What Is the Vanguard Small-Cap Value ETF, and Should You Buy It?

4 hours ago 1

Ben Gran, The Motley Fool

Wed, July 15, 2026 astatine 11:35 AM CDT 4 min read

The astir palmy stocks of the adjacent 10 years mightiness not beryllium the biggest names. According to caller Vanguard research, U.S. worth stocks and small-cap stocks are expected to outperform U.S. maturation and large-cap stocks. The concern firm's researchers judge that the biggest economical benefits from the artificial quality (AI) epoch mightiness yet spell to smaller companies.

Here's what Vanguard's exemplary projects for annualized returns successful the adjacent 10 years:

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Data source: Vanguard

There's nary warrant that immoderate concern company's probe volition beryllium 100% correct. But if you hold with the wide strategy that today's smaller companies and overlooked stocks mightiness beryllium amended investments during the adjacent 10 years, you mightiness privation to bargain the Vanguard Small-Cap Value ETF (NYSEMKT: VBR). Let's look astatine this worth banal exchange-traded money (ETF) and spot if it's worthy adding to your portfolio.

A savvy capitalist charts the show of the banal market.

Vanguard Small-Cap Value ETF (VBR): 835 stocks, 22 years of 9.5% annualized returns

The Vanguard Small-Cap Value ETF owns a full of 835 stocks with a median marketplace headdress of $10 cardinal each. This is simply a diversified money that makes it casual to ain hundreds of tiny U.S. worth companies astatine an ultra-low disbursal ratio of 0.05%.

The fund's apical holdings by assemblage see industrials (21.5% of the fund), financials (18.1%), user discretionary (13.9%), exertion (9.6%), and existent property (9.5%). This worth ETF has delivered a full instrumentality (by nett plus value) of 27.01% successful the past year, astir connected par with the S&P 500.

Over the longer term, this worth ETF has powerfully underperformed the S&P 500. Since its inception successful January 2004, the Vanguard Small-Cap Value ETF has delivered an mean yearly instrumentality of 9.51%. The S&P 500 has delivered full returns of 904.5% since this money was launched.

Is present a bully clip to bargain worth stocks?

Small-cap stocks don't ever underperform the market. Sometimes they outperform ample caps for a agelong time. For example, from 2010 to 2017, the Vanguard Small-Cap Value ETF delivered full returns of 156%, outperforming the S&P 500, which gained 132.9%.

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