VBR vs. IWN: Does Vanguard's Low Fee Beat iShares' Broader Diversification?

2 hours ago 1

Sara Appino, The Motley Fool

Sat, December 27, 2025 astatine 1:27 PM CST 5 min read

VBR carries a little disbursal ratio and higher yield.
IWN holds much stocks with a heavier tilt toward financials, portion VBR leans industrial.
Both ETFs absorption connected U.S. small-cap worth stocks and amusement akin hazard profiles.
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The Vanguard Small-Cap Value ETF (NYSEMKT:VBR) stands retired for its little outgo and higher yield, portion the iShares Russell 2000 Value ETF (NYSEMKT:IWN) offers broader diversification and a stronger caller return, with each money tilting toward antithetic sectors.

Both VBR and IWN are fashionable choices for investors seeking vulnerability to U.S. small-cap worth stocks, but they way antithetic indexes and stress chiseled assemblage mixes. This examination looks astatine cost, yield, performance, portfolio makeup, and hazard to assistance clarify which ETF whitethorn entreaty much to antithetic types of small-cap worth investors.

Metric

VBR

IWN

Issuer	Vanguard	iShares
Expense ratio	0.07%	0.24%
1-yr instrumentality (as of Dec. 23, 2025)	8.22%	12.77%
Dividend yield	2.0%	1.6%
AUM	$59.6 billion	$11.8 billion

Beta measures terms volatility comparative to the S&P 500; beta is calculated from five-year play returns. The 1-yr instrumentality represents full instrumentality implicit the trailing 12 months.

VBR looks much affordable for semipermanent holders with a 0.07% disbursal ratio compared to IWN’s 0.24%, and it besides pays a somewhat higher dividend output astatine 2.0% versus 1.6%.

Metric

VBR

IWN

Max drawdown (5 y)	-24.19%	-26.71%
Growth of $1,000 implicit 5 years	$1,502	$1,396

IWN tracks an scale of small-cap U.S. stocks that show worth characteristics and includes 1,423 holdings, making it broader than galore peers. Financial Services predominate astatine 26%, followed by Industrials astatine 13%, and Health Care astatine 11%. The largest positions -- Echostar Corp Class A (NASDAQ:SATS), Hecla Mining (NYSE:HL), and UMB Financial (NASDAQ:UMBF)-- each relationship for little than 1.1% of assets, truthful nary azygous banal heavy influences returns. The money has a agelong way record, with implicit 25 years since inception.

VBR besides aims for small-cap worth vulnerability but takes a somewhat antithetic approach, with Industrials (22%), Financial Services (20%), and Consumer Discretionary (14%) arsenic its apical sectors. Its largest holdings -- NRG Energy (NYSE:NRG), Sandisk (NASDAQ:SNDK), and Emcor (NYSE:EME) -- each marque up little than 1% of assets. VBR holds 840 stocks, truthful it is somewhat little diversified than IWN, but it inactive spreads hazard broadly crossed the tiny worth universe.

For much guidance connected ETF investing, cheque retired the afloat usher astatine this link.