Russell 1000 Value ETF Beats Growth Fund by 10.48 Percentage Points

The iShares Russell 1000 Value ETF (IWD) gained about 4.37% in October, while the iShares Russell 1000 Growth ETF (IWF) lost about 6.10% through the Oct. 30 close at 4 p.m. ET (20:00 UTC). The difference gave the value fund a 10.48-percentage-point lead for the month, based on unrounded returns.

The monthly figures are derived from each fund’s year-to-date net asset value total return at Sept. 30 and Oct. 30. IWD’s cumulative return moved from 19.11% to 24.32%, while IWF’s shifted from 6.15% to −0.33%. Because these are cumulative returns, the monthly results come from comparing the October-end return level with the September-end level, rather than simply subtracting the two year-to-date percentages. That calculation produces monthly returns of about 4.37% for IWD and −6.10% for IWF. Subtracting the displayed rounded returns gives 10.47 percentage points; the 10.48-point gap reflects the unrounded calculations.

The value fund’s lead was already evident in year-to-date performance at the end of September. IWD had returned 19.11% by Sept. 30, compared with 6.15% for IWF, a spread of 12.96 percentage points. By Oct. 30, IWD’s year-to-date return had reached 24.32%, while IWF’s stood at −0.33%. The figures compare NAV total returns, rather than changes in the funds’ share prices alone.

The ETFs track separate benchmarks: IWD follows the Russell 1000 Value Index, and IWF follows the Russell 1000 Growth Index. The Russell U.S. style indexes use book-to-price as a value measure. Growth measures include forecast earnings growth and historical sales-per-share growth.

Their portfolios also differed in technology exposure at the end of October. Information technology made up 19.35% of IWD’s portfolio by market value and 54.83% of IWF’s. Those allocations show a difference in portfolio composition, but do not by themselves establish what drove the funds’ October returns.