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Vanguard Value ETF Outperforms Large-Value Peers Over Decade
The Vanguard Value ETF (VTV) has demonstrated strong long-term performance and risk-adjusted returns compared to its large-value ETF peers. Over the 10 years through June 2025, VTV outperformed the average large-value peer by 1.51 percentage points annually[1].
This ETF, which tracks the CRSP US Large Cap Value Index, is a broadly diversified, market-cap-weighted portfolio of value stocks. The market-cap weighting of the VTV typically requires lower turnover, reducing transaction costs[2].
The CRSP US Large Cap Value Index selects stocks that exhibit strong value characteristics, such as low valuations, low projected earnings growth, and high dividend yields. This focus on companies with strong value characteristics can leave VTV vulnerable to value traps, but the ETF's market-cap weighting mitigates some of this risk by favoring larger, more stable stocks[3].
Financial services occupied 25% of the portfolio's assets, the largest of any sector, which was in line with the category average of 21%. The fund's top holdings include Berkshire Hathaway, JPMorgan Chase, Exxon Mobil, and Walmart[3]. The ETF also offers a dividend yield of roughly 2.19%, contributing to its total return.
The VTV's low expense ratio of 0.04% contributes significantly to its strong relative returns, as it minimizes costs detracting from investor gains. Additionally, the fund’s low turnover rate helps reduce capital gains distributions and tax liabilities, further enhancing investor net returns[4].
As of May 2025, the VTV held around 330 stocks and allocated 21% of its assets to its top 10 holdings, compared with peers' 30%. This smaller concentration of holdings may help the fund capture more of the upswings in boom markets but can be detrimental in down markets[1].
In the short term, VTV has also shown higher risk-adjusted returns over the trailing three- and five-year periods[1]. The performance advantage of the Vanguard Value ETF (VTV) is largely attributed to its cost advantage and the market-cap weighting, which harnesses the market's collective view of each stock's relative value[3].
In summary, VTV’s long-term outperformance, low fees, and low turnover make it an efficient vehicle for large-cap value exposure, delivering superior risk-adjusted returns compared to peers. Its strong and consistent track record underscores its position as a strong choice for investors emphasizing cost efficiency and stable value investing[1][3][4].
[1] Vanguard. (2025). Vanguard Value ETF (VTV). Retrieved from https://personal.vanguard.com/us/funds/snapshot?FundId=0570&FundIntExt=INT
[2] Vanguard. (2021). How Vanguard Value ETF (VTV) works. Retrieved from https://investor.vanguard.com/etfs/profile/vtv
[3] Morningstar. (2025). Vanguard Value ETF (VTV) factsheet. Retrieved from https://uk.morningstar.com/uk/fund/snapshot/snapshot.aspx?t=VTV
[4] Vanguard. (2022). Vanguard Value ETF (VTV) performance. Retrieved from https://investor.vanguard.com/etfs/profile/vtv/performance
[5] CRSP. (2025). CRSP US Large Cap Value Index methodology. Retrieved from https://www.crsp.com/products/indexes/methodology/uslargecapvalue
- The Vanguard Value ETF (VTV), which focuses on value stocks and technology companies, includes financial services as the largest sector of its portfolio.
- The Vanguard Value ETF (VTV), with its low expense ratio, low turnover, and a focus on value characteristics, offers investors an efficient vehicle for investing in both finance and technology sectors.
