This Unstoppable Vanguard ETF Is Beating the S&P 500, the Nasdaq-100, and the Dow Jones in 2026

The U.S. banal marketplace is disconnected to a hard commencement to 2026. Ongoing geopolitical tensions successful the Middle East person sent the terms of lipid soaring, which is creating economical instability and clouding the net representation for firm America. As a result, the S&P 500, the Nasdaq-100, and the Dow Jones Industrial Average have each suffered year-to-date declines of much than 5% truthful far.

However, different scale is bucking the losses to commercialized level for the year. The Russell 2000 is location to astir 2,000 of the smallest companies listed connected U.S. banal exchanges, galore of which run exclusively successful America, truthful they are somewhat insulated from planetary conflicts.

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The Vanguard Russell 2000 ETF (NASDAQ: VTWO) is an exchange-traded money (ETF) that tracks the show of the scale by holding the aforesaid stocks and maintaining akin weightings. Here's wherefore it could proceed outperforming the large banal marketplace indexes.

The companies successful the Russell 2000 travel from 11 antithetic economical sectors, truthful the scale is highly diversified. It's besides rather balanced; its largest assemblage is healthcare, which has a weighting of 18.7%, followed by industrials astatine 18.1% and financials astatine 17.2%. The S&P 500, for example, is acold much top-heavy, with a whopping 33.3% of its portfolio parked successful the accusation exertion assemblage alone.

A much evenly distributed scale tends to present steadier returns with little volatility than an scale with a precocious grade of portfolio concentration. On that note, the apical 10 holdings successful the Vanguard Russell 2000 ETF relationship for conscionable 5.6% of the worth of its portfolio, truthful dissimilar the S&P, the Nasdaq-100, and the Dow, its show isn't beholden to a specified fistful of stocks:

Data source: Vanguard. Portfolio weightings are close arsenic of Feb. 28, 2026, and are taxable to change.

Small-cap stocks are often overlooked by investors, but they tin nutrient unthinkable returns. Bloom Energy banal is up by a whopping 500% implicit the past 12 months arsenic request for the company's on-site cleanable vigor solutions soars from starring information halfway operators who are seeking alternate sources of energy for their artificial quality (AI) infrastructure.