Core Insights - The article compares two small-cap growth ETFs: iShares Morningstar Small-Cap Growth ETF (ISCG) and Invesco S&P SmallCap 600 Pure Growth ETF (RZG), highlighting their differences in cost, diversification, and sector focus [4][10]. Fund Comparison - ISCG has a broader portfolio with 971 holdings, while RZG is more concentrated with 131 holdings, leading to a higher share of assets in its top positions [1][2]. - ISCG's sector allocation is primarily in industrials (23%), technology (20%), and healthcare (17%), whereas RZG is more heavily tilted towards healthcare (26%), followed by industrials (18%) and financial services (16%) [1][2]. Performance Metrics - Over the past five years, RZG has outperformed ISCG with a total return of 20% compared to ISCG's 12% [9]. - However, ISCG has shown a better one-year total return as of January 9, 2026 [5]. Cost and Yield - ISCG has a lower expense ratio of 0.06% compared to RZG's 0.35%, making it more affordable for investors [8]. - ISCG also offers a higher dividend yield of 0.6% versus RZG's 0.3%, appealing to income-focused investors [8]. Liquidity and Size - ISCG has a larger asset under management (AUM) of $887 million compared to RZG's $110 million, which may provide greater liquidity for trading [8]. Risk Profile - Both funds have similar risk profiles and have underperformed the S&P 500 over the last five years, with nearly identical maximum drawdowns during market corrections [7].

Core Insights - The Vanguard Small-Cap Growth ETF (VBK) and Invesco S&P SmallCap 600 Pure Growth ETF (RZG) both focus on U.S. small-cap growth stocks but employ different strategies in portfolio construction, sector exposure, and fee structures [4][7]. Fund Comparison - VBK tracks a broad index of U.S. small-cap growth companies with 579 stocks, emphasizing technology (27%), industrials (21%), and healthcare (18%) [2][5]. - RZG is built around the S&P SmallCap 600 Pure Growth Index, focusing more on healthcare (26%), followed by industrials (18%) and financial services (16%), with only 131 stocks, leading to lower diversification [1][5]. Performance and Costs - VBK has a lower expense ratio of 0.07% compared to RZG's 0.35%, making it more appealing for cost-conscious investors [3][5]. - RZG has shown a marginally higher one-year total return compared to VBK, but both funds have nearly identical drawdowns and long-term growth [5][9]. Risk and Volatility - VBK's beta is 1.4, indicating higher volatility compared to RZG's beta of 1.2, which may appeal to different types of investors based on their risk tolerance [8][9]. - RZG's concentrated portfolio may increase risk due to its lower number of holdings [7][9]. Investor Suitability - RZG is suited for investors seeking potential outperformance and who are comfortable with higher fees and concentration risk [9]. - VBK is ideal for long-term investors looking for low costs and broader exposure to the small-cap growth market [9].