Key Points
IVV is much cheaper to own than IWM and offers a slightly higher yield.
IWM focuses on small-cap stocks, while IVV tracks large-cap U.S. companies with a heavy tilt to technology.
IVV has delivered stronger risk-adjusted returns and a smaller drawdown over the past five years.
The iShares Core S&P 500 ETF(NYSEMKT:IVV) stands out for its ultra-low expense ratio and large-cap technology exposure, while the iShares Russell 2000 ETF(NYSEMKT:IWM) targets small-cap stocks with higher volatility and costs.
IWM and IVV are both broad-based U.S. equity ETFs from iShares, but they serve different roles. IWM captures the performance of nearly 2,000 small-cap companies, while IVV tracks the S&P 500’s largest U.S. firms. This comparison highlights how their costs, returns, risks, and sector makeup differ.
Snapshot (cost & size)
| Metric | IWM | IVV |
|---|---|---|
| Issuer | IShares | IShares |
| Expense ratio | 0.19% | 0.03% |
| 1-yr return (as of 2026-02-27) | 23.1% | 17.3% |
| Dividend yield | 1.0% | 1.2% |
| Beta | 1.30 | 1.00 |
| AUM | $74.0 billion | $750.7 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months.
IVV is considerably more affordable, charging just 0.03% in expenses compared to IWM’s 0.19%, and it also offers a modestly higher dividend yield at 1.2% versus 1.0%.
Performance & risk comparison
| Metric | IWM | IVV |
|---|---|---|
| Max drawdown (5 y) | -31.91% | -24.53% |
| Growth of $1,000 over 5 years | $1,156 | $1,763 |
What's inside
IVV tracks the S&P 500, providing exposure to 503 large-cap U.S. stocks with a strong tilt toward technology (34%), followed by financial services and communication services. Its top holdings — Nvidia(NASDAQ:NVDA), Apple(NASDAQ:AAPL), and Microsoft(NASDAQ:MSFT) — make up a significant share of the portfolio. With nearly 26 years of history and no notable quirks, it is a long-standing, straightforward vehicle for large-cap exposure.
By contrast, IWM holds nearly 2,000 small-cap stocks, emphasizing healthcare, industrials, and financial services. Its largest positions — Bloom Energy(NYSE:BE), Fabrinet(NYSE:FN), and Coeur Mining(NYSE:CDE) — each comprise less than 1.2% of assets, leading to a far more diversified but less top-heavy portfolio. IWM’s focus on smaller companies introduces more volatility and different sector dynamics than IVV’s large-cap orientation.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investors
Choosing between the iShares Core S&P 500 ETF (IVV) and iShares Russell 2000 ETF (IWM) comes down to individual investor objectives. That’s because IVV targets the large-cap stocks of the S&P 500 while IWM focuses on the small-cap companies comprising the Russell 2000.
IVV is for investors who have a “set it and forget it” mentality looking for an ETF to buy and hold for the long term. The fund provides a very low expense ratio, the stability afforded by large caps, and a solid dividend yield. These factors make IVV a good choice as a retirement investment.
IWM is good for investors who may already have S&P 500 exposure and want to round out their portfolios with the diversification offered by the 2,000 stocks in the fund. Because IWM targets small caps, it tends to experience greater volatility than IVV, which is evidenced by IWM’s higher beta and max drawdown.
However, the benefit is that small caps hold greater growth potential, and this is seen in IWM’s higher one-year return. This makes IWM a good choice for investors who are seeking growth stocks, and are comfortable with the trade off of larger risk.
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Robert Izquierdo has positions in Apple, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Apple, Bloom Energy, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.
