Is it better to invest in VTI or VOO?
Pros and cons of Investing in VTI and VOO
Or, you could also invest in both, for example, by putting half in VOO and half in VTI. Here's a summary of which one to choose: If you want to own only the biggest and safest stocks, choose VOO. If you want more diversification and exposure to mid-caps and small-caps, choose VTI.
Generally, ETFs will have a slight edge from a tax efficiency perspective. 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 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.
Vanguard S&P 500 ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VOO is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market.
Average Return
In the past year, VOO returned a total of 22.33%, which is slightly higher than VTI's 21.96% return. Over the past 10 years, VOO has had annualized average returns of 12.37% , compared to 11.76% for VTI. These numbers are adjusted for stock splits and include dividends.
Since its inception over 20 years ago in 2001, VTI has returned 8.1% on an annualized basis, making this fund a consistent long-term performer.
Dividend Yield
VTI and VOO offer almost the same dividend yields—1.42% and 1.45% respectively as of July 31, 2023. Expressed as a percentage, dividend yield tells an investor how much they will earn in dividends each year for every $1 they invest in an ETF.
VTI - Performance Comparison. In the year-to-date period, VOO achieves a 5.41% return, which is significantly higher than VTI's 4.56% return. Over the past 10 years, VOO has outperformed VTI with an annualized return of 12.41%, while VTI has yielded a comparatively lower 11.76% annualized return.
Investing in the S&P 500 index fund, such as VOO, is a winning long-term strategy. Historical data shows that the market has consistently gone higher despite obstacles and downturns.
Should I own both VOO and VTI?
Investor Preferences: VOO is ideal for those seeking alignment with the performance of large-cap companies in the S&P 500, while VTI suits investors looking for more comprehensive market exposure, including smaller companies with potential for growth.
A classic diversified portfolio consists of a mix of approximately 60% stocks and 40% bonds. A more conservative portfolio would reverse those percentages. Investors may also consider diversifying by including other asset classes, such as futures, real estate or forex investments.
The diversification ratio of a long-only portfolio is equal to 1 when the portfolio is a single-asset portfolio. The diversification ratio of a long-only portfolio is equal to n when the portfolio is an equal-weighted portfolio of n uncorrelated assets with identical volatility.
Currently there's no upside potential for VTI, based on the analysts' average price target. Is VTI a Buy, Sell or Hold? VTI has a conensus rating of Moderate Buy which is based on 2347 buy ratings, 1236 hold ratings and 85 sell ratings.
You expose your portfolio to much higher risk with sector ETFs, so you should use them sparingly, but investing 5% to 10% of your total portfolio assets may be appropriate. If you want to be highly conservative, don't use these at all.
First, VOO has a clear advantage in terms of expense ratio. VOO's expense ratio is 0.03% compared to 0.20% of QQQ, which is more than three times cheaper. Next is diversification. While both ETFs are well diversified, VOO is less concentrated in both industry and top 10 holdings.
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- UTI S&P BSE Sensex ETF. ₹ 781.
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- HDFC Nifty50 Value 20 ETF. ₹ 123.2.
| Symbol | Name | 5-Year Return |
|---|---|---|
| VGT | Vanguard Information Technology ETF | 20.01% |
| IETC | iShares U.S. Tech Independence Focused ETF | 19.70% |
| XNTK | SPDR NYSE Technology ETF | 19.28% |
| AIRR | First Trust RBA American Industrial Renaissance ETF | 19.09% |
In the last 30 Years, the Vanguard Total Stock Market (VTI) ETF obtained a 10.49% compound annual return, with a 15.52% standard deviation.
According to the latest long-term forecast, Vanguard Total Fund VTI price will hit $250 by the middle of 2024 and then $300 by the middle of 2025. Vanguard Total Fund VTI will rise to $350 within the year of 2027, $400 in 2028, $450 in 2029, $500 in 2030 and $600 in 2033.
Is VTI good for Roth IRA?
Roth IRAs allow you to avoid paying taxes on investment returns by investing after-tax income now. VTI and SPAB are good options for your starting stock and bond funds, and are likely to be representative of the kinds of funds offered by Edward Jones.
VTI Dividend Information
VTI has a dividend yield of 1.40% and paid $3.54 per share in the past year. The dividend is paid every three months and the last ex-dividend date was Mar 22, 2024.
VOO's analyst rating consensus is a Moderate Buy. This is based on the ratings of 505 Wall Streets Analysts.
| Symbol | Name | Dividend Yield |
|---|---|---|
| CONY | YieldMax COIN Option Income Strategy ETF | 56.65% |
| TILL | Teucrium Agricultural Strategy No K-1 ETF | 55.16% |
| NVD | GraniteShares 2x Short NVDA Daily ETF | 53.09% |
| KMET | KraneShares Electrification Metals Strategy ETF | 52.58% |
iShares Core Aggressive Allocation ETF (AOA)
"We also generally stick to U.S. equity, international equity and fixed income." A great example of an ETF that meets Grossman's suggestions for broad diversification across global stocks and bonds is AOA. This ETF uses a split of 80% in stocks and 20% in bonds.
