VOO vs. VTI: Unraveling the Distinctions Between Two Top Vanguard ETFs (2024)

FAQs

VOO vs. VTI: Unraveling the Distinctions Between Two Top Vanguard ETFs? ›

VTI is a total U.S. market fund and holds more than 3,500 stocks. VTI is better diversified and benefits from small and mid-cap stocks that grow into large caps. VOO is less diversified, tracking the performance of the S&P 500 Index. VOO excludes small and mid-cap stocks.

Vanguard's Total Stock Market ETF (VTI) is similar to VOO in many ways, but the main difference is that it holds a much broader range of stocks. It follows the CRSP U.S. Total Market Index, which includes all the stocks in the S&P 500 plus over 3,000 additional stocks. This represents the entire U.S. stock market.

VTI: Offers broader diversification by including mid-cap and small-cap stocks in addition to large-cap stocks. This can provide exposure to a wider range of sectors and market segments. VOO: Concentrates on large-cap stocks, particularly those in the S&P 500.

VTI has an advantage with an expense ratio of 0.03% compared to 0.09% of SPY. Another key difference is the performance in annual returns and dividend yield. SPY has a clear advantage in annual returns; it has outperformed VTI by an average of 1% in 8 of the last ten years.

ETFs tend to distribute comparatively fewer capital gains to shareholders – these same gains are simply more challenging to manage efficiently from a mutual fund. Overall, VOO and VTI are considered to have the same level of tax efficiency.

VTI - Dividend Comparison. VOO's dividend yield for the trailing twelve months is around 1.33%, less than VTI's 1.36% yield.

VTI is an extremely diversified fund. Its large amount of holdings reflect the entire universe of investable U.S. securities. The fund has exposure to small-cap stocks which can be more volatile than mid- or large-cap holdings. The fund has a beta of 1.0 when compared to the larger market.

VOO has a consensus rating of Moderate Buy which is based on 403 buy ratings, 96 hold ratings and 5 sell ratings. What is VOO's price target? The average price target for VOO is $549.02. This is based on 504 Wall Streets Analysts 12-month price targets, issued in the past 3 months.

Which Vanguard fund is most aggressive? ›

Best Vanguard Funds for Aggressive Investors: Vanguard Explorer (VEXPX) Click to Enlarge If you want to turn up the growth potential and you want to go all-the-way aggressive, look no further than Vanguard Explorer (MUTF:VEXPX).

Top performing investment funds owned by Vanguard worldwide 2024, by one-year return. As of May 2024, the Vanguard Communication Services Index Fund provided the highest one-year return rate. The Vanguard Mega Cap Growth Index ranked second having a one-year return rate of 37.4 percent.

VTI vs VTSAX: Who Should Invest

Investors who prefer to trade during the day to take advantage of price fluctuations may prefer an ETF like VTI, whereas a more passive buy-and-hold investor may prefer a mutual fund like VTSAX.

Vanguard S&P offers a lower expense ratio (0.035%) than SPY (0.095%), which means lower costs for investors and potentially higher net returns over the long term. VOO might be the more economical choice for cost-conscious investors, especially those investing large sums or planning for long-term goals like retirement.

Vanguard S&P 500 ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VOO is an outstanding option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market.

Vanguard Total Stock Market ETF VTI offers cost-efficient, well-diversified exposure to the entire US stock market—a recipe for success over the long run. The fund tracks the CRSP US Total Market Index, which represents approximately 100% of the investable US opportunity set.

VOO has a dividend yield of 1.34% and paid $6.41 per share in the past year. The dividend is paid every three months and the last ex-dividend date was Mar 22, 2024.