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<h2>Key Points</h2><ul><li>IWO targets smaller companies with aggressive growth potential, while VOO focuses on the 500 largest U.S. companies.</li><li>VOO offers a significantly lower expense ratio and higher dividend yield than IWO.</li><li>IWO has experienced higher volatility and a deeper maximum drawdown compared to VOO over the last five years.</li><li>10 stocks we like better than iShares Trust - iShares Russell 2000 Growth ETF ›</li></ul><p>The <strong>iShares Russell 2000 Growth ETF</strong> <span class="ticker">(NYSEMKT:IWO)</span> and the <strong>Vanguard S&amp;P 500 ETF</strong> <span class="ticker">(NYSEMKT:VOO)</span> both provide access to a large swath of the U.S. equities market, but they take distinct approaches that may appeal to different investor priorities.</p><p>While IWO targets aggressive growth in smaller companies, VOO represents the core of the U.S. economy by tracking the <strong>S&amp;P 500</strong>. This comparison highlights how these two distinct segments of the market have behaved over time.</p><h2 id="snapshot-cost-amp-size">Snapshot (cost &amp; size)</h2><section><table><tbody><tr><th>Metric</th><th>VOO</th><th>IWO</th></tr><tr><td>Issuer</td><td>Vanguard</td><td>iShares</td></tr><tr><td>Expense ratio</td><td>0.03%</td><td>0.24%</td></tr><tr><td>1-yr return (as of May 9, 2026)</td><td>32.12%</td><td>43.20%</td></tr><tr><td>Dividend yield</td><td>1.08%</td><td>0.42%</td></tr><tr><td>Beta (5Y monthly)</td><td>1.00</td><td>1.46</td></tr><tr><td>Assets under management (AUM)</td><td>$1.6 trillion</td><td>$13.9 billion</td></tr></tbody></table></section><p><em>Beta measures price volatility relative to the S&amp;P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.</em></p><p>Cost is a primary differentiator, as the Vanguard fund is significantly more affordable for long-term investors. Additionally, those seeking passive income may prefer VOO’s higher dividend yield, reflecting the cash-flow-positive nature of large-cap companies.</p><h2 id="performance-amp-risk-comparison">Performance &amp; risk comparison</h2><section><table><tbody><tr><th>Metric</th><th>VOO</th><th>IWO</th></tr><tr><td>Max drawdown (5 yr)</td><td>-24.53%</td><td>-42.02%</td></tr><tr><td>Growth of $1,000 over 5 years (total return)</td><td>$1,876</td><td>$1,277</td></tr></tbody></table></section><h2 id="whatx27s-inside">What's inside</h2><p>IWO provides exposure to roughly 1,100 holdings, with industrials, technology, and healthcare making up its top three sectors. Its largest positions include <strong>Bloom Energy</strong>, <strong>Credo Technology Group</strong>, and <strong>Sterling Infrastructure</strong>. This fund, which was launched in 2000, has a trailing-12-month dividend of $1.51 per share.</p><p>In contrast, VOO tracks the S&amp;P 500 and holds just over 500 stocks, leaning heavily into technology, financial services, and communication services. Its largest positions include <strong>Nvidia</strong>, <strong>Apple</strong>, and <strong>Microsoft</strong>. VOO was launched in 2010 and paid $7.13 per share in dividends over the trailing 12 months.</p><p>For more guidance on ETF investing, check out the full guide at this link.</p><h2 id="what-this-means-for-investors">What this means for investors</h2><p>VOO and IWO take different approaches to U.S. stocks: VOO targets the largest industry leaders, while IWO focuses on smaller, up-and-coming stocks.</p><p>VOO offers three major advantages over IWO: greater stability, lower fees, and higher dividend income. Because this ETF holds stocks from 500 of the largest and strongest U.S. companies, it’s more likely to survive periods of volatility. It offers a substantially lower beta and max drawdown than IWO, suggesting smaller price fluctuations over the last five years.</p><p>With a lower expense ratio and higher dividend yield, investors can also expect to pay less in fees while earning more passive income alongside investment growth with VOO. It charges an expense ratio of 0.03% compared to IWO’s 0.24%, meaning investors will pay $3 or $24 in annual fees, respectively, for every $10,000 invested in each fund.</p><p>Where IWO shines, however, is its growth potential. The last few years have been unique, as advancements in artificial intelligence have caused large-cap tech stocks to skyrocket. Generally, though, smaller stocks often have more room for growth than their more established peers. If any of the stocks in IWO take off, this ETF could deliver lucrative returns.</p><p>Both IWO and VOO can be smart investments, and the right one for you will depend on your priorities and goals. VOO offers the stability of large-cap stocks with an emphasis on tech leaders, while IWO provides exposure to fast-growing small-cap stocks with plenty of long-term potential.</p><h2>Should you buy stock in iShares Trust - iShares Russell 2000 Growth ETF right now?</h2>
<p>Before you buy stock in iShares Trust - iShares Russell 2000 Growth ETF, consider this:</p>
<p>The <em>Motley Fool Stock Advisor</em> analyst team just identified what they believe are the <strong>10 best stocks</strong> for investors to buy now… and iShares Trust - iShares Russell 2000 Growth ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.</p>
<p>Consider when <strong>Netflix</strong> made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, <strong>you’d have $471,827</strong>!* Or when <strong>Nvidia</strong> made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, <strong>you’d have $1,319,291</strong>!*</p>
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<p style="color: #767676; text-align: left"><em>*Stock Advisor returns as of May 9, 2026. </em></p><p><em>Katie Brockman has positions in Vanguard S&amp;P 500 ETF. The Motley Fool has positions in and recommends Apple, Bloom Energy, Microsoft, Nvidia, Sterling Infrastructure, and Vanguard S&amp;P 500 ETF. The Motley Fool has a disclosure policy.</em></p>
<p>The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.</p>
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<p>The Vanguard S&P 500 ETF (VOO) and iShares Russell 2000 Growth ETF (IWO) offer distinct investment strategies. VOO targets the 500 largest U.S. companies, providing stability with a lower expense ratio (0.03%) and higher dividend yield (1.08%) compared to IWO (0.24% expense ratio, 0.42% yield). Over five years, VOO has shown less volatility and a smaller maximum drawdown (-24.53% vs. -42.02% for IWO). While VOO is suitable for conservative investors seeking income, IWO appeals to those looking for aggressive growth in smaller companies. The choice depends on individual investment goals.</p>

nasdaq

VG S&P 500

ISHRS Russ 2000 Growth

S&P 500

Bloom Energy

Credo Tech

Sterling Infrastructure

NVIDIA

Apple

Microsoft

Netflix

NVIDIA Corporation

Vanguard VOO vs. iShares IWO: How S&P 500 Stability Compares to Small-Cap Growth Potential