ETF of the Week: Vanguard S&P Small-Cap 600 Value ETF (VIOV)
ETF Trends CEO Tom Lydon discussed the Vanguard S&P Small-Cap 600 Value ETF (VIOV) on this week’s “ETF of the Week” podcast with Chuck Jaffe on the MoneyLife Show. VIOV seeks to replicate a benchmark which offers exposure small cap firms that exhibit value characteristics in the U.S. equity market. The investment thesis behind small caps is that these firms are likely to provide strong growth prospects to a portfolio and should have a much easier time growing then their large cap counterparts. However, these securities are extremely volatile and can experience large losses or gains in a very short period of time. Despite their volatility, these products should probably be in every investors' portfolio as they tend to move somewhat independently of large caps and can be a better 'pure play' on the American economy.