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The Vanguard Russell 1000 ETF (VONE) was launched on 09/22/2010, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Blend segment of the US equity market.
The fund is sponsored by Vanguard. It has amassed assets over $3.75 billion, making it one of the larger ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Companies that fall in the large cap category tend to have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.08%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.41%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 27.10% of the portfolio. Healthcare and Financials round out the top three.
Looking at individual holdings, Apple Inc. (AAPL) accounts for about 6.94% of total assets, followed by Microsoft Corp. (MSFT) and Amazon.com Inc. (AMZN).
Performance and Risk
VONE seeks to match the performance of the Russell 1000 Index before fees and expenses. The Russell 1000 Index measures the performance of large-capitalization stocks in the United States.
The ETF has added about 17.25% so far this year and was up about 9.53% in the last one year (as of 09/13/2023). In the past 52-week period, it has traded between $162.86 and $208.54.
The ETF has a beta of 1.02 and standard deviation of 18.24% for the trailing three-year period, making it a medium risk choice in the space. With about 1008 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard Russell 1000 ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, VONE is a sufficient option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.