VTWO vs. VIG

Last updated Aug 4, 2026

VTWO (Vanguard Russell 2000 ETF) and VIG (Vanguard Dividend Appreciation ETF) are both exchange-traded funds - VTWO is a Small Cap Blend Equities fund tracking the Russell 2000 Index, while VIG is a Dividend fund tracking the S&P U.S. Dividend Growers Index. Both are passively managed. Over the past 10 years, VTWO returned 10.77%/yr vs 12.98%/yr for VIG. Their 0.80 correlation means they have sometimes moved together and sometimes differently. VTWO charges 0.06%/yr vs 0.04%/yr for VIG.

Performance

VTWO vs. VIG - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Russell 2000 ETF (VTWO) and Vanguard Dividend Appreciation ETF (VIG). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VTWO achieves a 20.92% return, which is significantly higher than VIG's 10.16% return. Over the past 10 years, VTWO has underperformed VIG with an annualized return of 10.77%, while VIG has yielded a comparatively higher 12.98% annualized return.

VTWO

• 1D: 1.69%
• 1M: -0.42%
• 6M: 13.61%
• YTD: 20.92%
• 1Y: 39.49%
• 3Y*: 16.67%
• 5Y*: 7.83%
• 10Y*: 10.77%
• ALL TIME*: 11.43%

VIG

• 1D: 0.41%
• 1M: 0.64%
• 6M: 7.02%
• YTD: 10.16%
• 1Y: 19.59%
• 3Y*: 15.82%
• 5Y*: 10.56%
• 10Y*: 12.98%
• ALL TIME*: 10.24%

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

Liquidity Comparison

Position	Avg. Volume Value (2W)	Avg. Volume Value (1M)	Avg. Volume Value (3M)
VIG Vanguard Dividend Appreciation ETF	$232.65M	$242.03M	$260.72M
VTWO Vanguard Russell 2000 ETF	$175.64M	$193.82M	$227.97M

VTWO vs. VIG - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VTWO Vanguard Russell 2000 ETF	20.92%	12.90%	11.55%	17.08%	-20.49%	14.79%	20.22%	25.81%	-11.15%	14.69%
VIG Vanguard Dividend Appreciation ETF	10.16%	14.17%	16.99%	14.51%	-9.80%	23.76%	15.43%	29.62%	-2.08%	22.22%

Correlation

The correlation between VTWO and VIG is 0.75, which is moderate. They have sometimes moved together and sometimes differently, sharing some price drivers without tracking each other closely.

	Correlation
Correlation (1Y) Focuses on recent behavior, but can change the most.	0.75
Correlation (3Y) Balances recent behavior with more history.	0.78
Correlation (5Y) Shows whether the relationship held over a longer period.	0.80
Correlation (10Y) Provides a long-term view across more market conditions.	0.77
Correlation (All Time) Calculated using the full available price history since Sep 22, 2010	0.80

The correlation between VTWO and VIG has been stable across timeframes, ranging from 0.75 to 0.80 - a consistent structural relationship.

VTWO vs. VIG - Sectors Allocation Comparison

Sectors	VTWO	VIG
Healthcare	20.2%	17.8%
Financial Services	17.6%	20.3%
Technology	14.8%	26.9%
Industrials	14.1%	11.9%
Consumer Cyclical	9.2%	4.5%
Real Estate	6.7%	-
Energy	5.4%	3.0%
Basic Materials	4.4%	3.4%
Utilities	2.7%	3.0%
Consumer Defensive	2.6%	9.2%
Communication Services	2.2%	0.5%

Return for Risk

VTWO vs. VIG — Risk / Return Rank

Compare historical risk-adjusted metric ranks over the past 12 months.

VTWO

VTWO Risk / Return Rank: 85
VTWO Sharpe Ratio Rank: 86
VTWO Sortino Ratio Rank: 85
VTWO Omega Ratio Rank: 80
VTWO Calmar Ratio Rank: 88
VTWO Martin Ratio Rank: 87

VIG

VIG Risk / Return Rank: 79
VIG Sharpe Ratio Rank: 83
VIG Sortino Ratio Rank: 84
VIG Omega Ratio Rank: 82
VIG Calmar Ratio Rank: 71
VIG Martin Ratio Rank: 78

The rank (0–100) uses a weighted average of the Sharpe, Sortino, Omega, Calmar, and Martin percentile ranks for the trailing 12 months. Higher means stronger historical risk-adjusted performance within the peer group.

VTWO vs. VIG - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Russell 2000 ETF (VTWO) and Vanguard Dividend Appreciation ETF (VIG). 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.

	VTWO	VIG	Difference
Sharpe ratio: Return per unit of total volatility	2.06	1.96	+0.10
Sortino ratio: Return per unit of downside risk	2.87	2.82	+0.06
Omega ratio: Gain probability vs. loss probability	1.34	1.35	-0.01
Calmar ratio: Return relative to maximum drawdown	3.61	2.49	+1.12
Martin ratio: Return relative to average drawdown	12.83	10.11	+2.71

VTWO vs. VIG - Sharpe Ratio Comparison

The current VTWO Sharpe Ratio is 2.06, which is comparable to the VIG Sharpe Ratio of 1.96. The chart below compares the historical Sharpe Ratios of VTWO and VIG, 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

VTWO vs. VIG - Drawdown Comparison

The maximum VTWO drawdown since its inception was -41.19%, smaller than the maximum VIG drawdown of -46.81%. Use the drawdown chart below to compare losses from any high point for VTWO and VIG.

Drawdown Indicators

	VTWO	VIG	Difference
Max Drawdown Largest peak-to-trough decline	-41.19%	-46.81%	+5.62%
Max Drawdown (1Y) Largest decline over 1 year	-10.99%	-7.91%	-3.08%
Max Drawdown (3Y) Largest decline over 3 years	-27.57%	-14.95%	-12.62%
Max Drawdown (5Y) Largest decline over 5 years	-31.88%	-20.39%	-11.49%
Max Drawdown (10Y) Largest decline over 10 years	-41.19%	-31.72%	-9.47%
Current Drawdown Current decline from peak	-1.40%	-0.66%	-0.74%
Average Drawdown Average peak-to-trough decline	-8.32%	-5.47%	-2.85%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.09%	1.94%	+1.15%

Volatility

VTWO vs. VIG - Volatility Comparison

Vanguard Russell 2000 ETF (VTWO) has a higher volatility of 4.16% compared to Vanguard Dividend Appreciation ETF (VIG) at 2.57%. This indicates that VTWO's price experiences larger fluctuations and is considered to be riskier than VIG based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VTWO	VIG	Difference
Volatility (1M) Calculated over the trailing 1-month period	4.16%	2.57%	+1.59%
Volatility (6M) Calculated over the trailing 6-month period	14.11%	7.62%	+6.49%
Volatility (1Y) Calculated over the trailing 1-year period	19.30%	10.08%	+9.22%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	22.45%	14.20%	+8.25%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	23.07%	16.02%	+7.05%

VTWO vs. VIG - Expense Ratio Comparison

VTWO has a 0.06% expense ratio, which is higher than VIG's 0.04% 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

VTWO vs. VIG - Dividend Comparison

VTWO's dividend yield for the trailing twelve months is around 1.09%, less than VIG's 1.49% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VIG Vanguard Dividend Appreciation ETF	1.49%	1.62%	1.73%	1.88%	1.96%	1.55%	1.63%	1.71%	2.08%	1.88%	2.14%	2.34%
VTWO Vanguard Russell 2000 ETF	1.09%	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 VTWO and VIG in my portfolio?

VTWO and VIG have a correlation of 0.75, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VTWO or VIG?

VTWO has higher volatility (4.16%) compared to VIG (2.57%). In terms of maximum drawdown, VTWO dropped -41.19% vs VIG's -46.81%.

Which ETF is better, VTWO or VIG?

On 10-year performance, VIG leads with 12.98% vs 10.77% for VTWO. On fees, VIG is cheaper at 0.04% per year. On volatility, VIG has been the lower-risk option at 2.57%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VTWO or VIG?

Over the 10-year period, VIG has performed better with a 12.98% return vs 10.77%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VTWO or VIG?

VIG is cheaper with a 0.04% expense ratio, compared with 0.06% for VTWO.

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

VIG has the higher dividend yield at 1.49%, compared with 1.09% for VTWO.

What is the main difference between VTWO and VIG?

VTWO is categorized as Small Cap Blend Equities, while VIG is Dividend. VTWO tracks Russell 2000 Index, while VIG tracks S&P U.S. Dividend Growers Index. Their fees differ too: 0.06% for VTWO and 0.04% for VIG.

Which has better risk-adjusted returns?

VTWO currently has the higher Sharpe Ratio (2.06 vs 1.96), 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.