Choosing The Right Small-Cap ETFChoosing The Right Small-Cap ETF

Small-Cap ETFs

Small-cap ETFs are becoming a primary choice for passive small-cap investing. They provide a low-cost alternative for investors seeking a broader exposure to the small-cap market. The increasing popularity of robo-advisors, the new DOL fiduciary rule and the high number of underperforming active managers made small-cap ETFs an attractive investment choice for many investors and portfolio managers.

The current assets under management (AUM) of small-cap ETFs are $108.6 billion. The top 10 ETFs control 90.75% of the assets. The top 3 - the iShares Russell 2000 ETF (IWM), the iShares Core S&P Small-Cap ETF (IJR), and the Vanguard Small Cap ETF (VB) manage 56%.

Small-cap ETFs are not made equal. They come in different shapes and forms. ...