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VTWV vs. ETF Alternatives
Vanguard Russell 2000 Value ETF seeks to track the performance of a benchmark index that measures the investment return of small-capitalization value stocks.
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Country: United States
- In Your Portfolio: US Growth and Value ETFs, Core Building Blocks: A Guide to ETFs That Divide the U.S. Stock Market by Market Cap
- Asset Class Performance: Growth vs. Value
Thursday, Oct 174:28 PMSmall caps get even pricier
Thursday, Oct 174:28 PM| 1 Comment
- "We start to get a little queasy when we hit 19x," says BAML's Steven DeSanctis, unable to find bargains in any sector of the small cap universe.
- The Russell 2000 is up 29% this year, and 5.4% over the three months, easily cruising past the S&P 500's 21% and 2.7% gains, but the small cap's P/E ratio has risen to just over 18 vs. a long-term average of 14.9.
- The lofty valuation has BAML recommending clients swap out of U.S. growth for global growth as small caps generally have less exposure to international action.
- Small cap ETFs: IWM, VTWO, EWRS, SRTY, TWM, RWM, TNA, URTY, UWM, TZA, SMLV, TWOK, IWO, VTWG, UKK, SKK, IWN, VTWV, UVT, SJH.
Sunday, Sep 299:13 PMFocusing on value beats worrying about macro
Sunday, Sep 299:13 PM| 5 Comments
- Particularly apt reading tonight as stocks head south on worry about a partial U.S. government shutdown, The Brooklyn Investor makes the case for trying to ignore whatever the latest macro-boogeyman happens to be, and instead focus on buying and holding reasonably valued stocks. Paraphrasing Seth Klarman: "You just have to figure out what a business can earn in five or ten years on a normalized basis and see what it's worth; if you can buy it for lower than that, then it doesn't matter what the headlines say."
- The Shiller cyclically adjusted P/E ratio does raise TBI's eyebrow as it shows the market to be 47% overvalued, but it was similarly so in 1966. While the averages did nothing over the next 16 years, the "Superinvestors of Graham and Doddsville" (Walter Schloss, Tweedy Brown, Sequoia Fund) racked up ridiculous returns (this, of course, may be of little comfort to index investors).
- Buffett's classic "Superinvestors" article from 1984.
- Can the market go down? A lot? No doubt, says TBI, but the odds against being able to exploit a bear market are far too long - better to spend time looking for stocks trading at 1.1x book that should be selling for 1.5x book.
- Index value ETFs: SPYV, IVE, RPV, VOOV, FTA, SPYV, IVE, RPV, VOOV, FTA, IWN, VTWV, UVT, SJH, IWW, MDYV, IJJ, RFV, IVOV, SLYV, IJS, RZV, VIOV.
Monday, Sep 26:29 PMValue investing gold: Burry's 2000/2001 journal
Monday, Sep 26:29 PM| Comment!
- What George Soros' The Alchemy of Finance was to global macro investors, Michael Burry's journal of trades in 2000/2001 may be to value fans. "My strategy isn't very complex. I try to buy shares of unpopular companies when they look like road kill, and sell them when they've been polished up a bit ... I care little about the level of the general market and put few restrictions on potential investments."
- Plucked out of message-board obscurity and staked by Joel Greenblatt, Burry posted returns at his Scion Capital hedge fund of 8.2% in 2000 (partial year), 44.7% in 2001, and 13.1% in 2002, as the S&P lost 7.5%, 11.9%, and 22.1% during the same periods. When the S&P bounced 28.7% in 2003, Scion gained 50.7%.
- This journal shows Burry willing to venture into just about any industry or situation as long as he sees value there. One place he definitely didn't spot value was in the previously-favored big cap tech names as their stock prices imploded. "Now that the bubble is pricked, tech stocks will face scrutiny they never faced before. It is a good time to start picking prices based on a solid understanding of the fundamentals ... greater bargains are sure to come."
- Burry went on make an even bigger fortune for himself and his investors by shorting MBS from 2005 on (though his investors, including Greenblatt, never forgave him for straying from stockpicking).
- Value ETFs: SPYV, IVE, RPV, VOOV, FTA, IWD, VONV, UVG, SJF, IWN, VTWV, UVT, SJH, IWW, MDYV, IJJ, RFV, IVOV, SLYV, IJS, RZV, VIOV.
Tuesday, Jul 93:11 PMState Street (STT) is competing aggressively on price with the launch of its Russell 2000 ETF (TWOK) - the fund will have an expense ratio of 0.12% vs. iShares' (BLK) IWM with expenses of 0.24%, and Vanguard's VTWO at 0.21%. In addition, SSgA is relaunching 3 existing ETFs after refitting them to Russell indexes. The SPDR Russell 3000 ETF (THRK) replaces the SPDR Dow Jones Total Market ETF (TMW), with expense ratio halved to 0.10%. The SPDR Russell 1000 ETF (ONEK) replaces the SPDR Dow Jones Large Cap ETF (ELR), with expense ratio halved to 0.10%. The SPDR Russell Small Cap Completeness ETF (RSCO) replaces the SPDR Dow Jones Mid Cap ETF (EMM) with expense ratio falling to 0.10% from 0.25%. |Tuesday, Jul 93:11 PM| Comment!
Monday, Jul 83:54 PMState Street (STT) looks to take on iShares' (BLK) dominant small cap ETF (IWM) with the Tuesday launch of the SPDR Russell 2000 ETF (TWOK). IWM currently has $23.3B in AUM and an expense ratio of 0.24%. This compares to other far smaller competitors like Schwab's SCHA at 0.08% and Vanguard's VB at 0.10%. Previous: Small cap stocks outpace the S&P 500. Other reasonably popular ETFs: IJS, IJR.
|Monday, Jul 83:54 PM| 4 Comments
Tuesday, Jun 410:51 AMBNP's "Love-Panic Index" signals a correction ahead as it crossed into "love" territory a few weeks back. Past experience says to brace for an average 12% decline in the S&P (SPY) over the next 6 months. The biggest drivers of the recent move into "love" have been State Street's Investor Confidence, the CFTC's COT report, falling short interest, rising Nasdaq to NYSE trading volume, and small caps (IWM) outperformance over large caps (IWB). |Tuesday, Jun 410:51 AM| 14 Comments
Monday, May 203:11 PMThe Russell 2000 (IWM) cracked 1,000 for the first time this morning, but the small cap sector is far from over-loved by the fund managers who invest in it, according to Credit Suisse's Lori Calvasina - they ended Q1 with cash holdings at a near 10-year high. Indexing (IJR, IWO, IWN XSLV are some others) beats most active management, but Calvasina screened for stocks owned by fewer than 50 small-cap funds with $500M-$1.5B market cap, and with favorable investment ratings. No surprise the answer is heavy on mREITs - MTGE, AMTG, PMT. Also coming up: OMX and WFR. |Monday, May 203:11 PM| Comment!
Thursday, May 93:24 PM"Our enthusiasm is clearly a notch below where we were at the beginning of the year," write Credit Suisse analysts, starting to see a bit of froth creep into small caps. At 16.4x earnings, the Russell 2000 (IWM) "has admittedly lost its valuation appeal." For now, they're buyers on dips, but should the index near the 1,000 level, valuation pressure will really start to be felt. |Thursday, May 93:24 PM| 3 Comments
Friday, Apr 269:26 AM
Monday, Apr 1512:38 PM
Sunday, Apr 148:25 AMThe reconstitution of the Russell indexes coming up in June, Credit Suisse aims to anticipate who's in and who's out. The rules-based approach of the Russell 2000 has allowed arbitragers to profit each summer by front-running the moves, making the Russell 2000 ETF (IWM) a poorer play for small cap fans than IJR . Expected among the top 25 adds are ARCP, SRPT, PBYI, ACAD, and WSTC. Among the top 25 deletes: CPST, FCEL, CHKE, OMER, and EML. |Sunday, Apr 148:25 AM| Comment!
Tuesday, Mar 261:27 PMSmall-cap stocks are set to outperform, according to Goldman research showing the IWM outperforms the SPY by an annualized 8.1% in quarters following a steep drop in the VIX. The "acute" decline in the VIX YTD "provides a tailwind to small-cap performance in 2Q13." A must-read for small cap index fans is SA author Ploutos' piece suggesting IJR is your best bet. |Tuesday, Mar 261:27 PM| 3 Comments
Friday, Mar 2212:29 PMLagging the solid rise in stocks today are small caps, the Russell 2000 (IWM) up 0.1% while the S&P 500 and Nasdaq post better than 0.5% gains. Thus far in 2013, IWM is about level with the S&P, but is about 300 bps better on a Y/Y basis. IJR - maybe better for small cap fans - has outperformed both. |Friday, Mar 2212:29 PM| Comment!
Tuesday, Feb 199:10 AMOwners of the Russell 2000 ETF (IWM) may be able to declare arbitragers as dependents on their tax returns. Sharp traders have been gaming the rules-based rebalancing of the popular small-cap index for sweet profits each summer. Small-cap fans should instead take a look at IJR - it's performed better thanks to inclusion rules that may make more sense and are less likely to be arbitraged. |Tuesday, Feb 199:10 AM| Comment!
Tuesday, Jan 89:59 AMJust before New Year's, Vanguard cut fees on more than a third of its U.S.-listed ETF lineup while raising fees on just 2 ETFs. Its sector ETFs saw the biggest price cuts (from 0.19% to 0.14%) while its 2 small cap funds (VIOO, VIOV) actually saw slight fee hikes. |Tuesday, Jan 89:59 AM| Comment!
Monday, Jan 712:47 PMWith U.S. small caps "picked over," some managers are looking overseas for ideas. International valuations are at 13X earnings and dividend yields of 3% vs. domestic at 15X and 2%, according to Mark Bogar, whose firm is allocating 57% of it small cap exposure to foreign holdings, a big jump from a year ago. |Monday, Jan 712:47 PM| 1 Comment