IWM vs VB
iShares Russell 2000 ETF vs Vanguard Small Cap ETF
Quick Verdict
VB has a lower expense ratio. IWM delivered stronger 1-year returns. IWM offers more diversification with 1594 holdings.
Side-by-Side Comparison
| Metric | IWM | VB | Winner |
|---|---|---|---|
| Expense Ratio | 0.19% | 0.03% | |
| AUM | $79.5B | $81.5B | |
| Dividend Yield | 0.88% | 1.48% | |
| Holdings | 1,996 | 1,324 | |
| YTD Return | +21.49% | +17.85% | |
| 1Y Return | +38.07% | +29.58% | |
| 3Y Return (annualized) | +17.87% | +16.57% | |
| 5Y Return (annualized) | +7.45% | +7.97% | |
| Volatility (annualized) | 20.0% | 18.9% | |
| Max Drawdown | -59.9% | -61.0% | |
| Fund Family | iShares by BlackRock (US) | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | May 22, 2000 | Jan 26, 2004 |
IWM vs VB Performance
iShares Russell 2000 ETF (IWM) is a ETF from iShares by BlackRock (US) and Vanguard Small Cap ETF (VB) is a ETF from Vanguard (US). Over the past year IWM returned +38.07% while VB returned +29.58%. Year to date, IWM is up 21.49% versus a gain of 17.85% for VB.
Over three years, IWM compounded at +17.87% per year against +16.57% for VB; over five years the annualized figures are +7.45% and +7.97% respectively. Across the full 23-year window we track, VB has the edge at +8.85% annualized vs +7.72%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
IWM has been the more volatile fund, with annualized monthly volatility of 20.0% compared with 18.9% for VB. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -59.9% for IWM and -61.0% for VB. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.99. They move almost in lockstep, so holding both mostly duplicates the same exposure.
Fees and Cost Over Time
IWM charges 0.19% per year while VB charges 0.03%. On a $10,000 position that is $19 vs $3 annually, a gap of $16 per year that compounds over a long holding period. On income, IWM currently yields 0.88% against 1.48% for VB.
Holdings Overlap
IWM and VB share 485 holdings out of 2221 unique holdings combined, representing a 18.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, IWM or VB?
IWM has an expense ratio of 0.19% while VB charges 0.03%. VB is the cheaper option. On a $10,000 investment, that is $16 per year of difference.
Which performed better, IWM or VB?
Over the past year IWM returned +38.07% vs +29.58% for VB, so IWM leads on 1-year performance. Over the longest common window we track (23 years), IWM annualized +7.72% vs +8.85% for VB. Past performance does not guarantee future results.
Which is riskier, IWM or VB?
IWM has been the more volatile fund at 20.0% annualized versus 18.9% for VB. Worst drawdown: IWM -59.9% vs VB -61.0%.
Should I hold both IWM and VB?
IWM and VB have a monthly-return correlation of 0.99, so they move almost identically. Holding both adds little diversification - most investors pick one, usually on fees or the specific index tracked.
What is the holdings overlap between IWM and VB?
IWM and VB share 485 common holdings with a 18.0% weight overlap. Combined, they hold 2221 unique securities.
Which pays a higher dividend, IWM or VB?
IWM yields 0.88% while VB yields 1.48%, so VB currently pays the higher dividend yield.
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