JUSTBUYCAGEWhy
12 min read
The case Why this, not VEQT?

TRUST THE math.
Not the crowd.

VEQT and XEQT hold the whole world by size — the bigger a company already is, the more you own. CAGE holds the whole world by evidence — tilting toward companies that are cheaper and more profitable. Same plumbing. Opposite philosophy.

Scroll — the chart follows along
VEQT
Vanguard All-Equity ETF Portfolio
Holdings~13,500
Tickers to buy1
Equity100%
WeightingBy size
MER0.24%
The contrarian
CAGE
Avantis CIBC All-Equity ETF
Holdings~9,000
Tickers to buy1
Equity100%
WeightingBy evidence
MER0.28%
On the shelf, nearly identical. Underneath, not even close.
On the shelf
Weighted by market cap
US
Canada
Intl / EM
AAPLMSFTNVDAAMZNGOOGLMETAAVGOTSLALLYJPMBRKXOMUNHCVXCSCOPFERYTDENBCNQBNSUSHOPNESNNOVOASML7203ROGSHELMCSAPTSM0700005930BABARELI
Each circle is a company. Size = how much of the fund it is. The crowd piles into the biggest.
$1 invested · 50-yr horizon · illustrative long-run premia
$1$10$100$500×147MARKET×264PROFITABILITY×345VALUE×562SMALL-CAP VALUE
Long-short academic factor indices. Live funds capture a fraction — but the direction has held for decades.
01

Same shelf.

Put CAGE and VEQT side by side and they look like twins.

Both are one-ticker, all-equity, globally diversified ETFs. Buy either and you own thousands of companies across every continent, auto-rebalanced, for a fraction of a percent a year.

So if they're so alike — why does CAGE exist? The answer is in one word on the spec sheet: weighting.

02

Cap-weighting trusts the crowd.

VEQT and XEQT weight every company by its market capitalization — its price times its shares. The more the market already loves a stock, the bigger your slice.

~25% in 10 names

A handful of US mega-caps — Apple, Microsoft, Nvidia — dominate the whole portfolio. You're not betting on the world. You're betting on whatever's already expensive.

03

CAGE tilts on purpose.

Watch the same companies re-weight. CAGE systematically trims the priciest mega-caps and leans into stocks that are cheaper relative to their fundamentals and more profitable.

Nvidia shrinks. A profitable, unglamorous bank or energy name grows. Nothing is excluded — it's a tilt, not a bet on ten stocks.

Top-10 weight
~11%
vs VEQT
~25%
Names held
~9,000
04

Why those tilts?

Because the data behind them is about as close to a law as finance gets.

Nobel laureates Eugene Fama and Kenneth French spent decades showing that, over the long run, cheaper companies (value), more profitable companies, and smaller companies have earned higher returns than the market — repeated across 90+ years and dozens of countries.

A dollar riding those tilts didn't just beat the market. It lapped it — though never in a straight line, and never without stretches of pain.

05

CAGE's four dials.

Loadings vs
ACWI IMI = 0

CAGE doesn't guess. It turns four evidence-based dials, each measured against a plain market-cap index (where every dial sits at zero). Positive = CAGE leans into that style. Click a dial for the why.

Value cheap
+0.42
Book-to-price tilt
−0.7 underweightACWI = 0+0.7 overweight
CAGE owns more of companies trading cheaply relative to their book value. The value premium — cheap beats expensive — shows up in U.S. data back to 1926 and across dozens of countries. It is the oldest, most-replicated edge in markets.
Click for the evidence →
Profitability quality
+0.38
Cash profits ÷ book equity
−0.7 underweightACWI = 0+0.7 overweight
Tilts toward companies earning more cash per dollar of equity. Of all the Fama–French factors, profitability (RMW) has been the most consistent across eras — profitable businesses simply compound better.
Click for the evidence →
Size smaller
+0.18
Below the mega-cap index
−0.7 underweightACWI = 0+0.7 overweight
Leans slightly smaller than a market that is now dangerously top-heavy in a few US giants. Smaller companies have historically out-returned large ones — with more volatility as the toll.
Click for the evidence →
Investment disciplined
+0.15
Conservative ÷ aggressive
−0.7 underweightACWI = 0+0.7 overweight
Favours companies that grow disciplined, not ones that dilute shareholders chasing every shiny expansion. Conservative investors have quietly beaten the empire-builders.
Click for the evidence →
06

Head to head.

CAGE vs
VEQT · XEQT

Where they're identical, where they diverge. CAGE costs 4 basis points more than VEQT — about $4 a year on $10,000 — and in exchange you get an active factor tilt instead of pure market-cap.

CAGEAvantis CIBC
VEQTVanguard
XEQTiShares
Weighting
Value × profitability tiltedge
Pure market cap
Pure market cap
Top-10 concentration
~11%edge
~25%
~24%
Holdings
~9,000
~13,500
~9,800
Factor tilt
Value, profit, sizeedge
None (the market)
None (the market)
Implementation
Active, rules-based
Passive index
Passive index
MER
0.28%
0.24%edge
0.20%edge
Rebalancing
Daily screenedge
Quarterly
Semi-annual
Best for
Patient tilt believers
Set-and-forget indexers
Lowest-cost indexers
07

The catch.

Read this
part twice

We're not here to sell you. A tilt is a decision to look different from the market — and looking different is the whole reason it can pay, and the whole reason it can hurt.

01

It can lag for years

Value underperformed growth for most of 2010–2020. A factor tilt can trail a plain index for a decade before the premium shows up. If you'll panic-sell after three bad years, the tilt will hurt you, not help you.

02

You pay a little more

0.28% vs VEQT's 0.24%. Small, but real. You're paying for active implementation — daily screening on price and profitability — not just index replication.

03

Tracking error is the price

CAGE will sometimes visibly trail the index your friends own. That difference — tracking error — is not a bug. It's the cost of admission to a premium that only exists because most people won't tolerate it.

08

So, is it for you?

The honest
answer
CAGE makes sense if you…
  • Can answer “why this, not VEQT?” in one sentence — and now you can.
  • Have a 10-year-plus horizon and won't flinch when the tilt lags.
  • Believe decades of evidence beat the crowd's latest favourite.
  • Want a tilt built in, not a five-fund spreadsheet.
Stick with VEQT/XEQT if you…
  • Will compare your return to a friend's index fund every quarter.
  • Want the cheapest possible all-in-one and nothing more.
  • Don't have conviction in factor premia — and that's fine.
  • Would sell the moment CAGE trails for a couple of years.

Market-cap says “trust the crowd.”
CAGE says “trust the math.”