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ETF Comparison

IWM vs VB: Which Is the Better Pick in 2026?

A head-to-head comparison of iShares Russell 2000 ETF and Vanguard Small Cap ETF covering yield, cost, risk, and income potential.

Data updated August 14, 2026

Best for

  • IWMInvestors who want broad equity exposure.
  • VBInvestors who want broad equity exposure.

Jump to the side-by-side numbers

Side-by-side snapshot

Side-by-side snapshot. Each row is one metric; each column is one fund.
MetricIWMVB
Full nameiShares Russell 2000 ETFVanguard Small Cap ETF
IssueriSharesVanguard
Last Close$305.09 as of August 14, 2026$309.29 as of August 14, 2026
Distribution yield0.91%1.15%
Distribution Safety Score™ 9595
Expense ratio0.19%0.05%
AUM$82.2B$82.5B
Distribution frequencyQuarterlyQuarterly
Underlying indexRussell 2000 IndexCRSP US Small Cap Index
ObjectiveProvide exposure to the fund's underlying index or strategy per issuer materials.Provide exposure to the fund's underlying index or strategy per issuer materials.
Asset classEquityEquity
Inception date05/22/200001/26/2004
Beta1.261.1
Last dividend$0.6950$0.8920
Ex-dividend date06/15/202606/26/2026

Bottom lineIWM and VB are both for investors who want broad equity exposure — so strategy isn't the deciding factor here. Cost is: VB charges 0.05% against 0.19% for IWM, and between two funds this similar that gap comes straight out of your return every year you hold.

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iShares
ETFs473
Total AUM$4664B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

iShares is one of the largest ETF providers globally, known for offering a broad, diversified lineup of exchange-traded funds across multiple asset classes and investment strategies. The company operates 215 funds spanning 15 distinct families, including popular offerings in dividend income, covered call strategies, bonds, equities, ESG-focused investments, and factor-based approaches, with widely-held tickers like AGG (bond), ACWI (global equity), and AOA (allocation). iShares is characterized by its comprehensive fund ecosystem that serves both core portfolio holdings and specialized investment strategies, making it a prominent player for investors seeking both traditional and alternative income-generating ETF solutions.

See our curated list of related YouTube videos on IWM.

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Vanguard
ETFs116
Total AUM$4658B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

Vanguard is one of the largest and most established ETF issuers, known for low-cost, broadly diversified fund offerings built on passive indexing principles. Their lineup spans multiple asset classes and strategies, including core equity and bond index funds, dividend-focused portfolios, ESG-screened options, factor-based strategies, sector exposure, target-date retirement funds, and international investments across developed and emerging markets. The platform is characterized by its emphasis on accessibility and cost efficiency across a comprehensive range of fund families, serving both individual investors seeking broad market exposure and those pursuing specific income, sustainability, or thematic objectives.

See our curated list of related YouTube videos on VB.

See all Vanguard ETFs

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Visual comparison

Key metrics

Projected income on $10K

Projections assume the current yield and share price remain constant. Actual results will vary.

Total returns

IWM has outpaced VB over the trailing twelve months, posting a 33.32% total return against 25.42%. The picture flips over 10 years, though — VB has compounded at 11.32% a year, ahead of IWM at 10.86%. Figures are total returns: price change plus every distribution reinvested.

Total return and risk statistics by fund. Each row is one fund; each column is one period or statistic.
SymbolYTD1Y3Y5Y10YSince Jan 2004Volatility Sharpe Sortino Max drawdown
IWM23.14%33.32%18.35%7.98%10.86%9.08%21.1%0.590.86-27.5%
VB19.06%25.42%16.92%8.33%11.32%10.08%18.9%0.590.86-25.4%

Total return with all distributions reinvested on the ex-dividend date, split-adjusted, as of August 14, 2026. YTD and 1Y are cumulative; longer windows are annualized. “Since Jan 2004” measures every fund from January 30, 2004 — the youngest fund's first trading day — so all funds share one comparison window. Volatility is the annualized standard deviation of daily total returns over the trailing 3 years. Sharpe and Sortino divide the annualized return in excess of the risk-free rate by, respectively, that volatility and the downside deviation (both over the trailing 3 years) — higher is better. Max drawdown is the largest peak-to-trough total-return decline over the same window — shallower is better.

Quick verdict

IWM (iShares Russell 2000 ETF) and VB (Vanguard Small Cap ETF) are both quarterly-pay dividend ETFs, but they take different approaches.

VB offers the higher yield at 1.15% vs 0.91% for IWM. A higher yield means more current income per dollar invested, though it may come with different risk characteristics.

VB is cheaper with an expense ratio of 0.05% compared to 0.19%.

They track different benchmarks: IWM is linked to Russell 2000 Index while VB tracks CRSP US Small Cap Index, which means their performance drivers differ.

VB is the larger fund by assets ($82.5B), which generally means tighter spreads and better liquidity.

Deep dive

Yield & income

On a $10,000 investment, IWM would generate roughly $7.58/month, while VB would produce $9.58/month, at current distribution rates. Both pay quarterly distributions.

IWM yield0.91%
VB yield1.15%
Monthly diff on $10K$2.00

Cost & efficiency

Over 10 years on $10,000, IWM would cost approximately $190 in fees vs $50 for VB (simplified, not compounded). The $140.00 difference may be offset by yield or performance.

IWM ER0.19%
VB ER0.05%

Strategy & risk

IWM tracks Russell 2000 Index with an index approach, while VB tracks CRSP US Small Cap Index with an index approach. Beta is 1.26 for IWM and 1.1 for VB, indicating VB is less volatile relative to the market.

IWM beta1.26
VB beta1.1

Fund details

IWM is managed by iShares (launched 05/22/2000) with $82.2B in assets. VB is managed by Vanguard (launched 01/26/2004) with $82.5B in assets.

IWM AUM$82.2B
VB AUM$82.5B
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Frequently asked questions

What is the current distribution yield for IWM and VB?

IWM currently distributes 0.91% and VB 1.15%, based on fund data updated August 2026. Distribution yield moves with both the payout and the share price, so check the as-of date before relying on either figure.

Is IWM or VB better for dividend income?

It depends on your goals. VB currently offers the higher distribution yield, which means more income per dollar invested. However, a lower-yield fund may offer better total return or lower volatility. Consider your time horizon and risk tolerance.

What is the difference between IWM and VB?

IWM (iShares Russell 2000 ETF) tracks Russell 2000 Index with an index approach, while VB (Vanguard Small Cap ETF) tracks CRSP US Small Cap Index with an index approach. They are issued by iShares and Vanguard respectively.

Can I hold both IWM and VB?

Yes — nothing prevents holding both. Whether the combination actually diversifies depends on how much the underlying exposures overlap, which isn't fully measurable from the data on this page; review each security's holdings, sector, and strategy before treating them as complementary.

Is IWM or VB safer?

By Dividend Vision's Distribution Safety Score — a rules-based 0–100 estimate of how resilient a distribution looks, where higher is safer — they are effectively tied: IWM scores 95, VB scores 95. Neither has a clear safety edge on that measure. VB has also shown lower price volatility (beta 1.10 vs 1.26 for IWM). No score makes an investment risk-free — treat this as a screening signal, not a guarantee.

Which has lower fees, IWM or VB?

IWM has an expense ratio of 0.19% while VB charges 0.05%. Lower fees mean more of your investment returns stay in your pocket over time.

How much income does $10,000 in IWM vs VB generate?

At current rates, $10,000 in IWM would generate roughly $7.58 per month ($91.00 annually). The same in VB would produce about $9.58 per month ($115.00 annually).

Which has performed better historically, IWM or VB?

IWM has outpaced VB over the trailing twelve months, posting a 33.32% total return against 25.42%. The picture flips over 10 years, though — VB has compounded at 11.32% a year, ahead of IWM at 10.86%. Figures are total returns: price change plus every distribution reinvested. Past performance does not guarantee future results.

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IWM vs VB — at a glance

Generated August 8, 2026.

Overview

IWM and VB are both broad small-cap U.S. equity ETFs tracking different benchmark indexes. The crucial difference: IWM follows the Russell 2000 Index (tracking roughly 2,000 mid-cap and small-cap stocks), while VB tracks the CRSP US Small Cap Index (a broader, market-cap-weighted universe of smaller companies). This index choice drives meaningful differences in composition, yield, and cost.

How they differ

The single biggest difference is their underlying index methodology. IWM's Russell 2000 is reconstituted annually and includes some mid-cap exposure, whereas VB's CRSP index is market-cap-weighted and excludes larger small-cap stocks, making it genuinely smaller and more diversified. Second, VB charges 0.05% in expenses versus IWM's 0.19%—a 0.14 percentage point advantage that compounds over time. Third, VB yields 1.17% compared to IWM's 0.92%, reflecting its broader, lower-turnover portfolio structure. Both funds are substantial, with AUM near $82 billion, and both have reasonable betas (VB at 1.1, IWM at 1.26), though IWM's higher beta suggests it amplifies market moves slightly more than VB does.

Who each is best for

IWM: Fits investors seeking exposure to the Russell 2000 specifically—often used as a benchmark for small-cap performance or as a core small-cap holding when Russell-specific implementation matters for strategy or reporting.

VB: Fits investors who want lower-cost, broad small-cap U.S. equity exposure without annual index reconstitution, prioritizing expense efficiency and a more stable, market-weighted composition over Russell-brand familiarity.

Key risks to know

  • Index composition and concentration: IWM's annual Russell 2000 reconstitution can create "January effect" trading costs and liquidity shifts; VB's market-cap-weighted approach means its largest holdings may carry more weight than IWM's, potentially increasing single-name risk depending on composition overlap.
  • Sector and style drift: The two indexes may weight sectors (financials, energy, industrials) and value versus growth differently, exposing investors to unintended style tilts if they assume both funds deliver identical small-cap exposure.
  • Beta and volatility: IWM's beta of 1.26 versus VB's 1.1 indicates IWM will likely experience larger drawdowns in market downturns, a meaningful distinction during extended corrections.
  • Yield sustainability: VB's higher distribution rate (1.17% vs. 0.92%) is partly structural (lower expenses, broader holdings) but should still be verified against underlying earnings; if yield drifts higher, check whether it reflects capital gains distributions or return of capital.

Bottom line

If you prioritize the lowest cost and simplest market-cap-weighted small-cap exposure, VB's 0.05% expense ratio and 1.17% yield stand out. If you require Russell 2000 tracking specifically—for strategy rebalancing, benchmark matching, or institutional reporting—IWM fits that need, despite its higher cost and lower yield. Both funds are liquid and well-established; the decision hinges on whether index methodology or fee efficiency matters more to your allocation. Past performance doesn't guarantee future results.

AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.

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