VOO Has Delivered Higher Returns, But IWM Provides Broad Small Cap Exposure

Core Insights - Vanguard S&P 500 ETF (VOO) and iShares Russell 2000 ETF (IWM) target different segments of the U.S. stock market, with VOO focusing on large-cap stocks and IWM on small-cap stocks [1][2] Cost & Size Comparison - VOO has a significantly lower expense ratio of 0.03% compared to IWM's 0.19% [3][4] - As of February 4, 2026, VOO has a 1-year return of 14.0% and IWM has a 1-year return of 14.8% [3] - VOO has a total assets under management (AUM) of $860.7 billion, while IWM has an AUM of $75.6 billion [3] Performance & Risk Comparison - Over the past five years, VOO experienced a maximum drawdown of 24.52%, while IWM had a maximum drawdown of 31.91% [5] - An investment of $1,000 in VOO would have grown to $1,770 over five years, compared to $1,175 for IWM [5] Portfolio Composition - IWM provides exposure to nearly 1,945 small-cap U.S. stocks, with significant sector weights in healthcare (19%), financial services (16%), and technology (16%) [6] - VOO is heavily tilted towards technology (43%) and includes major holdings like NVIDIA Corp, Apple Inc, and Microsoft Corp, with the top three positions accounting for over 20% of its assets [7] Investor Considerations - Both VOO and IWM are attractive options for investors seeking broad market exposure, but they have distinct characteristics that cater to different investment objectives [8]