The Vanguard Total International Stock Index Fund ETF Shares (VXUS) and the SPDR S&P MIDCAP 400 ETF Trust (MDY) are both among the Top 100 ETFs. VXUS is a Vanguard Foreign Large Blend fund and MDY is a SPDR State Street Global Advisors Mid-Cap Blend fund. So, what’s the difference between VXUS and MDY? And which fund is better?
The expense ratio of VXUS is 0.15 percentage points lower than MDY’s (0.08% vs. 0.23%). VXUS also has a higher exposure to the financial services sector and a lower standard deviation. Overall, VXUS has provided lower returns than MDY over the past ten years.
In this article, we’ll compare VXUS vs. MDY. We’ll look at risk metrics and industry exposure, as well as at their performance and annual returns. Moreover, I’ll also discuss VXUS’s and MDY’s holdings, fund composition, and portfolio growth and examine how these affect their overall returns.
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Summary
| VXUS | MDY | |
| Name | Vanguard Total International Stock Index Fund ETF Shares | SPDR S&P MIDCAP 400 ETF Trust |
| Category | Foreign Large Blend | Mid-Cap Blend |
| Issuer | Vanguard | SPDR State Street Global Advisors |
| AUM | 404.73B | 21.31B |
| Avg. Return | 8.41% | 13.29% |
| Div. Yield | 2.44% | 0.94% |
| Expense Ratio | 0.08% | 0.23% |
The Vanguard Total International Stock Index Fund ETF Shares (VXUS) is a Foreign Large Blend fund that is issued by Vanguard. It currently has 404.73B total assets under management and has yielded an average annual return of 8.41% over the past 10 years. The fund has a dividend yield of 2.44% with an expense ratio of 0.08%.
The SPDR S&P MIDCAP 400 ETF Trust (MDY) is a Mid-Cap Blend fund that is issued by SPDR State Street Global Advisors. It currently has 21.31B total assets under management and has yielded an average annual return of 13.29% over the past 10 years. The fund has a dividend yield of 0.94% with an expense ratio of 0.23%.
VXUS’s dividend yield is 1.50% higher than that of MDY (2.44% vs. 0.94%). Also, VXUS yielded on average 4.88% less per year over the past decade (8.41% vs. 13.29%). The expense ratio of VXUS is 0.15 percentage points lower than MDY’s (0.08% vs. 0.23%).
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Fund Composition
Industry Exposure
| VXUS | MDY | |
| Technology | 13.07% | 14.74% |
| Industrials | 12.94% | 17.88% |
| Energy | 4.55% | 2.52% |
| Communication Services | 7.06% | 1.63% |
| Utilities | 2.94% | 2.84% |
| Healthcare | 9.19% | 11.17% |
| Consumer Defensive | 7.83% | 4.2% |
| Real Estate | 3.79% | 9.66% |
| Financial Services | 17.64% | 15.2% |
| Consumer Cyclical | 12.64% | 14.89% |
| Basic Materials | 8.37% | 5.27% |
The Vanguard Total International Stock Index Fund ETF Shares (VXUS) has the most exposure to the Financial Services sector at 17.64%. This is followed by Technology and Industrials at 13.07% and 12.94% respectively. Real Estate (3.79%), Energy (4.55%), and Communication Services (7.06%) only make up 15.40% of the fund’s total assets.
VXUS’s mid-section with moderate exposure is comprised of Consumer Defensive, Basic Materials, Healthcare, Consumer Cyclical, and Industrials stocks at 7.83%, 8.37%, 9.19%, 12.64%, and 12.94%.
The SPDR S&P MIDCAP 400 ETF Trust (MDY) has the most exposure to the Industrials sector at 17.88%. This is followed by Financial Services and Consumer Cyclical at 15.2% and 14.89% respectively. Energy (2.52%), Utilities (2.84%), and Consumer Defensive (4.2%) only make up 9.56% of the fund’s total assets.
MDY’s mid-section with moderate exposure is comprised of Basic Materials, Real Estate, Healthcare, Technology, and Consumer Cyclical stocks at 5.27%, 9.66%, 11.17%, 14.74%, and 14.89%.
VXUS is 2.44% more exposed to the Financial Services sector than MDY (17.64% vs 15.2%). VXUS’s exposure to Technology and Industrials stocks is 1.67% lower and 4.94% lower respectively (13.07% vs. 14.74% and 12.94% vs. 17.88%). In total, Real Estate, Energy, and Communication Services also make up 1.59% more of the fund’s holdings compared to MDY (15.40% vs. 13.81%).
Holdings
| VXUS Holdings | Weight |
| Taiwan Semiconductor Manufacturing Co Ltd | 1.62% |
| Tencent Holdings Ltd | 1.41% |
| Alibaba Group Holding Ltd Ordinary Shares | 1.26% |
| Nestle SA | 1.1% |
| Samsung Electronics Co Ltd | 1.05% |
| ASML Holding NV | 0.86% |
| Roche Holding AG | 0.81% |
| Toyota Motor Corp | 0.67% |
| LVMH Moet Hennessy Louis Vuitton SE | 0.61% |
| Novartis AG | 0.6% |
VXUS’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 1.62%, 1.41%, 1.26%, 1.1%, and 1.05%.
ASML Holding NV (0.86%), Roche Holding AG (0.81%), and Toyota Motor Corp (0.67%) have a slightly smaller but still significant weight. LVMH Moet Hennessy Louis Vuitton SE and Novartis AG are also represented in the VXUS’s holdings at 0.61% and 0.6%.
| MDY Holdings | Weight |
| Bio-Techne Corp | 0.75% |
| Molina Healthcare Inc | 0.63% |
| Cognex Corp | 0.63% |
| Fair Isaac Corp | 0.62% |
| XPO Logistics Inc | 0.61% |
| SolarEdge Technologies Inc | 0.61% |
| Signature Bank | 0.6% |
| Graco Inc | 0.55% |
| Camden Property Trust | 0.55% |
| FactSet Research Systems Inc | 0.54% |
MDY’s Top Holdings are Bio-Techne Corp, Molina Healthcare Inc, Cognex Corp, Fair Isaac Corp, and XPO Logistics Inc at 0.75%, 0.63%, 0.63%, 0.62%, and 0.61%.
SolarEdge Technologies Inc (0.61%), Signature Bank (0.6%), and Graco Inc (0.55%) have a slightly smaller but still significant weight. Camden Property Trust and FactSet Research Systems Inc are also represented in the MDY’s holdings at 0.55% and 0.54%.
Risk Analysis
| VXUS | MDY | |
| Mean Return | 0.56 | 1.08 |
| R-squared | 98.39 | 86.66 |
| Std. Deviation | 15.12 | 16.83 |
| Alpha | 0.31 | -4.1 |
| Beta | 0.99 | 1.15 |
| Sharpe Ratio | 0.4 | 0.73 |
| Treynor Ratio | 5.14 | 9.97 |
The Vanguard Total International Stock Index Fund ETF Shares (VXUS) has a Mean Return of 0.56 with a Alpha of 0.31 and a Beta of 0.99. Its Standard Deviation is 15.12 while VXUS’s Treynor Ratio is 5.14. Furthermore, the fund has a R-squared of 98.39 and a Sharpe Ratio of 0.4.
The SPDR S&P MIDCAP 400 ETF Trust (MDY) has a Sharpe Ratio of 0.73 with a Alpha of -4.1 and a Beta of 1.15. Its Mean Return is 1.08 while MDY’s Treynor Ratio is 9.97. Furthermore, the fund has a Standard Deviation of 16.83 and a R-squared of 86.66.
VXUS’s Mean Return is 0.52 points lower than that of MDY and its R-squared is 11.73 points higher. With a Standard Deviation of 15.12, VXUS is slightly less volatile than MDY. The Alpha and Beta of VXUS are 4.41 points higher and 0.16 points lower than MDY’s Alpha and Beta.
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Performance
Annual Returns
| Year | VXUS | MDY |
| 2020 | 11.32% | 13.51% |
| 2019 | 21.58% | 25.86% |
| 2018 | -14.42% | -11.28% |
| 2017 | 27.52% | 15.89% |
| 2016 | 4.72% | 20.33% |
| 2015 | -4.28% | -2.4% |
| 2014 | -4.17% | 9.42% |
| 2013 | 15.16% | 33.08% |
| 2012 | 18.22% | 17.58% |
| 2011 | 0.0% | -1.99% |
| 2010 | 0.0% | 26.17% |
VXUS had its best year in 2017 with an annual return of 27.52%. VXUS’s worst year over the past decade yielded -14.42% and occurred in 2018. In most years the Vanguard Total International Stock Index Fund ETF Shares provided moderate returns such as in 2010, 2016, and 2020 where annual returns amounted to 0.0%, 4.72%, and 11.32% respectively.
The year 2013 was the strongest year for MDY, returning 33.08% on an annual basis. The poorest year for MDY in the last ten years was 2018, with a yield of -11.28%. Most years the SPDR S&P MIDCAP 400 ETF Trust has given investors modest returns, such as in 2020, 2017, and 2012, when gains were 13.51%, 15.89%, and 17.58% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| VXUS | $10,000 | $19,315 | 8.41% |
| MDY | $10,000 | $29,536 | 13.29% |
A $10,000 investment in VXUS would have resulted in a final balance of $19,315. This is a profit of $9,315 over 9 years and amounts to a compound annual growth rate (CAGR) of 8.41%.
With a $10,000 investment in MDY, the end total would have been $29,536. This equates to a $19,536 profit over 9 years and a compound annual growth rate (CAGR) of 13.29%.
VXUS’s CAGR is 4.88 percentage points lower than that of MDY and as a result, would have yielded $10,221 less on a $10,000 investment. Thus, VXUS performed worse than MDY by 4.88% annually.
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