Avantis US Large Cap Value ETF

AVLV

Market cap $8.28B

Amid market uncertainty and overvalued equities, value investing with ETFs offer a safer, long-term path to steady returns.

Like it or not, the same risks that caused markets to dip so severely a few months ago are still here. In fact, they may be worse.

Avantis US Large Cap Value ETF offers exposure to large-cap US stocks with value characteristics via a systematic, factor-based approach. Its performance has been relatively good since its inception and demonstrates the effectiveness of large-cap value in periods of uncertainty. Due to short-term risks, AVLV is also attractive as a more defensive way to get market exposure without the idiosyncratic risks that are strongly present in broad-market funds.

Despite the ETF industry's passive roots, active has stolen the show. Active ETF assets just topped the $1 trillion threshold, making up nearly 10% of the total ETF pie.

The Avantis lineup of actively managed ETFs has had a strong first quarter of 2025. The five-most-popular funds to start the year pulled in $3.7 billion.

With rising recession and economic slowdown concerns, value investing stands out as an attractive strategy. Look at ETFs to simplify the implementation of the strategy.

While markets are flailing in response to the will-they/won't-they dance around tariffs, not all funds have struggled. Indeed, some ETFs have picked up serious inflows despite a climate of fear around equity investing.

Could 2025 finally be the year for value ETF investing? Value funds, by some definition, are infrequent star players in market narratives.

A 50/50 allocation of US large-cap and US small-cap value outperforms US large-cap value in risk-adjusted returns. AVLV offers better value factor loadings and historically superior returns compared to VTV, despite VTV's lower expense ratio and higher liquidity. VTV has better factor loadings in profitability and investment, less correlation to VOO, and a more diversified portfolio, making it less risky.

AVLV, an actively-managed ETF focusing on large-cap value stocks with high profitability and low valuations, has outperformed the Russell 1000 Value index by 330bps last year. We compare AVLV to the most popular product in the large-cap value space and find that it fares relatively well. We highlight why AVLV's top sector holding financials may do well.