IJJ vs. IWN: Can the Mid-Cap ETF Compete with a Small-Cap Fund?

Core Insights - The iShares Russell 2000 Value ETF (IWN) and iShares SP Mid-Cap 400 Value ETF (IJJ) were both launched 20 years ago but have diverged in performance and characteristics [1][2]. Cost & Size Comparison - IWN has an expense ratio of 0.24% and an AUM of $12.59 billion, while IJJ has a lower expense ratio of 0.18% and an AUM of $8.47 billion [3][4]. - The 1-year return for IWN is 18.44%, compared to IJJ's 10.84%, and IWN has a dividend yield of 1.53% versus IJJ's 1.7% [3]. Performance & Risk Comparison - Over the past five years, IWN experienced a maximum drawdown of 26.71%, while IJJ had a lower drawdown of 22.68% [5]. - A $1,000 investment in IWN would have grown to $1,338, whereas the same investment in IJJ would have grown to $1,528 [5]. Portfolio Composition - IJJ focuses on mid-cap value stocks, with significant holdings in financial services, industrials, and consumer cyclical sectors, totaling 311 holdings [6]. - IWN, in contrast, holds a broader array of 1,413 small-cap stocks, with top holdings including EchoStar Corp., Hecla Mining Company, and TTM Technologies, reflecting a wide diversification [7]. Investment Implications - Investors' choice between IWN and IJJ may hinge on their risk tolerance, as small-cap stocks (IWN) are generally more volatile than mid-cap stocks (IJJ) [8][10]. - IJJ has outperformed IWN by over 20% in both the last five years and since inception, making it a more stable option with potential for price gains [10].