에 대한 최신 뉴스 Vanguard Russell 2000 ETF (NASDAQ:VTWO)

Vanguard Russell 2000 ETF

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The fund employs an indexing investment approach designed to track the performance of the Russell 2000 Index. The index is designed to measure the performance of small-capitalization stocks in the United States. The advisor attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the index, holding each stock in approximately the same proportion as its weighting in the index.

Super Micro Computer, Inc.

Microstrategy Inc

Comfort Systems USA Inc.

Elf Beauty, Inc.

Light & Wonder Inc

Carvana Co.

Simpson Manufacturing Co Inc

Onto Innovation Inc

Sprouts Farmers Markets Inc.

Insmed Inc

Vaxcyte Inc

South State Corp

Applied Industrial Technologies Inc

Ftai Aviation Ltd

Rocket Lab Usa Inc

Credo Technology Group Holding Ltd

Healthequity Inc

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Corcept Therapeutics Inc

Mueller Industries Inc

Halozyme Therapeutics Inc

Mr Cooper Group Inc Com

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S&amp;P 500 지수는 여전히 상승세를 유지하고 있지만, 글로벌 시장과 비교하면 그 빛이 바래고 있다.JP모건 애널리스트인 제이슨 헌터는 S&amp;P 500 지수가 더 높은 저점을 유지하고 저항선을 밀어붙이고 있지만, 6,100포인트 고점을 돌파하는 데 어려움을 겪고 있다고 지적한다.

S&amp;P 500 vs. 러셀 2000: 소형주 돌파 준비되었나?

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벤징가와의 독점 인터뷰에서 러셀 인베스트먼트(Russell Investments)의 북미 최고 투자 전략가인 폴 아이텔만(Paul Eitelman)은 2025년이 다가옴에 따라 소형주로의 전환이 촉발될 수 있는 두 가지 주요 요인을 설명했다.

독점: &#39;매그 7&#39;의 실적 하락, &#39;소프트 랜딩&#39;은 소형주로의 전환을 촉발: 폴 아이텔만

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최근 벤징가(Benzinga)와의 독점 인터뷰에서 러셀 인베스트먼트(Russell Investments)의 북미 최고 투자 전략가인 폴 아이텔만(Paul Eitelman)은 경제적 불확실성 속에서 눈에 띄는 소형주 부문에 대한 통찰력을 제공했다.

단독: 러셀의 전략가가 낮은 금리 환경에서 기회를 잡으며 최고의 소형주들을 발견

Investing entails both risk and reward. On one hand, conservative investors focus on stabilizing their portfolios through bonds, <a href="https://in.benzinga.com/startups/25/02/43451833/warren-buffetts-1m-bet-why-simple-index-funds-crushed-hedge-funds-by-7-1-to-2-2-over-a-decade">index funds</a>, and blue-chip <a href="https://www.benzinga.com/personal-finance/25/03/44486348/58-year-old-with-3m-portfolio-makes-bold-retirement-move-i-want-to-test-it-out-before-i-actually-retire-with-1m-in-dividend-stocks">dividend stocks</a>. On the other, aggressive investors chase high-growth assets, such as tech stocks, leveraged ETFs, and high-yield dividend funds, betting on huge returns.
The middle ground is a diversified portfolio that combines growth and income while adjusting risk as <a href="https://www.benzinga.com/personal-finance/25/03/44552100/i-have-no-doubt-theyre-going-to-raise-the-full-retirement-age-possibly-to-70-suze-orman-weighs-in-on-social-security-fears">retirement</a> approaches. But what happens when a young investor leans heavily into dividend-focused ETFs, overlooking long-term growth for quick cash? That's the question tearing through the r/Dividends Reddit community after a 34-year-old shared his bold three-ETF strategy.
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&#8220;Right now, I'm planning to go with just [Vanguard S&amp;P 500 ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/voo#NYSE">VOO</a>)], [JPMorgan Equity Premium Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/jepi#NYSE">JEPI</a>)​], and [Schwab U.S. Dividend Equity ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schd#NYSE">SCHD</a>)], split like this: VOO – 45% (broad market exposure and long-term growth), JEPI – 15% (monthly income and lower volatility), and SCHD – 40% (strong dividend growth and fundamentals). I know this setup is pretty barebones, but I feel like it covers the basics well enough for now. I plan to start adding bonds in maybe 5 to 6 years, once I get closer to 40,&#8221; he wrote.
Still, the poster is wondering whether his allocations are too basic and whether he&#8217;s missing something, mentioning that he wants to build a dividend-only portfolio. The r/Dividends community on Reddit has offered its advice in the comments, so let&#8217;s analyze that.
Trending: <a href="https://www.benzinga.com/money/are-you-rich">Are you rich?</a> Here&#8217;s what Americans think you need to be considered wealthy.
<h2 class="wp-block-heading">3-ETF Portfolio–Is He Onto Something or Is It a Bad Idea? Reddit Responds</h2>
Ditch JEPI Since You Don&#8217;t Need Income Now
Most Redditors argued that JEPI is a rather poor fit for a 34-year-old who&#8217;s still in the accumulation phase.
&#8220;Unless you are currently using the income generated from it, there&#8217;s no reason to hold JEPI or [NEOS S&amp;P 500 High Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spyi#NYSE">SPYI</a>)] or any of the others instead of holding the index itself like VOO. They underperform the underlying assets, so the total return of VOO will be higher than JEPI and there are also the tax implications of getting your returns as nonqualified dividends. So, if you are just going to reinvest the dividends from JEPI, there&#8217;s no reason to hold it instead of VOO, but there are good reasons to hold VOO instead,&#8221; a Reddit community member suggested.
Recommending what he thinks is a better allocation for the poster&#8217;s portfolio, this commenter also advised getting rid of JEPI: &#8220;JEPI is not only a bad option for you, it is also not very tax efficient. Stick with this: VOO/[Schwab U.S. Large-Cap Growth ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schg#NYSE">SCHG</a>)]/SCHD 70/20/10.&#8221;
&#8220;You have a job for income. You don't need JEPI at your age. Get into growth and dividend growth stocks,&#8221; a Redditor wrote.
See Also: It&#8217;s no wonder Jeff Bezos holds over $250 million in art — <a href="https://www.benzinga.com/money/masterworks">this alternative asset has outpaced the S&amp;P 500 since 1995, delivering an average annual return of 11.4%. Here&#8217;s how everyday investors are getting started.</a>
Shift from Dividends to Growth for Now
Many users urged the 34-year-old investor to prioritize growth-focused ETFs over dividend-heavy assets like SCHD because he's young and has a long time until retirement to grow the money.
&#8220;At 34, you have a fairly long investment horizon in front of you before you retire–20 years or more. So, you should be much more heavily invested in growth rather than dividends. Growth companies invest their earnings in growth opportunities rather than using cash to pay dividends and as a result, you will almost certainly build more wealth over 20 years with growth stocks/ETFs than you will in dividend stocks/ETFs,&#8221; a comment reads.
Suggesting that the poster&#8217;s allocation is way too conservative for his age, this Redditor shared the way his portfolio is split, recommending keeping growth-focused assets even in retirement: &#8220;You are going too hard on dividends for your age. At 40, I am about 20% dividends, 20% bonds, and 60% growth stocks. That will shift about every 5 years toward stable income goals, but even then I probably will still hold at least 40% growth in retirement.&#8221;
When it comes to long-term growth, a commenter advised the poster to invest in VOO rather than SCHD.
&#8220;VOO outperforms SCHD and is a better option for long-term growth. I&#8217;d also consider mixing in [Vanguard Russell 2000 Index Fund ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vtwo#NASDAQ">VTWO</a>)] and [Vanguard Mid-Cap Growth Index Fund ETF Shares (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vot#NYSE">VOT</a>)] at 15% to 20% each to cover mid and small-cap stocks,&#8221; he said.
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Personal Finance

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34-Year-Old Gambles His Entire Future On Just 3 ETFs – 'Is This A Dumb Idea Or Am I Onto Something?' Reddit Explodes Over His Risky Bet

<a href="https://www.benzinga.com/topic/s-p-500-index">The S&amp;P 500 index</a> remains in bullish territory, but it&#8217;s losing its shine compared to global markets. 
JPMorgan analyst Jason Hunter notes that while the index maintains higher lows and pushes resistance levels, it's struggling to break past the 6,100 peak.
<h2 class="wp-block-heading">Big Caps Hold Ground, But Momentum Wobbles </h2>
With momentum cooling off, the path to the next milestone of 6,350 looks slow and choppy. ETFs like SPDR S&amp;P 500 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>) and the Vanguard S&amp;P 500 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOO#NYSE">VOO</a>) continue to reflect this cautious optimism but aren't exactly screaming bullish right now.
Hunter points out that the S&amp;P 500's current bullish trend remains intact as long as it holds above key support between 5,772 and 5,871. However, a break below 5,651 could jeopardize the broader uptrend. For now, investors might want to tread carefully while keeping an eye on key levels.
Read Also: <a href="https://www.benzinga.com/content/43845962/buffett-just-dumped-his-s-amp-p-500-holdings-what-it-means-for-you">Buffett Just Dumped His S&amp;P 500 Holdings—What It Means for You</a>
<h2 class="wp-block-heading">Small Caps Eyeing A Breakout</h2>
Meanwhile, the Russell 2000 index is quietly building steam. Hovering above key support at 2,150, the index is consolidating for a potential breakout past the 2,310-2,350 resistance zone. Hunter sees an eventual rally toward the 2,432-2,466 range if global cyclicals keep trending up. 
For ETF investors, iShares Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>) and the Vanguard Russell 2000 Index Fund ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NYSE">VTWO</a>) might be worth a closer look as small caps gear up for what could be a catch-up trade.
Interestingly, history suggests that when cyclical markets pick up, small caps tend to outperform. With global equity leadership broadening, the odds could tilt in favor of small-cap stocks outperforming large caps in the coming months.
<h2 class="wp-block-heading">Investor Implications</h2>
<ol start="1">
<li>Hold the Fort: S&amp;P 500 ETFs like SPY and VOO remain bullish but aren't the most compelling entry point unless the index decisively clears 6,100.</li>
<li>Watch the Underdog: Russell 2000's bullish setup favors ETFs like IWM and VTWO, especially if the index breaks past 2,350.</li>
<li>Global Check: Keep an eye on cyclical trends worldwide—they could fuel the small-cap rally while large caps tread water.</li>
</ol>
<h2 class="wp-block-heading">Would Small Caps Could Steal The Show?</h2>
Big caps are holding steady, but the real action could soon shift to small caps.
ETF investors, stay nimble—the underdog's moment may be just around the corner.
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Image created using artificial intelligence via Midjourney.

S&P 500 Vs. Russell 2000: Are Small Caps Set For A Breakout?

Several factors could hinder small-cap performance, according to Paul Eitelman, Chief Investment Strategist for North America at Russell Investments.
Eitelman recently shared with Benzinga his <a href="https://www.benzinga.com/exclusives">key insights</a> on small-cap stocks and equity performance, tracked by the Russell 2000 Index.
Read Also: <a href="https://www.benzinga.com/trading-ideas/long-ideas/24/09/40777734/exclusive-small-caps-at-most-attractive-relative-valuations-since-1990s-says-russell-inv">EXCLUSIVE: Small Caps At &#8216;Most Attractive Relative Valuations&#8217; Since 1990s, Says Russell Investments&#8217; Paul Eitelman</a>
<h2 class="wp-block-heading">Narrow Market Leadership &#8211; A Key Risk</h2>
Eitelman noted, "Extreme market concentration and narrow market leadership remain a key risk for the relative performance of small-cap stocks in the near-term." 
This refers to the outsized influence of mega-cap stocks like the &#8216;Magnificent 7&#8216; in driving market returns. As long as market leadership remains this narrow, small-cap stocks are unlikely to keep pace, especially if these tech giants continue to dominate investor capital.
<h2 class="wp-block-heading">Macroeconomic Vulnerabilities</h2>
Eitelman also highlighted macroeconomic risks. &#8220;While we think a U.S. recession can be avoided in the year ahead, an economic downturn would likely cause small-cap stocks to underperform." 
Small-cap companies are typically more vulnerable during recessions because of their weaker balance sheets and higher sensitivity to the business cycle. A sudden economic shock could exacerbate these vulnerabilities, causing underperformance in the small-cap space.
<h2 class="wp-block-heading">Inflation Impacts Small-Cap Stocks</h2>
Another critical risk is inflation. Eitelman explained, "Stickier U.S. inflation data would also be a challenge for small-cap stocks, given many of these companies are more indebted with shorter- and variable-rate financing." Rising borrowing costs could strain these companies further, making them more susceptible to financial stress.
Eitelman's analysis underscores the importance of cautious positioning within small caps, as the sector faces both macroeconomic and market concentration risks that could limit upside potential in 2024.
Price Action: popular funds tracking the Russell 2000 index include: 
<ul>
<li>iShares Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>), up 1.39% at last check</li>
<li>The Vanguard Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NYSE">VTWO</a>), up 1.38%</li>
<li>And the Avantis US Small Cap Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AVSC#NYSE">AVSC</a>), up 1.45%</li>
</ul>
Read Next: 
<ul>
<li><a href="https://www.benzinga.com/etfs/broad-u-s-equity-etfs/24/09/40782870/exclusive-russell-strategist-uncovers-top-small-cap-picks-seizing-opportunities-in-a-l" target="_blank" rel="noreferrer noopener">EXCLUSIVE: Russell Strategist Uncovers Top Small-Cap Picks — Seizing Opportunities In A Low-Rate Environment</a></li>
</ul>
Don't miss the opportunity to dominate in a volatile market at the&nbsp;<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Benzinga SmallCAP Conference on Oct. 9-10, 2024</a>,&nbsp;at the Chicago Marriott Downtown Magnificent Mile.
Get exclusive access to CEO presentations, 1:1 meetings with investors, and valuable insights from top financial experts. Whether you're a trader, entrepreneur, or investor, this event offers unparalleled opportunities to grow your portfolio and network with industry leaders.
<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Secure your spot and get your tickets today!</a>
Image: Shutterstock

News

EXCLUSIVE: Small-Cap Stocks Stumble As Market Concentration Looms, Warns Russell's Eitelman

In an exclusive interview with Benzinga, Paul Eitelman, chief investment strategist for North America at Russell Investments, outlined two main catalysts that could spur a rotation into small-cap stocks as <a href="https://www.benzinga.com/trading-ideas/small-cap-analysis">2025 approaches</a>.
While small-cap stocks struggled for investor attention in recent years, Eitelman believed certain macroeconomic events could be the game-changers.
<h1 class="wp-block-heading">Rotation Into Small-Caps Stocks: What Will It Take?</h1>
&#8220;A rotation into small-cap stocks would likely hinge on two potential catalysts in the near term,&#8221; Eitelman said. 
<ol>
<li>First, he highlights the potential for an underperformance of the Magnificent 7: the tech giants that have dominated market returns in 2023. "Lackluster earnings results from the Magnificent 7 in coming quarters could shake their valuation multiples back down to Earth and catalyze an unwind of concentrated investor positioning.&#8221; </li>
<li>The second catalyst Eitelman pointed to was a "soft landing" for the U.S. economy. "A soft landing for the U.S. economy — where the Federal Reserve cuts rates methodically into resilient growth — would likely benefit small-cap stocks given their sensitivity to both interest rates and the business cycle." This environment could help small-caps regain investor favor, especially if inflation moderates and labor markets remain resilient.</li>
</ol>
Read Also: <a href="https://www.benzinga.com/trading-ideas/long-ideas/24/08/40652895/exclusive-beyond-the-magnificent-seven-direxions-egilinsky-reveals-top-sector-picks" target="_blank" rel="noreferrer noopener">EXCLUSIVE: Beyond The Magnificent Seven — Direxion&#8217;s Egilinsky Reveals Top Sector Picks</a>
<h1 class="wp-block-heading">Eitelman Sees Acceleration In Earnings Growth For Small-Cap Stocks</h1>
Eitelman adds that accelerating earnings growth in the small-cap sector would further support this narrative, as would visible improvements in inflation and more dovish signals from the Federal Reserve. 
"Evidence of accelerating small-cap earnings growth, moderating inflation, resilient labor markets and Fed rate cuts in the quarter ahead would support this view," Eitelman said.
If these triggers materialize, small-cap stocks could finally see the rotation investors have been waiting for. The Russell 2000 Index serves as a widely used benchmark for tracking small-cap stock performance in the U.S. market. It follows the 2,000 smallest companies, offering insight into the small-cap sector. 
Notable ETFs that track this index include the iShares Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>), Vanguard Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NYSE">VTWO</a>) and Avantis US Small Cap Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AVSC#NYSE">AVSC</a>).
Read Next: 
<ul>
<li><a href="https://www.benzinga.com/trading-ideas/long-ideas/24/09/40777734/exclusive-small-caps-at-most-attractive-relative-valuations-since-1990s-says-russell-inv" target="_blank" rel="noreferrer noopener">EXCLUSIVE: Small Caps At &#8216;Most Attractive Relative Valuations&#8217; Since 1990s, Says Russell Investments&#8217; Paul Eitelman</a></li>
</ul>
Don't miss the opportunity to dominate in a volatile market at the&nbsp;<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Benzinga SmallCAP Conference on October 9-10, 2024</a>,&nbsp;at the Chicago Marriott Downtown Magnificent Mile.
Get exclusive access to CEO presentations, 1:1 meetings with investors, and valuable insights from top financial experts. Whether you're a trader, entrepreneur, or investor, this event offers unparalleled opportunities to grow your portfolio and network with industry leaders.
<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Secure your spot and get your tickets today!</a>

Photo: Shutterstock

EXCLUSIVE: Magnificent 7 Underperformance, 'Soft Landing' Could Trigger A Rotation Into Small-Cap Stocks, Says Russell Investments' Eitelman

In a recent exclusive interview with Benzinga, Paul Eitelman, chief investment strategist for North America at Russell Investments, provided insights into the sectors of small-cap stocks that stand out <a href="https://www.benzinga.com/trading-ideas/small-cap-analysis">amidst economic uncertainty</a>.
While small-caps as a whole face some macroeconomic risks, Eitelman highlights several specific sectors that could offer substantial opportunities.
<h1 class="wp-block-heading">Where Small-Cap Managers Are Finding Opportunities</h1>
Eitelman notes that &#8220;dedicated small-cap managers are finding opportunities to tilt their portfolio strategies toward banks, technology and select highly indebted companies that are likely to benefit from lower interest rates going forward.&#8221; These sectors are positioned to thrive, especially as interest rates begin to decline.
Technology continues to dominate market discussions, and small-cap tech companies could be key beneficiaries of economic shifts, particularly those aligned with innovative growth areas like AI and data services.
The Russell 2000 index is one of the more popular indices tracking small cap U.S. equity. ETFs that track this index include the iShares Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>), the Vanguard Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NYSE">VTWO</a>) and the Avantis US Small Cap Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AVSC#NYSE">AVSC</a>). The Invesco S&amp;P SmallCap Information Technology ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PSCT#NYSE">PSCT</a>) is a lesser-known but technology-focused ETF tracking small cap companies. The top 3 holdings of this ETF are Fabrinet (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FN#NYSE">FN</a>), SPS Commerce, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SPSC#NASDAQ">SPSC</a>) and Badger Meter Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BMI#NYSE">BMI</a>).
Read Also: <a href="https://www.benzinga.com/news/24/08/40423157/small-cap-ai-stocks-on-the-rise-3-hidden-gems-you-shouldnt-miss">Small-Cap AI Stocks On The Rise: 3 Hidden Gems You Shouldn&#8217;t Miss</a>
<h1 class="wp-block-heading">Stock Selection: Primary Driver Of Risk, Return</h1>
However, Eitelman cautions that given the high macroeconomic uncertainty, broad sector bets are risky. He recommends a more refined approach: "Our preference into high macro uncertainty is to target only modest sector tilts and let stock selection shine as the primary driver of risk and return."
This focus on stock selection over aggressive sector rotation makes sense in an environment where not all companies are equally positioned to navigate fluctuating interest rates or economic slowdowns. 
Banks, for example, are likely to benefit from a soft landing scenario, while indebted companies could see relief as rates fall. Tech remains a favorite sector due to its long-term growth prospects, even amid near-term uncertainty.
Overall, Eitelman's strategy emphasizes precision and caution, advising investors to prioritize stock-picking and avoid broad over-exposure in the small-cap space.
Read Next: 
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<li><a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/09/40749609/this-small-cap-top-pick-is-positioned-for-strong-gains-jpmorgan-sees-over-50-upside">This Small Cap &#8216;Top Pick&#8217; Is Positioned For Strong Gains, JPMorgan Sees Over 50% Upside</a></li>
</ul>
Don&#8217;t miss the opportunity to dominate in a volatile market at the <a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Benzinga SmallCAP Conference on Oct. 9-10, 2024</a>, at the Chicago Marriott Downtown Magnificent Mile.
Get exclusive access to CEO presentations, 1:1 meetings with investors, and valuable insights from top financial experts. Whether you&#8217;re a trader, entrepreneur, or investor, this event offers unparalleled opportunities to grow your portfolio and network with industry leaders.
<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Secure your spot and get your tickets today!</a>
Photo: Borka Kiss via Shutterstock

EXCLUSIVE: Russell Strategist Uncovers Top Small-Cap Picks — Seizing Opportunities In A Low-Rate Environment

In an exclusive interview with Benzinga, Paul Eitelman, Chief Investment Strategist for North America at Russell Investments, laid out a measured approach to small-cap stocks as we <a href="https://www.benzinga.com/trading-ideas/small-cap-analysis">head toward 2025</a>. 
While he acknowledges the long-term benefits of maintaining a small-cap allocation, Eitelman also warns of the sector&#8217;s sensitivity to macroeconomic shifts.
The Russell 2000 Index is a popular benchmark for measuring small-cap equity performance in the U.S. stock market. It tracks the smallest 2,000 companies, providing a clear view of the small-cap segment. The iShares Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>), the Vanguard Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NYSE">VTWO</a>) and the Avantis US Small Cap Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AVSC#NYSE">AVSC</a>) are popular funds tracking the Russell 2000 index.
Don&#8217;t miss out on this unparalleled opportunity:
<ul>
<li><a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Register now to secure your spot at Benzinga&#8217;s Largest SmallCap Conference ever in Chicago!</a></li>
</ul>
<h2 class="wp-block-heading">&#8216;Small Cap Faces A Two-Scenario Problem&#8217;</h2>
"We think investors should maintain a strategic allocation to small cap stocks," Eitelman advises. However, the near-term outlook is uncertain: "Small cap faces a two-scenario problem – macro uncertainty is high, with economists conflicted on whether the U.S. economy is slowing toward a soft or hard landing.&#8221;
Small-cap stocks have more volatile balance sheets and are highly sensitive to economic cycles, making them vulnerable to a recession but positioned to outperform in a soft landing. 
Eitelman suggests taking a cautious approach to tactical positioning during this period of high uncertainty.
<h2 class="wp-block-heading">Small Caps At &#8216;Most Attractive Relative Valuations&#8216;</h2>
Despite the short-term challenges, Eitelman highlights the longer-term case for small-cap investments: "Small cap companies are trading at their most attractive relative valuations to large cap since the late 1990s." 
The market's low stock-level correlations also provide fertile ground for active management, which, in Eitelman's view, "allows investors to limit their exposure to unprofitable companies that make up a large share of the Russell 2000 Index."
His advice to investors is clear: use skilled active managers to navigate this challenging landscape and capitalize on undervalued opportunities.
Read Next: 
<ul>
<li><a href="https://www.benzinga.com/news/24/08/40535630/small-caps-set-to-lead-their-large-cap-brothers-for-rest-of-2024-says-market-strategist">Small Caps Set To &#8216;Lead Their Large Cap Brothers&#8217; For Rest Of 2024, Says Market Strategist</a></li>
</ul>
Don&#8217;t miss the opportunity to dominate in a volatile market at the&nbsp;<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Benzinga SmallCAP Conference on October 9-10, 2024</a>,&nbsp;at the Chicago Marriott Downtown Magnificent Mile.
Get exclusive access to CEO presentations, 1:1 meetings with investors, and valuable insights from top financial experts. Whether you&#8217;re a trader, entrepreneur, or investor, this event offers unparalleled opportunities to grow your portfolio and network with industry leaders.
<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Secure your spot and get your tickets today!</a>
Image created using artificial intelligence via Midjourney.

EXCLUSIVE: Small Caps At 'Most Attractive Relative Valuations' Since 1990s, Says Russell Investments' Paul Eitelman

As investors navigate an unpredictable market landscape, small-cap stocks might be on the brink of a resurgence. With the Federal Reserve signaling potential rate cuts, the conditions could soon favor companies that thrive on <a href="https://www.benzinga.com/trading-ideas/small-cap-analysis">lower borrowing costs</a>.
In an exclusive interview with Benzinga, Ed Egilinsky, Managing Director at Direxion, shared his views on the evolving small-cap sector. 
&#8220;Small caps tend to be more reliant on taking on debt to help grow their business, and borrowing at lower rates could be helpful to their bottom line,&#8221; he noted. With potential rate cuts on the horizon, Egilinsky believes there are trading opportunities within the small-cap space.
Read Also: <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/08/40348381/small-caps-set-for-a-comeback-heres-why-they-deserve-your-attention">Small Caps Set For A Comeback? Here&#8217;s Why They Deserve Your Attention</a>
<h2 class="wp-block-heading">The Bull Vs. Bear Debate: Where Should Traders Bet?</h2>
For those looking to ride the wave, leveraged ETFs like the Direxion Small Cap Bull 3X Shares (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TNA#NYSE">TNA</a>) and the Direxion Small Cap Bear 3X Shares (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TZA#NYSE">TZA</a>) could be valuable tools. &#8220;We&#8217;ve seen significant inflows from traders tilted toward the bull side through our 3x bull TNA,&#8221; Egilinsky shared, pointing to recent trends that suggest a bullish outlook.
Investors looking for non-leveraged diversified exposure to the small-cap space may also consider ETFs tracking the Russell 2000 index. The Russell 2000 Index is one of the more popular indices tracking the performance of 2,000 small-cap companies. Popular ETFs tracking the index include: the iShares Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>) and the Vanguard Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NYSE">VTWO</a>). 
<h2 class="wp-block-heading">Fed Policy, Market Sentiment: A Recipe For Volatility?</h2>
Egilinsky highlighted the impact of a potential Fed pivot on small-cap stocks, suggesting that these companies might outperform their larger counterparts as borrowing costs decrease. 
&#8220;If you adhere to the theory of mean reversion, you might believe at some point that small caps on a relative valuation basis might represent a better opportunity than large caps,&#8221; he explained.
Active traders should remain vigilant, ready to capitalize on both bullish and bearish movements in the market. 
With a dynamic year ahead, the small-cap sector offers plenty of opportunities for those looking to diversify their portfolios beyond the dominant large-cap names.
Read Also: 
<ul>
<li><a href="EXCLUSIVE: 'Fed Pivot May Be Imminent' — Small Caps Are Poised For Big Comeback, Says WisdomTree Strategist">EXCLUSIVE: &#8216;Fed Pivot May Be Imminent&#8217; — Small Caps Are Poised For Big Comeback, Says WisdomTree Strategist</a></li>
</ul>

EXCLUSIVE: Are Small-Cap Stocks Ready For A Rebound? Leveraged ETF Data Signals A Bullish Trend, Says Expert

Small cap stocks are poised for a strong rally, according to Kevin Dreyer, co-CIO of Value at Gabelli Funds.
In a recent CNBC <a href="https://www.youtube.com/watch?v=k9u3gs7uztA">interview</a>, Dreyer, who oversees the Gabelli Asset Fund (GABAX), emphasized that small caps have &#8220;a long room to run&#8221; and are increasingly becoming an attractive option for investors looking to diversify their portfolios.
<h1 class="wp-block-heading">From Large Caps To Small Caps: The Shift Began In Early July</h1>
Dreyer noted that while growth stocks have dominated the markets for some time, a shift began to emerge in early July. 
"We are long-time value investors, and growth has really led the markets for some time now. But we started to see this rotation in early July," Dreyer explained.
This change is closely tied to recent actions by the Federal Reserve, which will soon start cutting interest rates. "Now this was in line with what we all are seeing now — the Fed finally cutting rates, and we&#8217;re seeing small-caps and value start to do better."
Read Also: <a href="https://www.benzinga.com/news/24/08/40535630/small-caps-set-to-lead-their-large-cap-brothers-for-rest-of-2024-says-market-strategist">Small Caps Set To &#8216;Lead Their Large Cap Brothers&#8217; For Rest Of 2024, Says Market Strategist</a>
<h1 class="wp-block-heading">Small Caps: Trading At &#8216;Massive Discount&#8217; To Large Cap Counterparts</h1>
The renewed interest in small caps comes as they are trading at a substantial discount compared to their large-cap counterparts. 
"Right now, they trade at a massive discount to their large-cap peers," Dreyer highlighted, suggesting that this could be an ideal time for investors to consider adding small caps to their portfolios.
Dreyer's optimistic view is also supported by the recent performance of the Russell 2000, a key index for small-cap stocks, which seems on track to close higher. Popular ETFs tracking the index closely include the iShares Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>), the Vanguard Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NYSE">VTWO</a>) and the Avantis U.S Small Cap Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AVSC#NYSE">AVSC</a>).
Though they don&#8217;t track the Russell 2000 index, the iShares Core S&amp;P Small-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IJR#NYSE">IJR</a>) and the Vanguard Small Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VB#NYSE">VB</a>) are other popular ways to get investment exposure to small-cap equity.
<h1 class="wp-block-heading">Small Caps Still Have A &#8216;Long Way To Go&#8217;</h1>
"By and large, we&#8217;ve been buying more small caps lately, and we think they&#8217;ve got a long way to go," Dreyer added, indicating that the current market environment could present a lucrative opportunity for those looking to capitalize on undervalued assets.
Read Next:
<ul>
<li><a href="https://www.benzinga.com/trading-ideas/long-ideas/24/08/40447799/small-caps-soar-3-russell-2000-stocks-doubling-investor-wealth-in-2024">Small Caps Soar: 3 Russell 2000 Stocks Doubling Investor Wealth In 2024</a></li>
</ul>
Don&#8217;t miss the opportunity to dominate in a volatile market at the&nbsp;<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Benzinga SmallCAP Conference on Oct. 9-10, 2024</a>, at the Chicago Marriott Downtown Magnificent Mile.
Get exclusive access to CEO presentations, 1:1 meetings with investors, and valuable insights from top financial experts. Whether you&#8217;re a trader, entrepreneur, or investor, this event offers unparalleled opportunities to grow your portfolio and network with industry leaders.
<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/" target="_blank" rel="noreferrer noopener">Secure your spot and get your tickets today</a>!
Photo: IConcept via Shutterstock

Media

Russell 2000 Stocks 'Trading At A Massive Discount' To Large Caps: Gabelli Funds' Kevin Dreyer

The Russell 2000 surged over 10% in July, and the iShares Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>) and the Vanguard Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NYSE">VTWO</a>) gained 11.27% and 11.36%, respectively, over <a href="https://www.benzinga.com/quote/IWM/news">the same period</a>.
So, what's behind this recent impressive rally in small-cap stocks? Benzinga spoke with Brian Manby, Associate in Investment Strategy at WisdomTree, to get the exclusive scoop on the factors driving this trend and what it means<a href="https://www.benzinga.com/news/small-cap"> for retail investors</a>.
<h2 class="wp-block-heading">Rotation Trade Fuels Small-Cap Surge</h2>
The recent rally in small-cap stocks is largely due to a rotation trade rather than specific sector gains. Manby explains, &#8220;July's small cap rally was more of a rotation trade rather than a gain motivated by specific sectors.&#8221; He attributes this shift to the anticipated Federal Reserve pivot, saying, &#8220;Markets realized that a Fed pivot may be imminent, so investors piled into small caps while they still offered discounted valuations and attractive entry points relative to large caps.&#8221;
<h2 class="wp-block-heading">Promising Small-Cap Stocks Amid Big Tech Shift</h2>
As investors move away from Big Tech, certain small-cap stocks are standing out. 
Manby notes, &#8220;We prefer high-quality small caps to provide growth potential while also potentially mitigating some of the inherent volatility of the asset class.&#8221; He highlights the WisdomTree U.S. SmallCap Quality Dividend Growth Fund (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/DGRS#NASDAQ">DGRS</a>) and the WisdomTree U.S. SmallCap Quality Growth Fund (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QSML#NASDAQ">QSML</a>) as prime examples.
&#8220;The former trades at about 13x earnings, while the latter trades at about 17.6x earnings. Both are well below the Russell 2000, which is nearly at 40x trailing earnings,&#8221; he said.
<h2 class="wp-block-heading">Interest Rate Cuts Could Boost Small Caps</h2>
The prospect of interest rate cuts is promising for small caps. 
According to Manby, &#8220;Interest rate cuts would be a welcome reprieve for small caps whose debt burdens have become onerous in the post-pandemic environment.&#8221; He anticipates that a shift to lower rates would result in a &#8220;relief rally&#8221; for these stocks.
<h2 class="wp-block-heading">A Soft Landing Could Benefit Small Caps, Healthcare, Technology, Financials</h2>
Looking forward, Manby is optimistic about sectors like healthcare and technology.
&#8220;If the Fed directs a soft landing from this point while steadily cutting rates, we'd anticipate a large &#8216;risk on&#8217; rally where small caps would be a prime beneficiary,&#8221; he says.
He also sees potential in financials, noting, &#8220;We're also becoming more optimistic on financials, as the regional banking concerns over the last 18 months appear to have subsided.&#8221;
<h2 class="wp-block-heading">Focus On High-Quality Small Caps</h2>
Despite the positive outlook, there are risks. &#8220;The main risk factor for small caps right now is material economic weakness that cannot be quickly alleviated by rate cuts,&#8221; Manby warns.
Focus on high-quality small caps with robust operations and efficient use of balance sheet capital, Manby advises.
Also Read: <a href="https://www.benzinga.com/trading-ideas/long-ideas/24/07/40079676/exclusive-restaurants-are-to-soundhound-ai-what-books-were-to-amazon-ceo-tells-benzinga">EXCLUSIVE &#8211; &#8216;Restaurants Are To SoundHound AI What Books Were To Amazon,&#8217; CEO Tells Benzinga</a>
<h2 class="wp-block-heading">Why Consider Small Caps Now?</h2>
For retail investors, now might be the ideal time to explore small caps. With potential Fed actions and an evolving economic landscape, small caps could offer significant upside. Manby's insights emphasize the importance of strategic allocation and focusing on high-quality stocks that can handle market volatility while capturing growth opportunities.
Small caps are making waves as an investment choice. Are you ready to dive in?
Read Next: 
<ul>
<li><a href="https://www.benzinga.com/etfs/broad-u-s-equity-etfs/24/08/40116558/8-best-performing-small-caps-in-july-find-out-which-stock-jumped-803">8 Best-Performing Small Caps In July: Find Out Which Stock Jumped 803%</a></li>
</ul>
Don't miss the opportunity to dominate in a volatile market at the <a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/">Benzinga SmallCAP Conference</a> on October 9-10, 2024, at the Chicago Marriott Downtown Magnificent Mile. 
Get exclusive access to CEO presentations, 1:1 meetings with investors, and valuable insights from top financial experts. Whether you're a trader, entrepreneur, or investor, this event offers unparalleled opportunities to grow your portfolio and network with industry leaders. 
<a href="https://www.benzinga.com/events/small-cap/global-small-cap-conference-2024/">Secure your spot and get your tickets today!</a>
Image: Shutterstock

DGRS

QSML

EXCLUSIVE: 'Fed Pivot May Be Imminent' — Small Caps Are Poised For Big Comeback, Says WisdomTree Strategist

Super Micro Computer Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SMCI#NASDAQ">SMCI</a>) CEO Charles Liang discussed the company&#8217;s initiatives to lessen the environmental impact of data centers in an interview with CNBC&#8217;s Jim Cramer on Monday.
The artificial intelligence server company&#8217;s clientele includes Nvidia Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) and Elon Musk&#8217;s AI startup.
Liang highlighted the benefits of Super Micro&#8217;s &#8220;liquid cooling&#8221; and &#8220;green computer&#8221; technologies, which aim to reduce carbon footprints and cut customer costs, CNBC <a target="_blank" href="https://www.cnbc.com/2024/07/15/super-micro-computer-ceo-talks-reducing-energy-costs-and-carbon-footprint.html" rel="noreferrer noopener">reports</a>.
Meanwhile, Nasdaq announced on Friday evening that Super Micro Computer would join the Nasdaq 100 <a target="_blank" href="https://www.benzinga.com/markets/equities/24/07/39771681/whats-going-on-with-ai-server-stock-super-micro-computer-on-monday" rel="noreferrer noopener">on July 22</a>.
<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="750" height="650" src="https://editorial-assets.benzinga.com/wp-content/uploads/2024/07/16080611/newplot-33.png" alt="" class="wp-image-438224" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2024/07/16080611/newplot-33.png 750w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/07/16080611/newplot-33-300x260.png 300w" sizes="(max-width: 750px) 100vw, 750px" /></figure>
Liang also mentioned that the company&#8217;s energy-saving technologies have the potential to &#8220;preserve 20 billion trees for our planet.&#8221;
Liang expressed optimism about Super Micro&#8217;s growth trajectory, stating, &#8220;this AI revolution can be bigger even than the industrial revolution.&#8221;
Year-to-date, the company&#8217;s stock has surged over 200%. Investors can gain exposure to Super Micro through Vanguard Mid-Cap Growth ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOT#NYSE">VOT</a>) and Vanguard Russell 2000 ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NASDAQ">VTWO</a>).
Price Action: SMCI shares were down 0.04% at $897.32 premarket at the last check on Tuesday.
Photo via Company

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NVDA

SMCI

Super Micro CEO Predicts AI Revolution Bigger Than Industrial Era: Report

Small-cap exchange-traded funds (ETFs) have witnessed their largest weekly inflows since Bank of America began tracking <a href="https://www.benzinga.com/topic/small-caps">the data in 2017.</a> 
According to a note shared Wednesday, this surge is predominantly fueled by retail investors, marking a significant shift in market dynamics. 
Over the past 23 weeks, 22 have seen positive inflows, culminating in a record-breaking week that attracted over $3.5 billion into small-cap ETFs.
Data derived from Tradingview shows that the Pacer US Small Cap Cash Cows ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CALF#NYSE">CALF</a>) has emerged as a frontrunner, drawing in over $3 billion in the last three months, closely followed by the Vanguard Small-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VB#NYSE">VB</a>) with $2.6 billion of inflows, of which $1.615 billion recorded in the last month alone. 
Despite this record influx of funds, Bank of America highlights that small caps remain undervalued relative to their historical performance.
Top 10 Small-Cap ETF By Inflows Over The Last Three Months
<figure class="wp-block-table is-style-stripes"> 
<table>
<tbody>
<tr>
<td>Small-Cap ETF </td>
<td>1M Flows</td>
<td>3M Flows</td>
</tr>
<tr>
<td>Pacer US Small Cap Cash Cows </td>
<td>1.194B </td>
<td>3.096B</td>
</tr>
<tr>
<td>Vanguard Small-Cap ETF </td>
<td>1.615B </td>
<td>2.608B</td>
</tr>
<tr>
<td>iShares Core S&amp;P Small-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IJR#NYSE">IJR</a>)</td>
<td>116.003M </td>
<td>1.651B</td>
</tr>
<tr>
<td>Avantis U.S. Small Cap Value ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AVUV#NYSE">AVUV</a>)</td>
<td>695.473M </td>
<td>1.646B</td>
</tr>
<tr>
<td>Vanguard Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTWO#NYSE">VTWO</a>)</td>
<td>750.154M </td>
<td>1.411B</td>
</tr>
<tr>
<td>SPDR Portfolio S&amp;P 600 Small Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPSM#NYSE">SPSM</a>)</td>
<td>417.995M</td>
<td>915.308M</td>
</tr>
<tr>
<td>Vanguard Small-Cap Growth ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VBK#NYSE">VBK</a>)</td>
<td>440.327M</td>
<td>741.54M</td>
</tr>
<tr>
<td>Schwab U.S. Small-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHA#NYSE">SCHA</a>)</td>
<td>520.145M </td>
<td>622.329M</td>
</tr>
<tr>
<td>Dimensional U.S. Small Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DFAS#NYSE">DFAS</a>)</td>
<td>131.079M</td>
<td>507.818M</td>
</tr>
<tr>
<td>SSGA SPDR ETFS EUROPE II PLC (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SSEUF#NYSE">SSEUF</a>)</td>
<td>184.185M</td>
<td>484.932M</td>
</tr>
</tbody>
</table>
</figure>
<h2 class="wp-block-heading">Small Caps: A Bullish Outlook For 2024</h2>
Bank of America&#8217;s analysis suggests a turning tide for small caps. Analyst Jill Carey Hall, CFA, maintains a bullish outlook, predicting that 2024 could mark the year when small caps outperform large caps for the first time in nearly a decade. 
This optimism stems from a resilient small-cap sector, which has priced in a recession that has yet to materialize, as evidenced by the Russell 2000&#8217;s performance.
With investor sentiment improving and valuations becoming more attractive, small caps present a compelling opportunity for long-term investors. The Russell 2000&#8217;s forward P/E ratio has dipped to 14.3x, positioning small caps as the only size segment that is historically inexpensive. 
According to Bank of America, the valuation gap between small and large caps is reminiscent of the disparity seen during the Tech Bubble, which preceded a decade of exceptional returns for small caps.
Bank of America&#8217;s analysis implies potential annualized returns of 10% over the next decade for the Russell 2000, compared to a modest 3% for the Russell 1000.
For 2024, Bank of America reinforces the strategy of focusing on value within the small and mid-cap spaces. This approach favors high-quality stocks over non-earners. Financials, Communication Services, and Industrials are identified as top sector overweights within small caps. 
Read Now: <a href="https://www.benzinga.com/money/best-small-cap-stocks">Best Small Cap Stocks Right Now</a>
Photo: Shutterstock

New ETFs

Econ #s

AVUV

CALF

DFAS

SCHA

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SSEUF

Small-Cap ETFs Enjoy Record Inflows Due To Optimistic Retail Investors: Is This The Decade Of 10% Annual Returns?

Key&nbsp;jobs data&nbsp;is due Friday and recent numbers&nbsp;suggest&nbsp;the labor market may&nbsp;be starting to roll over.&nbsp;Here&#39;s what you need to know <a href="https://www.benzinga.com/topic/economics">ahead of the print</a>.
Friday&#39;s Jobs Report:&nbsp;The Bureau of Labor Statistics is set to release the March&nbsp;nonfarm payrolls&nbsp;at 8:30 a.m. ET Friday.&nbsp;The data will&nbsp;measure&nbsp;how many jobs were created in the U.S. last month across a majority of businesses.&nbsp;
Economists are anticipating that employers&nbsp;added 239,000&nbsp;payrolls, according to&nbsp;<a href="https://benzinga.grsm.io/gxjhpowx7zks">Benzinga Pro</a>.&nbsp;The number will follow a&nbsp;hotter-than-expected print in February in which the&nbsp;U.S. added&nbsp;311,000 jobs,&nbsp;well&nbsp;above&nbsp;average economist estimates of 200,000.
The Read-Through For The Fed:&nbsp;Jobless claims decreased by 18,000&nbsp;to 228,000&nbsp;for the week ending April 1 from&nbsp;an upwardly revised level of 246,000,&nbsp;according to&nbsp;data the Labor Department&nbsp;<a href="http://www.benzinga.com/news/23/04/31696305/weekly-jobless-claims-fall-18k-to-228k-still-higher-than-expected">released&nbsp;on Thursday</a>.
<a href="https://www.benzinga.com/economics/macro-economic-events/23/04/31677911/labor-market-is-cooling-adp-job-growth-misses-expectations-heres-how-fed-rate-bet">Private payrolls rose</a> by just 145,000 in March, down from 261,000 in February and well&nbsp;below forecasts of 200,000, which suggests the labor market is cooling significantly.&nbsp;
Projections for the Federal Reserve&#39;s next move have been bouncing around between a pause and another 0.25% rate hike.&nbsp;Following the cooler-than-expected labor&nbsp;data, the market was split approximately 60/40 Thursday in favor of a pause at the Fed&#39;s next meeting, according to CME Group&#39;s <a href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html">FedWatch tool</a>.&nbsp;
Friday&#39;s jobs number is likely to swing projections one way or the other. Another hot print could lift&nbsp;expectations&nbsp;for a subsequent 0.25% hike, but CNBC&#39;s Jim Cramer&nbsp;said he expects the labor market to have finally cracked, as recent data seems to suggest.
Cramer predicted the number will be the first to really show weakness in the labor market on Thursday&#39;s &quot;Squawk On The Street.&quot;
&quot;I think the help wanted signs are down, and not because they found the people, I think they are afraid to hire,&quot; he said.&nbsp;
People are underestimating the effects of the Silicon Valley Bank collapse, the CNBC host said.&nbsp;
See Also:&nbsp;<a href="https://www.benzinga.com/analyst-ratings/analyst-color/23/04/31664611/3-signs-a-recession-is-coming-just-1-is-left-before-bank-of-america-sounds-the-alar">3 Signs A Recession Is Coming: Just 1 Is Left Before Bank Of America Sounds The Alarm</a>
Powell Holds The Line On 2% Inflation Goal: The Fed has been willing to continue to raise&nbsp;rates, especially considering the continued strength of the labor market, but SVB&#39;s crumbling suggests&nbsp;the Fed might have finally broken something in the banking system in its aggressive fight against inflation.&nbsp;
Potential contagion in the banks is the primary factor&nbsp;pushing expectations toward a pause, but the labor market appears to be finally cooling off and the Fed also revised its outlook following its most recent decision on rates.&nbsp;
At the<a href="https://www.benzinga.com/news/23/03/31462259/fed-takes-another-swing-at-inflation-with-second-consecutive-0-25-rate-hike"> Fed&#39;s last meeting</a>,&nbsp;the committee said it no longer sees &quot;ongoing increases&quot; as appropriate and instead&nbsp;opted to say that some&nbsp;&quot;firming&quot; may be needed.&nbsp;
Fed Chair Jerome Powell maintained that 2% inflation is still the goal and said the Fed would use all of its tools to do so.
&quot;There are real costs to bringing it down to 2%, but the costs of failing are much higher,&quot; Powell said in a press conference following the Fed&#39;s last 0.25% hike.
If Friday brings another hot jobs number, projections for the Fed&#39;s next move could easily return to looking like a coin flip, which is where the projections were&nbsp;immediately following&nbsp;the Fed&#39;s last meeting. A cooler-than-expected print will likely continue to push projections in favor of a pause.&nbsp;
Check This Out:&nbsp;<a href="https://www.benzinga.com/analyst-ratings/analyst-color/23/04/31685581/inflation-is-about-to-plummet-wall-street-firm-says-heres-when-things-should-get-ba">Inflation Is About To Plummet, Wall Street Firm Says: Here&#39;s When Things Should Get Back To Normal</a>
Price Action:&nbsp;At publication time, the&nbsp;SPDR S&amp;P 500 (ARCA:SPY) was&nbsp;down 0.21% at $406.79, while the&nbsp;Invesco QQQ Trust ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqq#NASDAQ">QQQ</a>) was&nbsp;down 0.26% at $315.13 and the&nbsp;Vanguard Russell 2000 ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vtwo#NASDAQ">VTWO</a>) was&nbsp;lower by just&nbsp;0.13%, trading at $70.04, according to&nbsp;<a href="https://benzinga.grsm.io/gxjhpowx7zks">Benzinga Pro</a>.
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Friday's Jobs Data Likely To Shift Market Odds For Fed's Next Interest Rate Decision: Are Help Wanted Signs Gone?

The Russell 2000 Index tracks the 2,000 smallest stocks out of the 3,000 stocks in the Russell 3000 Index. The index makes up about 10% of the entire market capitalization of the Russell 3000. The Russell 2000 is managed by the FTSE Russell Group in London. Its focus on small-cap, U.S. stocks makes it one of the bellwethers of the U.S. economy and the broader market. Every stock in the index must trade on a major stock exchange (i.e., the NYSE, NASDAQ, or AMEX).
This article will go into detail about the Russell 2000, including how it removes some risk from investing in small-cap stocks. We&#39;ll also go over some <a href='https://www.benzinga.com/money/best-options-to-buy-this-week/'>options</a> for investors looking to trade the Russell 2000 stocks. 
<h2>A Balanced Approach to Investing in Small-Cap Stocks</h2>

The Russell 2000 is a <a href='https://www.benzinga.com/money/best-small-cap-etfs/'>small cap</a> index because the stocks it tracks have stocks that fit the small-cap market capitalization definition. Small-cap stocks are generally companies with a market capitalization of less than $2 billion dollars. When they are compared to large- and mid-cap companies, small-cap stocks are typically seen as having better growth potential.
By nature, small-cap stocks are subject to <a href='https://www.benzinga.com/money/most-volatile-stocks/'>volatile</a> price swings that make them appropriate only for risk-tolerant investors. One such risk is that many small-cap companies are newer entries into their field. And depending on where they are in their business cycle, they may require access to a lot of capital which can be hard to acquire. 
<h2>Why is the Russell 2000 Index Significant?</h2>

The first index fund debuted in 1960. As of July 2022, there are more than 1,700 <a href='https://www.benzinga.com/money/best-index-funds/'>index funds</a>. And that number is up from just over 400 in 2003. With so many index funds to choose from, it&#39;s important to understand what makes one index fund stand out from another.
The Russell 2000 is a relatively old fund. It launched in 1984 and was one of the first index funds to specifically focus on small-cap stocks. Before we explain why that is significant, it&#39;s important to understand how the Russell 2000 relates to its &quot;parent index,&quot; the Russell 3000.
The Russell 3000 index is a benchmark index of the entire U.S. stock market. As its name suggests, the index measures the performance of the 3,000 largest publicly held companies in the United States and represents approximately 97% of the entire U.S. public equity market. The Russell 3000 is weighted by market capitalization. Like the Russell 2000, the Russell 3000 debuted in 1984.
The objective of the Russell 2000 is to measure the performance of the 2,000 smallest companies in the Russell 3000. As of the first quarter of 2022, the average value for a company in the index was $3.17 billion, and the median market cap was $0.93 billion. The index is the most widely quoted measure of the overall performance of small- to mid-cap stocks.
In addition to the Russell 2000, there are two sub-indexes that are fine-tuned to track special characteristics that are sought after by investors.&nbsp; For example, the Russell 2000 Growth Index measures the performance of Russell 2000 companies with higher price-to-value ratios and projected higher growth values. Conversely, the Russell 2000 Value Index measures the performance of companies in the index with low price-to-book (P/B) ratios and is projected to have lower growth values. 
<h2>How is the Russell 2000 Index Different from Other Major Indices?</h2>
<ul>
<li>A focus on smaller, more volatile companies - The most obvious difference is the index&#39;s focus on small-cap stocks. Many other indices such as those that track the S&amp;P 500 and the Dow Jones Industrial Average (DJIA) track large-cap stocks. However, the Russell 2000 focuses more on newer growth companies which tend to be more volatile than large-cap companies.</li>
<li>Larger growth potential &ndash; Small-cap stocks offer the potential for more growth than large-cap companies. This is even true in growth sectors like technology. This means that, over time, small-cap stocks tend to outperform large-cap stocks.</li>
<li>Offers diversification - Investing in small-cap stocks is only for risk-tolerant investors. However, because the Russell 2000 index consists of 2,000 stocks, the risk is more evenly distributed over many stocks and is not reliant on the performance of a handful of companies.</li>
</ul>

Another way the Russell 2000 Index is different from other indices is in the way it is weighted. Specifically, it is weighted by market capitalization and adjusted by each company&#39;s number of shares outstanding. As opposed to an index that is exclusively weighted by market cap, the Russell 2000 Index is influenced by a stock&#39;s closing price and the number of shares that are available to be traded. 
<h2>What is the Russell Reconstitution?</h2>

The Russell Reconstitution is the period in which the index rebalances its holdings. This means that the managers of the index add some companies and drop others. It also means the weighting of companies within the index may change. Every index fund rebalances its holding. That reflects the fact that markets are always evolving. This process allows the Russell 2000 to reflect these changes.
This is a multi-week process that typically concludes in late June. The final day of the reconstitution is one of the most closely watched and anticipated events. One reason for this is that the reconstitution may impact over $9 trillion in assets that are either invested or benchmarked to the Russell Indexes. Investors can expect significant price movement in several of the index components in the period after the reconstitution. 
<h2>How Can Investors Trade the Russell 2000 Index?</h2>

Investors have many options to invest in mutual funds and exchange-traded funds that passively track the performance of the Russell 2000 index. The most heavily traded of the ETFs is the iShares Russell 2000 index ETF (NYSEARCA: IWM).
Funds such as the RVX Emerging Markets Equity Opportunity Fund are ideal for investors who want exposure to a specific market. This fund is an offshoot of the Russell 2000. Another example is the Vanguard Russell 2000 ETF&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vtwo#NASDAQ">VTWO</a>). This fund invests in all 2,000 stocks according to their relative weights. This fund&#39;s low (0.10%) expense ratio is an attractive feature.
Investors who are specifically interested in trading the index based on the reconstitution can trade the CME E-mini Russell 2000 Index (RTY) Future contracts.&nbsp; Doing so means the futures contracts will track the index, and the investor does not have to be concerned about any tracking errors caused by the reconstitution. 
<h2>Some Final Thoughts on the Russell 2000 Index</h2>

Having exposure to small-cap stocks is an ideal way for risk-tolerant investors to diversify their portfolios. The Russell 2000 is a weighted index fund that incorporates the 2,000 smallest companies in the Russell 3000 Index. The size of the index helps to smooth out the volatility that can be found in small-cap stocks and offer market-beating performance at times when the economy is growing.
Image sourced from <a href="https://www.shutterstock.com/image-photo/russell-2000-index-glass-showing-words-2157437401">Shutterstock</a>

What Is The Russell 2000 Index And How Can Investors Use It For Profitable Trading?

ATCO, ANET, FIT, SRAX, SNE, DAC, STKL, ROCHW, TIMB, AAIC, OCUL, GRBK, ROCHU, OPRX, DVD, ROCH, APPN, MYOK, HEI, DRIV, NMCI, BPYU, CLPT, SWAV, LOB, NBACW, TANH, SQM, ALACW, HDS, IXUS, INFI, LB, TMUS, FPI, NBAC, DXYN, ALB, CRNC, SCZ, TRIB, NTLA, FFIV, MCK, THCBW, CX, CMCSA, VTWO, MGI, UBS, GM, MRNA, MS, BIDU, KZIA, WMT, FSK, CL, CBAT, SE, PLTR, NWG, ALV, TSM, MHLD, FUTU, VJET, JD 
&nbsp;

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First Trust Advantage Preferred Income Fund

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68 Stocks Trading Near 52-Week Highs Just After Open On Monday, Nov. 16, 2020:

Earnings

Futures

SPDR Dow Jones Industrial Average ETF Trust

VIOO

Podcast: Is This The Best Earnings Season Of The Century?

Major companies are set to be pushed out of the Russell 1000 Index Friday as the Russell Investment Group evaluates what companies have a high enough market cap to be a part of the index's rank.
Major retailers like JCPenney JCP and Dillard's DDS and tech companies like Yelp YELP and Groupon GRPN will leave the Russell 1000, while growing companies like Advanced Micro Devices, Inc. AMD are set to join the Russell 1000.
The Russell Indexes
The Russell 3000 Index is an index weighted by market capitalization, or the companies with the largest market value. It is maintained by the Russell Investment Group which strives to make the index the benchmark for the entire U.S. stock market.
The Russell 3000 has two subset indexes: the Russell 1000 and the Russell 2000. The Russell 1000 Index is based on the 1,000 largest companies in the Russell 3000 and the U.S. market, comprising over 90% of the total market capitalization of all listed U.S. stocks. The Russell 2000 Index comprises of the remaining small cap companies from the Russell 3000 not included in the Russell 1000.
Stocks within the Russell 3000 Index are reconstituted once a year, usually around June. At this time, the companies are re-ranked based on their market cap for the previous year. As a result, companies that have maintained their market value will stay in their current residing index, while others may move up to the Russell 1000 or down to the Russell 2000 accordingly.
What Companies Are Moving Up or Down
This year, some major companies are moving down from the Russell 1000 to the Russell 2000. For instance, JCPenney, whose market cap has shrunk to $1.4 billion, and Dillard's, which is down to $1.5 billion, will be moved to the Russell 2000. Major tech companies are also going down to the Russell 2000, including Groupon, Yelp, and Fitbit FIT.
Many energy stocks are also moving to the Russell 2000 this year. The Russell 1000 RGS Energy Index is down 15.2% since the start of 2017 and down 9% since last June. This makes it likely that energy companies will shift from the Russell 1000 to the Russell 2000, including companies such as Diamond Offshore DO, Noble NE, Ensco ESV, Rowan RDC, and Penn Virginia PVAC.
However, other companies are graduating to the Russell 1000. For instance, AMD had a very good year with its shares going from $5 to $14 in 12 months. This year has also been successful for financial companies, as the Russell 1000 Financial Services Index is up 21% since last June. Various financial companies are expected to replace the energy stocks leaving.
The Impact
This reconstitution of the Russell Index makes a huge difference in the stock market because many major mutual funds and ETFs are benchmarked to these indexes, such as the Vanguard Russell 2000 ETF VTWO. In total, $8.5 trillion is invested in products based on the Russell U.S. indexes.
Consequently, these investors buy stock from the companies that the Russell Index includes or sell based on what the index removes. Investors will be working to rebalance their portfolios, wanting their investments in various sectors to be proportional to the Russell 1000 Index.
As the Russell Investment Group works to reconstitute their indexes, investors will sell some major companies and buy shares of newer, growing companies. When this happens, some companies' stock will be bought by new investors and will continue to grow, while those leaving the Russell 1000 may not recover. 
The Best &amp; Worst of Zacks
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 Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. <a href="http://www.zacks.com/registration/pfp/?ALERT=RPT_7BST_LP194&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461" target="_blank">Click to get this free report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&amp;d_alert=ZER_LINK&amp;t=GRPN&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">Groupon, Inc. (NASDAQ: <a class="ticker" href="/stock/grpn#NASDAQ">GRPN</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZR_LINK&amp;d_alert=rd_final_rank&amp;t=YELP&amp;ADID=BENZ_CONTENT_ZRANK_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">Yelp Inc. (NYSE: <a class="ticker" href="/stock/yelp#NYSE">YELP</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&amp;d_alert=ZER_LINK&amp;t=AMD&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">Advanced Micro Devices, Inc. (NYSE: <a class="ticker" href="/stock/amd#NYSE">AMD</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&amp;d_alert=ZER_LINK&amp;t=FIT&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">Fitbit, Inc. (NYSE: <a class="ticker" href="/stock/fit#NYSE">FIT</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&amp;d_alert=ZER_LINK&amp;t=NE&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">Noble Corporation (NYSE: <a class="ticker" href="/stock/ne#NYSE">NE</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&amp;d_alert=ZER_LINK&amp;t=ESV&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">ENSCO PLC (NYSE: <a class="ticker" href="/stock/esv#NYSE">ESV</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&amp;d_alert=ZER_LINK&amp;t=RDC&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">Rowan Companies PLC (NYSE: <a class="ticker" href="/stock/rdc#NYSE">RDC</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&amp;d_alert=ZER_LINK&amp;t=DO&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">Diamond Offshore Drilling, Inc. (NYSE: <a class="ticker" href="/stock/do#NYSE">DO</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&amp;d_alert=ZER_LINK&amp;t=DDS&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">Dillard's, Inc. (NYSE: <a class="ticker" href="/stock/dds#NYSE">DDS</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZER_LINK&amp;d_alert=ZER_LINK&amp;t=JCP&amp;ADID=BENZ_CONTENT_ZER_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">J.C. Penney Company, Inc. Holding Company (NYSE: <a class="ticker" href="/stock/jcp#NYSE">JCP</a>): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/registration/pfp/?ALERT=ETF225&amp;adid=BENZ_CONTENT_ETF_ARTCAT_STOCKS_IN_THE_NEWS&amp;d_alert=rd_final_rank&amp;t=VTWO&amp;split=1&amp;cid=CS-BENZ-FT-265461">VANGD-RUS 2000 (NASDAQ: <a class="ticker" href="/stock/vtwo#NASDAQ">VTWO</a>): ETF Research Reports</a>   <a href="http://www.zacks.com/registration/pfp?ALERT=ZR_LINK&amp;d_alert=rd_final_rank&amp;t=PVAC&amp;ADID=BENZ_CONTENT_ZRANK_ARTCAT_STOCKS_IN_THE_NEWS&amp;cid=CS-BENZ-FT-265461">Penn Virginia Corporation (PVAC): Free Stock Analysis Report</a>   <a href="http://www.zacks.com/stock/news/265461/heres-why-jcpenney-yelp-and-others-were-removed-from-the-russell-1000?cid=CS-BENZ-FT-265461">To read this article on Zacks.com click here.</a>   <a href="http://www.zacks.com/">Zacks Investment Research</a>

GRPN

YELP

Here's Why JCPenney, Yelp, and Others Were Removed From the Russell 1000

David Rolfe, chief investment officer of Wedgewood Partners, recently provided <a href="http://www.marketwatch.com/story/why-buffetts-berkshire-hathaway-is-still-a-better-bet-than-small-cap-stocks-2016-03-08">an update</a> on a 10-year market bet he made with Marketwatch columnist Nicholas Vardy about two years ago.
The bet was that, over a 10-year stretch starting last March, Berkshire Hathaway Inc. (NYSE: <a class="ticker" href="/stock/brk-b#NYSE">BRK-B</a>)&rsquo;s stock would outperform the Vanguard Russell 2000 ETF (BMV: VTWO).
After two years, Berkshire&rsquo;s shares are up about 18.0 percent, while the Russell 2000 ETF is down 8.0 percent.
Looking ahead to the next year, Rolfe predicts that Berkshire will continue to widen its performance gap over small-cap stocks. He sees long-term growth and valuation advantage for Berkshire and its holdings. This advantage makes the stock a favorable long-term investment to small caps in either an up or down market.
<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/general/education/16/03/6862606/mit-researchers-heres-where-to-look-for-the-next-amazon-or-facebook#ixzz42LnT5pim">MIT Researchers: Here&#39;s Where To Look For The Next Amazon Or Facebook</a></bzrelatedlink>
&ldquo;I&rsquo;m not clever enough to figure out if Corporate America is [in] an &#39;earnings recession,&#39; but if I was a betting man and had to take the over or under on the prospect for robust earnings growth over the next 12 months, I would take the under,&rdquo; Rolfe wrote.
Rolfe pointed out that Berkshire currently trades at only 1.3x book value and that Warren Buffett himself has repeatedly expressed his desire to buy back shares of the company at 1.2x book value. That buying could mean some major support for the stock in the $125 level if the market deteriorates further in the near future.
Disclosure: The author holds no position in the stocks mentioned.

BRK-B

Rolfe: Berkshire Still Better Bet Than Small Caps

On the heels of a pre-Christmas announcement that saw the firm, lower fees on a variety of bond and broader market equity ETFs, Vanguard said today it will lower fees on its 10 sector ETFs. The news is significant because prior to today, State Street's (NYSE: <a class="ticker" href="/stock/stt#NYSE">STT</a>) State Street Global Advisors unit, the second-largest U.S. ETF sponsor, had the lowest fees on major U.S.-focused sector ETFs.

For example, funds such as the Consumer Staples Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xlp#NYSE">XLP</a>) and the Technology Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xlk#NYSE">XLK</a>) feature expense ratios of 0.18%, which had made the select sector SPDRs ETFs cheaper than their Vanguard equivalents.

Vanguard, the third-largest U.S. ETF issuer, can now wear the crown as the major issuer with lowest-cost sector funds. 

The Vanguard Consumer Discretionary ETF (NYSE: <a class="ticker" href="/stock/vcr#NYSE">VCR</a>), the Vanguard Energy ETF (NYSE: <a class="ticker" href="/stock/vde#NYSE">VDE</a>), the Vanguard Consumer Staples ETF (NYSE: <a class="ticker" href="/stock/vdc#NYSE">VDC</a>), the Vanguard Materials ETF (NYSE: <a class="ticker" href="/stock/vaw#NYSE">VAW</a>) and the Vanguard Utilities ETF (NYSE: <a class="ticker" href="/stock/vpu#NYSE">VPU</a>) have all seen annual expenses lowered to 0.14 percent from 0.19 percent.

The same fee reductions also apply to the Vanguard Health Care ETF (NYSE: <a class="ticker" href="/stock/vht#NYSE">VHT</a>), the Vanguard Industrials ETF (NYSE: <a class="ticker" href="/stock/vis#NYSE">VIS</a>), the Vanguard Information Technology ETF (NYSE: <a class="ticker" href="/stock/vgt#NYSE">VGT</a>) and the Vanguard Telecom Services ETF (NYSE: <a class="ticker" href="/stock/vox#NYSE">VOX</a>).

Pennsylvania-based Vanguard did lower the expense ratio on the Vanguard Financials ETF (NYSE: <a class="ticker" href="/stock/vfh#NYSE">VFH</a>) to 0.19 percent from 0.23 percent, but the Financial Services Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xlf#NYSE">XLF</a>) is slightly cheaper at 0.18 percent per year. The firm also said it reduced the fees on the Vanguard Extended Duration Treasury Index ETF (NYSE: <a class="ticker" href="/stock/edv#NYSE">EDV</a>) to 0.12 percent from 0.13 percent. All of the changes take effect immediately.

Vanguard continued to emphasize that it is unique corporate structure allows to deliver cost-saving to investors.

"For Vanguard, our unique client-owned corporate structure is what drives the low costs of our funds.Since we area mutually owned firm, low costs are an outcome that is directly tied to how much it costs us to manage our funds. Economies of scale and a focus on keeping operating costs low have resulted in a long track record of Vanguard lowering costs across the board," <a href="https://advisors.vanguard.com/VGApp/iip/site/advisor/researchcommentary/article/IWE_NewsDec2012ExpenseRatio">the firm said in a statement</a>.

Last week, <a href="http://www.benzinga.com/markets/bonds/12/12/3198204/vanguard-fires-1-more-shot-in-2012-etf-fee-war">Vanguard announced fee cuts on 11 of its ETFs</a>, including the Vanguard Long-Term Government Bond ETF (NASDAQ: <a class="ticker" href="/stock/vglt#NASDAQ">VGLT</a>) and the Vanguard Russell 2000 Index ETF (NASDAQ: <a class="ticker" href="/stock/vtwo#NASDAQ">VTWO</a>).

For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

Sector ETFs

Bonds

Short Ideas

Intraday Update

VGLT

Vanguard Trims Fees on Sector ETFs

Not surprisingly, Vanguard, the third-largest U.S. ETF sponsor, has something to say about the ongoing 2012 ETF fee battle. Pennsylvania-based, known for being one of the ETF industry's low-cost leaders, announced fee reductions for 11 of its ETFs. The fee reductions took effect last week, <a href="https://advisors.vanguard.com/VGApp/iip/site/advisor/researchcommentary/article/IWE_NewsDec2012ExpenseRatio">according to a statement issued by Vanguard</a>.

The 11 Vanguard ETFs that are now home to lower fees include the Vanguard Intermediate-Term Corporate Bond (NASDAQ: <a class="ticker" href="/stock/vcit#NASDAQ">VCIT</a>), which now has an expense ratio of 0.12 percent down from 0.14 percent. The Vanguard Intermediate-Term Government Bond ETF (NASDAQ: <a class="ticker" href="/stock/vgit#NASDAQ">VGIT</a>), the Vanguard Long-Term Corporate Bond ETF (NASDAQ: <a class="ticker" href="/stock/vclt#NASDAQ">VCLT</a>) and the Vanguard Long-Term Government Bond ETF (NASDAQ: <a class="ticker" href="/stock/vglt#NASDAQ">VGLT</a>) also saw fee reductions to 0.12 percent per year from 0.14 percent.

Other fee reductions include the Vanguard Mortgage-Backed Securities Index ETF (NASDAQ: <a class="ticker" href="/stock/vmbs#NASDAQ">VMBS</a>) going to 0.12 percent from 0.15 percent. The Vanguard Russell 1000 Value Index ETF (NASDAQ: <a class="ticker" href="/stock/vonv#NASDAQ">VONV</a>) now charges 0.15 percent down from 0.16 percent while the Vanguard Russell 2000 Index ETF (NASDAQ: <a class="ticker" href="/stock/vtwo#NASDAQ">VTWO</a>) saw its fees reduced to 0.21 percent from 0.22 percent.

Vanguard lowered fees on another small-cap ETF, taking the expense ratio on the Vanguard Russell 2000 Value Index ETF (NASDAQ: <a class="ticker" href="/stock/vtwv#NASDAQ">VTWV</a>) to 0.32 percent per year from 0.33 percent. The Vanguard Russell 3000 Index ETF (NASDAQ: <a class="ticker" href="/stock/vthr#NASDAQ">VTHR</a>) is now charging 0.15 percent down from 0.16 percent.

The Vanguard Short-Term Corp Bond Index ETF (NASDAQ: VSCH) and the Vanguard Short-Term Government Bond Index ETF (NASDAQ: <a class="ticker" href="/stock/vgsh#NASDAQ">VGSH</a>) both saw fee cuts to 0.12 percent per year from 0.14 percent.

Over the past year, a broad swath of ETF issuers have lowered fees in an effort to attract fresh capital from investors. Vanguard's most recent fee-cut announcement is by no means the firm's first and issuers such as Charles Schwab (NYSE: <a class="ticker" href="/stock/schw#NYSE">SCHW</a>) and State Street's (NYSE: <a class="ticker" href="/stock/stt#NYSE">STT</a>) State Street Global Advisors (SSgA) have announced fee reductions of their own. SSgA is the second-largest U.S. ETF sponsor.

BlackRock's (NYSE: <a class="ticker" href="/stock/blk#NYSE">BLK</a>) iShares, the world's largest ETF issuer and the firm often viewed as Vanguard's primary rival, announced fee cuts of its own earlier this year. In late November, Invesco's (NYSE: <a class="ticker" href="/stock/ivz#NYSE">IVZ</a>) PowerShares unit, the fourth-largest U.S. ETF sponsor, <a href="http://www.benzinga.com/news/12/11/3128183/powershares-fires-its-own-shot-in-etf-fee-war">signaled it would not be left out of the fee war</a> by announcing lower fees on six of its ETFs.

For its part, Vanguard's fee cuts may not be a direct response to what rival firms are doing, but rather the result of the firm's corporate structure and its ability to drive cost savings through economies of scale.

"Other investment firms may lower costs as a business strategy to attract assets," the firm said in the statement. "For Vanguard, our unique client-owned corporate structure is what drives the low costs of our funds. Since we are a mutually owned firm, low costs are an outcome that is directly tied to how much it costs us to manage our funds. Economies of scale and a focus on keeping operating costs low have resulted in a long track record of Vanguard lowering costs across the board."

For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

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