The Vanguard Russell 2000 and the S&P 500 are both stock market indexes, but they are based on different groups of stocks and have different investment strategies.
The S&P 500 is a stock market index that tracks the performance of 500 large-cap U.S. companies. These companies are selected based on their market capitalization, which is the total value of their outstanding shares. The S&P 500 is a broad-based index that represents the overall performance of the U.S. stock market.
On the other hand, the Vanguard Russell 2000 Index Fund tracks the performance of the Russell 2000 Index. The Russell 2000 Index is a stock market index that measures the performance of 2,000 small-cap U.S. companies. These companies are selected based on their market capitalization, with the smallest companies being included in the index.
So, while the S&P 500 tracks the performance of large-cap companies, the Russell 2000 Index focuses on small-cap companies. Small-cap stocks tend to be more volatile and have higher growth potential, but they can also be riskier than large-cap stocks. The Vanguard Russell 2000 Index Fund may be a better fit for investors who are looking for exposure to small-cap stocks and are willing to accept the higher risk that comes with them, while the S&P 500 may be a better fit for investors who want exposure to large-cap stocks with a lower level of risk.
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