SCHX vs. VXF: What’s The Difference?

The Schwab U.S. Large-Cap ETF (SCHX) and the Vanguard Extended Market Index Fund ETF Shares (VXF) are both among the Top 100 ETFs. SCHX is a Schwab ETFs Large Blend fund and VXF is a Vanguard Mid-Cap Growth fund. So, what’s the difference between SCHX and VXF? And which fund is better?

The expense ratio of SCHX is 0.03 percentage points lower than VXF’s (0.03% vs. 0.06%). SCHX also has a higher exposure to the technology sector and a lower standard deviation. Overall, SCHX has provided lower returns than VXF over the past ten years.

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

Summary

SCHX VXF
Name Schwab U.S. Large-Cap ETF Vanguard Extended Market Index Fund ETF Shares
Category Large Blend Mid-Cap Growth
Issuer Schwab ETFs Vanguard
AUM 30.89B 114.53B
Avg. Return 14.60% 15.47%
Div. Yield 1.41% 1.19%
Expense Ratio 0.03% 0.06%

The Schwab U.S. Large-Cap ETF (SCHX) is a Large Blend fund that is issued by Schwab ETFs. It currently has 30.89B total assets under management and has yielded an average annual return of 14.60% over the past 10 years. The fund has a dividend yield of 1.41% with an expense ratio of 0.03%.

The Vanguard Extended Market Index Fund ETF Shares (VXF) is a Mid-Cap Growth fund that is issued by Vanguard. It currently has 114.53B total assets under management and has yielded an average annual return of 15.47% over the past 10 years. The fund has a dividend yield of 1.19% with an expense ratio of 0.06%.

SCHX’s dividend yield is 0.22% higher than that of VXF (1.41% vs. 1.19%). Also, SCHX yielded on average 0.87% less per year over the past decade (14.60% vs. 15.47%). The expense ratio of SCHX is 0.03 percentage points lower than VXF’s (0.03% vs. 0.06%).

Fund Composition

Industry Exposure

SCHX vs. VXF - Industry Exposure

SCHX VXF
Technology 25.13% 23.61%
Industrials 8.65% 11.31%
Energy 2.72% 2.46%
Communication Services 11.26% 7.29%
Utilities 2.37% 1.65%
Healthcare 13.04% 15.25%
Consumer Defensive 5.97% 3.09%
Real Estate 3.13% 8.16%
Financial Services 13.82% 12.56%
Consumer Cyclical 11.63% 11.35%
Basic Materials 2.28% 3.26%

The Schwab U.S. Large-Cap ETF (SCHX) has the most exposure to the Technology sector at 25.13%. This is followed by Financial Services and Healthcare at 13.82% and 13.04% respectively. Utilities (2.37%), Energy (2.72%), and Real Estate (3.13%) only make up 8.22% of the fund’s total assets.

SCHX’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Healthcare stocks at 5.97%, 8.65%, 11.26%, 11.63%, and 13.04%.

The Vanguard Extended Market Index Fund ETF Shares (VXF) has the most exposure to the Technology sector at 23.61%. This is followed by Healthcare and Financial Services at 15.25% and 12.56% respectively. Energy (2.46%), Consumer Defensive (3.09%), and Basic Materials (3.26%) only make up 8.81% of the fund’s total assets.

VXF’s mid-section with moderate exposure is comprised of Communication Services, Real Estate, Industrials, Consumer Cyclical, and Financial Services stocks at 7.29%, 8.16%, 11.31%, 11.35%, and 12.56%.

SCHX is 1.52% more exposed to the Technology sector than VXF (25.13% vs 23.61%). SCHX’s exposure to Financial Services and Healthcare stocks is 1.26% higher and 2.21% lower respectively (13.82% vs. 12.56% and 13.04% vs. 15.25%). In total, Utilities, Energy, and Real Estate also make up 4.05% less of the fund’s holdings compared to VXF (8.22% vs. 12.27%).

Holdings

SCHX - Holdings

SCHX Holdings Weight
Apple Inc 5.37%
Microsoft Corp 5.1%
Amazon.com Inc 3.69%
Facebook Inc A 2.08%
Alphabet Inc A 1.84%
Alphabet Inc Class C 1.78%
Berkshire Hathaway Inc Class B 1.32%
Tesla Inc 1.31%
NVIDIA Corp 1.25%
JPMorgan Chase & Co 1.18%

SCHX’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc A, and Alphabet Inc A at 5.37%, 5.1%, 3.69%, 2.08%, and 1.84%.

Alphabet Inc Class C (1.78%), Berkshire Hathaway Inc Class B (1.32%), and Tesla Inc (1.31%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the SCHX’s holdings at 1.25% and 1.18%.

VXF - Holdings

VXF Holdings Weight
Square Inc A 1.2%
Zoom Video Communications Inc 1.04%
Uber Technologies Inc 0.93%
Moderna Inc 0.9%
Blackstone Group Inc 0.83%
Snap Inc Class A 0.8%
Twilio Inc A 0.73%
DocuSign Inc 0.68%
CrowdStrike Holdings Inc Class A 0.63%
Marvell Technology Inc 0.6%

VXF’s Top Holdings are Square Inc A, Zoom Video Communications Inc, Uber Technologies Inc, Moderna Inc, and Blackstone Group Inc at 1.2%, 1.04%, 0.93%, 0.9%, and 0.83%.

Snap Inc Class A (0.8%), Twilio Inc A (0.73%), and DocuSign Inc (0.68%) have a slightly smaller but still significant weight. CrowdStrike Holdings Inc Class A and Marvell Technology Inc are also represented in the VXF’s holdings at 0.63% and 0.6%.

Risk Analysis

SCHX VXF
Mean Return 1.24 1.24
R-squared 99.83 85.73
Std. Deviation 13.8 18.04
Alpha -0.14 -3.26
Beta 1.02 1.23
Sharpe Ratio 1.03 0.79
Treynor Ratio 14.06 10.92

The Schwab U.S. Large-Cap ETF (SCHX) has a Sharpe Ratio of 1.03 with a Standard Deviation of 13.8 and a Alpha of -0.14. Its R-squared is 99.83 while SCHX’s Mean Return is 1.24. Furthermore, the fund has a Treynor Ratio of 14.06 and a Beta of 1.02.

The Vanguard Extended Market Index Fund ETF Shares (VXF) has a Sharpe Ratio of 0.79 with a Mean Return of 1.24 and a Standard Deviation of 18.04. Its Beta is 1.23 while VXF’s Treynor Ratio is 10.92. Furthermore, the fund has a R-squared of 85.73 and a Alpha of -3.26.

SCHX’s Mean Return is 0.00 points lower than that of VXF and its R-squared is 14.10 points higher. With a Standard Deviation of 13.8, SCHX is slightly less volatile than VXF. The Alpha and Beta of SCHX are 3.12 points higher and 0.21 points lower than VXF’s Alpha and Beta.

Performance

Annual Returns

SCHX vs. VXF - Annual Returns

Year SCHX VXF
2020 20.9% 32.19%
2019 31.4% 28.04%
2018 -4.52% -9.37%
2017 21.91% 18.1%
2016 11.78% 16.16%
2015 1.02% -3.26%
2014 13.33% 7.55%
2013 32.54% 38.37%
2012 16.06% 18.48%
2011 1.61% -3.61%
2010 15.88% 27.55%

SCHX had its best year in 2013 with an annual return of 32.54%. SCHX’s worst year over the past decade yielded -4.52% and occurred in 2018. In most years the Schwab U.S. Large-Cap ETF provided moderate returns such as in 2014, 2010, and 2012 where annual returns amounted to 13.33%, 15.88%, and 16.06% respectively.

The year 2013 was the strongest year for VXF, returning 38.37% on an annual basis. The poorest year for VXF in the last ten years was 2018, with a yield of -9.37%. Most years the Vanguard Extended Market Index Fund ETF Shares has given investors modest returns, such as in 2016, 2017, and 2012, when gains were 16.16%, 18.1%, and 18.48% respectively.

Portfolio Growth

SCHX vs. VXF - Portfolio Growth

Fund Initial Balance Final Balance CAGR
SCHX $10,000 $36,987 14.60%
VXF $10,000 $34,598 15.47%

A $10,000 investment in SCHX would have resulted in a final balance of $36,987. This is a profit of $26,987 over 10 years and amounts to a compound annual growth rate (CAGR) of 14.60%.

With a $10,000 investment in VXF, the end total would have been $34,598. This equates to a $24,598 profit over 10 years and a compound annual growth rate (CAGR) of 15.47%.

SCHX’s CAGR is 0.87 percentage points lower than that of VXF and as a result, would have yielded $2,389 more on a $10,000 investment. Thus, SCHX performed worse than VXF by 0.87% annually.


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