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VTI vs. IJR: What’s The Difference?

The Vanguard Total Stock Market Index Fund ETF Shares (VTI) and the iShares Core S&P Small-Cap ETF (IJR) are both among the Top 100 ETFs. VTI is a Vanguard Large Blend fund and IJR is a iShares Small Blend fund. So, what’s the difference between VTI and IJR? And which fund is better?

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

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

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Summary

VTIIJR
NameVanguard Total Stock Market Index Fund ETF SharesiShares Core S&P Small-Cap ETF
CategoryLarge BlendSmall Blend
IssuerVanguardiShares
AUM1.26T68.64B
Avg. Return14.70%13.97%
Div. Yield1.26%0.96%
Expense Ratio0.03%0.06%

The Vanguard Total Stock Market Index Fund ETF Shares (VTI) is a Large Blend fund that is issued by Vanguard. It currently has 1.26T total assets under management and has yielded an average annual return of 14.70% over the past 10 years. The fund has a dividend yield of 1.26% with an expense ratio of 0.03%.

The iShares Core S&P Small-Cap ETF (IJR) is a Small Blend fund that is issued by iShares. It currently has 68.64B total assets under management and has yielded an average annual return of 13.97% over the past 10 years. The fund has a dividend yield of 0.96% with an expense ratio of 0.06%.

VTI’s dividend yield is 0.30% higher than that of IJR (1.26% vs. 0.96%). Also, VTI yielded on average 0.73% more per year over the past decade (14.70% vs. 13.97%). The expense ratio of VTI is 0.03 percentage points lower than IJR’s (0.03% vs. 0.06%).

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Fund Composition

Industry Exposure

VTI vs. IJR - Industry Exposure

VTIIJR
Technology24.1%14.32%
Industrials9.39%17.31%
Energy2.77%4.0%
Communication Services10.4%2.59%
Utilities2.29%1.8%
Healthcare13.64%11.55%
Consumer Defensive5.77%4.01%
Real Estate3.59%9.55%
Financial Services13.77%15.91%
Consumer Cyclical11.83%13.61%
Basic Materials2.44%5.34%

The Vanguard Total Stock Market Index Fund ETF Shares (VTI) has the most exposure to the Technology sector at 24.1%. This is followed by Financial Services and Healthcare at 13.77% and 13.64% respectively. Basic Materials (2.44%), Energy (2.77%), and Real Estate (3.59%) only make up 8.80% of the fund’s total assets.

VTI’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Healthcare stocks at 5.77%, 9.39%, 10.4%, 11.83%, and 13.64%.

The iShares Core S&P Small-Cap ETF (IJR) has the most exposure to the Industrials sector at 17.31%. This is followed by Financial Services and Technology at 15.91% and 14.32% respectively. Communication Services (2.59%), Energy (4.0%), and Consumer Defensive (4.01%) only make up 10.60% of the fund’s total assets.

IJR’s mid-section with moderate exposure is comprised of Basic Materials, Real Estate, Healthcare, Consumer Cyclical, and Technology stocks at 5.34%, 9.55%, 11.55%, 13.61%, and 14.32%.

VTI is 9.78% more exposed to the Technology sector than IJR (24.1% vs 14.32%). VTI’s exposure to Financial Services and Healthcare stocks is 2.14% lower and 2.09% higher respectively (13.77% vs. 15.91% and 13.64% vs. 11.55%). In total, Basic Materials, Energy, and Real Estate also make up 10.09% less of the fund’s holdings compared to IJR (8.80% vs. 18.89%).

Holdings

VTI - Holdings

VTI HoldingsWeight
Apple Inc4.9%
Microsoft Corp4.6%
Amazon.com Inc3.33%
Facebook Inc Class A1.88%
Alphabet Inc Class A1.66%
Alphabet Inc Class C1.56%
Tesla Inc1.18%
Berkshire Hathaway Inc Class B1.09%
NVIDIA Corp1.07%
JPMorgan Chase & Co1.06%

VTI’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 4.9%, 4.6%, 3.33%, 1.88%, and 1.66%.

Alphabet Inc Class C (1.56%), Tesla Inc (1.18%), and Berkshire Hathaway Inc Class B (1.09%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the VTI’s holdings at 1.07% and 1.06%.

IJR - Holdings

IJR HoldingsWeight
BlackRock Cash Funds Treasury SL Agency1.08%
GameStop Corp Class A0.86%
Omnicell Inc0.61%
Stamps.com Inc0.58%
Saia Inc0.57%
Power Integrations Inc0.57%
Exponent Inc0.54%
NeoGenomics Inc0.53%
Chart Industries Inc0.53%
Macy’s Inc0.51%

IJR’s Top Holdings are BlackRock Cash Funds Treasury SL Agency, GameStop Corp Class A, Omnicell Inc, Stamps.com Inc, and Saia Inc at 1.08%, 0.86%, 0.61%, 0.58%, and 0.57%.

Power Integrations Inc (0.57%), Exponent Inc (0.54%), and NeoGenomics Inc (0.53%) have a slightly smaller but still significant weight. Chart Industries Inc and Macy’s Inc are also represented in the IJR’s holdings at 0.53% and 0.51%.

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Performance

Annual Returns

VTI vs. IJR - Annual Returns

YearVTIIJR
202020.95%11.24%
201930.8%22.79%
2018-5.13%-8.43%
201721.16%13.2%
201612.68%26.49%
20150.4%-2.0%
201412.56%5.67%
201333.51%41.36%
201216.41%16.28%
20111.06%0.9%
201017.26%26.14%

VTI had its best year in 2013 with an annual return of 33.51%. VTI’s worst year over the past decade yielded -5.13% and occurred in 2018. In most years the Vanguard Total Stock Market Index Fund ETF Shares provided moderate returns such as in 2016, 2012, and 2010 where annual returns amounted to 12.68%, 16.41%, and 17.26% respectively.

The year 2013 was the strongest year for IJR, returning 41.36% on an annual basis. The poorest year for IJR in the last ten years was 2018, with a yield of -8.43%. Most years the iShares Core S&P Small-Cap ETF has given investors modest returns, such as in 2020, 2017, and 2012, when gains were 11.24%, 13.2%, and 16.28% respectively.

Portfolio Growth

VTI vs. IJR - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
VTI$10,000$42,64814.70%
IJR$10,000$38,80013.97%

A $10,000 investment in VTI would have resulted in a final balance of $42,648. This is a profit of $32,648 over 11 years and amounts to a compound annual growth rate (CAGR) of 14.70%.

With a $10,000 investment in IJR, the end total would have been $38,800. This equates to a $28,800 profit over 11 years and a compound annual growth rate (CAGR) of 13.97%.

VTI’s CAGR is 0.73 percentage points higher than that of IJR and as a result, would have yielded $3,848 more on a $10,000 investment. Thus, VTI outperformed IJR by 0.73% annually.


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