Small-cap value has done something in 2026 that few investors positioned for: it pulled meaningfully ahead of the growth complex that defined the prior decade.
Nomura joins Wall Street firms expecting no Fed rate cuts in 2026. These value, bank and cash-flow ETFs could benefit.
Avantis U.S. Small Cap Value ETF (AVUV) offers diversified exposure to U.S. small-cap value equities at a relatively moderate ~0.25% expense ratio. The valuation spread and gap between growth and value stocks remains near historically highly elevated levels, increasing the relative appeal of value-oriented allocations. AVUV's proposition is primarily factor-driven rather than security-selection driven, given its highly diversified portfolio structure with over 700 holdings.
The Avantis U.S. Small Cap Value ETF (NYSEARCA:AVUV | AVUV Price Prediction) is the actively managed option on this list, and that distinction matters more than the label suggests.
U.S. Small Cap Value trades near historical averages, while Large Cap Growth trades at more than 2x its long-term relative valuation. The price-to-book spread between growth and value is near historical extremes, a setup that has historically favored SCV outperformance. Institutional capital market assumptions continue to show higher expected real returns for small caps relative to large caps.
Avantis US Small Cap Value ETF offers diversified exposure to U.S. small-cap value stocks, targeting firms with strong fundamentals and low valuations. AVUV has delivered a 14.9% average annual return since inception, with a low 0.25% expense ratio and over $22B in assets as of February 2026. Small-cap value stocks are positioned for potential outperformance in 2026 due to lower interest rates, earnings growth, and rotation out of large-cap tech.
Avantis U.S. Small-Cap Value ETF delivers superior risk-adjusted returns by targeting small-cap stocks that are both cheap and profitable. AVUV's rules-based, actively managed process filters for value and profitability, largely avoiding unprofitable companies and minimizing stock-specific risk through broad diversification. The fund's unique adjustments to valuation and profitability metrics, along with disciplined transaction cost management, underpin its performance edge over peers.
There's a lot of buzz about the opportunity in US small cap stocks this year. There's a confluence of factors that seem aligned just right for the segment, chief amongst them earnings growth expectations.
Avantis US Small Cap Value ETF is rated 'Strong Buy' due to its superior factor loading, positive alpha, and attractive valuation. The current value-growth valuation spread exceeds levels seen since the Great Depression, signaling a historic opportunity for small-cap value exposure. AVUV offers a compelling risk-reward profile with a 0.25% expense ratio and recent outperformance versus the S&P 500, despite higher volatility.
On this episode of the “ETF of the Week” podcast, VettaFi's Head of Research, Todd Rosenbluth, discussed the Avantis U.S. Small Cap Value ETF (AVUV) with Chuck Jaffe of Money Life. The pair discussed several topics related to the fund to give investors a deeper understanding of the ETF.
VettaFi's Head of Research Todd Rosenbluth discussed the Avantis US Small Cap Value ETF (AVUV) on this week's “ETF of the Week” podcast with Chuck Jaffe of “Money Life.” For more news, information, and strategy, visit the Core Strategies Content Hub.
Avantis Investors, a shop within American Century Investments, saw its suite of strategies recently crossed $100 billion in total AUM. The firm hit that threshold just as its largest ETF by AUM, AVUV, spiked over $20 billion in AUM in the last week, itself.