I reiterate my buy rating on VB despite recent underperformance, as its valuation remains attractive and technicals have stabilized after a difficult period. VB continues to outperform peer small-cap ETFs, maintains strong earnings growth prospects for 2025, and offers a low expense ratio with solid diversification. The ETF's depressed valuation, strong seasonality from May through July, and sector exposure to Industrials and Tech support my positive outlook.
Designed to provide broad exposure to the Small Cap Blend segment of the US equity market, the Vanguard Small-Cap ETF (VB) is a passively managed exchange traded fund launched on 01/26/2004.
One of the more important parts of smart investing is diversification. This has two benefits: It reduces risks by not relying on too few stocks, and it increases your long-term return potential.
Small-cap stocks are currently in correction territory and have underperformed the S&P 500. Small-cap stocks typically outperform during economic recoveries, but current economic indicators suggest potential softness and recession fears ahead. Despite attractive valuations relative to the S&P 500, small-cap stocks are not well-positioned to recover (for now) due to looming trade wars and economic pressures.
The Vanguard Small-Cap ETF (VB) was launched on 01/26/2004, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Blend segment of the US equity market.
Designed to provide broad exposure to the Small Cap Blend segment of the US equity market, the Vanguard Small-Cap ETF (VB) is a passively managed exchange traded fund launched on 01/26/2004.
I maintain a buy rating on VB due to its reasonable valuation, solid earnings growth, and bullish chart, despite a recent 10% correction. VB tracks the CRSP US Small Cap Index, offering a diversified small-cap portfolio with a modest P/E ratio and attractive PEG ratio near 1.5. The ETF has grown significantly in assets under management, features a low expense ratio of 0.05%, and has a forward dividend yield comparable to the S&P 500.
The S&P 500 (^GSPC -0.30%) is on track to finish above 20% for the seventh time in the 21st century. If it gains only a little momentum, it could end the year up over 30% for the first time since 1997.
Large-cap stocks, particularly mega-cap technology companies, have dominated market returns since the Federal Reserve began its aggressive rate-hiking campaign. From March 2022 through Nov. 2024, the S&P 500 delivered a total return of 38.3%, while the Russell 2000 produced a modest 14.9%.
The Vanguard Small-Cap ETF (VB) was launched on 01/26/2004, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Blend segment of the US equity market.
These ETFs give you exposure to companies from all size categories and abroad.
For investors seeking momentum, Vanguard Small-Cap ETF VB is probably on the radar. The fund just hit a 52-week high and is up 38.6% from its 52-week low price of $174.84/share.