SMMD vs. VFORX

Last updated Jun 16, 2026

SMMD (iShares Russell 2500 ETF) and VFORX (Vanguard Target Retirement 2040 Fund) are both funds - SMMD is a Small Cap Growth Equities fund tracking the Russell 2500 Index, while VFORX is a Target Retirement Date fund managed by Vanguard. Over the past 5 years, SMMD returned 8.04%/yr vs 8.29%/yr for VFORX. Their correlation of 0.83 suggests significant overlap in exposure. SMMD charges 0.15%/yr vs 0.08%/yr for VFORX.

Performance

SMMD vs. VFORX - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in iShares Russell 2500 ETF (SMMD) and Vanguard Target Retirement 2040 Fund (VFORX). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, SMMD achieves a 21.12% return, which is significantly higher than VFORX's 8.57% return.

SMMD

• 1D: 0.88%
• 1M: 6.77%
• YTD: 21.12%
• 6M: 19.58%
• 1Y: 39.92%
• 3Y*: 18.30%
• 5Y*: 8.04%
• 10Y*: —

VFORX

• 1D: 0.43%
• 1M: 1.69%
• YTD: 8.57%
• 6M: 9.25%
• 1Y: 21.73%
• 3Y*: 16.14%
• 5Y*: 8.29%
• 10Y*: 10.74%

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

SMMD vs. VFORX - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
SMMD iShares Russell 2500 ETF	21.12%	11.72%	11.87%	17.71%	-18.53%	18.30%	19.98%	28.01%	-10.58%	11.27%
VFORX Vanguard Target Retirement 2040 Fund	8.57%	18.77%	12.90%	18.56%	-17.00%	14.55%	15.48%	23.86%	-7.32%	8.27%

Correlation

The correlation between SMMD and VFORX is 0.84, 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	0.84
Correlation (3Y) Calculated over the trailing 3-year period	0.85
Correlation (5Y) Calculated over the trailing 5-year period	0.88
Correlation (All Time) Calculated using the full available price history since Jul 7, 2017	0.83

The correlation between SMMD and VFORX has been stable across timeframes, ranging from 0.83 to 0.88 - a consistent structural relationship.

Return for Risk

SMMD vs. VFORX — Risk / Return Rank

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

SMMD

SMMD Risk / Return Rank: 79
SMMD Sharpe Ratio Rank: 78
SMMD Sortino Ratio Rank: 77
SMMD Omega Ratio Rank: 71
SMMD Calmar Ratio Rank: 84
SMMD Martin Ratio Rank: 85

VFORX

VFORX Risk / Return Rank: 65
VFORX Sharpe Ratio Rank: 65
VFORX Sortino Ratio Rank: 62
VFORX Omega Ratio Rank: 64
VFORX Calmar Ratio Rank: 62
VFORX Martin Ratio Rank: 70

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.

SMMD vs. VFORX - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for iShares Russell 2500 ETF (SMMD) and Vanguard Target Retirement 2040 Fund (VFORX). 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.

	SMMD	VFORX	Difference
Sharpe ratio: Return per unit of total volatility	2.27	2.00	+0.27
Sortino ratio: Return per unit of downside risk	3.13	2.78	+0.35
Omega ratio: Gain probability vs. loss probability	1.38	1.37	+0.01
Calmar ratio: Return relative to maximum drawdown	4.15	2.67	+1.48
Martin ratio: Return relative to average drawdown	15.75	11.51	+4.24

SMMD vs. VFORX - Sharpe Ratio Comparison

The current SMMD Sharpe Ratio is 2.27, which is comparable to the VFORX Sharpe Ratio of 2.00. The chart below compares the historical Sharpe Ratios of SMMD and VFORX, 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

SMMD vs. VFORX - Drawdown Comparison

The maximum SMMD drawdown since its inception was -41.06%, smaller than the maximum VFORX drawdown of -51.63%. Use the drawdown chart below to compare losses from any high point for SMMD and VFORX.

Drawdown Indicators

	SMMD	VFORX	Difference
Max Drawdown Largest peak-to-trough decline	-41.06%	-51.63%	+10.57%
Max Drawdown (1Y) Largest decline over 1 year	-9.66%	-7.70%	-1.96%
Max Drawdown (3Y) Largest decline over 3 years	-25.50%	-12.12%	-13.38%
Max Drawdown (5Y) Largest decline over 5 years	-28.26%	-24.32%	-3.94%
Max Drawdown (10Y) Largest decline over 10 years	—	-29.35%	—
Current Drawdown Current decline from peak	0.00%	-1.40%	+1.40%
Average Drawdown Average peak-to-trough decline	-8.34%	-6.76%	-1.58%
Ulcer Index Depth and duration of drawdowns from previous peaks	2.54%	1.79%	+0.75%

Volatility

SMMD vs. VFORX - Volatility Comparison

iShares Russell 2500 ETF (SMMD) has a higher volatility of 6.29% compared to Vanguard Target Retirement 2040 Fund (VFORX) at 4.18%. This indicates that SMMD's price experiences larger fluctuations and is considered to be riskier than VFORX based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	SMMD	VFORX	Difference
Volatility (1M) Calculated over the trailing 1-month period	6.29%	4.18%	+2.11%
Volatility (6M) Calculated over the trailing 6-month period	13.28%	8.45%	+4.83%
Volatility (1Y) Calculated over the trailing 1-year period	17.69%	10.28%	+7.41%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	20.92%	12.51%	+8.41%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	22.38%	13.70%	+8.68%

SMMD vs. VFORX - Expense Ratio Comparison

SMMD has a 0.15% expense ratio, which is higher than VFORX's 0.08% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

SMMD vs. VFORX - Dividend Comparison

SMMD's dividend yield for the trailing twelve months is around 1.30%, less than VFORX's 2.55% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
SMMD iShares Russell 2500 ETF	1.30%	1.28%	1.27%	1.44%	1.79%	1.12%	1.31%	1.50%	2.45%	0.68%	0.00%	0.00%
VFORX Vanguard Target Retirement 2040 Fund	2.55%	2.77%	2.86%	2.38%	2.60%	20.68%	2.06%	2.28%	2.58%	0.04%	2.40%	2.99%

Frequently Asked Questions

Can I hold both SMMD and VFORX in my portfolio?

SMMD and VFORX have a correlation of 0.84, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, SMMD or VFORX?

SMMD has higher volatility (6.29%) compared to VFORX (4.18%). In terms of maximum drawdown, SMMD dropped -41.06% vs VFORX's -51.63%.

Which has better risk-adjusted returns?

SMMD currently has the higher Sharpe Ratio (2.27 vs 2.00), 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.