Launched on September 9, 2010, the Vanguard S&P Small-Cap 600 Value Index Fund ETF Shares (VIOV) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Vanguard. It has amassed assets over $1.71 billion, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
Small cap companies have market capitalization below $2 billion. They usually have higher potential than large and mid cap companies with stocks but higher risk.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. While value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.1%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.62%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector -- about 21.6% of the portfolio. Consumer Discretionary and Industrials round out the top three.
Looking at individual holdings, Eastman Chemical Co (EMN) accounts for about 1.12% of total assets, followed by Jackson Financial Inc (JXN) and Lkq Corp (LKQ).
The top 10 holdings account for about 7.45% of total assets under management.
Performance and Risk
VIOV seeks to match the performance of the S&P SmallCap 600 Value Index before fees and expenses. The S&P SmallCap 600 Value Index represents the value companies of the S&P SmallCap 600 Index.
The ETF has added roughly 13.26% so far this year and was up about 37.8% in the last one year (as of 05/12/2026). In the past 52-week period, it has traded between $81.09 and $111.76.
The ETF has a beta of 1.01 and standard deviation of 21.14% for the trailing three-year period, making it a medium risk choice in the space. With about 464 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard S&P Small-Cap 600 Value Index Fund ETF Shares holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VIOV is an excellent option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Value ETF (IWN) and the Vanguard Small-Cap Value Index Fund ETF Shares (VBR) track a similar index. While iShares Russell 2000 Value ETF has $13.76 billion in assets, Vanguard Small-Cap Value Index Fund ETF Shares has $34.95 billion. IWN has an expense ratio of 0.24% and VBR charges 0.05%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are 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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Vanguard S&P Small-Cap 600 Value Index Fund ETF Shares (VIOV): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).