IJR vs. VB: Which Small-Cap ETF Is the Better Buy for Investors?
Key Points
IJR carries a slightly higher fee than VB.
VB provides broader exposure, holding more than twice as many stocks as IJR.
While both funds have similar risk profiles, IJR posted the stronger 1-year total return.
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The iShares Core S&P Small-Cap ETF (NYSEMKT:IJR) gives investors concentrated exposure to the S&P SmallCap 600, while the Vanguard Small-Cap ETF (NYSEMKT:VB) offers a broader, lower-cost slice of the small-cap market.
Investors looking for small-company growth often compare these two funds. Both target smaller U.S. companies, but their underlying indexes and stock-selection rules lead to different holdings counts and sector tilts -- which affects how they perform across different market cycles.
Snapshot (cost & size)
| Metric | VB | IJR |
|---|---|---|
| Issuer | Vanguard | iShares |
| Expense ratio | 0.03% | 0.06% |
| 1-year return (as of July 8, 2026) | 23.73% | 29.95% |
| Dividend yield | 1.19% | 1.11% |
| Beta | 1.10 | 1.08 |
| AUM | $188.6 billion | $111.3 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-year return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
VB is the cheaper option, with a 0.03% expense ratio compared to IJR’s 0.06%. Both funds offer comparable dividend yields of roughly 1.1% to 1.2%.
Performance & risk comparison
| Metric | VB | IJR |
|---|---|---|
| Max drawdown (5 yr) | (28.16%) | (28.01%) |
| Growth of $1,000 over 5 years (total return) | $1,445 | $1,430 |
What's inside
Launched in 2000, IJR tracks the S&P SmallCap 600 Index and holds 652 stocks. Its largest sector weights include financial services at 17.0%, industrials at 15.6%, and technology at 15.5%. Its top equity positions include FormFactor (NASDAQ:FORM) (NYSE:FORM) at 0.7%, Viasat (NASDAQ:VSAT) at 0.7%, and Molina Healthcare (NYSE:MOH) at 0.6%.
VB tracks the CRSP US Small Cap Index and holds a much larger portfolio of 1,310 stocks. Its top sector weights include industrials at 20.6%, technology at 19.3%, and financial services at 12.3%. The fund’s largest holdings include Flex (NASDAQ:FLEX) at 0.7%, Astera Labs (NASDAQ:ALAB) at 0.6%, and Ciena (NYSE:CIEN) at 0.5%. VB was launched in 2004.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investors
The main difference between these two funds comes down to a familiar trade-off: concentration versus breadth. IJR's tighter focus on the S&P SmallCap 600 -- an index with built-in profitability screens -- has helped it edge out VB over the past year, and that quality filter is worth noting. Vanguard's CRSP-based index doesn't screen for profitability in the same way, which means VB captures a wider swath of the small-cap universe, including younger or less established companies that IJR would leave out.
IJR’s recent outperformance shouldn’t be read as a permanent edge. Small-cap ETFs like these can swing significantly depending on where the market cycle stands -- IJR's profitability tilt should help it hold up relatively better when investors get cautious, while VB's broader net can capture more upside when smaller, riskier names rally.
For cost-conscious investors, VB's rock-bottom 0.03% expense ratio is hard to beat, and its much larger holdings count gives investors exposure to a wider slice of the small-cap market. For those willing to pay a few extra basis points, IJR's quality screen has historically added a bit of ballast during rockier stretches. Either way, both funds offer a straightforward, low-cost way to add small-cap exposure to investors’ portfolios
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Andy Gould has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Ciena and iShares Core S&P Small-Cap ETF. The Motley Fool recommends Astera Labs and Flex. The Motley Fool has a disclosure policy.
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