The S&P 500 usually steals the spotlight when it comes to major stock indexes, thanks to big tech giants leading the charge. But here’s something you might want to consider for 2025—the Vanguard Russell 2000 ETF.
This fund tracks the Russell 2000 Index, which represents around 2,000 smaller companies in the U.S. that could see significant growth in the near future. Why? Well, there are two major reasons:
- Trump’s Business-Friendly Policies
With Donald Trump back in the White House, American businesses could benefit from his pro-business agenda. Lower taxes for domestic manufacturers and fewer regulations could boost companies that focus on U.S.-based operations. Since many Russell 2000 companies are based in the U.S., they’re in a prime position to capitalize on these changes. - Falling Interest Rates
Small companies are more sensitive to interest rates than their big counterparts. With the Federal Reserve expected to continue lowering rates in 2025, smaller businesses will likely have more access to cheap financing. This can help them grow and increase their profits.
The Vanguard Russell 2000 ETF offers great diversification, covering sectors like industrials, healthcare, and financials. And with an expense ratio of just 0.1%, it’s super affordable to own compared to other funds.
Could the Vanguard Russell 2000 ETF be the one to watch in 2025? It’s certainly looking like a strong contender, with the potential for big returns ahead.
