Introduction
Investors everywhere are searching for stability and growth in their portfolios, especially in unpredictable markets. For those who want the benefits of value investing without picking individual stocks, a value ETFs is a straightforward and effective solution. ETFs (Exchange Traded Funds) focused on value stocks bring the discipline of the world’s best investors—like Warren Buffett—straight to your brokerage account. In this post, you’ll learn what makes a great value ETF, how they compare, and, most importantly, discover the top 3 value ETFs poised to help supercharge your portfolio in 2025.
Why Add Value ETFs to Your Portfolio?
Value investing is the time-tested approach of buying shares believed to be trading below their true worth, then patiently holding as the market recognizes their value. But sifting through hundreds of company reports and quarterly statements isn’t practical for everyone.
That’s where a value ETF comes in:
- Diversification across dozens or hundreds of undervalued companies
- Lower costs thanks to efficient management
- Simplicity, requiring only a single purchase to own a basket of value stocks
- Historical resilience: Over long periods, value strategies have frequently outperformed growth or momentum chasing
With interest rates, inflation, and market volatility on investors’ minds, 2025 is shaping up to be another year where focusing on quality and valuation pays off.
Key Criteria for Selecting a Value ETF
Not all value ETFs are built the same. The top performers for this year typically show:
- Low expense ratios: Minimizing costs boosts net returns
- Strong underlying index: Tracks a reputable, proven value index (like the S&P 500 Value Index or Russell 1000 Value)
- Robust liquidity: High trading volume for easy buying and selling
- Consistent performance: Delivers stable, above-average returns over years, not just months
Let’s dive into the three top value ETFs to closely consider for your portfolio.
1. Schwab U.S. Large-Cap Value ETF (SCHV)
SCHV is a favorite among savvy investors who want broad exposure to large, established U.S. companies trading at attractive valuations. With an exceptionally low expense ratio (as low as 0.04%), it allows for cost-efficient long-term investing.
- What it invests in: SCHV tracks the Dow Jones U.S. Large-Cap Value Total Stock Market Index—giving instant access to value giants like J.P. Morgan Chase, ExxonMobil, and Johnson & Johnson.
- Why it stands out: The combination of low fees and broad diversification makes it a “set and forget” core holding. The fund’s performance is consistently competitive, especially during market downturns when value often outshines growth.
- Who it’s for: Investors who want reliable blue-chip exposure, excellent liquidity, and minimal cost.
2. Vanguard Value ETF (VTV)
VTV is one of the oldest and largest value ETFs in the world, making it a cornerstone for many long-term portfolios. What sets VTV apart is not just its iconic brand name, but its robust strategy backed by Vanguard’s low-cost, long-term investing philosophy.
- What it invests in: This ETF tracks the CRSP U.S. Large Cap Value Index, providing a basket of approximately 350 companies with lower-than-average price-to-earnings and price-to-book ratios. Notable holdings include Berkshire Hathaway, Procter & Gamble, and Bank of America.
- Why it stands out: Historically strong performance, high liquidity, and a yield that often exceeds typical growth funds. VTV is popular among income-seeking investors, thanks to dividends from established firms.
- Who it’s for: Long-term investors wanting broad, blue-chip value exposure and a reliable partner for riding out both bull and bear markets.
3. iShares Russell 1000 Value ETF (IWD)
IWD is another powerhouse in the value ETF space, known for its deep and diversified approach. By tracking the Russell 1000 Value Index, it includes not just mega-cap names, but also mid-cap value opportunities, expanding potential returns.
- What it invests in: The fund holds over 800 stocks, mixing household names like Intel and Johnson & Johnson with lesser-known yet promising value plays.
- Why it stands out: Scale, liquidity, and diversification. IWD is suitable for active traders and long-term holders alike, and has a strong history of risk-adjusted returns. Its broader reach also means exposure to more sectors and industries.
- Who it’s for: Those wanting breadth in their value allocation, or seeking a single ETF to cover most of their U.S. value stock needs.
Bonus: Why Not Just Buy Individual Value Stocks?
Picking individual value stocks can be rewarding—but time-consuming, risky, and emotionally taxing. Even legends like Buffett have missed occasionally. Value ETFs automate the screening, maintain discipline, and minimize emotional trading mistakes that come with trying to beat the market solo.
How to Use These Value ETFs in Your Portfolio
- Core equity holding: Any of these value ETFs can serve as the main U.S. stock allocation for most moderate to conservative investors.
- Diversification tool: Combine with international value ETFs, growth ETFs, or thematic funds for a custom mix.
- Rebalance yearly: Periodically review allocations, topping up on value if growth stocks become overvalued.
About the Author
As an investment-focused content creator, my mission is to break down complex strategies and market trends into practical, actionable advice. I am a true believer in value investing—with a modern twist—and love helping readers balance risk and reward through well-researched ETF selections.
