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Yahoo
16 hours ago
- Business
- Yahoo
5 Vanguard ETFs to Buy With $1,000 and Hold Forever
The Vanguard S&P 500 ETF is a great core holding, while the Value ETF is also a solid option. The Vanguard Growth ETF and Information Technology ETF are great options for growth investors. The Vanguard International High Dividend Yield ETF is worth consideration for overseas exposure. 10 stocks we like better than Vanguard S&P 500 ETF › Investing in exchange-traded funds (ETFs) is a great way for both new and experienced investors to gain market exposure, and Vanguard is one of the best places to begin, given that the investment firm is known as the low-cost leader. A $1,000 investment is a good starting point, although one key to building wealth is to consistently add to your investments over time through a dollar-cost averaging strategy. Among the variety of ETFs that Vanguard offers, there's something to fit nearly every investment style and strategy. Let's look at five Vanguard ETFs you can buy right now. The most popular of its ETFs, the Vanguard S&P 500 ETF (NYSEMKT: VOO), is a solid core holding. It tracks the S&P 500, which consists of 500 of the largest companies in the U.S. and is considered the benchmark for the U.S. stock market. The index is market-cap weighted, meaning that larger companies represent proportionally greater percentages of the index than smaller companies. The ETF has been a strong performer over the years with an average annualized return of 15.9% over the past five years and 12.8% over the past 10 years, as of the end of May. Growth stocks have delivered the largest share of the market's gains over the past decade, so it's quite reasonable that investors may want more exposure to these types of stocks. One of the best Vanguard funds on this front is the Vanguard Growth ETF (NYSEMKT: VUG). The fund tracks the CRSP US Large Cap Growth Index, which is essentially the growth side of the S&P 500. It currently includes 166 stocks, though growth stocks dominate the list of the largest companies in the world at this point. The ETF has nicely outperformed the S&P 500 in recent years. It's produced an average annualized return of 17.1% over the past five years and 15.3% over the past 10 years. The best-performing Vanguard ETF over the past decade was the Vanguard Information Technology ETF (NYSEMKT: VGT). It aims to replicate the performance of the MSCI US Investable Market Information Technology 25/50 index, which only includes technology stocks. Given the strengths that the technology sector has shown over the years and the opportunities ahead with artificial intelligence (AI), I think technology is the one sector that investors should overweight in their portfolios. Notably, this ETF is very top-heavy. Its top three holdings -- Nvidia, Microsoft, and Apple -- represent about 45% of the portfolio. As such, I would suggest using the ETF more as a supplement to your portfolio rather than making it a primary holding. That said, its performance cannot be overlooked. The ETF has had an annualized average return of 19.2% over the past five years and 19.8% over the past 10 years. Growth stocks have long been in favor with the market, but returns on Wall Street tend to be streaky. There were long stretches in the past when value stocks outperformed growth. For investors who anticipate the trends shifting back toward value stocks, the Vanguard Mega Cap Value ETF (NYSEMKT: MGV) is a solid option. The ETF tracks the investment performance of the CRSP US Mega Cap Value Index, which, as the name implies, invests in very large value stocks. Financial stocks make up more than a quarter of its holdings, while healthcare accounts for over 16%. Its top positions include stocks like Berkshire Hathaway, JP Morgan, and Bank of America in the financial sector, popular retailers like Walmart and Home Depot, energy giant ExxonMobil, and a slew of healthcare companies like UnitedHealth, Johnson & Johnson, and AbbVie. While the ETF's performance has trailed that of the S&P 500, it has delivered solid gains. It recorded an average annualized return of 13.9% over the past five years and 10.3% over the last ten. Vanguard's best-performing ETFs so far this year have actually been the ones that track international markets. And among its international ETFs, the Vanguard International High Dividend Yield ETF (NASDAQ: VYMI) has had the best track record. It's up nearly 18% year to date (as of June 23), and has had an average annualized return of 14.7% over the past five years. The ETF tracks the FTSE All-World ex US High Dividend Yield Index, which invests in non-U.S. companies that are forecast to have above-average dividend yields. Over 40% of its portfolio is in European stocks, more than a quarter is in Asia-Pacific stocks, and over 20% is in emerging market stocks. I would still invest the bulk of my portfolio in U.S.-based companies, but this ETF is a nice way to diversify into international markets. Before you buy stock in Vanguard S&P 500 ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard S&P 500 ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $687,731!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $945,846!* Now, it's worth noting Stock Advisor's total average return is 818% — a market-crushing outperformance compared to 175% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 23, 2025 Bank of America is an advertising partner of Motley Fool Money. JPMorgan Chase is an advertising partner of Motley Fool Money. Geoffrey Seiler has positions in Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends AbbVie, Bank of America, Berkshire Hathaway, Home Depot, JPMorgan Chase, Vanguard Index Funds-Vanguard Growth ETF, Vanguard S&P 500 ETF, and Walmart. The Motley Fool recommends Johnson & Johnson and UnitedHealth Group. The Motley Fool has a disclosure policy. 5 Vanguard ETFs to Buy With $1,000 and Hold Forever was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
3 days ago
- Business
- Yahoo
Markets Unfazed by Geopolitical Tensions: ETFs to Consider
U.S. involvement in the Israel-Iran conflict was expected to be a major geopolitical turning point. On the contrary, following U.S. strikes on Iranian nuclear facilities, investors and markets have remained largely composed, whereas normally, such events would trigger a rush into safe-haven assets. Markets have reacted far less aggressively to the U.S. strikes, especially when compared to Israel's strikes on Iran just over a week ago. Even though the latest development in the conflict is significant, industry experts agree that they do not pose a systemic threat to global markets. According to Dan Ives, managing director at Wedbush, the escalating conflict in the Middle East is expected to be isolated to the region, while making the region more stable as the nuclear threat is neutralized, as quoted on CNBC. According to strategists at Morgan Stanley, as quoted on Yahoo Finance, market selloffs triggered by geopolitical events tend to be short-lived. Per Morgan Stanley, past geopolitical risk events have triggered short-term volatility in equities, but historically, the S&P 500 has posted average gains of 2% after one month, 3% after three months and 9% after a year following such events. In response to U.S. strikes, Iran has limited options, one of which includes the potential closure of the Strait of Hormuz. According to Iranian state media, as quoted on CNBC, Iran's parliament approved the closure of the Strait of Hormuz. This would not be an ideal scenario for the global economy as oil prices would rise sharply and drive broader inflation. However, this remains highly unlikely. According to CNBC, the threat to shut down the Strait of Hormuz has been a recurring element of Iran's rhetoric, but it has never been carried out, with experts saying it remains an unlikely scenario. Investors can consider increasing their exposure to funds tracking major indexes like the S&P 500, providing them with the growth potential of the market, as well as diversifying their portfolio. According to Morgan Stanley strategists, a weaker dollar and improving earnings growth are supporting U.S. markets, as quoted on Yahoo Finance. In such an economic environment, investors should keep a long-term investment horizon and look past short-term market fluctuations. Investors can consider Vanguard S&P 500 ETF VOO, SPDR S&P 500 ETF Trust SPY, iShares Core S&P 500 ETF IVV, SPDR Portfolio S&P 500 ETF SPLG and Invesco S&P 500 Equal Weight ETF RSP. VOO, SPY and IVV are among the largest funds in the United States, with VOO having the largest asset base of $681.56 billion, followed by SPY and IVV, with an asset base of $604.78 billion and $574.05 billion, respectively. Both VOO and IVV are the cheapest options and more suitable for long-term investing, charging 0.03%, and sporting a Zacks ETF Rank #1 (Strong Buy). With a one-month average trading volume of about 73.88 million shares, SPY is the most liquid option, offering investors easier entry and exit while minimizing the risk of significant price fluctuations, ideal for active trading strategies. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SPDR S&P 500 ETF (SPY): ETF Research Reports Vanguard S&P 500 ETF (VOO): ETF Research Reports Invesco S&P 500 Equal Weight ETF (RSP): ETF Research Reports iShares Core S&P 500 ETF (IVV): ETF Research Reports SPDR Portfolio S&P 500 ETF (SPLG): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNBC
5 days ago
- Business
- CNBC
Tech stocks, including Apple, were safety trade during Covid, but this market is different
Tech stocks have acted like a stock market safe haven at various times in recent years when volatility went up, such as during the Covid pandemic. But a recent slide in the tech stock often considered to be the safest of all, Apple, has raised questions about that role for the market's leading sector. As of last week, Apple was a notable underperformer, down -0.6% over the past two months (approximately 40 trading sessions), according to CNBC research. But that doesn't mean tech hasn't bounced back strongly from the early 2025 tariff-triggered selloff. The SPDR Info Tech Sector Fund (XLK) is up 25% over that period, while the Invesco Nasdaq Trust (QQQ) has produced a similar rally. It's Apple that's no longer acting like the stock that in recent years had seemed to function as the equities market's closest thing to a bond. The recent gap is Apple's worst relative performance to its own sector fund since December 2002, according to CNBC research. It's the only of the so-called "Magnificent 7" tech stocks to recently trade below both its 50- and 200-day moving averages. How are investors playing tech in an up-and-down year for the market? Buying the broad stock market on the dips has worked, and is an inherent bet on tech. Investors have a hefty weighting to tech in S&P 500 index funds and ETFs this year, where the top tech stocks represent over 30% of the index. Amid the recent tariff volatility, the Vanguard S&P 500 ETF (VOO) has bested all other funds in new flows from investors, and in fact, it's on pace to break the record for annual net inflows, a mark it just set last year. It's currently sitting at $82 billion in net inflows in 2025, more than four times as much as the next biggest haul for equity ETFs, the Vanguard Total Stock Market Fund (VTI). Both the Invesco Nasdaq 100 ETF (QQQM) and the Invesco QQQ Trust make the top 10 among all ETFs, with roughly $9 billion and $8 billion in inflows, respectively. The Vanguard Information Technology ETF (VGT) has taken in close to $3 billion. VettaFi director of research Todd Rosenbluth said the broadest bets on a resilient U.S. stock market are also the biggest bets on tech. "I think many people are having tech and AI as part of a broader portfolio, as opposed to leaning in solely onto the technology sector," he said on a recent CNBC "ETF Edge." And he added that investors are for the most part using traditional approaches to hedging stock market risk, with strong interest in fixed income ETFs, especially the shortest-term bonds and notes where they can "earn some income, and not take on much risk," he said. Rosenbluth said it is true that during Covid the tech sector had been seen as a relative safe haven for investors. But in 2020, there was also the sudden surge in reliance on technology for those who were working or attending school remotely, leading to a unique tech sector boom. The tech sector went through a significant downturn in 2022, but it has remained a fairly reliable grower, he said, with the emergence of AI and rise of the chip sector led by Nvidia. "Large-cap tech is a relative safe haven, but we're seeing investors want the benefit of diversification with more traditional defensive sectors," Rosenbluth said. That includes utilities and consumer staples, which have both outperformed the S&P 500 this year, though not by nearly as sizable a margin as tech has. For others who follow tech stocks, any market volatility remains a buying opportunity. Wedbush Securities global head of technology research Dan Ives said on "ETF Edge" that times of geopolitical strife are no different. And he said concerns about the valuation of the sector compared to other sectors have cost investors if that kept them out of tech stocks in recent years. "My view of tech, if you focus just on valuation, you missed every transformational tech stock of the last 20 years. And I believe the market is still massively underestimating what the growth is going to look like for the AI revolution" said Ives, whose firm recently launched an AI ETF branded with his name. "That's why any type of geopolitical events, we always view as opportunities to own these names cheaper, that's kind of always been our view the last 25 years we have covered tech." One investor approach of note this year is certain, Rosenbluth said, regardless of how any single investor approaches tech stocks. "In 2025, investors are getting used to a more volatile time period than they were even a month, or three months ago, more accepting of volatility," he said. Disclaimer
Yahoo
6 days ago
- Business
- Yahoo
If I Could Invest $1,000 In Any Vanguard ETF, It Would Undoubtedly Be This One
Investing in the S&P 500 offers instant diversification, exposure to blue chip stocks, and proven historical results. The Vanguard S&P 500 ETF is one of the cheapest exchange-traded funds on the stock market. They're not directly correlated, but the S&P 500's performance is used as a broad gauge of the U.S. economy. 10 stocks we like better than Vanguard S&P 500 ETF › One of the biggest misconceptions about investing is the amount of effort and time required to do it successfully. In some cases, it pays to dedicate a lot of time and energy to selecting the right stocks. However, for most people, this isn't necessary, and good returns can be accomplished via exchange-traded funds (ETFs). Investing in ETFs allows investors to achieve instant diversification in many cases, removes much of the guesswork from investing, and reduces the risk associated with investing in individual stocks. No need to listen to earnings calls, read financial statements, or tune into every headline. Simply invest in the ETF and let multiple companies do the work. There are thousands of ETFs on the stock market, but there's one ETF in particular that I'd invest $1,000 (or any amount) in without thinking twice: The Vanguard S&P 500 ETF (NYSEMKT: VOO). The Vanguard S&P 500 ETF mirrors the S&P 500 (SNPINDEX: ^GSPC) index, which tracks the 500 largest American companies on the stock market. The S&P 500 and the U.S. economy aren't directly tied, but the size and importance of these companies to the U.S. economy make the S&P 500 a broad representation of that economy. According to S&P Global, S&P 500 companies accounted for around 80% of the available U.S. market cap. There are multiple S&P 500 ETFs to choose from, but I prefer the Vanguard ETF because of its low 0.03% expense ratio. For perspective, the more popular SPDR S&P 500 ETF Trust has an expense ratio that's more than three times higher, at 0.0945%. The difference may seem small, but it could easily add up to hundreds or thousands of dollars over time. Combine that low cost with instant diversification and exposure to some of the world's top blue chip stocks, and it's a trifecta worth having in your portfolio. This ETF is weighted by market cap, so larger companies account for more of it than smaller companies. As a result, mega-cap tech stocks ($200 billion or more) and the information technology (tech) sector as a whole make up a larger portion of the ETF than they did in previous years. This concentration has reduced some of the ETF's diversification, but it still manages to cover ground in all 11 major sectors: Information Technology: 31.7% of the ETF Financials: 14.2% Consumer Discretionary: 10.7% Health Care: 9.6% Communication Services: 9.6% Industrials: 8.7% Consumer Staples: 5.9% Energy: 3% Utilities: 2.5% Real Estate: 2.1% Materials: 2% The tech sector has easily been the best-performing over the past decade, so it has worked out in investors' favor. Still, it's something to keep an eye on as you potentially invest in other stocks or ETFs, because you don't want to become too reliant on the tech sector's success. If we assume (with the emphasis on "assume") that this ETF continues to average 12% annual returns, here's how much a one-time $1,000 investment could grow to in different years. Years Investment Value 15 $5,400 20 $9,500 25 $16,880 30 $29,700 35 $52,300 Table by author. Values rounded down to the nearest hundred and taking into account the ETF's expense ratio. Ideally, you'd continue to make investments in the ETF to help compound your returns. Again, assuming 12% annual returns, here's how much your investment could grow to with a one-time $1,000 investment and monthly $100 investments. Years Investment Value 15 $50,000 20 $95,700 25 $176,100 30 $317,600 35 $566,600 Table by author. Values rounded down to the nearest hundred and taking into account the ETF's expense ratio. It's never wise to use past performance to predict future performance, but this shows how this ETF (and the S&P 500 in general) has historically been a great way for the average investor to build wealth over time. It's one investment that can be the staple of many people's portfolios. Before you buy stock in Vanguard S&P 500 ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard S&P 500 ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $664,089!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $881,731!* Now, it's worth noting Stock Advisor's total average return is 994% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Stefon Walters has positions in Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends S&P Global and Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy. If I Could Invest $1,000 In Any Vanguard ETF, It Would Undoubtedly Be This One was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
7 days ago
- Business
- Yahoo
Warren Buffett's Top Recommendation for Investors Could Turn $500 Per Month Into $100,000 in 10 Years.
Buffett shares a lot of investment advice in his shareholder letters and annual meetings. He recommends one investment for most people, including the executor of his estate. If you consistently add to your portfolio, you could have six figures within a decade of starting. 10 stocks we like better than Vanguard S&P 500 ETF › Warren Buffett is happy to share investment advice with anyone who's interested. His annual letters to shareholders and extended question-and-answer sessions at Berkshire Hathaway's annual meetings are incomparable sources of wisdom. Buffett has been a great guide for countless successful investors who like to pick great companies, not just great stocks. But the Oracle of Omaha's top recommendation for most investors is to ignore a lot of that and keep things as simple as possible. That's because it's often the behavioral challenges of investing in individual companies that trip up those who would otherwise be successful. Buying or selling a great company at the wrong price at the wrong time is a path to underperformance. Here's what Buffett recommends instead. One of the easiest ways for investors to avoid the behavioral tripwires that can lead to lagging the stock market is to stop trying to outperform the market average in the first place. That's why Buffett's top recommendation for average investors is to put money in an index fund. He prefers the Vanguard S&P 500 ETF (NYSEMKT: VOO). Buffett plans to take his own advice, too. He instructed the executor of his estate to put 90% of his wealth in the index fund after his passing. If you consistently put aside $500 of your paycheck every month, you could be sitting on a six-figure portfolio 10 years from now, even if you're starting from nothing. Buffett doesn't think dollar-cost averaging is for active stock pickers. While he doesn't try to time the market, he does try to value companies. Buying a company's stock without regard for its value (as dictated by a dollar-cost averaging strategy) won't lead to the outperformance stock pickers seek. But when it comes to passive investing, the best way to get the most out of your money is to put all your money into the fund and consistently add to it over time with money from your earnings. Earning average returns for a long time can produce above-average wealth. The S&P 500 expanded to a 500-constituent format in March of 1957. Since then, the broad-based index has gone on to produce a compound average annual total return of 10.5%. That return is achieved by reinvesting dividends, which most brokerages allow you to do automatically. If you set up a brokerage account and automatically purchase $500 of the Vanguard S&P 500 ETF every month while reinvesting dividends, here's what you can expect if you earn average returns from the last 70 years. Years Investing Expected Value of Portfolio 1 $6,335 2 $13,335 3 $21,068 4 $29,611 5 $39,050 6 $49,477 7 $60,998 8 $73,726 9 $87,788 10 $103,324 Calculations by author. It's worth pointing out that $500 per month, or $6,000 per year, is less than the annual contribution limit for an IRA. That will ensure you keep your investments tax-deferred or even tax-free. While the Vanguard S&P 500 ETF doesn't have a history of capital gains distributions, investors still have to pay taxes on its income distributions from dividends. Those usually incur a 15% qualified dividend tax, so there's a slight tax drag. But even if you set aside 15% of each dividend distribution, you could end up with a portfolio value north of $100,000 based on average returns. If you contribute the $500 per month to an employer-sponsored retirement plan, you could end up with well over $100,000. That's because most plans include a matching contribution. While you might not have the Vanguard fund available in your plan, most include some low-cost index funds. Even with relatively high fees, that can be the easiest way to build a sizable portfolio for retirement. Charlie Munger, Warren Buffett's Vice Chairman and longtime friend, once told a young investor that the first $100,000 is the hardest. (He used more colorful language.) Once you have $100,000, you can let off the gas a bit because the returns from the portfolio will start to do some of the work for you. Indeed, if all you did was invest $500 per month for 10 years like above and let it sit for another 10 years, you'd have close to $280,000 without adding another penny. Wait 15 more years, and you'll have around $1.25 million. That's the true power of compounding, and it doesn't take any special skills or market timing knowledge to get there. Before you buy stock in Vanguard S&P 500 ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard S&P 500 ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $659,171!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $891,722!* Now, it's worth noting Stock Advisor's total average return is 995% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Adam Levy has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway and Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy. Warren Buffett's Top Recommendation for Investors Could Turn $500 Per Month Into $100,000 in 10 Years. was originally published by The Motley Fool Sign in to access your portfolio
