Vanguard Extended Market Index effectively combines a broadly diversified low-turnover portfolio with a minuscule price, providing it with a durable edge over its category peers. 

The fund tracks the S&P Completion Index, which constructs a market-cap-weighted portfolio of the entire U.S. equity market outside of the S&P 500. The index sweeps in mid- to micro-cap stocks as well as some large-cap stocks that do not meet the S&P 500’s selection criteria. This lands the fund in the mid-cap blend Morningstar Category. 

Market-cap weighting is a sensible approach here. It harnesses the market’s collective view on the relative value of each holding and promotes diversification. Low turnover and associated trading costs add to the appeal. 

However, market-cap weighting may expose the fund to significant stock- or sector-level concentration during the market’s intermittent manic episodes. This can tilt the portfolio toward richly valued names or sectors and cause it to migrate into other categories. It had a short stint in the mid-growth category between May 2021 and December 2022 before returning to the mid-blend category. But this does not undermine its long-term efficacy. 

The fund’s style and sector allocations accurately mimic its average mid-blend peer. No sector weighting deviated by more than 5 percentage points from the category average. It also trades at similar valuations as its average category peer. These qualities emphasize the fund’s cost advantage in driving category-relative performance.

The fund diversifies risk effectively and tames concentration. Assets in its top 10 holdings constituted only 7.8% of the portfolio as of June 2023, 8 percentage points lower than the average mid-blend fund.

Analyst Rating

A complement to the S&P 500.

Associate Analyst

Mo'ath Almahasneh

CrowdStrike

Marvell Technology

Workday

Snowflake

Apollo Global Management

Block

Coinbase

Ferguson PLC

Palantir Technologies

This fund complements the S&P 500. Its broadly diversified, low-turnover portfolio holds all U.S. stocks not included in the S&P 500. It earns an Above Average Process rating.

Above Average

Process

The Vanguard Equity Index Group boasts seasoned managers and a dedicated supporting staff well-equipped to provide tight index tracking, earning it an Above Average People Pillar rating.

Donald Butler, Michelle Louie, and Nicholas Birkett are the named managers of this strategy. Butler, a principal at Vanguard, joined the firm in 1997 and has been on this strategy since 1998. Louie has been with the firm since 2010 and has been on this strategy since February 2023. Birkett has been with the firm since 2017 and joined the fund in August 2023. Though management turnover has been subdued lately, Vanguard frequently rotates its managers to promote breadth and depth across the team.

The managers are responsible for the fund’s trading, providing more portfolio insights than a stand-alone trader. They are supported by a global team of dedicated personnel and sophisticated, scalable technology that optimize precision and reduce the managers’ workload. Its independent risk management team works closely with the managers to monitor trades and review any potential issues. The managers’ compensation is tied to performance using a combination of tracking error and excess return metrics, which aligns their interests with investors’.

People

As The Vanguard Group settles on new senior leadership, it retains a High Parent rating.

Vanguard announced current CEO Tim Buckley will step down by the end of the year, marking an end to his 33 years at the firm. Historically, Vanguard has pronounced CEO retirements while simultaneously signaling who (from inside the firm) would take over. In this instance, Vanguard’s board said it will evaluate internal and external candidates in the coming months to find its next, and fifth, leader, though it also promoted CIO Greg Davis to president.

Vanguard flourished in several respects under Buckley’s leadership. Assets under management have grown by two thirds over his six years at the helm, while its asset-weighted average US fund fee ratcheted lower to 0.08% at the end of 2023. Vanguard further refined its advice business through its low-cost Digital Advisor platform and more holistic Vanguard Personal Advisor Services, and it debuted promising investment options.

Vanguard has had its share of challenges under Buckley, too. Growing its business outside the US has proved difficult, and ex US investors account for less than 10% of AUM. Between 2019 and 2023, Vanguard’s efforts to build its China business underwent dramatic shifts, with the firm ultimately abandoning plans to launch low-cost index funds there. It also ended a partnership with Ant Financial to provide advisory services to retail investors. Inside the US, customer service issues have continued to be a problem, and some of Vanguard’s newer offers, such as margin loans, seem a departure from a more-conservative approach to investing.

Vanguard retains an investor-friendly culture at its core that’s burnished by a commitment to low costs and supported by its unique mutual ownership structure and direct-to-investor playbook.

High

Parent

Vanguard Extended Market ETF

VXF tracks a market-cap-weighted version of the S&P Total Market Index, excluding all S&P 500 stocks.

The fund is passively managed to provide exposure to the US equity space. It holds mid- and small-cap stocks.

Launched on 12/27/2001, the Vanguard Extended Market ETF (VXF) is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Blend segment of the US equity market.

Should Vanguard Extended Market ETF (VXF) Be on Your Investing Radar?

Vanguard S&P Mid-Cap 400 Growth ETF

Vanguard S&P Mid-Cap 400 ETF

Vanguard S&P Mid-Cap 400 Value ETF

Vanguard Small-Cap Growth

Vanguard Small Cap Value ETF

Vanguard U.S. Multifactor ETF

Vanguard U.S. Momentum Factor ETF

Vanguard U.S. Quality Factor ETF

Vanguard U.S. Value Factor ETF

Vanguard S&P Small-Cap 600 Growth ETF

Vanguard S&P Small-Cap 600 Value ETF

Vanguard Mid-Cap ETF

Vanguard Mid-Cap Value ETF

Vanguard S&P 500 ETF

Vanguard Mid-Cap Growth ETF

Vanguard FTSE All-World ex-US Small-Cap ETF

Vanguard Total Stock Market ETF

Vanguard Russell 2000 Growth 

Vanguard Russell 2000 ETF

Vanguard Russell 2000 Value ETF

With so many small and mid-cap ETFs out there, which might be the best to own right now. I'll restrict this analysis to Vanguard ETFs which seem to have a reasonable exchange policy and which offers among the best returns over the long term. My top choices are based on which Vanguard ETF have shown the best returns over the last five years, with the admonition that past returns may not predict the future.

Vanguard Has 17 Small And Mid-Cap ETFs. Which Are Best Right Now?

The S&P 500 trades above 20 times forward operating earnings estimates for the first time in two years. The Vanguard Extended Market Index Fund ETF Shares offers a better deal for long-term investors seeking value in US small- and mid-cap stocks. VXF is a large ETF with a diversified portfolio, high exposure to US SMID caps, and a solid price-to-earnings ratio below 17.

VXF: U.S. SMID Caps Creeping Up Toward 2-Year Highs, The ETF Remains A Bargain

Vanguard Extended Market Index Fund ETF Shares provides diversified investment opportunities in the mid and small-cap segment of the U.S. equity market. The VXF ETF has underperformed the S&P 500, making it a potential rotation opportunity for investors. The ETF offers a well-diversified portfolio with low concentration risk and a lower weighting in the technology sector compared to large-cap funds.

VXF: The Anti-Large-Cap Trade

Vanguard Extended Market Index Fund ETF Shares tracks the S&P Completion Index and has low dividends but strong average total returns. VXF is well-diversified across sectors and has little concentration, with top 10 holdings accounting for 8%. Mid-cap stocks have performed well, and VXF has generated above-average returns, but there are concerns about future performance.

VXF: Portfolio Of Small-Cap And Mid-Caps Has Low Concentration Risk, High Returns

VanEck Vectors Social Sentiment ETF

Fidelity Stocks for Inflation ETF

The Meet Kevin Pricing Power ETF

First Trust NASDAQ ABA Community Bank Index Fund

Cambria Shareholder Yield ETF

On this episode of ETF Prime, host Nate Geraci speaks with a trio of industry experts to discuss key stories and trends. He begins with Dave Nadig from VettaFi, exploring significant and hype cycle topics that have shaped the industry in the last several years.

ETF Prime: Hype Cycle Topics, SYLD & ETFs for Market Conditions

Global X Robotics & Artificial Intelligence ETF

Roundhill Generative AI & Technology ETF

JPMorgan Equity Premium Income ETF

Invesco S&P 500 Equal Weight ETF

Why investors may want to stick with what's working in the market.

Two ETF experts reveal their top tech and A.I. plays for 2023's second half

Vanguard Total Bond Market ETF

Vanguard Total International Bond ETF

Vanguard Short-Term Inflation-Protected Securities ETF

Vanguard Total International Stock ETF

I discuss two of James Picerno's posts (Part I & Part II) from last week. I conclude that a market uptrend began on March 30 and 31.

The Current Upswing Started In October 2022: Updated As Of March 31, 2023

Vanguard's Extended Market ETF tracks the performance of the mid & small-cap equities space. VXF has recorded a -18.27% TTM return underperforming the broader market.

VXF: A Mid And Small-Cap Blend ETF For Mid-Term Gains?

A lot of market commentary has been focused on large-cap indices and large-cap stocks. This article analyzes the layer underneath. The small-cap and mid-cap blended ETF has underperformed the small-cap specific ETF and is expected to continue doing so, potentially due to higher exposure to the lagging technology sector.

VXF Vs. VTWO: Relative Assessment Of U.S. Mid Caps Vs. Small Caps (Technical Analysis)

The Vanguard Russell 2000 ETF "VTWO" invests based on the Russell 2000 Index, which focuses on Small-Cap and Micro-Cap stocks. The Vanguard Extended Market ETF "VXF" invests based on the S&P Completion Index that measures the investment return of small- and mid-capitalization stocks.

VTWO Vs. VXF: Comparing 2 Non-Large Cap ETFs

FedEx

Vanguard Small-Cap ETF

Last week, ETFs pulled in about $25 billion in capital, pushing year-to-date inflows to $409.4 billion.

5 ETFs That Gained Investors Love Last Week

VXF invests in a wide array of companies (well over 3,000) besides the largest U.S. companies. VXF is basically a source of beta, and it has held up against the S&P 500 well since its inception, but periods of sharper underperformance have occurred on numerous occasions.

VXF: A Diversified ETF With An Expensive Price And Poor Cyclical Positioning

VXF provides exposure to a diversified basket of small and mid-size U.S. stocks that are not included in the S&P 500 Index. VXF can be extremely volatile during economic downturns and it can have significant drawdowns.

VXF: A Well-Diversified Small And Mid-Cap ETF

VO is the Vanguard Mid Cap ETF, which holds stocks below the Large-Cap US stocks and many investors equate it with the S&P 500 Index.

VO + VB Vs. VXF: Picking The Better ETF Strategy

Writing Puts is a strategy that can be used to try gaining ownership when the price dips below your chosen entry point as set by the strike price used.

Thanks To Put Writing, I Own VXF; So A New Review Was In Order

Vanguard Russell 1000 Value ETF

Invesco S&P MidCap Momentum ETF

The year 2021 has been a stellar year for 2021. However, there are some corners of the investing world that couldn't keep pace with the S&P 500 rally but may usher gains in 2022.

4 Top-Ranked ETF Underperformers of 2021 Could be Winners in 2022

First Trust Financials AlphaDEX Fund

US Global Jets ETF

Global X Superdividend ETF

SPDR S&P Biotech ETF

Wall Street has been wavering in recent sessions due to renewed virus fears, higher inflation and rising rate worries.

5 ETFs to Offer a Really Good Deal on Black Friday

VXF is higher risk, and deserves to be priced as such. However, investors are pricing VXF in a rather sanguine way given underlying earnings. And yet over the past decade or so, VXF has managed to hold its own against VOO.

VXF: Unlikely To Outperform VOO

SPDR S&P 500 ETF Trust

Vanguard Dividend Appreciation ETF

Investors have poured in a near record amount of money into ETFs driven by worries over a tax hike.

Tax Hike Worries Drive Last Week's Inflows: 5 Hot ETFs

Virtus LifeSci Biotech Clinical Trials ETF

Global X Copper Miners ETF

Invesco China Technology ETF

Emerging Markets Internet & Ecommerce ETF

Invesco S&P 500 Equal Weight Industrials ETF

VanEck Vectors Steel ETF

SPDR S&P Retail ETF

Looking for the perfect partner for the world's largest ETF.

Finding Synergy With SPY

Small-cap equities tend to outperform. VXF invests in all relevant U.S. equities, except the large-cap S&P 500 stocks.

VXF: Small-Cap And Mid-Cap Index ETF, Market-Beating Returns

iShares Russell 2000 ETF

iShares Russell Midcap ETF

Q.ai's deep learning algorithms have identified several top US SMID Cap Smart Beta ETFs based on fund flows. Diversify your portfolio with these.

IShares Russell 2000 ETF And Vanguard Mid-Cap ETF Ranked Top Smart Beta ETFs

Last week, once again, rising bond yields and inflation fears weighed on the markets. But Q.ai's Artificial Intelligence has found you this week's top ETFs to help you diversify and mitigate risk.

Top ETFs This Week Amid Rising Bond Yields And Fears Of Inflation

Vanguard Information Technology ETF

Turn your $1,400 check into $5,000 with zero effort.

News for Vanguard Extended Market ETF ETF (VXF)