Launched on September 22, 2010, the Vanguard Russell 2000 Value Index Fund ETF Shares (VTWV) 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 $1.07 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.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.06%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.74%.
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 Financials sector -- about 24.7% of the portfolio. Industrials and Healthcare round out the top three.
Looking at individual holdings, Echostar Corp (SATS) accounts for about 1.04% of total assets, followed by Hecla Mining Co (HL) and Ttm Technologies Inc (TTMI).
Performance and Risk
VTWV seeks to match the performance of the Russell 2000 Value Index before fees and expenses. The Russell 2000 Value Index measures the performance of the small-cap value segment of the U.S. equity universe.
The ETF has gained about 6.92% so far this year and was up about 45.72% in the last one year (as of 04/08/2026). In the past 52-week period, it has traded between $119.45 and $177.34.
The ETF has a beta of 1.02 and standard deviation of 20.73% for the trailing three-year period, making it a medium risk choice in the space. With about 1430 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard Russell 2000 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, VTWV 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 $12.56 billion in assets, Vanguard Small-Cap Value Index Fund ETF Shares has $32.87 billion. IWN has an expense ratio of 0.24% and VBR charges 0.05%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds 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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Vanguard Russell 2000 Value Index Fund ETF Shares (VTWV): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).