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VTI vs. SCHX: What’s The Difference?

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

VTI and SCHX have the same expense ratio: 0.03%. VTI also has a lower exposure to the technology sector and a higher standard deviation. Overall, VTI has provided higher returns than SCHX over the past ten years.

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

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Summary

VTISCHX
NameVanguard Total Stock Market Index Fund ETF SharesSchwab U.S. Large-Cap ETF
CategoryLarge BlendLarge Blend
IssuerVanguardSchwab ETFs
AUM1.26T30.89B
Avg. Return14.70%14.60%
Div. Yield1.26%1.41%
Expense Ratio0.03%0.03%

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 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%.

VTI’s dividend yield is 0.15% lower than that of SCHX (1.26% vs. 1.41%). Also, VTI yielded on average 0.09% more per year over the past decade (14.70% vs. 14.60%). VTI and SCHX have the same expense ratio: 0.03%.

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Fund Composition

Industry Exposure

VTI vs. SCHX - Industry Exposure

VTISCHX
Technology24.1%25.13%
Industrials9.39%8.65%
Energy2.77%2.72%
Communication Services10.4%11.26%
Utilities2.29%2.37%
Healthcare13.64%13.04%
Consumer Defensive5.77%5.97%
Real Estate3.59%3.13%
Financial Services13.77%13.82%
Consumer Cyclical11.83%11.63%
Basic Materials2.44%2.28%

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 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%.

VTI is 1.03% less exposed to the Technology sector than SCHX (24.1% vs 25.13%). VTI’s exposure to Financial Services and Healthcare stocks is 0.05% lower and 0.60% higher respectively (13.77% vs. 13.82% and 13.64% vs. 13.04%). In total, Basic Materials, Energy, and Real Estate also make up 0.67% more of the fund’s holdings compared to SCHX (8.80% vs. 8.13%).

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%.

SCHX - Holdings

SCHX HoldingsWeight
Apple Inc5.37%
Microsoft Corp5.1%
Amazon.com Inc3.69%
Facebook Inc A2.08%
Alphabet Inc A1.84%
Alphabet Inc Class C1.78%
Berkshire Hathaway Inc Class B1.32%
Tesla Inc1.31%
NVIDIA Corp1.25%
JPMorgan Chase & Co1.18%

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%.

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Risk Analysis

VTISCHX
Mean Return1.231.24
R-squared99.2499.83
Std. Deviation14.1513.8
Alpha-0.57-0.14
Beta1.041.02
Sharpe Ratio11.03
Treynor Ratio13.5814.06

The Vanguard Total Stock Market Index Fund ETF Shares (VTI) has a Mean Return of 1.23 with a Standard Deviation of 14.15 and a Alpha of -0.57. Its Beta is 1.04 while VTI’s Treynor Ratio is 13.58. Furthermore, the fund has a R-squared of 99.24 and a Sharpe Ratio of 1.

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

VTI’s Mean Return is 0.01 points lower than that of SCHX and its R-squared is 0.59 points lower. With a Standard Deviation of 14.15, VTI is slightly more volatile than SCHX. The Alpha and Beta of VTI are 0.43 points lower and 0.02 points higher than SCHX’s Alpha and Beta.

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Performance

Annual Returns

VTI vs. SCHX - Annual Returns

YearVTISCHX
202020.95%20.9%
201930.8%31.4%
2018-5.13%-4.52%
201721.16%21.91%
201612.68%11.78%
20150.4%1.02%
201412.56%13.33%
201333.51%32.54%
201216.41%16.06%
20111.06%1.61%
201017.26%15.88%

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 SCHX, returning 32.54% on an annual basis. The poorest year for SCHX in the last ten years was 2018, with a yield of -4.52%. Most years the Schwab U.S. Large-Cap ETF has given investors modest returns, such as in 2014, 2010, and 2012, when gains were 13.33%, 15.88%, and 16.06% respectively.

Portfolio Growth

VTI vs. SCHX - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
VTI$10,000$36,37014.70%
SCHX$10,000$36,98714.60%

A $10,000 investment in VTI would have resulted in a final balance of $36,370. This is a profit of $26,370 over 10 years and amounts to a compound annual growth rate (CAGR) of 14.70%.

With a $10,000 investment in SCHX, the end total would have been $36,987. This equates to a $26,987 profit over 10 years and a compound annual growth rate (CAGR) of 14.60%.

VTI’s CAGR is 0.09 percentage points higher than that of SCHX and as a result, would have yielded $617 less on a $10,000 investment. Thus, VTI outperformed SCHX by 0.09% annually.


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