The Vanguard Value Index Fund ETF Shares (VTV) and the iShares Core MSCI Total International Stock ETF (IXUS) are both among the Top 100 ETFs. VTV is a Vanguard Large Value fund and IXUS is a iShares Foreign Large Blend fund. So, what’s the difference between VTV and IXUS? And which fund is better?
The expense ratio of VTV is 0.05 percentage points lower than IXUS’s (0.04% vs. 0.09%). VTV also has a higher exposure to the financial services sector and a higher standard deviation. Overall, VTV has provided higher returns than IXUS over the past ten years.
In this article, we’ll compare VTV vs. IXUS. We’ll look at annual returns and holdings, as well as at their portfolio growth and risk metrics. Moreover, I’ll also discuss VTV’s and IXUS’s performance, industry exposure, and fund composition and examine how these affect their overall returns.
Summary
| VTV | IXUS | |
| Name | Vanguard Value Index Fund ETF Shares | iShares Core MSCI Total International Stock ETF |
| Category | Large Value | Foreign Large Blend |
| Issuer | Vanguard | iShares |
| AUM | 125.77B | 29.54B |
| Avg. Return | 12.07% | 6.09% |
| Div. Yield | 2.15% | 2.13% |
| Expense Ratio | 0.04% | 0.09% |
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 MSCI Total International Stock ETF (IXUS) is a Foreign Large Blend fund that is issued by iShares. It currently has 29.54B total assets under management and has yielded an average annual return of 6.09% over the past 10 years. The fund has a dividend yield of 2.13% with an expense ratio of 0.09%.
VTV’s dividend yield is 0.02% higher than that of IXUS (2.15% vs. 2.13%). Also, VTV yielded on average 5.99% more per year over the past decade (12.07% vs. 6.09%). The expense ratio of VTV is 0.05 percentage points lower than IXUS’s (0.04% vs. 0.09%).
Fund Composition
Industry Exposure
| VTV | IXUS | |
| Technology | 7.86% | 13.24% |
| Industrials | 12.61% | 12.78% |
| Energy | 5.59% | 4.39% |
| Communication Services | 5.49% | 7.09% |
| Utilities | 5.37% | 2.95% |
| Healthcare | 19.84% | 9.29% |
| Consumer Defensive | 10.72% | 8.19% |
| Real Estate | 3.01% | 3.66% |
| Financial Services | 22.81% | 17.34% |
| Consumer Cyclical | 3.79% | 12.57% |
| Basic Materials | 2.91% | 8.5% |
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 MSCI Total International Stock ETF (IXUS) has the most exposure to the Financial Services sector at 17.34%. This is followed by Technology and Industrials at 13.24% and 12.78% respectively. Real Estate (3.66%), Energy (4.39%), and Communication Services (7.09%) only make up 15.14% of the fund’s total assets.
IXUS’s mid-section with moderate exposure is comprised of Consumer Defensive, Basic Materials, Healthcare, Consumer Cyclical, and Industrials stocks at 8.19%, 8.5%, 9.29%, 12.57%, and 12.78%.
VTV is 5.47% more exposed to the Financial Services sector than IXUS (22.81% vs 17.34%). VTV’s exposure to Healthcare and Industrials stocks is 10.55% higher and 0.17% lower respectively (19.84% vs. 9.29% and 12.61% vs. 12.78%). In total, Real Estate, Consumer Cyclical, and Utilities also make up 7.01% less of the fund’s holdings compared to IXUS (12.17% vs. 19.18%).
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%.
| IXUS Holdings | Weight |
| Taiwan Semiconductor Manufacturing Co Ltd | 1.64% |
| Tencent Holdings Ltd | 1.35% |
| Alibaba Group Holding Ltd Ordinary Shares | 1.34% |
| Nestle SA | 1.1% |
| Samsung Electronics Co Ltd | 1.06% |
| ASML Holding NV | 0.9% |
| Roche Holding AG | 0.81% |
| LVMH Moet Hennessy Louis Vuitton SE | 0.67% |
| Novartis AG | 0.62% |
| Toyota Motor Corp | 0.59% |
IXUS’s Top Holdings are Taiwan Semiconductor Manufacturing Co Ltd, Tencent Holdings Ltd, Alibaba Group Holding Ltd Ordinary Shares, Nestle SA, and Samsung Electronics Co Ltd at 1.64%, 1.35%, 1.34%, 1.1%, and 1.06%.
ASML Holding NV (0.9%), Roche Holding AG (0.81%), and LVMH Moet Hennessy Louis Vuitton SE (0.67%) have a slightly smaller but still significant weight. Novartis AG and Toyota Motor Corp are also represented in the IXUS’s holdings at 0.62% and 0.59%.
Risk Analysis
| VTV | IXUS | |
| Mean Return | 1.05 | 0 |
| R-squared | 92.61 | 0 |
| Std. Deviation | 13.78 | 0 |
| Alpha | -1.92 | 0 |
| Beta | 0.98 | 0 |
| Sharpe Ratio | 0.87 | 0 |
| Treynor Ratio | 11.94 | 0 |
The Vanguard Value Index Fund ETF Shares (VTV) has a Alpha of -1.92 with a Mean Return of 1.05 and a Beta of 0.98. Its R-squared is 92.61 while VTV’s Treynor Ratio is 11.94. Furthermore, the fund has a Standard Deviation of 13.78 and a Sharpe Ratio of 0.87.
The iShares Core MSCI Total International Stock ETF (IXUS) has a Sharpe Ratio of 0 with a Treynor Ratio of 0 and a Standard Deviation of 0. Its Mean Return is 0 while IXUS’s R-squared is 0. Furthermore, the fund has a Alpha of 0 and a Beta of 0.
VTV’s Mean Return is 1.05 points higher than that of IXUS and its R-squared is 92.61 points higher. With a Standard Deviation of 13.78, VTV is slightly more volatile than IXUS. The Alpha and Beta of VTV are 1.92 points lower and 0.98 points higher than IXUS’s Alpha and Beta.
Performance
Annual Returns
| Year | VTV | IXUS |
| 2020 | 2.23% | 11.14% |
| 2019 | 25.85% | 21.85% |
| 2018 | -5.39% | -14.55% |
| 2017 | 17.12% | 28.08% |
| 2016 | 16.88% | 4.66% |
| 2015 | -0.89% | -4.62% |
| 2014 | 13.19% | -3.96% |
| 2013 | 33.03% | 15.85% |
| 2012 | 15.19% | 0.0% |
| 2011 | 1.16% | 0.0% |
| 2010 | 14.45% | 0.0% |
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 2017 was the strongest year for IXUS, returning 28.08% on an annual basis. The poorest year for IXUS in the last ten years was 2018, with a yield of -14.55%. Most years the iShares Core MSCI Total International Stock ETF has given investors modest returns, such as in 2011, 2010, and 2016, when gains were 0.0%, 0.0%, and 4.66% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| VTV | $10,000 | $18,692 | 12.07% |
| IXUS | $10,000 | $14,209 | 6.09% |
A $10,000 investment in VTV would have resulted in a final balance of $18,692. This is a profit of $8,692 over 7 years and amounts to a compound annual growth rate (CAGR) of 12.07%.
With a $10,000 investment in IXUS, the end total would have been $14,209. This equates to a $4,209 profit over 7 years and a compound annual growth rate (CAGR) of 6.09%.
VTV’s CAGR is 5.99 percentage points higher than that of IXUS and as a result, would have yielded $4,483 more on a $10,000 investment. Thus, VTV outperformed IXUS by 5.99% annually.
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