These exchange-traded funds own domestic stocks with smallish market capitalizations.
The Vanguard Small-Cap Index Fund (VB) has beaten the S&P 500 index of big companies over the past decade by a full percentage point (10.7% annually versus 9.7%). But it has stretches, like the last five years, when it lags that benchmark.
You have excellent choices if you want an ETF to do the work of assembling a portfolio of 1,000-plus positions. Four diversified funds, all with negative holding costs (thanks to their securities lending revenue), are on our Honor Roll.
We have separate categories for funds zeroing in on growth stocks and value stocks.
Best ETFs: Small-Cap Stocks
Diversified
| Ticker | Exchange-Traded Fund | Holding Cost1 | Liquidity Score2 | Assets ($bil) |
| SPSM | SPDR Portfolio Small Cap* | -$130 | B | 1.0 |
| SCHA | Schwab US Small-Cap* | -61 | A | 7.4 |
| IJR | iShares Core S&P Small-Cap* | -51 | A+ | 38.6 |
| VB | Vanguard Small-Cap* | -3 | A | 22.4 |
| IWM | iShares Russell 2000 | 2 | A+ | 43.0 |
| VTWO | Vanguard Russell 2000 | 42 | B | 1.4 |
| IWC | iShares Micro-Cap | 83 | B | 1.0 |
| SLY | SPDR S&P 600 Small Cap | 141 | C | 0.9 |
| VIOO | Vanguard S&P Small-Cap 600 | 159 | B | 0.8 |
| SMMD | iShares Russell 2500 | 227 | D | 0.01 |
| JKJ | iShares Morningstar Small-Cap | 318 | D | 0.2 |
| JPSE | JPMorgan Divers Ret US Small Cap Eq | 496 | D | 0.1 |
Growth stocks
| IWO | iShares Russell 2000 Growth* | -23 | A | 9.6 |
| VBK | Vanguard Small-Cap Growth* | 16 | A | 7.7 |
| VTWG | Vanguard Russell 2000 Growth | 114 | B | 0.3 |
| SLYG | SPDR S&P 600 Small Cap Growth | 185 | B | 1.7 |
| PXSG | PowerShares Russell 2000 Pure Growth | 226 | F | 0.1 |
| IJT | iShares S&P Small-Cap 600 Growth | 298 | B | 5.5 |
| VIOG | Vanguard S&P Small-Cap 600 Growth | 340 | C | 0.3 |
| JKK | iShares Morningstar Small-Cap Growth | 346 | D | 0.2 |
| RZG | PowerShares S&P SmCp 600 Pure Gr | 604 | D | 0.3 |
Value stocks
| VBR | Vanguard Small-Cap Value* | 59 | A | 12.9 |
| SLYV | SPDR S&P 600 Small Cap Value* | 63 | B | 1.3 |
| IWN | iShares Russell 2000 Value | 160 | A | 9.6 |
| VTWV | Vanguard Russell 2000 Value | 169 | C | 0.2 |
| IJS | iShares S&P Small-Cap 600 Value | 196 | B | 5.2 |
| VIOV | Vanguard S&P Small-Cap 600 Value | 216 | C | 0.3 |
| JKL | iShares Morningstar Small-Cap Value | 357 | C | 0.5 |
| PXSV | PowerShares Russell 2000 Pure Value | 358 | D | 0.1 |
| RFV | PowerShares S&P MidCap 400 PureVal | 584 | C | 0.1 |
| RZV | PowerShares S&P SmCp 600 Pure Val | 608 | D | 0.2 |
*Best ETFs Honor Roll Member
1 Cumulative cost of holding a $10,000 position for a decade. Incorporates annual expense ratio, bid/ask spreads and cost offset from securities lending. 2Reflects bid/ask spreads and trading volume. A = easy to trade.
Data sources: Morningstar, Bloomberg, fund distributors.
