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Should Vanguard Russell 2000 ETF (VTWO) Be on Your Investing Radar?
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If you're interested in broad exposure to the Small Cap Blend segment of the US equity market, look no further than the Vanguard Russell 2000 ETF (VTWO - Free Report) , a passively managed exchange traded fund launched on 09/22/2010.
The fund is sponsored by Vanguard. It has amassed assets over $6.31 billion, making it one of the larger ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.10%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.55%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 17.50% of the portfolio. Financials and Healthcare round out the top three.
Looking at individual holdings, Super Micro Computer Inc. (SMCI - Free Report) accounts for about 0.47% of total assets, followed by Shockwave Medical Inc. and Inspire Medical Systems Inc. (INSP - Free Report) .
Performance and Risk
VTWO seeks to match the performance of the Russell 2000 Index before fees and expenses. The Russell 2000 Index measures the performance of the small-cap segment of the U.S. equity universe.
The ETF has added roughly 6.55% so far this year and was up about 0.11% in the last one year (as of 09/12/2023). In the past 52-week period, it has traded between $66.63 and $80.31.
The ETF has a beta of 1.16 and standard deviation of 23.63% for the trailing three-year period, making it a medium risk choice in the space. With about 1912 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard Russell 2000 ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VTWO is an outstanding option for investors seeking exposure to the Style Box - Small Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $52.42 billion in assets, iShares Core S&P Small-Cap ETF has $68.39 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should Vanguard Russell 2000 ETF (VTWO) Be on Your Investing Radar?
If you're interested in broad exposure to the Small Cap Blend segment of the US equity market, look no further than the Vanguard Russell 2000 ETF (VTWO - Free Report) , a passively managed exchange traded fund launched on 09/22/2010.
The fund is sponsored by Vanguard. It has amassed assets over $6.31 billion, making it one of the larger ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.10%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.55%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 17.50% of the portfolio. Financials and Healthcare round out the top three.
Looking at individual holdings, Super Micro Computer Inc. (SMCI - Free Report) accounts for about 0.47% of total assets, followed by Shockwave Medical Inc. and Inspire Medical Systems Inc. (INSP - Free Report) .
Performance and Risk
VTWO seeks to match the performance of the Russell 2000 Index before fees and expenses. The Russell 2000 Index measures the performance of the small-cap segment of the U.S. equity universe.
The ETF has added roughly 6.55% so far this year and was up about 0.11% in the last one year (as of 09/12/2023). In the past 52-week period, it has traded between $66.63 and $80.31.
The ETF has a beta of 1.16 and standard deviation of 23.63% for the trailing three-year period, making it a medium risk choice in the space. With about 1912 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard Russell 2000 ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VTWO is an outstanding option for investors seeking exposure to the Style Box - Small Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $52.42 billion in assets, iShares Core S&P Small-Cap ETF has $68.39 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.