Vanguard S&P Small-Cap 600 ETF

VIOO

Market cap $3.06B

There's never really a bad time to buy the Vanguard S&P 500 ETF (VOO 0.59%). But there are better times than others: It's better to buy on a dip than at a peak, for instance.

Looking for broad exposure to the Small Cap Blend segment of the US equity market? You should consider the Vanguard S&P Small-Cap 600 ETF (VIOO), a passively managed exchange traded fund launched on September 9, 2010.

Vanguard S&P Small-Cap 600 Index Fund ETF is rated a "Buy," benefiting from the Fed's anticipated rate cuts and attractive valuations. VIOO offers low expenses, a profitability screen, and a compelling PEG ratio, making it less exposed to unprofitable companies than IWM. Sector exposure is concentrated in Financials and Industrials, so VIOO's performance is closely tied to U.S. economic expectations and Fed policy.

It's been tough to lose money on ETFs this year — nearly every actively traded U.S. diversified ETF is up in 2025 so far. But there's a tiny number of unlucky ETFs sinking amid a rising tide.

U.S. equity markets notched another series of record highs this week, surging into the weekend after surprisingly dovish commentary from Federal Reserve Chair Powell, who hinted at imminent rate cuts. Powell used his final Jackson Hole speech as Fed Chair to deliver a clear policy pivot, an unexpected reversal after months of insistence that tariff-related inflation warranted a hawkish framework. Markets were equally relieved by the policy-focused nature of Powell's speech amid speculation that the address may be used instead as a potential defiant sermon on central bank independence.

U.S. equity markets fell sharply this week, while benchmark interest rates retreated to three-month lows, after revised employment data showed that job growth was far weaker than initially reported. The BLS payrolls report showed softer-than-expected hiring in July and the steepest two-month downward revisions to jobs growth since 2020, raising concern that the Fed may be "behind the curve." The downward revisions came days after Fed Chair Powell used it as the primary evidence for "solid" labor markets, which justified the FOMC's decision to keep rates in "restrictive" territory.

Looking for broad exposure to the Small Cap Blend segment of the US equity market? You should consider the Vanguard S&P Small-Cap 600 ETF (VIOO), a passively managed exchange traded fund launched on 09/09/2010.

VIOO is a passively managed ETF tracking the S&P SmallCap 600, but has underperformed peers like VBR and VIOG over multiple time frames. The fund's low expense ratio and diversified portfolio are positives, but its simple benchmark criteria lead to mediocre returns and higher volatility. Risk-adjusted returns are weak, with a low Sharpe ratio and heightened sensitivity to interest rates and tariffs, making the risk/reward unattractive.

Launched on 09/09/2010, the Vanguard S&P Small-Cap 600 ETF (VIOO) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Blend segment of the US equity market.

VIOO is a passively managed ETF tracking the S&P SmallCap 600 Index, offering small-cap exposure with quarterly rebalancing and low fees. VIOO has underperformed compared to other Vanguard small-cap ETFs like VBR, making it a less attractive option despite its decent performance. The fund's higher volatility and poor risk-adjusted returns, indicated by a low Sharpe ratio, make it a riskier investment.