2 No-Brainer Vanguard ETFs to Buy With $1,000 Right Now
Investing doesn't have to involve hours of research, reading company financial statements, or being glued to finance shows. In some situations, doing those things can be beneficial, but it's far from needed for the average investor.
One way to simplify investing while still being in a position to receive great value is by using exchange-traded funds (ETFs). ETFs allow you to invest in multiple companies at once, instantly diversifying your portfolio and reducing risk.
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If you have $1,000 available to invest (or any amount, really), the following two Vanguard ETFs are great options. One gives you exposure to the U.S. economy, and the other gives you exposure to international companies.
1. Vanguard S&P 500 ETF
The S&P 500 (SNPINDEX: ^GSPC) is an index that tracks the largest 500 American companies on the market. Although there are over 30 million American businesses, these companies account for a lot of the country's economic output, so the S&P 500 is seen as a relatively fair representation of the U.S. economy.
Investing in the Vanguard S&P 500 ETF (NYSEMKT: VOO) is essentially betting on the long-term growth of the U.S. economy. Nobody can predict the future, but that's historically been one of the better bets any investor could make. The S&P 500 has averaged around 10% annual returns over the long run, which is enough to build a sufficient nest egg over time.
Data by YCharts.
The rate of return isn't guaranteed. As the saying goes, past performance is no guarantee of future success. However, if this index does match its past performance, investing $500 monthly in this ETF and averaging 10% annual returns for 20 years will generate over $340,000 in returns from $120,000 in investments over that time. And that's after taking into account the ETF's 0.03% expense ratio.
Famed investor Warren Buffett once said, "For most people, the best thing to do is to own the S&P 500 index fund." If you're wondering why, it's because some of the world's best companies are top holdings in the fund. Here are this ETF's top 10 holdings (accounting for about 34% of the fund):
Rank/Stock % Share of ETF Rank/Stock % Share of ETF
1. Apple 6.75% 6. Berkshire Hathaway (Class B) 2.07%
2. Microsoft 6.22% 7. Alphabet (Class A) 1.96%
3. Nvidia 5.64% 8. Broadcom 1.91%
4. Amazon 3.68% 9. Tesla 1.67%
5. Meta Platforms 2.54% 10. Alphabet (Class C) 1.61%
Data source: Vanguard. Percentages as of April 30, 2025.
The top holdings (and S&P 500 in general) will shift as companies reach different market caps, but many of these companies have been staples in the S&P 500 for a while and will likely continue to be for the foreseeable future.
2. Vanguard Total International Stock ETF
While betting on the U.S. economy makes a lot of sense, it's never a bad idea to have diversification in your portfolio. The Vanguard Total International Stock ETF (NASDAQ: VXUS) provides that, exposing investors to over 8,500 companies in both developed and emerging markets.
Developed markets are generally more stable (mature economies, good infrastructure, etc.), but the upside can be limited compared to faster-growing economies. Emerging markets generally come with more risks (currency devaluation, political instability, etc.), but the upside is high as the economy develops and grows.
Investing in companies in both markets is a good balance of stability and growth. Here is how the ETF is broken down by region:
Region Percentage of the ETF
Europe 40.3%
Emerging markets 26.4%
Pacific 25.3%
North America 7.5%
Middle East 0.5%
Data source: Vanguard. Percentages as of April 30.
Although this ETF has historically underperformed the S&P 500, it can be a great hedge during times when the U.S. economy is facing trouble and uncertainty (like now). For context, consider this ETF's 15% gains in 2025 through June 6, compared to the S&P 500's 2%.
Even if this ETF's recent momentum slows, investors can rely on its above-average dividend yield. Its current yield is around 2.9%, which is in line with its average for the past decade.
Data by YCharts.
I wouldn't have a large amount of my portfolio in international stocks, but a small percentage is worth having. I keep around 10% of my stock portfolio in international stocks, so if I were investing $1,000 into these two ETFs, I'd dedicate $100 to this one specifically.
Should you invest $1,000 in Vanguard S&P 500 ETF right now?
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Stefon Walters has positions in Apple, Microsoft, Vanguard S&P 500 ETF, and Vanguard Total International Stock ETF. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Berkshire Hathaway, Meta Platforms, Microsoft, Nvidia, Tesla, Vanguard S&P 500 ETF, and Vanguard Total International Stock ETF. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
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