Vanguard Russell 2000 Growth ETF (NASDAQ: VTWG)

Latest news for Vanguard Russell 2000 Growth ETF (NASDAQ:VTWG)

Vanguard Russell 2000 Growth ETF

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The fund employs an indexing investment approach designed to track the performance of the Russell 2000 Growth Index. The index is designed to measure the performance of small-capitalization growth stocks in the United States. The advisor attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the index, holding each stock in approximately the same proportion as its weighting in the index.

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3 Vanguard ETFs That Just Got Cheaper

Market Rout Crush Small Caps the Most: 7 ETFs in Focus

Guide to Small Cap Growth ETFs Investing  - ETF News And Commentary

In the world of exchange traded funds, Vanguard is famous for low fees. Across various equity market segments and some corners of the fixed income universe, if there&#39;s a Vanguard ETF for it, there&#39;s a reasonably good chance that product is the cheapest or one of the least expensive in its respective asset class.

To its credit, Vanguard doesn&#39;t rest on its low cost laurels. The issuer frequently lowers fees on ETFs as those products attract more assets, providing investors with cost efficiencies that prove meaningful over the long term.

The Pennsylvania-based was recently at it again as it was revealed Vanguard trimmed expense ratios on 15 of its equity-based ETFs tracking Russell and S&amp;P benchmark.

Let&#39;s examine a few of Vanguard&#39;s previously inexpensive now even cheaper ETFs here.

Vanguard Russell 1000 Value ETF (VONV)

With value stocks receiving increased attention, the Vanguard Russell 1000 Value ETF (NASDAQ:<a class="ticker" href="/stock/VONV#NASDAQ">VONV</a>) may have found its way into the spotlight anyway, but a fee cut could move that process along. VONV&#39;s new expense ratio <a href="https://www.inquirer.com/business/vanguard-schwab-fidelity-etf-fee-war-20191107.html?mod=article_inline">is 0.15% per year</a>, or $15 on a $10,000 investment, down from 0.20%.

There are some cheaper value ETFs on the market, but many lack the depth of VONV and other Russell 1000 Value Index tracking funds. This Vanguard fund holds 765 stocks, giving it a deep bench compared to some rival large-cap value funds.

Up almost 20% year to date, VONV allocates 29.5% of its weight to financial services stocks. The overweight to that sector is par for the course with value ETFs. Consumer discretionary and health care names combine for about 23% of VONV&#39;s roster.

Vanguard S&amp;P 500 Growth ETF (VOOG)

Investors don&#39;t have to be dedicated to value or growth. The factors can be combined and it might be a good time to consider such a strategy with value looking attractive while growth is far from done. Even for investors opting to emphasize growth, the Vanguard S&amp;P 500 Growth ETF (NASDAQ:<a class="ticker" href="/stock/VOOG#NASDAQ">VOOG</a>) is now less expensive with annual fee of 0.10%, down from 0.15%.

VOOG targets the S&amp;P 500 Growth Index, one of the most widely observed gauges of growth stocks. The fund holds 297 stocks with a median market value of $145.6 billion and its top 10 holdings <a href="https://investor.vanguard.com/etf/profile/portfolio/voog">combine for nearly a third of its weight</a>.

As is the case with value ETFs, sector allocations can be predictable, but in different directions, with growth funds. VOOG devotes almost 27% of its weight to technology stocks while the communication services and consumer cyclical sectors combine for 26.60%.

Vanguard Russell 2000 Growth ETF (VTWG)

Small-cap ETFs are usually more expensive than their large-cap rivals and the same is true of factor-based strategies compared to cap-weighted funds. Put those traits together and it makes for a pricier ETF. However, Vanguard Russell 2000 Growth ETF (NASDAQ:<a class="ticker" href="/stock/VTWG#NASDAQ">VTWG</a>) is reasonably priced with a new annual fee of 0.10%, down from 0.15%.

VTWG merits near-term consideration because the seasonally strong period for small caps is near and the fund is higher by 4.62% over the past month. This inexpensive Vanguard now resides 2.19% below its 52-week high.

Small-cap growth ETFs are often test investors&#39; sense of risk and reward. Over the past three years, VTWG has been more volatile than the Russell 2000 Index, but the Vanguard has also topped that small-cap benchmark by 920 basis points over that span.

Related Links:

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Though the U.S. markets performed reasonably well during the final quarter of 2013, they lost strength in the first quarter of this year. Beginning of the end of the era of cheap money, emerging market turmoil, concerns over slowdown in China, the second largest economy and geo-political crises in Russia dampened spirits (read: <a href="http://www.zacks.com/stock/news/127671/3-commodity-etfs-surging-on-russia-sanctions">3 Commodity ETFs Surging on Russia Sanctions</a>). 
  
However, the chilly U.S. weather was deemed to be the main spoilsport for the slowdown in the broader economy in the first quarter. Things are expected to turn around this quarter with the economy returning to health. The recent in line Jobless Claims and Trade Deficit data point towards the improving tone in economic activity. 
  
Along with this the strengthening job market, rebounding auto sales and increasing consumer spending all signal toward improving domestic strength. Given the improving domestic market, smaller companies are expected to be the primary beneficiaries. 
  
In fact, small cap stocks have outperformed large cap stocks over the past five years. The Russell 2000 Index of small cap stocks has generated a compounded five-year return of 152.27%, against 120.5% generated by the large cap index, S&P 500 (read: <a href="http://www.zacks.com/stock/news/126301/3-small-cap-etfs-surging-in-the-past-month">3 Small Cap ETFs Surging in the Past Month</a>). 
  
Small cap companies usually focus more on the domestic segment as compared to larger companies which have a more international exposure. Small caps are thus expected to deliver superior returns than their larger counterparts. 
  
Growth in Focus 
  
Growth stocks usually enjoy a competitive edge against their competitors. This is due to the fact that growth companies primarily reinvest a major portion of their retained earnings in capital projects and pay out smaller dividends. 
  
However, it is worth noting that growth stocks have comparatively higher P/B, P/S and P/E ratios and exhibit a higher degree of volatility especially compared to value stocks. 
  
Thus, given the strengths and weakness of small cap growth stocks, a look at a top ranked small cap ETF will be a good idea to capture a surge, especially based on our Zacks ETF Ranking system. 
  
About the Zacks ETF Rank 
  
The Zacks ETF Rank provides a recommendation for the ETF in the context of our outlook for the underlying industry, sector, style box or asset class (Read: <a href="http://www.zacks.com/stock/news/94561/zacks-etf-rank-guide">Zacks ETF Rank Guide</a>). 
  
The aim of our models is to select the best ETF within each risk category. We assign each ETF one of the five ranks within each risk bucket. Thus, the Zacks ETF Rank reflects the expected return of an ETF relative to other products with a similar level of risk. 
  
For investors seeking to apply this methodology to their portfolio in the small cap space, we have taken a closer look at the top ranked VTWG. This ETF has a Zacks ETF Rank of 1 or ‘Strong Buy' (see the full list of <a href="http://www.zacks.com/funds/top-etfs">top ranked ETFs</a>) and is detailed below. 
  
Vanguard Russell 2000 Growth ETF (VTWG) 
 
The fund seeks to track the performance of the Russell 2000 Growth Index before fees and expenses, having amassed $130.9 million since inception. The index primarily holds growth stocks of small U.S. companies (see <a href="http://www.zacks.com/etf/etf_category_details.php?cat=Small-Cap-ETFs&i=3">all the Small Cap ETFs here</a>). 
 
Due to this focus, the fund holds a huge basket of 1180 stocks which are quite well diversified. None of the individual holdings form more than 0.61% of total assets. CoStar Group Inc., Athenahealth Inc. and Acuity Brands are the top three holdings of the fund. 
 
Sector-wise, the fund allocates more than one-fifth of its assets towards Healthcare, followed by Technology (18.8%) and Consumer Discretionary (16.5%). Energy, Consumer Staples and Utilities have the least allocation in the fund. 
 
The fund seems to be a little light on volumes, having a daily average volume of just 20,000 shares. However, the fund is a low-cost option having an annual expense of just 20 basis points. 
 
Though it has been choppy in the past week, this fund is still up roughly 30% in the past year, and thanks to its top ranked status, it could be a solid choice for investors seeking more small cap exposure at this time. 
  
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. <a href="http://www.zacks.com/registration/pfp/?ALERT=RPT_7BST_LP194&ADID=ZACKS_PFP_7BEST_ETF">Click to get this free report >></a> 
   <a href="http://www.zacks.com/registration/pfp/?ALERT=ETF225&adid=BENZ_CONTENT_ETF_ARTCAT_ETF_NEWS_AND_COMMENTARY&d_alert=rd_final_rank&t=VTWG&split=1">VANGD-RUS 2000G (NASDAQ: <a class="ticker" href="/stock/vtwg#NASDAQ">VTWG</a>): ETF Research Reports</a>   <a href="http://www.zacks.com/stock/news/128839/top-ranked-small-cap-growth-etf-in-focus-vtwg">To read this article on Zacks.com click here.</a>   <a href="http://www.zacks.com/">Zacks Investment Research</a>   <a href="http://www.zacks.com/registration/pfp/?ALERT=RPT_7BST_LP194&ADID=ZACKS_PFP_7BEST_ETF">Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report</a>

Top Ranked Small Cap Growth ETF in Focus: VTWG - ETF News And Commentary

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