QSML vs VYM

QSMLCWisdomTree U.S. SmallCap Quality Growth Fund

VYMAVanguard High Dividend Yield ETF

In short

QSML Small-cap indexes are stuffed with companies that don't earn money. QSML screens the US small-cap field on growth and profitability, keeps the top 30% of scorers, and leaves out banks, utilities and real estate by rule. Roughly 400 names, market-cap weighted.

VYM The no-frills dividend workhorse. VYM buys the higher-yielding end of the US market, roughly 600 names, for four basis points: no quality screen, no dividend-growth-streak test, just yield, at scale since 2006.

Stated mandate

QSML The Fund uses passive indexing and representative sampling to track, before fees and expenses, the price and yield performance of the WisdomTree U.S. SmallCap Quality Growth Index. It normally invests at least 80% of net assets in index constituents issued by small-cap U.S. companies.

VYM The Fund seeks to track a benchmark index measuring the investment return of common stocks from companies characterized by high dividend yields.

Why people hold it

• QSML Ranks the small-cap universe on equally weighted growth and quality scores and keeps only the top 30%, leaving out the unprofitable story stocks that fill broad small-cap indexes.wisdomtree.comsec.gov
• Real estate, utilities and banks are excluded by rule, tilting the portfolio toward operating businesses instead of rate-sensitive balance sheets.wisdomtree.com
• Roughly 400 holdings, market-cap weighted, with at least 80% of assets in index constituents and rules published in advance. No manager hunches.

• VYM Four basis points a year, against a peer-group median near 0.32%. Cheaper than cohort neighbors VONV (0.06%) and FNDX (0.25%).
• Running since 2006 and now a multi-billion-dollar fund that trades actively, so ordinary orders tend to fill at tight spreads.
• Simple mandate: track the FTSE High Dividend Yield Index of US common stocks screened on yield. No manager discretion, no options overlay, plain 1940-Act fund.vanguard.com
• Pays quarterly, and among 100-plus value and multifactor rivals it stands as one of the strongest overall packages in the group.

Worth knowing

• QSML The 0.38% fee runs above the median for US multifactor ETFs, and large-cap factor staples like ILCV (0.04%) and VONV (0.06%) charge a fraction of it.
• Launched in 2024, still small and thinly traded: spreads can be wider than in the giant small-cap funds, and small young funds sometimes close.
• Skipping banks, utilities and real estate, plus the growth tilt, means the sector mix can sit far from broad small-cap benchmarks in either direction.wisdomtree.com

• VYM The screen is yield, not payout growth or dividend quality, so a company can qualify simply because its share price fell.
• This is a value slice by design, tilted to established payers, so it behaves differently from a total US market fund.
• Roughly 600 holdings, but weight leans toward the largest payers, so the top of the roster does more of the work than the count suggests.

Full QSML profile⁠

Full VYM profile⁠