FVAL vs VTV: Weighing Two Distinct Value ETF Strategies

Key Takeaways

• FVAL is a "value factor" fund whose sector weights mirror the broad market, leaving roughly one-third of assets in technology; VTV is a classic large-cap value fund tilted toward financials, health care, industrials, and energy.
• The cost gap is wide and structural: VTV charges 0.03% versus 0.15% for FVAL.
• VTV holds roughly 320 stocks against about 130 for FVAL, and carries a lower beta (a measure of sensitivity to broad market moves) near 0.7 versus roughly 0.95.
• FVAL's largest positions overlap heavily with growth-leaning megacaps, diluting its value tilt, while VTV emphasizes dividend-paying, cash-generative companies.
• Tickeron AI Verdict: VTV — on cost, diversification, and consistency of value exposure, the AI currently favors VTV.

Introduction

Both funds carry the "value" label in ETF screens, yet they pursue very different versions of it. FVAL applies a value factor within a market-like sector structure, so it ends up holding many of the same megacap technology names as a broad index. VTV, by contrast, is a purer large-cap value fund concentrated in financials, health care, industrials, and energy. That makes this pair a useful ETF comparison for investors deciding whether they want value exposure that mirrors the broad market or a more classic, defensive tilt. The distinction matters especially now, as markets debate the durability of technology leadership and the path of interest rates. I also checked this using Tickeron’s AI Screener to see how the sector profiles line up against peers.

Fidelity Value Factor ETF (FVAL) Overview

The Fidelity Value Factor ETF (FVAL) is a passively managed fund that seeks to track the Fidelity U.S. Value Factor Index. Rather than screening purely on cheapness, the index selects constituents from among the largest 1,000 U.S. stocks using value measures such as free-cash-flow yield, low enterprise value to EBITDA, low price-to-tangible-book value, and low price-to-forward earnings. Critically, the fund then weights each sector roughly in line with the broad market and is rebalanced semi-annually.

As a result, FVAL's sector profile resembles the broader index more than a textbook value fund. Information technology is its largest sector at roughly 30–38% of assets, followed by financials, health care, communication services, and consumer discretionary. It holds approximately 130 stocks, with top positions including NVDA, AAPL, GOOGL, MSFT, MU, AMZN, META, and TSLA. The expense ratio is 0.15%, and the fund carries a beta of roughly 0.95. Launched in 2016, FVAL offers broad, market-like exposure rather than a concentrated deep-value portfolio. From what I see, this setup keeps it closely tied to overall market moves.

Vanguard Morningstar Value ETF (VTV) Overview

The Vanguard Morningstar Value ETF (VTV), formerly known as the Vanguard Value ETF, is a passively managed fund that tracks the Morningstar US Large Cap Value Index. The index selects and weights large-cap U.S. stocks based on value characteristics, producing a portfolio that looks markedly different from the broad market. VTV is one of the largest and cheapest large-cap value funds, with hundreds of billions of dollars in assets and an expense ratio of just 0.03%.

VTV holds roughly 320 stocks, with a sector allocation tilted decisively toward traditional value territory: financial services (about 22–23%), health care (about 16%), technology (about 14%), industrials (about 13%), plus consumer staples and energy. Its largest positions include MU, JPM, BRK.B, XOM, JNJ, WMT, ABBV, BAC, CSCO, and CVX. With a beta near 0.7 and a dividend yield approaching 1.9%, VTV is the more defensive, income-oriented of the two. Launched in 2004, it has become a core holding for investors seeking classic large-cap value exposure.

Industry and Thematic Backdrop

Both funds sit within the U.S. large-cap equity universe, but their fates diverge with sector rotation. Over recent market cycles, the dominance of a handful of megacap technology and artificial intelligence names has lifted the broad index—and, by extension, FVAL, whose top holdings overlap heavily with that cohort. At the same time, persistent questions about AI-related capital spending and elevated valuations have periodically driven investors toward cheaper, cash-generative businesses in financials, health care, and energy—the exact areas where VTV is overweight. One thing that stands out is how interest-rate expectations and commodity trends affect these holdings differently.

Performance and Positioning Comparison

In recent weeks and months, the two funds have illustrated their distinct positioning. FVAL has tended to track the broader, technology-heavy market more closely, benefiting when megacap tech rallies but giving up ground when those names falter. VTV, with its financials and energy overweight and its modest technology exposure, has generally been more insulated from tech volatility while remaining sensitive to bank earnings, commodity prices, and interest-rate shifts. I’m watching this closely because relative performance often hinges on whether value rotation gains traction.

Relative positioning matters more than isolated price moves. FVAL's higher beta and concentrated top holdings make it the more growth-sensitive of the two, while VTV's lower beta, broader diversification, and higher dividend yield make it the steadier sleeve. In an environment favoring value rotation, VTV's sector mix aligns more directly with the rotation; in a technology-led rally, FVAL captures more upside. That is the central trade-off in this ETF comparison.

Tickeron AI Verdict

On a structural basis, Tickeron's AI would currently favor VTV over FVAL. The case rests on three observable factors. First, cost: VTV's 0.03% expense ratio is a durable, compounding advantage over FVAL's 0.15%. Second, diversification and defensiveness: VTV's roughly 320 holdings and lower beta provide broader company-level risk spreading and reduced sensitivity to any single sector. Third, consistency of exposure: VTV is a more "pure" value fund, whereas FVAL's market-like sector weighting leaves a meaningful share of assets in expensive megacap technology names, partially offsetting its value objective. In the current environment, where valuation discipline and sector diversification are increasingly rewarded, the AI's probabilistic assessment leans toward VTV.

Exploring Tickeron’s AI Tools for ETF Research

In my own analysis, Tickeron’s AI Screener has become a practical way to compare funds like these. The tool lets users apply filters for technical patterns, fundamentals, volatility, and AI-driven signals across thousands of ETFs and stocks. Instead of reviewing holdings manually, it helps surface how sector weights, betas, and expense ratios stack up against industry peers. I find it useful for quickly testing ideas on diversification or cost efficiency before making allocation decisions. To see how these filters can refine your own fund research, explore the AI Screener.

Disclaimer

The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.

Disclaimers and Limitations

Contributor

Scott Bell|Expert

I’m a trader and independent researcher. My interest lies at the intersection of financial markets, algorithms, and capital management. I develop data-driven tools and strategies and study algorithmic approaches to market analysis. I help turn complex market data into clear insights and practical systems. I believe technology should support, not replace, investment thinking

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