Meet the Low-Cost Vanguard ETF Beating the S&P 500 in 2026 That Many Investors Are Overlooking
Yahoo Finance ·
As the stock market's most popular and invested-in index, it makes sense that the S&P 500 ( ^GSPC +0.76% ) would get a lot of attention. In fact, the three largest ETFs on the market are all S&P 500 ETFs, and so far through July 8, the S&P 500 is up just over 9%. Historically, the S&P 500 has averaged around 10% annual returns over the long haul, so being up by 9% through half the year is still a solid start. However, there is one overlooked ETF that has more than doubled the S&P 500's returns so far this year: the Vanguard Russell 2000 ETF ( VTWO +1.42% ) . It's up just over 19%. VTWO mirrors the Russell 2000 index , the primary index for small-cap stocks. As of May 31, it holds 1,951 stocks spanning all major sectors. Whereas the S&P 500 has become top-heavy and tech-heavy (nearly 39% of the index), VTWO is more diversified across sectors: Most of the companies won't be recognizable because they operate in niche industries (like biotech ) or are regional (like many banks), but there are plenty of productive and flourishing companies in the ETF nonetheless.
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