VTV vs. IJH: What’s The Difference?

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

The expense ratio of VTV is 0.01 percentage points lower than IJH’s (0.04% vs. 0.05%). VTV also has a higher exposure to the financial services sector and a lower standard deviation. Overall, VTV has provided lower returns than IJH over the past ten years.

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

Summary

VTV IJH
Name Vanguard Value Index Fund ETF Shares iShares Core S&P Mid-Cap ETF
Category Large Value Mid-Cap Blend
Issuer Vanguard iShares
AUM 125.77B 63.4B
Avg. Return 12.07% 13.50%
Div. Yield 2.15% 1.07%
Expense Ratio 0.04% 0.05%

The Vanguard Value Index Fund ETF Shares (VTV) is a Large Value fund that is issued by Vanguard. It currently has 125.77B total assets under management and has yielded an average annual return of 12.07% over the past 10 years. The fund has a dividend yield of 2.15% with an expense ratio of 0.04%.

The iShares Core S&P Mid-Cap ETF (IJH) is a Mid-Cap Blend fund that is issued by iShares. It currently has 63.4B total assets under management and has yielded an average annual return of 13.50% over the past 10 years. The fund has a dividend yield of 1.07% with an expense ratio of 0.05%.

VTV’s dividend yield is 1.08% higher than that of IJH (2.15% vs. 1.07%). Also, VTV yielded on average 1.42% less per year over the past decade (12.07% vs. 13.50%). The expense ratio of VTV is 0.01 percentage points lower than IJH’s (0.04% vs. 0.05%).

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Fund Composition

Industry Exposure

VTV vs. IJH - Industry Exposure

VTV IJH
Technology 7.86% 14.81%
Industrials 12.61% 18.09%
Energy 5.59% 2.5%
Communication Services 5.49% 1.57%
Utilities 5.37% 2.9%
Healthcare 19.84% 10.89%
Consumer Defensive 10.72% 4.02%
Real Estate 3.01% 10.04%
Financial Services 22.81% 14.85%
Consumer Cyclical 3.79% 14.91%
Basic Materials 2.91% 5.42%

The Vanguard Value Index Fund ETF Shares (VTV) has the most exposure to the Financial Services sector at 22.81%. This is followed by Healthcare and Industrials at 19.84% and 12.61% respectively. Real Estate (3.01%), Consumer Cyclical (3.79%), and Utilities (5.37%) only make up 12.17% of the fund’s total assets.

VTV’s mid-section with moderate exposure is comprised of Communication Services, Energy, Technology, Consumer Defensive, and Industrials stocks at 5.49%, 5.59%, 7.86%, 10.72%, and 12.61%.

The iShares Core S&P Mid-Cap ETF (IJH) has the most exposure to the Industrials sector at 18.09%. This is followed by Consumer Cyclical and Financial Services at 14.91% and 14.85% respectively. Energy (2.5%), Utilities (2.9%), and Consumer Defensive (4.02%) only make up 9.42% of the fund’s total assets.

IJH’s mid-section with moderate exposure is comprised of Basic Materials, Real Estate, Healthcare, Technology, and Financial Services stocks at 5.42%, 10.04%, 10.89%, 14.81%, and 14.85%.

VTV is 7.96% more exposed to the Financial Services sector than IJH (22.81% vs 14.85%). VTV’s exposure to Healthcare and Industrials stocks is 8.95% higher and 5.48% lower respectively (19.84% vs. 10.89% and 12.61% vs. 18.09%). In total, Real Estate, Consumer Cyclical, and Utilities also make up 15.68% less of the fund’s holdings compared to IJH (12.17% vs. 27.85%).

Holdings

VTV - Holdings

VTV Holdings Weight
Berkshire Hathaway Inc Class B 2.98%
JPMorgan Chase & Co 2.82%
Johnson & Johnson 2.6%
UnitedHealth Group Inc 2.27%
Procter & Gamble Co 1.98%
Bank of America Corp 1.91%
Exxon Mobil Corp 1.6%
Comcast Corp Class A 1.57%
Intel Corp 1.36%
Verizon Communications Inc 1.32%

VTV’s Top Holdings are Berkshire Hathaway Inc Class B, JPMorgan Chase & Co, Johnson & Johnson, UnitedHealth Group Inc, and Procter & Gamble Co at 2.98%, 2.82%, 2.6%, 2.27%, and 1.98%.

Bank of America Corp (1.91%), Exxon Mobil Corp (1.6%), and Comcast Corp Class A (1.57%) have a slightly smaller but still significant weight. Intel Corp and Verizon Communications Inc are also represented in the VTV’s holdings at 1.36% and 1.32%.

IJH - Holdings

IJH Holdings Weight
Bio-Techne Corp 0.8%
Molina Healthcare Inc 0.68%
Cognex Corp 0.68%
Fair Isaac Corp 0.64%
Camden Property Trust 0.62%
XPO Logistics Inc 0.6%
Masimo Corp 0.59%
SolarEdge Technologies Inc 0.57%
FactSet Research Systems Inc 0.57%
Graco Inc 0.56%

IJH’s Top Holdings are Bio-Techne Corp, Molina Healthcare Inc, Cognex Corp, Fair Isaac Corp, and Camden Property Trust at 0.8%, 0.68%, 0.68%, 0.64%, and 0.62%.

XPO Logistics Inc (0.6%), Masimo Corp (0.59%), and SolarEdge Technologies Inc (0.57%) have a slightly smaller but still significant weight. FactSet Research Systems Inc and Graco Inc are also represented in the IJH’s holdings at 0.57% and 0.56%.

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Risk Analysis

VTV IJH
Mean Return 1.05 1.13
R-squared 92.61 86.39
Std. Deviation 13.78 16.8
Alpha -1.92 -4.01
Beta 0.98 1.15
Sharpe Ratio 0.87 0.77
Treynor Ratio 11.94 10.55

The Vanguard Value Index Fund ETF Shares (VTV) has a Alpha of -1.92 with a Treynor Ratio of 11.94 and a Beta of 0.98. Its Mean Return is 1.05 while VTV’s Standard Deviation is 13.78. Furthermore, the fund has a R-squared of 92.61 and a Sharpe Ratio of 0.87.

The iShares Core S&P Mid-Cap ETF (IJH) has a Beta of 1.15 with a Sharpe Ratio of 0.77 and a Standard Deviation of 16.8. Its R-squared is 86.39 while IJH’s Mean Return is 1.13. Furthermore, the fund has a Alpha of -4.01 and a Treynor Ratio of 10.55.

VTV’s Mean Return is 0.08 points lower than that of IJH and its R-squared is 6.22 points higher. With a Standard Deviation of 13.78, VTV is slightly less volatile than IJH. The Alpha and Beta of VTV are 2.09 points higher and 0.17 points lower than IJH’s Alpha and Beta.

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Performance

Annual Returns

VTV vs. IJH - Annual Returns

Year VTV IJH
2020 2.23% 13.61%
2019 25.85% 26.14%
2018 -5.39% -11.14%
2017 17.12% 16.19%
2016 16.88% 20.63%
2015 -0.89% -2.23%
2014 13.19% 9.64%
2013 33.03% 33.4%
2012 15.19% 17.76%
2011 1.16% -1.89%
2010 14.45% 26.38%

VTV had its best year in 2013 with an annual return of 33.03%. VTV’s worst year over the past decade yielded -5.39% and occurred in 2018. In most years the Vanguard Value Index Fund ETF Shares provided moderate returns such as in 2014, 2010, and 2012 where annual returns amounted to 13.19%, 14.45%, and 15.19% respectively.

The year 2013 was the strongest year for IJH, returning 33.4% on an annual basis. The poorest year for IJH in the last ten years was 2018, with a yield of -11.14%. Most years the iShares Core S&P Mid-Cap ETF has given investors modest returns, such as in 2020, 2017, and 2012, when gains were 13.61%, 16.19%, and 17.76% respectively.

Portfolio Growth

VTV vs. IJH - Portfolio Growth

Fund Initial Balance Final Balance CAGR
VTV $10,000 $33,163 12.07%
IJH $10,000 $37,266 13.50%

A $10,000 investment in VTV would have resulted in a final balance of $33,163. This is a profit of $23,163 over 11 years and amounts to a compound annual growth rate (CAGR) of 12.07%.

With a $10,000 investment in IJH, the end total would have been $37,266. This equates to a $27,266 profit over 11 years and a compound annual growth rate (CAGR) of 13.50%.

VTV’s CAGR is 1.42 percentage points lower than that of IJH and as a result, would have yielded $4,103 less on a $10,000 investment. Thus, VTV performed worse than IJH by 1.42% annually.


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