If you're interested in broad exposure to the Mid Cap Blend segment of the US equity market, look no further than the Vanguard Extended Market ETF (VXF), a passively managed exchange traded fund launched on 12/27/2001.

The fund is sponsored by Vanguard. It has amassed assets over $14.09 billion, making it one of the larger ETFs attempting to match the Mid Cap Blend segment of the US equity market.

Why Mid Cap Blend

Compared to large and small cap companies, mid cap businesses tend to have higher growth prospects and are less volatile, respectively, with market capitalization between $2 billion and $10 billion. Thus, companies that fall under this category provide a stable and growth-heavy investment.

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

Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.

Annual operating expenses for this ETF are 0.06%, making it one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 1.07%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Information Technology sector--about 18.30% of the portfolio. Financials and Industrials round out the top three.

Looking at individual holdings, Blackstone Inc. (BX) accounts for about 1.05% of total assets, followed by Uber Technologies Inc. (UBER) and Palo Alto Networks Inc. (PANW).

Performance and Risk

VXF seeks to match the performance of the S&P Completion Index before fees and expenses. The S&P Completion Index contains all of the U.S. common stocks regularly traded on the New York Stock Exchange and the Nasdaq over-the-counter market, except those stocks included in the S&P 500 Index.

The ETF has gained about 7.71% so far this year and is down about -11.21% in the last one year (as of 01/25/2023). In the past 52-week period, it has traded between $126.36 and $170.83.

The ETF has a beta of 1.17 and standard deviation of 30.93% for the trailing three-year period, making it a medium risk choice in the space. With about 3651 holdings, it effectively diversifies company-specific risk.

Alternatives

Vanguard Extended Market 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, VXF is a good option for those seeking exposure to the Style Box - Mid Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.

The Vanguard MidCap ETF (VO) and the iShares Core S&P MidCap ETF (IJH) track a similar index. While Vanguard MidCap ETF has $52.71 billion in assets, iShares Core S&P MidCap ETF has $67.73 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.

Bottom-Line

Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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Vanguard Extended Market ETF (VXF): ETF Research Reports

Blackstone Inc. (BX) : Free Stock Analysis Report

Palo Alto Networks, Inc. (PANW) : Free Stock Analysis Report

iShares Core S&P MidCap ETF (IJH): ETF Research Reports

Vanguard MidCap ETF (VO): ETF Research Reports

Uber Technologies, Inc. (UBER) : Free Stock Analysis Report

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