than VV’s (0.06% vs. 0.04%).

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Fund Composition

Industry Exposure

SCHF vs. VV - Industry Exposure

SCHF VV
Technology 11.55% 25.38%
Industrials 14.86% 8.39%
Energy 4.23% 2.62%
Communication Services 5.65% 11.68%
Utilities 3.09% 2.35%
Healthcare 11.05% 13.22%
Consumer Defensive 9.41% 6.06%
Real Estate 3.17% 2.7%
Financial Services 17.85% 13.82%
Consumer Cyclical 10.87% 11.65%
Basic Materials 8.26% 2.13%

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 Vanguard Large-Cap Index Fund ETF Shares (VV) has the most exposure to the Technology sector at 25.38%. This is followed by Financial Services and Healthcare at 13.82% and 13.22% respectively. Utilities (2.35%), Energy (2.62%), and Real Estate (2.7%) only make up 7.67% of the fund’s total assets.

VV’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Consumer Cyclical, Communication Services, and Healthcare stocks at 6.06%, 8.39%, 11.65%, 11.68%, and 13.22%.

SCHF is 4.03% more exposed to the Financial Services sector than VV (17.85% vs 13.82%). SCHF’s exposure to Industrials and Technology stocks is 6.47% higher and 13.83% lower respectively (14.86% vs. 8.39% and 11.55% vs. 25.38%). In total, Real Estate, Energy, and Communication Services also make up 3.95% less of the fund’s holdings compared to VV (13.05% vs. 17.00%).

Holdings

SCHF - Holdings

SCHF Holdings Weight
Nestle SA 1.66%
Samsung Electronics Co Ltd 1.6%
ASML Holding NV 1.29%
Roche Holding AG 1.24%
Toyota Motor Corp 1.02%
LVMH Moet Hennessy Louis Vuitton SE 0.93%
Novartis AG 0.92%
Shopify Inc A 0.78%
AstraZeneca PLC 0.75%
SAP SE 0.74%

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%.

VV - Holdings

VV Holdings Weight
Apple Inc 5.7%
Microsoft Corp 5.35%
Amazon.com Inc 3.87%
Facebook Inc Class A 2.19%
Alphabet Inc Class A 1.93%
Alphabet Inc Class C 1.81%
Tesla Inc 1.37%
Berkshire Hathaway Inc Class B 1.3%
NVIDIA Corp 1.24%
JPMorgan Chase & Co 1.24%

VV’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 5.7%, 5.35%, 3.87%, 2.19%, and 1.93%.

Alphabet Inc Class C (1.81%), Tesla Inc (1.37%), and Berkshire Hathaway Inc Class B (1.3%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the VV’s holdings at 1.24% and 1.24%.

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Risk Analysis

SCHF VV
Mean Return 0.58 1.24
R-squared 98.16 99.86
Std. Deviation 15.08 13.75
Alpha 0.53 -0.08
Beta 0.99 1.01
Sharpe Ratio 0.42 1.04
Treynor Ratio 5.39 14.14

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

The Vanguard Large-Cap Index Fund ETF Shares (VV) has a Mean Return of 1.24 with a Sharpe Ratio of 1.04 and a Alpha of -0.08. Its Treynor Ratio is 14.14 while VV’s Beta is 1.01. Furthermore, the fund has a Standard Deviation of 13.75 and a R-squared of 99.86.

SCHF’s Mean Return is 0.66 points lower than that of VV and its R-squared is 1.70 points lower. With a Standard Deviation of 15.08, SCHF is slightly more volatile than VV. The Alpha and Beta of SCHF are 0.61 points higher and 0.02 points lower than VV’s Alpha and Beta.

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Performance

Annual Returns

SCHF vs. VV - Annual Returns

Year SCHF VV
2020 9.86% 20.99%
2019 22.15% 31.39%
2018 -14.39% -4.44%
2017 25.83% 22.03%
2016 2.88% 11.65%
2015 -2.44% 1.07%
2014 -4.44% 13.39%
2013 20.03% 32.65%
2012 17.12% 16.09%
2011 -12.32% 1.58%
2010 8.6% 15.81%

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 VV, returning 32.65% on an annual basis. The poorest year for VV in the last ten years was 2018, with a yield of -4.44%. Most years the Vanguard Large-Cap Index Fund ETF Shares has given investors modest returns, such as in 2014, 2010, and 2012, when gains were 13.39%, 15.81%, and 16.09% respectively.

Portfolio Growth

SCHF vs. VV - Portfolio Growth

Fund Initial Balance Final Balance CAGR
SCHF $10,000 $17,089 6.43%
VV $10,000 $37,103 14.75%

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 VV, the end total would have been $37,103. This equates to a $27,103 profit over 10 years and a compound annual growth rate (CAGR) of 14.75%.

SCHF’s CAGR is 8.32 percentage points lower than that of VV and as a result, would have yielded $20,014 less on a $10,000 investment. Thus, SCHF performed worse than VV by 8.32% annually.


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