VBR vs. SLYV: Why VBR's Lower Fees and Broader Diversification Give it The Edge

Core Insights - The article compares two small-cap value ETFs: Vanguard's VBR and State Street's SLYV, highlighting their differences in fees, performance, and sector allocations [4][5][6]. Fund Overview - SLYV tracks the S&P SmallCap 600 Value Index, holding over 460 companies with a focus on financials (23%), consumer discretionary (17%), and industrials (14%) [1]. - VBR tracks the CRSP US Small Cap Value Index, containing 840 stocks with a distribution across industrials (22%), financial services (20%), and consumer discretionary (14%) [2]. Performance and Fees - VBR has a lower expense ratio of 0.07% compared to SLYV's 0.15%, and has generated higher returns over the past year and five years [3][6]. - Both funds offer similar dividend yields, but VBR's overall performance is superior [3][5]. Market Capitalization - VBR's index includes companies with market caps ranging from $340 million to $31 billion, with a median of $4.0 billion [7]. - SLYV's index comprises companies with market caps from around $250 million to $11 billion, with a median of $1.9 billion [7]. Investment Considerations - VBR's broader diversification and higher median market cap may appeal to investors seeking stability and liquidity [8]. - SLYV may be suitable for those looking for a more concentrated ETF with exposure to smaller market cap companies, despite its higher fees [9].