Equity: U.S. - Small Cap

NUSC Top Performer Intra-day
Price $25.81
Today’s Change +0.02%(0.08)
10:03am 02/23/2017
OUSM Bottom Performer Intra-day
Price 0.00
Today’s Change 0.00%(0.00)
  • Overview
  • Efficiency
  • Tradability
  • Fit

ETF.com Insight

The US small-cap equity space is crowded—20+ funds offer some take on small-caps, be it straight-ahead market-cap, an index-based strategy or active management.

Far and awayin some cases, tracking differences blur the distinction between fees the most popular small-cap ETFs are those tracking market-weight indexes: the Russell 2000 and S&P 600. In fact, three of the market-weight funds (IWM, IJR and VB) together dominate small-cap assets. The rest of the assets are split between lesser-known market-cap funds, fundamentals-focused strategies and alpha-seeking funds.

The good news for small-cap investors is the top funds in the space capture the market return at extremely low cost. Taking the largest small-cap ETF as an example, IWM offers exposure to nearly 2,000 stocks with excellent liquidity, at typical holding costs lower than its fee. Vanguard’s VB, which tracks 1,500 stocks in a CRSP index, also tends to cost even less than its low fee.

What distinguishes the large number of market-weight ETFs from each other? Often, the answer is “very little.” Expense ratios and liquidity are the main distinguishing factors, and in some cases, tracking differences blur the distinction between fees. Investors here can choose their favorite index and are still likely to get an excellent price and deep liquidity.

The small-cap ETFs tracking alternative indexes are a little more varied. The remaining funds offer niche strategies in everything from dividend weighted, revenue weighted, to so-called 'core' indexes. Some of these funds are barely a blip on the radar, asset-wise, but others, like the WisdomTree SmallCap Dividend ETF (DES), have attracted hundreds of millions. The less popular of these ETFs often have serious liquidity concerns, so keep an eye on the Tradability score of anything that looks appealing.

Those that prefer active management have 1 choice (IESM), but assets and liquidity are weak for the relatively new fund. (Insight updated 02/22/17)

All Funds (36)

VB $17.68 B 17677627211.3 dirt-cheap all-in costs

A 97
E
99
99
T
99
99
F
97
97

SCHA $5.19 B 5190389844.2 very low all-in costs

A 96
E
100
100
T
98
98
F
96
96

VIOO $576.62 M 576620750 Decent but eclipsed by IJR

A 96
E
97
97
T
97
97
F
96
96

SLY $721.6 M 721603607.21286 IJR is more liquid

A 96
E
98
98
T
88
88
F
96
96

IJR $29.73 B 29726321735 Trades easily

A 96
E
100
100
T
98
98
F
96
96

DES $2.09 B 2085610560 stable and liquid

A 92
E
92
92
T
94
94
F
92
92

FNDA $1.54 B 1541895784.1229 viable assets and liquidity

A 92
E
95
95
T
97
97
F
92
92

JKJ $250.14 M 250139000 not as liquid as some

A 91
E
97
97
T
85
85
F
91
91

IWM $36.69 B 36689119340 Extremely large & liquid

A 91
E
100
100
T
98
98
F
91
91

VTWO $995.38 M 995376000 rock solid but lags IWM in liquidiy

A 91
E
97
97
T
98
98
F
91
91

FYX $543.31 M 543312110.88 very expensive to hold

A 91
E
88
88
T
96
96
F
91
91

TWOK $213.7 M 213701550.4 lags IWM and VTWO in liquidity

A 89
E
97
97
T
88
88
F
89
89

EES $483.98 M 483982290 tracks its index well

A 84
E
93
93
T
86
86
F
84
84

DGRS $103.18 M 103184245 investor interest still weak

A 76
E
93
93
T
85
85
F
76
76

XSLV $945.18 M 945182100 Low Volatility

A 66
E
97
97
T
92
92
F
66
66

SMLV $204.95 M 204953119.8 Low AUM, low trading volume

A 62
E
99
99
T
79
79
F
62
62

EWSC $32.88 M 32878300 same index as EQWS

B 93
E
91
91
T
58
58
F
93
93

EQWS $19.95 M 19945500 paltry assets

B 83
E
94
94
T
61
61
F
83
83

RWJ $508.61 M 508610209.8 high holding costs

B 82
E
85
85
T
91
91
F
82
82

DWAS $186.26 M 186263650 popular but not cheap to hold

B 69
E
91
91
T
82
82
F
69
69

CSF $45.0 M 45001000 Low-vol market timer

B 67
E
88
88
T
67
67
F
67
67

SCAP $3.45 M 3453080.576 N/A

F 74
E
60
60
T
57
57
F
74
74

PSC $252.35 M 252349813.5141 N/A

N/A 0
E
0
-1
T
0
-1
F
0
-1

CSA $20.95 M 20945000 higher fee

N/A 0
E
0
-1
T
0
-1
F
0
-1

JPSE $27.88 M 27878341.586042 N/A

N/A 0
E
0
-1
T
0
-1
F
0
-1

CSB $26.63 M 26630500 N/A

N/A 0
E
0
-1
T
0
-1
F
0
-1

XSHD $7.69 M 7686325.621 N/A

N/A 0
E
0
-1
T
0
-1
F
0
-1

DESC $3.18 M 3183531.835 N/A

N/A 0
E
0
-1
T
0
-1
F
0
-1

SMDV $398.85 M 398850000 low assets, weak liquidity

N/A 0
E
0
-1
T
0
-1
F
0
-1

NUSC $11.53 M 11530170 N/A

N/A 0
E
0
-1
T
0
-1
F
0
-1

SMLF $39.85 M 39845850 New; trade with care

N/A 0
E
0
-1
T
0
-1
F
0
-1

OUSM $21.85 M 21845747 N/A

N/A 0
E
0
-1
T
0
-1
F
0
-1

SMMV $5.33 M 5328260 N/A

N/A 0
E
0
-1
T
0
-1
F
0
-1

ZSML $1.34 M 1344500 Looks for companies with the biggest earnings increases

F 68
E
54
54
T
39
39
F
68
68

IESM $8.36 M 8361150 thin investor interest

C 78
E
84
84
T
58
58
F
78
78

EWRS $35.93 M 35931000 same index as EQWS

B 72
E
87
87
T
59
59
F
72
72

ETF.com Grade as 02/16/17

Equity: U.S. - Small Cap

Performance Dispersion
Performance  [as of 02/21/17] 1 Month 3 Month YTD 1 Year 3 Years 5 Years 10 Years
Benchmark: MSCI USA Small Cap4.46%7.86%5.11%38.52%8.26%13.21%--
A 96.536764VB17677627211.3VBVanguard Small-Cap Index Fund4.36%7.90%5.34%37.43%8.41%13.53%8.11%
A 96.211986SCHA5190389844.2SCHASchwab U.S. Small-Cap ETF4.16%7.38%4.60%39.33%8.17%13.62%--
A 95.92507VIOO576620750VIOOVanguard S&P Small Cap 600 Index Fund ETF4.24%7.37%2.96%41.13%11.12%14.72%--
A 95.828697SLY721603607.21286SLYSPDR S&P 600 Small Cap ETF4.23%7.51%2.93%41.08%11.09%14.84%9.16%
A 95.751392IJR29726321735IJRiShares Core S&P Small Cap ETF4.19%7.24%2.98%41.00%11.08%14.94%8.70%
A 91.911526DES2085610560DESWisdomTree SmallCap Dividend Fund2.39%5.61%0.74%40.85%11.06%14.65%7.19%
A 91.813165FNDA1541895784.1229FNDASchwab Fundamental US Small Co. Index ETF3.96%8.11%3.99%39.70%9.62%----
A 91.464089JKJ250139000JKJiShares Morningstar Small-Cap ETF4.43%7.28%4.19%37.62%9.55%13.34%7.31%
A 91.401081IWM36689119340IWMiShares Russell 2000 ETF4.28%6.98%3.97%41.74%8.17%13.01%7.01%
A 91.297853VTWO995376000VTWOVanguard Russell 2000 Index Fund4.16%6.91%3.96%41.65%8.12%12.95%--
A 90.544773FYX543312110.88FYXFirst Trust Small Cap Core AlphaDEX Fund3.88%6.24%3.36%39.10%6.32%11.63%--
A 89.191499TWOK213701550.4TWOKSPDR Russell 2000 ETF4.26%6.88%4.11%41.90%8.22%----
A 83.64443EES483982290EESWisdomTree SmallCap Earnings Fund2.40%7.02%0.91%45.63%8.83%13.10%--
A 75.601419DGRS103184245DGRSWisdomTree US Smallcap Quality Dividend Growth Fund1.63%3.47%0.19%38.64%9.68%----
A 65.855957XSLV945182100XSLVPowerShares S&P SmallCap Low Volatility Portfolio2.21%5.89%0.23%35.80%14.92%----
A 62.316604SMLV204953119.8SMLVSPDR SSGA US Small Cap Low Volatility Index ETF2.78%5.53%0.43%36.69%13.15%----
B 93.330006EWSC32878300EWSCGuggenheim S&P SmallCap 600 Equal Weight ETF2.72%6.10%1.18%43.20%4.45%10.21%--
B 82.822242EQWS19945500EQWSPowerShares Russell 2000 Equal Weight Portfolio2.64%6.07%1.67%45.62%8.53%11.59%4.56%
B 82.12713RWJ508610209.8RWJOppenheimer Small Cap Revenue ETF4.71%9.13%3.37%48.43%10.25%14.88%--
B 68.667555DWAS186263650DWASPowerShares DWA SmallCap Momentum Portfolio4.70%5.19%3.74%32.22%2.17%----
B 66.85271CSF45001000CSFVictoryShares US Discovery Enhanced Volatility Weighted Index ETF3.59%6.06%1.51%29.82%------
F 74.282477SCAP3453080.576SCAPAdvisorShares Cornerstone Small Cap ETF2.33%4.99%2.42%--------
N/A 0PSC252349813.5141PSCPrincipal U.S. Small Cap Index ETF4.21%7.85%4.01%--------
N/A 0CSA20945000CSAVictoryShares US Small Cap Volatility Wtd Index ETF3.28%6.06%1.55%39.85%------
N/A 0JPSE27878341.586042JPSEJPMorgan Diversified Return U.S. Small Cap Equity ETF3.70%5.44%2.23%--------
N/A 0CSB26630500CSBVictoryShares US Small Cap High Div Volatility Wtd ETF1.02%4.44%-0.63%33.34%------
N/A 0XSHD7686325.621XSHDPowerShares S&P SmallCap High Dividend Low Volatility Portfolio0.94%---0.15%--------
N/A 0DESC3183531.835DESCDeutsche X-trackers Russell 2000 Comprehensive Factor ETF2.79%6.05%0.25%--------
N/A 0SMDV398850000SMDVProShares Russell 2000 Dividend Growers ETF1.65%5.53%-0.45%32.47%------
N/A 0NUSC11530170NUSCNuShares ESG Small-Cap ETF3.26%--4.18%--------
N/A 0SMLF39845850SMLFiShares Edge MSCI Multifactor USA Small-Cap ETF3.63%6.96%3.19%35.96%------
N/A 0OUSM21845747OUSMO'Shares FTSE Russell Small Cap Quality Dividend ETF3.18%--3.22%--------
N/A 0SMMV5328260SMMViShares Edge MSCI Min Vol USA Small-Cap ETF3.12%6.90%3.23%--------
F 67.528426ZSML1344500ZSMLETFS Zacks Earnings Small-Cap U.S. Index Fund5.28%14.69%-4.28%32.80%------
C 78.062121909754IESM8361150IESMiShares Enhanced US Small-Cap ETF2.65%11.34%13.46%12.25%7.95%----
B 71.940939152313EWRS35931000EWRSGuggenheim Russell 2000 Equal Weight-13.64%-18.45%-14.72%-20.44%1.32%2.67%--
All returns over 1 year are annualized. All returns are total returns unless otherwise stated.

ETF.com Efficiency Insight

Fee wars among ETF issuers have driven holding costs down. Small-cap ETFs holding hundreds of stocks are now available for under 15 basis points annually. Low fees are a positiveSCHA's actual holding cost is even lower than its fee contributor to great tracking and to actual investor holding costs. Securities-lending revenue and turnover due to non-cap-weighted strategies also drive tracking performance.

SCHA and VB stand out as low-fee leaders charging under 10 bps. Amazingly, each fund’s actual holding cost (as measured by median tracking difference) is even lower than its fee to the point where the funds are effectively free to hold.

GURX, ZSML and FYX stand out at the other extreme with the segment’s highest fees. Actual holding costs for these are higher still, approaching 100 bps.

Such cost differences count for a lot in the case of large, multiyear allocations.

Costs and tracking differences certainly vary among the funds, but so do risks, especially the risk that an ETF will close due to lack of interest. Several small-cap funds have tiny asset bases, and could be shut down by their issuers. (Other metrics beyond AUM also go into our qualitative risk level.) Specifically, watch out for SMLV, DGRS and PXSC. If a fund does close, rarely do investors lose the value of their investment, but closure does typically trigger a tax event for holders of the ETF, and investors must cope with reinvestment. All things equal, it’s clearly preferable to invest in a stable fund.

Tracking risks aren’t a consideration for the segment’s lone actively-managed fund, IESM. Still, investors here should keep a watchful eye on the funds slender asset base.

One last caveat: Investors should look beyond holdings costs as a proxy for all-in costs when choosing an ETF in this space. Trading costs can quickly outweigh the savings from choosing cheaper but less liquid funds, especially when the fee difference is a handful of basis points for shorter holding periods. (Insight updated 02/22/17)

All Funds (36)

100
99.531232
99
99.008478
99
98.98167
98
97.984058
97
97.498497
97
97.275312
97
97.238619
97
97.098263
97
96.50028
95
95.196627
94
93.925504
93
93.467353
93
92.579057
92
92.340229
91
90.843806
91
90.821229
88
88.366003
88
87.828182
85
85.004467
60
60.189189
100
100
100
100
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
54
54.11577
84
83.629378793993
87
87.007897976144

ETF.com Grade as 02/16/17

Equity: U.S. - Small Cap

Tracking Difference (12 Month)

Ticker Expense Ratio Median Max. Upside Max. Downside Max LT/ST Cap Gains Rate Rule Legal Structure Fund Closure Risk Efficiency
SMMV iShares Edge MSCI Min Vol USA Small-Cap ETF 0.20% -- -- -- 20.00% / 39.60% Low 0
FNDA Schwab Fundamental US Small Co. Index ETF 0.32% -0.24% -0.18% -0.41% 20.00% / 39.60% Low 95.196627
SMLV SPDR SSGA US Small Cap Low Volatility Index ETF 0.12% -0.16% 0.16% -0.34% 20.00% / 39.60% Low 98.98167
PSC Principal U.S. Small Cap Index ETF 0.38% -- -- -- -- / -- N/A 0
FYX First Trust Small Cap Core AlphaDEX Fund 0.64% -0.52% -0.45% -0.66% 20.00% / 39.60% Low 88.366003
TWOK SPDR Russell 2000 ETF 0.10% 0.25% 0.32% -0.05% 20.00% / 39.60% Low 97.498497
CSA VictoryShares US Small Cap Volatility Wtd Index ETF 0.35% -- -- -- 20.00% / 39.60% Medium 0
JPSE JPMorgan Diversified Return U.S. Small Cap Equity ETF 0.39% -- -- -- 20.00% / 39.60% Low 0
VB Vanguard Small-Cap Index Fund 0.08% 0.02% 0.07% 0.01% 20.00% / 39.60% Low 99.008478
CSB VictoryShares US Small Cap High Div Volatility Wtd ETF 0.35% -- -- -- 20.00% / 39.60% Medium 0
XSHD PowerShares S&P SmallCap High Dividend Low Volatility Portfolio 0.30% -- -- -- -- / -- Low 0
IJR iShares Core S&P Small Cap ETF 0.07% -0.01% 0.04% -0.12% 20.00% / 39.60% Low 100
VIOO Vanguard S&P Small Cap 600 Index Fund ETF 0.15% 0.06% 0.14% -0.09% 20.00% / 39.60% Low 97.275312
CSF VictoryShares US Discovery Enhanced Volatility Weighted Index ETF 0.38% -- -- -- 20.00% / 39.60% Low 87.828182
NUSC NuShares ESG Small-Cap ETF 0.40% -- -- -- -- / -- Low 0
IWM iShares Russell 2000 ETF 0.20% 0.09% 0.11% 0.05% 20.00% / 39.60% Low 99.531232
VTWO Vanguard Russell 2000 Index Fund 0.15% 0.02% 0.06% -0.01% 20.00% / 39.60% Low 97.238619
DES WisdomTree SmallCap Dividend Fund 0.38% -0.15% -0.06% -0.39% 20.00% / 39.60% Low 92.340229
OUSM O'Shares FTSE Russell Small Cap Quality Dividend ETF 0.48% -- -- -- -- / -- Low 0
JKJ iShares Morningstar Small-Cap ETF 0.25% -0.10% -0.06% -0.33% 20.00% / 39.60% Low 96.50028
XSLV PowerShares S&P SmallCap Low Volatility Portfolio 0.25% -0.29% -0.25% -0.40% 20.00% / 39.60% Low 97.098263
DGRS WisdomTree US Smallcap Quality Dividend Growth Fund 0.38% -0.13% -0.07% -0.33% 20.00% / 39.60% Low 93.467353
RWJ Oppenheimer Small Cap Revenue ETF 0.39% -0.70% -0.45% -1.16% 20.00% / 39.60% Low 85.004467
DWAS PowerShares DWA SmallCap Momentum Portfolio 0.60% -0.56% -0.49% -0.73% 20.00% / 39.60% Low 90.843806
SCHA Schwab U.S. Small-Cap ETF 0.06% 0.02% 0.07% -0.04% 20.00% / 39.60% Low 100
EWSC Guggenheim S&P SmallCap 600 Equal Weight ETF 0.41% -0.35% -0.20% -0.70% 20.00% / 39.60% Low 90.821229
EES WisdomTree SmallCap Earnings Fund 0.38% -0.11% 0.04% -0.29% 20.00% / 39.60% Low 92.579057
SLY SPDR S&P 600 Small Cap ETF 0.15% -0.01% 0.01% -0.16% 20.00% / 39.60% Low 97.984058
DESC Deutsche X-trackers Russell 2000 Comprehensive Factor ETF 0.30% -- -- -- 20.00% / 39.60% High 0
EQWS PowerShares Russell 2000 Equal Weight Portfolio 0.25% -0.28% -0.12% -0.42% 20.00% / 39.60% Medium 93.925504
SMDV ProShares Russell 2000 Dividend Growers ETF 0.40% -- -- -- 20.00% / 39.60% Low 0
SCAP AdvisorShares Cornerstone Small Cap ETF 0.90% -- -- -- 20.00% / 39.60% High 60.189189
SMLF iShares Edge MSCI Multifactor USA Small-Cap ETF 0.30% -0.37% -0.16% -0.87% 20.00% / 39.60% Low 0
ZSML ETFS Zacks Earnings Small-Cap U.S. Index Fund -- -- -- 20.00% / 39.60% Closing 54.11577
IESM iShares Enhanced US Small-Cap ETF -- -- -- 20.00% / 39.60% Closing 83.629378793993
EWRS Guggenheim Russell 2000 Equal Weight -0.13% 0.02% -0.39% 20.00% / 39.60% Low 87.007897976144

ETF.com Tradability Insight

Tradability can determine whether a small-cap ETF is truly investment-worthy or not. Several funds with otherwise-attractive strategies and efficient management trade at large spreads. TheIWM trades more than $3B most days, a massive sum cost of a bad trade can far outweigh the small differences in annual fees between competing ETFs.

The largest funds here provide some of the best liquidity that ETFs have to offer. IWM, iShares Russell 2000 ETF, trades well more than $3B most days—a massive sum—at penny-wide spreads. In fact, all three of the top-trading small-cap funds (IWM, IJR and VB) trade huge amounts daily, and will absorb institutional-size trades with little impact. To be sure, these funds offer outstanding Tradability for retail-sized orders too.

However, watch out for the funds that occupy the other end of the liquidity spectrum. For instance, PXSC trades at very thin volumes—under 1,000 shares most days—and spreads are wide. Placing a market order in such a fund is a recipe for high cost execution.

Poor liquidity isn’t confined to more esoteric strategies— plain-vanilla funds like TWOK (the SPDR Russell 2000) trade thinly, so double-check Tradability scores even if the fund sounds safe. All told, poor liquidity can add significant cost—and time spent—to the investment. The silver lining in the US small-cap segment is that the primary liquidity of these ETFs tends to be high, so if you can place large transactions through a liquidity provider, you’re still likely to get a fair price. Institutional traders should nonetheless check for potential price impact for creates and redeems (via underlying volume/unit), as funds like SMLV, IESM and XSLV have less liquid underlying names. (Insight updated 02/22/17)

All Funds (36)

99
99.042187
98
98.377886
98
98.334203
98
97.951263
98
97.659873
97
97.186798
97
96.973431
96
95.543583
94
94.028945
92
92.321004
91
91.00543
88
87.870407
88
87.694555
86
85.640444
85
85.266555
85
85.096369
82
81.680058
79
79.30322
67
66.902574
61
61.115659
58
57.899712
57
57.244611
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
39
39.34955
58
57.52387108872
59
59.346433883911

ETF.com Grade as 02/16/17

Equity: U.S. - Small Cap

Ticker Median Daily Volume ($) Average Spread Creation Unit/Day Market Hours Overlap Underlying Volume/Unit % Creation Cost Per Unit (%) Impediment to Creations Score - Tradability
RWJ Oppenheimer Small Cap Revenue ETF $3.94 M 0.15% 1.16 100.00% 0.27% 0.09% None 91.00543
PSC Principal U.S. Small Cap Index ETF $9.58 K 0.42% 0.01 100.00% 0.04% 0.11% None 0
SCHA Schwab U.S. Small-Cap ETF $30.37 M 0.05% 9.77 100.00% 0.02% 0.05% None 97.951263
JPSE JPMorgan Diversified Return U.S. Small Cap Equity ETF $17.63 K 0.19% 0.01 100.00% 0.03% 0.18% None 0
CSA VictoryShares US Small Cap Volatility Wtd Index ETF $66.56 K 0.34% 0.03 100.00% 0.08% 0.04% None 0
CSB VictoryShares US Small Cap High Div Volatility Wtd ETF $164.29 K 0.28% 0.08 100.00% 0.47% 0.01% None 0
SLY SPDR S&P 600 Small Cap ETF $4.18 M 0.28% 0.70 100.00% 0.16% 0.05% None 87.870407
XSHD PowerShares S&P SmallCap High Dividend Low Volatility Portfolio $184.27 K 0.41% 0.14 100.00% 0.50% 0.04% None 0
CSF VictoryShares US Discovery Enhanced Volatility Weighted Index ETF $231.63 K 0.28% 0.12 100.00% 0.08% 0.04% None 66.902574
SMDV ProShares Russell 2000 Dividend Growers ETF $4.6 M 0.14% 3.48 100.00% 0.50% 0.02% None 0
NUSC NuShares ESG Small-Cap ETF $8.05 K 0.47% 0.00 100.00% 0.02% 0.04% None 0
DES WisdomTree SmallCap Dividend Fund $11.55 M 0.12% 2.81 100.00% 0.19% 0.04% None 94.028945
SMLF iShares Edge MSCI Multifactor USA Small-Cap ETF $167.52 K 0.72% 0.09 100.00% 0.05% 0.08% None 0
OUSM O'Shares FTSE Russell Small Cap Quality Dividend ETF $537.77 K 0.17% 0.39 100.00% 0.04% 0.04% None 0
DGRS WisdomTree US Smallcap Quality Dividend Growth Fund $839.47 K 0.19% 0.50 100.00% 0.16% 0.03% None 85.096369
SMLV SPDR SSGA US Small Cap Low Volatility Index ETF $1.4 M 0.34% 0.30 100.00% 0.63% 0.01% None 79.30322
DWAS PowerShares DWA SmallCap Momentum Portfolio $875.23 K 0.28% 0.43 100.00% 0.31% 0.02% None 81.680058
TWOK SPDR Russell 2000 ETF $1.54 M 0.27% 0.38 100.00% 0.04% 0.06% None 87.694555
EES WisdomTree SmallCap Earnings Fund $1.83 M 0.28% 0.49 100.00% 0.08% 0.15% None 85.640444
VB Vanguard Small-Cap Index Fund $98.08 M 0.03% 29.88 100.00% 0.02% 0.01% None 99.042187
EQWS PowerShares Russell 2000 Equal Weight Portfolio $93.28 K 0.35% 0.05 100.00% 0.09% 0.05% None 61.115659
VIOO Vanguard S&P Small Cap 600 Index Fund ETF $4.89 M 0.07% 1.56 100.00% 0.08% 0.02% None 97.186798
VTWO Vanguard Russell 2000 Index Fund $9.68 M 0.04% 3.49 100.00% 0.03% 0.04% None 98.377886
FNDA Schwab Fundamental US Small Co. Index ETF $8.5 M 0.09% 4.94 100.00% 0.02% 0.03% None 96.973431
XSLV PowerShares S&P SmallCap Low Volatility Portfolio $7.76 M 0.10% 3.61 100.00% 0.37% 0.02% None 92.321004
FYX First Trust Small Cap Core AlphaDEX Fund $2.84 M 0.12% 1.03 100.00% 0.10% 0.02% None 95.543583
EWSC Guggenheim S&P SmallCap 600 Equal Weight ETF $205.16 K 0.49% 0.08 100.00% 0.11% 0.12% None 57.899712
IJR iShares Core S&P Small Cap ETF $211.52 M 0.03% 44.74 100.00% 0.09% 0.04% None 97.659873
DESC Deutsche X-trackers Russell 2000 Comprehensive Factor ETF $17.67 K 0.15% 0.00 100.00% 0.07% 0.13% None 0
IWM iShares Russell 2000 ETF $3.43 B 0.01% 508.04 100.00% 0.07% 0.04% None 98.334203
SCAP AdvisorShares Cornerstone Small Cap ETF $18.8 K 0.40% 0.02 100.00% 0.06% 0.06% None 57.244611
JKJ iShares Morningstar Small-Cap ETF $759.58 K 0.12% 0.09 100.00% 0.22% 0.01% None 85.266555
SMMV iShares Edge MSCI Min Vol USA Small-Cap ETF $37.35 K 0.47% 0.02 100.00% 0.05% 0.08% None 0
ZSML ETFS Zacks Earnings Small-Cap U.S. Index Fund $0 0.00 100.00% 0.02% 0.02% None 39.34955
IESM iShares Enhanced US Small-Cap ETF $102.89 K 0.06 100.00% 0.00% 0.06% None 57.52387108872
EWRS Guggenheim Russell 2000 Equal Weight $134.43 K 0.07 98.00% 0.09% 0.17% None 59.346433883911

ETF.com/ Block Liquidity

FYX
5
4
3
2
1
IJR
5
4
3
2
1
IWM
5
4
3
2
1
JKJ
5
4
3
2
1
RWJ
5
4
3
2
1
SCHA
5
4
3
2
1
SLY
5
4
3
2
1
SMLF
5
4
3
2
1
SMLV
5
4
3
2
1
TWOK
5
4
3
2
1
VB
5
4
3
2
1
VIOO
5
4
3
2
1
VTWO
5
4
3
2
1
XSLV
5
4
3
2
1
EWSC
5
4
3
2
1
CSF
5
4
3
2
1
OUSM
5
4
3
2
1
DES
5
4
3
2
1
DGRS
5
4
3
2
1
DWAS
5
4
3
2
1
EES
5
4
3
2
1
FNDA
5
4
3
2
1
SMDV
5
4
3
2
1
DESC
5
4
3
2
1
SCAP
5
4
3
2
1
SMMV
5
4
3
2
1
PSC
5
4
3
2
1
JPSE
5
4
3
2
1
CSA
5
4
3
2
1
CSB
5
4
3
2
1
NUSC
5
4
3
2
1
EQWS
5
4
3
2
1
XSHD
5
4
3
2
1
ZSML
5
4
3
2
1
IESM
5
4
3
2
1
EWRS
5
4
3
2
1

This measurement shows how easy it is to trade 25,000 shares of each ETF.

ETF.com Fit Insight

No matter what kind of small-cap exposure investors are looking for, there are plenty of ETF options. Choices range from those that simply capture the market return to funds delivering aThe Russell 2000 is an excellent index for capturing the small-cap market range of niche strategies and alternate weightings.

Among those offering the market return, a few names stand out. The Vanguard Small-Cap ETF (VB) earns the highest score here, tracking a comprehensive CRSP index that holds roughly 1,500 small-cap stocks. Schwab’s SCHA also earns high marks, tracking a Dow Jones Index of over 2,000 stocks. Surprisingly, funds tracking the Russell 2000 Index, including the asset-behemoth IWM, don’t earn a great Fit score. That has more to do with our benchmark for small-caps (which tends to lean toward larger stocks) than it does with any shortcoming of the Russell 2000 Index. Don’t let the score throw you off here: The Russell 2000 is an excellent index for capturing the small-cap market.

Choices abound among alternative strategies as well. Most of them don’t score favorably in Fit because they don’t aim to provide the market return or provide vanilla exposure. But low Fit scores don’t mean these funds don’t provide valuable exposure. WisdomTree’s Small-Cap Dividend Fund (DES) is a diversified and small-leaning fund that weights its holdings according to dividend. DES’ higher cash flows, coupled with the capital appreciation potential of small-caps, sounds appealing, but be sure you’re comfortable with its exposure tilts, and know also that some dividend strategies have lagged in total return over the past year.

Also popular are so-called core funds, which hold only those stocks that fall in the middle of the style spectrum between growth and value. The iShares Morningstar Small Core (JKJ), the PowerShares Fundamental Pure Small Core (PXSC) and the First Trust Small Cap Core AlphaDex (FYX) all offer some flavor of that methodology.

Equal-weighted methodologies have gained less traction here than in other ETF segments. GURX equal-weights its copycat holdings while EWRS equal weights by sectors and then by stocks within the sector.

IESM is the lone actively managed fund in the segment. So far performance has lagged as the fund reaches deep into the microcap space.

 (Insight updated 02/22/17)

All Funds (36)

97
96.536764
96
96.211986
96
95.92507
96
95.828697
96
95.751392
93
93.330006
92
91.911526
92
91.813165
91
91.464089
91
91.401081
91
91.297853
91
90.544773
89
89.191499
84
83.64443
83
82.822242
82
82.12713
76
75.601419
74
74.282477
69
68.667555
67
66.85271
66
65.855957
62
62.316604
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
N/A
0
68
67.528426
78
78.062121909754
72
71.940939152313

ETF.com Grade as 02/16/17

Equity: U.S. - Small Cap