PSC vs. VTWO

Last updated Jul 17, 2026

PSC (Principal U.S. Small Cap Multi-Factor ETF) and VTWO (Vanguard Russell 2000 ETF) are both Small Cap Blend Equities funds - PSC tracks the Nasdaq US Small Cap Select Leaders TR Index while VTWO tracks the Russell 2000 Index. Both are passively managed. Over the past 5 years, PSC returned 10.35%/yr vs 8.09%/yr for VTWO. Their correlation of 0.86 suggests significant overlap in exposure. PSC charges 0.38%/yr vs 0.06%/yr for VTWO.

Performance

PSC vs. VTWO - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Principal U.S. Small Cap Multi-Factor ETF (PSC) and Vanguard Russell 2000 ETF (VTWO). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, PSC achieves a 19.32% return, which is significantly lower than VTWO's 20.72% return.

PSC

• 1D: 0.06%
• 1M: 2.19%
• 6M: 12.72%
• YTD: 19.32%
• 1Y: 30.70%
• 3Y*: 17.31%
• 5Y*: 10.35%
• 10Y*: —

VTWO

• 1D: -0.05%
• 1M: 1.27%
• 6M: 11.97%
• YTD: 20.72%
• 1Y: 35.48%
• 3Y*: 16.75%
• 5Y*: 8.09%
• 10Y*: 10.97%

*Multi-year figures are annualized to reflect compound growth (CAGR)

PSC vs. VTWO - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
PSC Principal U.S. Small Cap Multi-Factor ETF	19.32%	13.41%	12.38%	18.51%	-15.91%	32.56%	13.30%	18.99%	-11.35%	15.93%
VTWO Vanguard Russell 2000 ETF	20.72%	12.90%	11.55%	17.08%	-20.49%	14.79%	20.22%	25.81%	-11.15%	14.69%

Correlation

The correlation between PSC and VTWO is 0.95, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.95
Correlation (3Y) Calculated over the trailing 3-year period	0.96
Correlation (5Y) Calculated over the trailing 5-year period	0.96
Correlation (All Time) Calculated using the full available price history since Sep 22, 2016	0.86

The correlation between PSC and VTWO has been stable across timeframes, ranging from 0.86 to 0.96 - a consistent structural relationship.

PSC vs. VTWO - Sectors Allocation Comparison

Sectors	PSC	VTWO
Technology	19.0%	19.1%
Financial Services	17.7%	15.5%
Industrials	17.5%	17.9%
Healthcare	16.9%	16.3%
Consumer Cyclical	8.0%	7.9%
Energy	5.3%	5.3%
Real Estate	4.6%	5.9%
Basic Materials	4.0%	4.7%
Utilities	2.6%	2.8%
Communication Services	2.3%	2.5%
Consumer Defensive	2.1%	2.2%

Return for Risk

PSC vs. VTWO — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

PSC

PSC Risk / Return Rank: 67
PSC Sharpe Ratio Rank: 62
PSC Sortino Ratio Rank: 64
PSC Omega Ratio Rank: 56
PSC Calmar Ratio Rank: 76
PSC Martin Ratio Rank: 75

VTWO

VTWO Risk / Return Rank: 73
VTWO Sharpe Ratio Rank: 72
VTWO Sortino Ratio Rank: 72
VTWO Omega Ratio Rank: 64
VTWO Calmar Ratio Rank: 78
VTWO Martin Ratio Rank: 78

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

PSC vs. VTWO - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Principal U.S. Small Cap Multi-Factor ETF (PSC) and Vanguard Russell 2000 ETF (VTWO). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.

	PSC	VTWO	Difference
Sharpe ratio: Return per unit of total volatility	1.64	1.84	-0.20
Sortino ratio: Return per unit of downside risk	2.37	2.60	-0.23
Omega ratio: Gain probability vs. loss probability	1.28	1.31	-0.03
Calmar ratio: Return relative to maximum drawdown	3.10	3.24	-0.15
Martin ratio: Return relative to average drawdown	10.97	11.47	-0.51

PSC vs. VTWO - Sharpe Ratio Comparison

The current PSC Sharpe Ratio is 1.64, which is comparable to the VTWO Sharpe Ratio of 1.84. The chart below compares the historical Sharpe Ratios of PSC and VTWO, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Drawdowns

PSC vs. VTWO - Drawdown Comparison

The maximum PSC drawdown since its inception was -46.69%, which is greater than VTWO's maximum drawdown of -41.19%. Use the drawdown chart below to compare losses from any high point for PSC and VTWO.

Drawdown Indicators

	PSC	VTWO	Difference
Max Drawdown Largest peak-to-trough decline	-46.69%	-41.19%	-5.50%
Max Drawdown (1Y) Largest decline over 1 year	-9.95%	-10.99%	+1.04%
Max Drawdown (3Y) Largest decline over 3 years	-23.49%	-27.57%	+4.08%
Max Drawdown (5Y) Largest decline over 5 years	-25.86%	-31.88%	+6.02%
Max Drawdown (10Y) Largest decline over 10 years	—	-41.19%	—
Current Drawdown Current decline from peak	-1.95%	-1.56%	-0.39%
Average Drawdown Average peak-to-trough decline	-8.19%	-8.33%	+0.14%
Ulcer Index Depth and duration of drawdowns from previous peaks	2.81%	3.10%	-0.29%

Volatility

PSC vs. VTWO - Volatility Comparison

Principal U.S. Small Cap Multi-Factor ETF (PSC) and Vanguard Russell 2000 ETF (VTWO) have volatilities of 3.90% and 3.76%, respectively, indicating that both stocks experience similar levels of price fluctuations. This suggests that the risk associated with both stocks, as measured by volatility, is nearly the same. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	PSC	VTWO	Difference
Volatility (1M) Calculated over the trailing 1-month period	3.90%	3.76%	+0.14%
Volatility (6M) Calculated over the trailing 6-month period	13.42%	14.16%	-0.74%
Volatility (1Y) Calculated over the trailing 1-year period	18.76%	19.35%	-0.59%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	20.96%	22.50%	-1.54%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	23.23%	23.04%	+0.19%

PSC vs. VTWO - Expense Ratio Comparison

PSC has a 0.38% expense ratio, which is higher than VTWO's 0.06% expense ratio.

Dividends

PSC vs. VTWO - Dividend Comparison

PSC's dividend yield for the trailing twelve months is around 0.52%, less than VTWO's 1.10% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
PSC Principal U.S. Small Cap Multi-Factor ETF	0.52%	0.67%	0.75%	0.73%	1.92%	1.45%	1.25%	1.47%	1.30%	0.95%	0.35%	0.00%
VTWO Vanguard Russell 2000 ETF	1.10%	1.25%	1.21%	1.45%	1.48%	1.13%	0.92%	1.36%	1.41%	1.18%	1.27%	1.23%

Frequently Asked Questions

Can I hold both PSC and VTWO in my portfolio?

With a correlation of 0.95, PSC and VTWO move almost identically. Holding both adds very little diversification - you're essentially doubling your position in the same market segment. Choosing one is usually more capital-efficient.

Which is riskier, PSC or VTWO?

PSC has higher volatility (3.90%) compared to VTWO (3.76%). In terms of maximum drawdown, PSC dropped -46.69% vs VTWO's -41.19%.

Which ETF is better, PSC or VTWO?

On 5-year performance, PSC leads with 10.35% vs 8.09% for VTWO. On fees, VTWO is cheaper at 0.06% per year. On volatility, VTWO has been the lower-risk option at 3.76%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, PSC or VTWO?

Over the 5-year period, PSC has performed better with a 10.35% return vs 8.09%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, PSC or VTWO?

VTWO is cheaper with a 0.06% expense ratio, compared with 0.38% for PSC.

Which ETF pays a higher dividend yield, PSC or VTWO?

VTWO has the higher dividend yield at 1.10%, compared with 0.52% for PSC.

What is the main difference between PSC and VTWO?

PSC tracks Nasdaq US Small Cap Select Leaders TR Index, while VTWO tracks Russell 2000 Index. They also come from different issuers: Principal and Vanguard. Their fees differ too: 0.38% for PSC and 0.06% for VTWO.

Which has better risk-adjusted returns?

VTWO currently has the higher Sharpe Ratio (1.84 vs 1.64), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.