Generated August 8, 2026.
Overview
IWY and VOO are both large-cap U.S. equity ETFs tracking broad market indexes, but they diverge meaningfully in construction and tilt. IWY targets the Russell Top 200 Growth Index—favoring growth characteristics within the 200 largest stocks—while VOO tracks the S&P 500, capturing 500 large-cap companies across growth, value, and blend styles. This makes IWY a growth-tilted satellite and VOO a core-portfolio holding with neutral style exposure.
How they differ
The biggest difference is style focus: IWY explicitly screens for growth traits (higher earnings growth expectations, lower valuations relative to growth), while VOO holds the full breadth of the S&P 500 without style tilting. IWY's 1.17 beta signals it amplifies broad market moves; VOO's 1.0 beta moves in lockstep with the market. On income, VOO yields 1.10% versus IWY's 0.37%—a function of IWY's growth focus, since high-growth stocks typically reinvest earnings rather than pay dividends. Cost-wise, VOO's 0.03% expense ratio is among the cheapest in the industry, while IWY's 0.20% is reasonable but higher; VOO's $1032B in AUM dwarfs IWY's $16.5B, reflecting VOO's role as a de facto core holding for millions of investors.
Who each is best for
IWY: Fits investors who already hold broad market exposure and want to overweight growth equities, or who believe large-cap growth will outperform value over their holding period and accept the higher volatility that comes with it.
VOO: Fits investors seeking a single, low-cost holding covering the largest 500 U.S. companies with no style tilt, suitable as a foundational core equity position in a diversified portfolio.
Key risks to know
- Growth tilt concentration: IWY's Russell Top 200 Growth filter narrows the investable universe to stocks exhibiting higher growth expectations and lower valuations relative to growth, meaning the fund's holdings may cluster in technology and similar sectors; style rotations favoring value could underperform.
- IWY's higher volatility: With a beta of 1.17, IWY amplifies broad market drawdowns; in a 20% market decline, IWY would likely fall roughly 23%, versus VOO's approximately 20%.
- Holdings overlap and tracking risk: While not identical, IWY and VOO may hold many of the same largest-cap names. IWY's smaller AUM and more focused index mean slightly wider tracking error relative to its benchmark than VOO's, though both track accurately.
- Dividend sustainability during downturns: VOO's 1.10% yield is generated largely by dividend-paying sectors (financials, utilities, industrials); during recessions or rate-hiking cycles, dividend cuts can erode that yield.
Bottom line
If you want core S&P 500 exposure at rock-bottom cost with balanced style exposure, VOO's 0.03% expense ratio and $1032B scale are hard to match. If you already own broad market exposure and want to tilt toward growth equities with conviction, IWY offers that tilt—though its higher volatility and lower yield reflect the trade-off. Past performance does not guarantee future results; style rotations can persist for years, so ensure either choice aligns with your time horizon and risk tolerance.
AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.
