Latest news with #VanguardValueETF
Yahoo
09-08-2025
- Business
- Yahoo
Is the Vanguard Value ETF the Simplest Way to Consistently Collect More Passive Income Than the S&P 500?
Key Points The Vanguard Value ETF has a much lower valuation than the Vanguard S&P 500 ETF. The Value ETF is a wealth compounder first and a passive income tool second. The ETF can be an effective tool for investors who don't want to amplify their exposure to mega-cap growth stocks. 10 stocks we like better than Vanguard Index Funds - Vanguard Value ETF › The S&P 500 (SNPINDEX: ^GSPC) has historically been a fantastic way to compound wealth -- generating annualized total returns of 9% to 10%. The proliferation of low-cost index funds and exchange-traded funds (ETFs) has made it easier than ever to invest in the S&P 500 without racking up high fees. The Vanguard S&P 500 ETF (NYSEMKT: VOO) -- one of the largest S&P 500 index funds by net assets -- has an expense ratio of just 0.03% -- or 3 cents for every $100 invested. When I first began investing, it was normal to see flat fees per stock trade of around $5 to $10. So fees and expense ratios are no longer a major drag on returns for investors who regularly pour their savings into equities. One issue with buying the S&P 500 is that it doesn't have a high yield. Today's top S&P 500 companies are growth stocks that have yields well below 1% or don't pay dividends at all -- a stark contrast to the days when the most valuable companies were oil and gas giants, industrials, or consumer staples behemoths with high yields. As a result, the yield of the S&P 500 has fallen to just 1.2%. What's more, the valuation of the S&P 500 has gotten more expensive as stock prices have outpaced earnings growth. Here's why investors looking to use passive income as a key way to achieve their financial goals may want to consider buying the Vanguard Value ETF (NYSEMKT: VTV) over the Vanguard S&P 500 ETF. A lower yield at a better valuation The Vanguard Value ETF sports an expense ratio of 0.04%, so it has just one cent more in annual fees per $100 invested than the Vanguard S&P 500 ETF. It also offers a full percentage point higher in 30-day SEC yield at 2.2% compared to 1.2% for the S&P 500 ETF. In addition to having a higher yield, the Value ETF sports a 19.6 price-to-earnings (P/E) ratio (as of June 30) and holds 335 stocks compared to a 27.2 P/E ratio (also as of June 30) and 505 holdings for the S&P 500 ETF. The Value ETF's higher yield and significantly lower valuation may appeal to investors looking to avoid paying a premium for the top stocks that are leading the S&P 500. A different cast of characters The Value ETF's higher yield and lower valuation result from its composition. Vanguard Value ETF Vanguard S&P 500 ETF Holding Rank Company Weighting Company Weighting 1 Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) 4% Nvidia (NASDAQ: NVDA) 7.3% 2 JPMorgan Chase (NYSE: JPM) 3.6% Microsoft (NASDAQ: MSFT) 7% 3 ExxonMobil (NYSE: XOM) 2.1% Apple (NASDAQ: AAPL) 5.8% 4 Walmart (NYSE: WMT) 2% Amazon (NASDAQ: AMZN) 3.9% 5 Procter & Gamble (NYSE: PG) 1.7% Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) 3.5% 6 Oracle (NYSE: ORCL) 1.7% Meta Platforms (NASDAQ: META) 3.1% 7 Johnson & Johnson (NYSE: JNJ) 1.7% Broadcom (NASDAQ: AVGO) 2.5% 8 Home Depot (NYSE: HD) 1.7% Berkshire Hathaway 1.7% 9 AbbVie (NYSE: ABBV) 1.5% Tesla (NASDAQ: TSLA) 1.7% 10 Bank of America (NYSE: BAC) 1.4% JPMorgan Chase 1.5% Total 23.1% Total 38% Data source: Vanguard. Aside from Berkshire Hathaway and JPMorgan Chase, there are no other companies that overlap the top 10 holdings in the Value ETF and S&P 500 ETF. You'll also notice that the S&P 500 is much more top-heavy -- meaning that just a handful of names can move the index. Whereas the Value ETF is more balanced and not as dominated by just 10 companies. Far more than a passive income vehicle Over the last decade, the Value ETF has gone up 111.5% and has a total return of 173.5%. Meaning that capital gains have made up a much higher percentage of the total return than dividend income. The investment thesis centers around the companies it holds rather than being all about yield, a stark contrast to ETFs that prioritize passive income over upside potential. The JP Morgan Nasdaq Equity Premium ETF (NASDAQ: JEPQ) sells covered call options on the Nasdaq-100 as a way to generate income -- which provides a sizable stream of monthly payouts while capping the upside potential of the Nasdaq-100 moving higher. The fund sports an 11.2% 30-day SEC yield (as of June 30), so it could be a great way for investors who are primarily focused on passive income. However, the Value ETF offers a way to get a higher yield than the S&P 500 without having any cap on upside potential. The Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) doesn't use call options to achieve its high 3.9% yield. But many of its holdings are arguably lesser quality companies than what you'll find in the Value ETF. The Vanguard Value ETF remains a top fund to buy now The Value ETF is a good buy if you already own many of the top growth stocks in the S&P 500 and are looking to diversify your portfolio into different companies and boost your passive income. It's also a good option for investors who want to participate in the broader market and collect more passive income than the S&P 500. While there are plenty of ETFs that offer higher yields than the Value ETF, I would argue that the quality of companies in the ETF makes it one of the best ways to consistently collect more passive income than the index. Should you buy stock in Vanguard Index Funds - Vanguard Value ETF right now? Before you buy stock in Vanguard Index Funds - Vanguard Value ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard Index Funds - Vanguard Value 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 $636,563!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,108,033!* Now, it's worth noting Stock Advisor's total average return is 1,047% — a market-crushing outperformance compared to 181% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025 Bank of America is an advertising partner of Motley Fool Money. JPMorgan Chase is an advertising partner of Motley Fool Money. Daniel Foelber has positions in Nvidia and Procter & Gamble. The Motley Fool has positions in and recommends AbbVie, Alphabet, Amazon, Apple, Berkshire Hathaway, Home Depot, JPMorgan Chase, Meta Platforms, Microsoft, Nvidia, Oracle, Tesla, Vanguard Index Funds-Vanguard Value ETF, Vanguard S&P 500 ETF, and Walmart. The Motley Fool recommends Broadcom and Johnson & Johnson 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. Is the Vanguard Value ETF the Simplest Way to Consistently Collect More Passive Income Than the S&P 500? 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
Globe and Mail
09-08-2025
- Business
- Globe and Mail
Is the Vanguard Value ETF the Simplest Way to Consistently Collect More Passive Income Than the S&P 500?
Key Points The Vanguard Value ETF has a much lower valuation than the Vanguard S&P 500 ETF. The Value ETF is a wealth compounder first and a passive income tool second. The ETF can be an effective tool for investors who don't want to amplify their exposure to mega-cap growth stocks. 10 stocks we like better than Vanguard Index Funds - Vanguard Value ETF › The S&P 500 (SNPINDEX: ^GSPC) has historically been a fantastic way to compound wealth -- generating annualized total returns of 9% to 10%. The proliferation of low-cost index funds and exchange-traded funds (ETFs) has made it easier than ever to invest in the S&P 500 without racking up high fees. The Vanguard S&P 500 ETF (NYSEMKT: VOO) -- one of the largest S&P 500 index funds by net assets -- has an expense ratio of just 0.03% -- or 3 cents for every $100 invested. When I first began investing, it was normal to see flat fees per stock trade of around $5 to $10. So fees and expense ratios are no longer a major drag on returns for investors who regularly pour their savings into equities. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More » One issue with buying the S&P 500 is that it doesn't have a high yield. Today's top S&P 500 companies are growth stocks that have yields well below 1% or don't pay dividends at all -- a stark contrast to the days when the most valuable companies were oil and gas giants, industrials, or consumer staples behemoths with high yields. As a result, the yield of the S&P 500 has fallen to just 1.2%. What's more, the valuation of the S&P 500 has gotten more expensive as stock prices have outpaced earnings growth. Here's why investors looking to use passive income as a key way to achieve their financial goals may want to consider buying the Vanguard Value ETF (NYSEMKT: VTV) over the Vanguard S&P 500 ETF. A lower yield at a better valuation The Vanguard Value ETF sports an expense ratio of 0.04%, so it has just one cent more in annual fees per $100 invested than the Vanguard S&P 500 ETF. It also offers a full percentage point higher in 30-day SEC yield at 2.2% compared to 1.2% for the S&P 500 ETF. In addition to having a higher yield, the Value ETF sports a 19.6 price-to-earnings (P/E) ratio (as of June 30) and holds 335 stocks compared to a 27.2 P/E ratio (also as of June 30) and 505 holdings for the S&P 500 ETF. The Value ETF's higher yield and significantly lower valuation may appeal to investors looking to avoid paying a premium for the top stocks that are leading the S&P 500. A different cast of characters The Value ETF's higher yield and lower valuation result from its composition. Data source: Vanguard. Aside from Berkshire Hathaway and JPMorgan Chase, there are no other companies that overlap the top 10 holdings in the Value ETF and S&P 500 ETF. You'll also notice that the S&P 500 is much more top-heavy -- meaning that just a handful of names can move the index. Whereas the Value ETF is more balanced and not as dominated by just 10 companies. Far more than a passive income vehicle Over the last decade, the Value ETF has gone up 111.5% and has a total return of 173.5%. Meaning that capital gains have made up a much higher percentage of the total return than dividend income. The investment thesis centers around the companies it holds rather than being all about yield, a stark contrast to ETFs that prioritize passive income over upside potential. The JP Morgan Nasdaq Equity Premium ETF (NASDAQ: JEPQ) sells covered call options on the Nasdaq-100 as a way to generate income -- which provides a sizable stream of monthly payouts while capping the upside potential of the Nasdaq-100 moving higher. The fund sports an 11.2% 30-day SEC yield (as of June 30), so it could be a great way for investors who are primarily focused on passive income. However, the Value ETF offers a way to get a higher yield than the S&P 500 without having any cap on upside potential. The Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) doesn't use call options to achieve its high 3.9% yield. But many of its holdings are arguably lesser quality companies than what you'll find in the Value ETF. The Vanguard Value ETF remains a top fund to buy now The Value ETF is a good buy if you already own many of the top growth stocks in the S&P 500 and are looking to diversify your portfolio into different companies and boost your passive income. It's also a good option for investors who want to participate in the broader market and collect more passive income than the S&P 500. While there are plenty of ETFs that offer higher yields than the Value ETF, I would argue that the quality of companies in the ETF makes it one of the best ways to consistently collect more passive income than the index. Should you invest $1,000 in Vanguard Index Funds - Vanguard Value ETF right now? Before you buy stock in Vanguard Index Funds - Vanguard Value ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard Index Funds - Vanguard Value 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 $636,563!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,108,033!* Now, it's worth noting Stock Advisor's total average return is 1,047% — a market-crushing outperformance compared to 181% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025 Bank of America is an advertising partner of Motley Fool Money. JPMorgan Chase is an advertising partner of Motley Fool Money. Daniel Foelber has positions in Nvidia and Procter & Gamble. The Motley Fool has positions in and recommends AbbVie, Alphabet, Amazon, Apple, Berkshire Hathaway, Home Depot, JPMorgan Chase, Meta Platforms, Microsoft, Nvidia, Oracle, Tesla, Vanguard Index Funds-Vanguard Value ETF, Vanguard S&P 500 ETF, and Walmart. The Motley Fool recommends Broadcom and Johnson & Johnson 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.
Globe and Mail
11-07-2025
- Business
- Globe and Mail
VTV Is a Great Choice for Most, but I Like the VUG ETF Better
Key Points The Vanguard Value ETF focuses on shares of seemingly undervalued companies that offer a margin of safety. The Vanguard Growth ETF offers its investors the potential to grow their portfolios at above-average rates. 10 stocks we like better than Vanguard Index Funds - Vanguard Growth ETF › Exchange-traded funds (ETFs) have grown in popularity over the past decade or two, and for good reason. Just like mutual funds, they let you invest in a range of stocks (or other things) with one simple investment -- and they often sport lower expense ratios (annual fees), too. ETFs also make investing easy by trading like stocks throughout the day in the stock market. One particularly popular ETF is the Vanguard Value ETF (NYSEMKT: VTV). I do like it myself, but I'm a bit more jazzed by the Vanguard Growth ETF (NYSEMKT: VUG). Here's a look at both. See which one(s) you like. First, let's tackle performance. You can see how each has fared in the table below, and I'll include an also-excellent S&P 500 index fund, the Vanguard S&P 500 ETF (NYSEMKT: VOO), for comparison: Sources: as of July 7, 2025. ETF = exchange-traded fund. What's so great about the Vanguard Value ETF? Before you write off the Vanguard Value ETF because of its slower growth, keep reading. The ETF is offering a different proposition than the other ETFs. It's focused on value -- meaning it's not chasing high-flying stocks and buying them at sometimes inflated prices. Instead, it's focused on seemingly undervalued stocks, ones that offer a margin of safety. For anyone skittish about stocks in general, or just today, given that our economy is facing tariff complications, among other things, this ETF should provide some relief. If the market suddenly heads south (as it has always done every few years), value stocks will often drop less severely than their more richly valued counterparts. Here are some more things to know about the ETF: Its expense ratio is 0.04%, meaning it will charge you $4 per year for every $10,000 you have invested in the fund. It tracks the CRSP US Large Cap Value Index, which focuses on the less expensive stocks in the broad U.S. market. Its holdings are likely to sport relatively low valuations, more modest growth prospects, and significant dividend yields. (Its overall dividend yield was recently 2.2%.) It recently included 331 stocks, with an average price-to-earnings (P/E) ratio of 16.7. Its top 10 holdings made up 21% of its total assets (as of May 31), and here they are: Company Weight in Index Berkshire Hathaway 3.59% JPMorgan Chase 3.40% ExxonMobil 2.07% Walmart 2.03% Procter & Gamble 1.86% Johnson & Johnson 1.74% The Home Depot 1.71% AbbVie 1.53% Bank of America 1.34% Philip Morris International 1.31% Source: as of May 31, 2025. What's so great about the Vanguard Growth ETF? The Vanguard Growth ETF has an admirable track record, topping the other two ETFs above. Thus, many people, myself included, will be drawn to it, imagining our own portfolios growing at above-average rates. Still, it's important to remember that the stock market is volatile, and not every year will feature double-digit gains for this (or other) ETFs. Indeed, in market downturns, growth stocks can have further to fall. Check out how the ETFs fared in 2022 and 2023: ETF 2022 Return 2023 Return Vanguard Value ETF (2.07%) 9.32% Vanguard S&P 500 ETF (18.19%) 26.32% Vanguard Growth ETF (33.15%) 46.83% Sources: as of July 7, 2025. ETF = exchange-traded fund. There's a clear risk-and-reward trade-off there, right? That's why you might want to spread your dollars across several different kinds of ETFs to diversify by risk and return. Here are some more things to know about the Vanguard Growth ETF: Its expense ratio is also 0.04%. It tracks the CRSP US Large Cap Growth Index, which focuses on faster-growing stocks in the broad U.S. market. Its overall dividend yield was recently 0.45%. That's not surprising, as growth stocks tend to reinvest most of their excess earnings to further their growth. They're generally not generous dividend payers. It recently included 166 stocks, with an average P/E ratio of 31.2 -- roughly twice that of the value-oriented ETF. Its top 10 holdings made up a whopping 58% of its total assets (as of May 31), and here they are: Company Weight in Index Microsoft 11.32% Nvidia 10.30% Apple 10.08% Amazon 6.29% Meta Platforms 4.37% Broadcom 3.97% Tesla 3.32% Alphabet Class A 3.21% Alphabet Class C 2.59% Eli Lilly 2.21% Source: as of May 31, 2025. Clearly, that's a different bunch of companies, including all the "Magnificent Seven" -- Apple, Microsoft, Google parent Alphabet, Amazon, Nvidia, Facebook parent Meta Platforms, and Tesla. If you would like to be part-owner of those companies -- and more than 150 others -- without having to buy into lots of companies, you might want to park some of your dollars in this ETF. So, really, both of these are solid, low-fee ETFs with a lot going for them. Think about which might serve you best. Should you invest $1,000 in Vanguard Index Funds - Vanguard Growth ETF right now? Before you buy stock in Vanguard Index Funds - Vanguard Growth ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard Index Funds - Vanguard Growth 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 $674,432!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,005,854!* Now, it's worth noting Stock Advisor 's total average return is1,049% — a market-crushing outperformance compared to180%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 7, 2025 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. Bank of America is an advertising partner of Motley Fool Money. JPMorgan Chase is an advertising partner of Motley Fool Money. Selena Maranjian has positions in AbbVie, Alphabet, Amazon, Apple, Berkshire Hathaway, Broadcom, Meta Platforms, Microsoft, Nvidia, Procter & Gamble, and Vanguard Index Funds-Vanguard Growth ETF. The Motley Fool has positions in and recommends AbbVie, Alphabet, Amazon, Apple, Bank of America, Berkshire Hathaway, Home Depot, JPMorgan Chase, Meta Platforms, Microsoft, Nvidia, Tesla, Vanguard Index Funds-Vanguard Growth ETF, Vanguard Index Funds-Vanguard Value ETF, Vanguard S&P 500 ETF, and Walmart. The Motley Fool recommends Broadcom, Johnson & Johnson, and Philip Morris International 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.
Yahoo
11-07-2025
- Business
- Yahoo
VTV Is a Great Choice for Most, but I Like the VUG ETF Better
The Vanguard Value ETF focuses on shares of seemingly undervalued companies that offer a margin of safety. The Vanguard Growth ETF offers its investors the potential to grow their portfolios at above-average rates. 10 stocks we like better than Vanguard Index Funds - Vanguard Growth ETF › Exchange-traded funds (ETFs) have grown in popularity over the past decade or two, and for good reason. Just like mutual funds, they let you invest in a range of stocks (or other things) with one simple investment -- and they often sport lower expense ratios (annual fees), too. ETFs also make investing easy by trading like stocks throughout the day in the stock market. One particularly popular ETF is the Vanguard Value ETF (NYSEMKT: VTV). I do like it myself, but I'm a bit more jazzed by the Vanguard Growth ETF (NYSEMKT: VUG). Here's a look at both. See which one(s) you like. First, let's tackle performance. You can see how each has fared in the table below, and I'll include an also-excellent S&P 500 index fund, the Vanguard S&P 500 ETF (NYSEMKT: VOO), for comparison: ETF 5-Year Avg. Annual Return 10-Year Avg. Annual Return 15-Year Avg. Annual Return Vanguard Value ETF 15.11% 10.60% 12.31% Vanguard Growth ETF 16.77% 16.08% 16.77% Vanguard S&P 500 ETF 16.35% 13.54% N/A Sources: as of July 7, 2025. ETF = exchange-traded fund. Before you write off the Vanguard Value ETF because of its slower growth, keep reading. The ETF is offering a different proposition than the other ETFs. It's focused on value -- meaning it's not chasing high-flying stocks and buying them at sometimes inflated prices. Instead, it's focused on seemingly undervalued stocks, ones that offer a margin of safety. For anyone skittish about stocks in general, or just today, given that our economy is facing tariff complications, among other things, this ETF should provide some relief. If the market suddenly heads south (as it has always done every few years), value stocks will often drop less severely than their more richly valued counterparts. Here are some more things to know about the ETF: Its expense ratio is 0.04%, meaning it will charge you $4 per year for every $10,000 you have invested in the fund. It tracks the CRSP US Large Cap Value Index, which focuses on the less expensive stocks in the broad U.S. market. Its holdings are likely to sport relatively low valuations, more modest growth prospects, and significant dividend yields. (Its overall dividend yield was recently 2.2%.) It recently included 331 stocks, with an average price-to-earnings (P/E) ratio of 16.7. Its top 10 holdings made up 21% of its total assets (as of May 31), and here they are: Company Weight in Index Berkshire Hathaway 3.59% JPMorgan Chase 3.40% ExxonMobil 2.07% Walmart 2.03% Procter & Gamble 1.86% Johnson & Johnson 1.74% The Home Depot 1.71% AbbVie 1.53% Bank of America 1.34% Philip Morris International 1.31% Source: as of May 31, 2025. The Vanguard Growth ETF has an admirable track record, topping the other two ETFs above. Thus, many people, myself included, will be drawn to it, imagining our own portfolios growing at above-average rates. Still, it's important to remember that the stock market is volatile, and not every year will feature double-digit gains for this (or other) ETFs. Indeed, in market downturns, growth stocks can have further to fall. Check out how the ETFs fared in 2022 and 2023: ETF 2022 Return 2023 Return Vanguard Value ETF (2.07%) 9.32% Vanguard S&P 500 ETF (18.19%) 26.32% Vanguard Growth ETF (33.15%) 46.83% Sources: as of July 7, 2025. ETF = exchange-traded fund. There's a clear risk-and-reward trade-off there, right? That's why you might want to spread your dollars across several different kinds of ETFs to diversify by risk and return. Here are some more things to know about the Vanguard Growth ETF: Its expense ratio is also 0.04%. It tracks the CRSP US Large Cap Growth Index, which focuses on faster-growing stocks in the broad U.S. market. Its overall dividend yield was recently 0.45%. That's not surprising, as growth stocks tend to reinvest most of their excess earnings to further their growth. They're generally not generous dividend payers. It recently included 166 stocks, with an average P/E ratio of 31.2 -- roughly twice that of the value-oriented ETF. Its top 10 holdings made up a whopping 58% of its total assets (as of May 31), and here they are: Company Weight in Index Microsoft 11.32% Nvidia 10.30% Apple 10.08% Amazon 6.29% Meta Platforms 4.37% Broadcom 3.97% Tesla 3.32% Alphabet Class A 3.21% Alphabet Class C 2.59% Eli Lilly 2.21% Source: as of May 31, 2025. Clearly, that's a different bunch of companies, including all the "Magnificent Seven" -- Apple, Microsoft, Google parent Alphabet, Amazon, Nvidia, Facebook parent Meta Platforms, and Tesla. If you would like to be part-owner of those companies -- and more than 150 others -- without having to buy into lots of companies, you might want to park some of your dollars in this ETF. So, really, both of these are solid, low-fee ETFs with a lot going for them. Think about which might serve you best. Before you buy stock in Vanguard Index Funds - Vanguard Growth ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard Index Funds - Vanguard Growth 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 $674,432!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,005,854!* Now, it's worth noting Stock Advisor's total average return is 1,049% — a market-crushing outperformance compared to 180% 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 July 7, 2025 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. Bank of America is an advertising partner of Motley Fool Money. JPMorgan Chase is an advertising partner of Motley Fool Money. Selena Maranjian has positions in AbbVie, Alphabet, Amazon, Apple, Berkshire Hathaway, Broadcom, Meta Platforms, Microsoft, Nvidia, Procter & Gamble, and Vanguard Index Funds-Vanguard Growth ETF. The Motley Fool has positions in and recommends AbbVie, Alphabet, Amazon, Apple, Bank of America, Berkshire Hathaway, Home Depot, JPMorgan Chase, Meta Platforms, Microsoft, Nvidia, Tesla, Vanguard Index Funds-Vanguard Growth ETF, Vanguard Index Funds-Vanguard Value ETF, Vanguard S&P 500 ETF, and Walmart. The Motley Fool recommends Broadcom, Johnson & Johnson, and Philip Morris International 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. VTV Is a Great Choice for Most, but I Like the VUG ETF Better was originally published by The Motley Fool 擷取數據時發生錯誤 登入存取你的投資組合 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤
Yahoo
02-07-2025
- Business
- Yahoo
$1,000 in the Vanguard Value Index Fund ETF Could Turn Into $1,900
Value stocks have trailed growth stocks recently. You should use past returns with caution. Nonetheless, these can serve as a starting point when modeling future returns. 10 stocks we like better than Vanguard Index Funds - Vanguard Value ETF › No one has the ability to accurately predict the future, of course. That certainly applies to investments. However, you can project how much your initial investment will become based on an assumed rate of return and your intended holding period. If you were to invest $1,000 in the Vanguard Value Index Fund ETF (NYSEMKT: VTV), how much would you have after five years? This exchange-traded fund (ETF), with nearly $190 billion in assets as of May 31, is popular with investors. But let's have an overview, because it's advisable to understand the ETF before investing any money. The Vanguard Value Index Fund ETF tracks the CRSP US Large Cap Value Index, which includes 330 companies with a median market capitalization of more than $130 billion. The ETF has more than half of its funds invested in the financial (22.9%), industrial (16.2%), and healthcare (14.3%) sectors. As the name suggests, it seeks to include value stocks rather than growth stocks. You can see this by comparing the price-to-earnings (P/E) ratio since that's a common valuation metric. At the end of May, the stocks in the index and ETF had an average P/E ratio of 18.9 versus 37.2 for the Vanguard Growth ETF. Growth stocks have vastly outperformed value stocks over various time periods. The Vanguard Value Index Fund ETF returned 13.9% over the last five years through May 31. During this time, the Vanguard Growth ETF returned an annualized 17.1%. Notably, since both invest passively, tracking their respective indexes, they have low fees. The Vanguard Growth ETF has an expense ratio of just 0.04%, or $4 annually per $10,000 invested. That's much lower than the average expense ratio of 0.88% for similar funds, according to Vanguard. The expense ratio is an important consideration for investors. The lower the ratio, the more money investors get to keep. That translates into a higher return. With knowledge about the ETF's stock composition, fees, and past returns, it's time to look at future rates of return. As the well-worn saying goes, past performance is no guarantee of future results. Still, it's a good base assumption that you can adjust upward and downward. If the fund returns the same 13.9% over the next five years, your $1,000 investment would grow to about $1,917. That's nearly doubling your initial stake. With the economic uncertainty amid geopolitical tensions and the uncertain effects of global economies, it seems prudent to model a lower rate of return. Assuming a 5% annualized return over the next five years, that $1,000 would turn into $1,276. That's not a much higher return than the roughly 4% yield you could get on the risk-free U.S. Treasury's five-year note. What if the ETF matched the previous five years' growth ETF return? After all, while growth stocks have done well lately, that doesn't mean they'll continue to outpace value stocks. In that scenario, your initial $1,000 investment would more than double to $2,202. And, under a very optimistic scenario, if the ETF returns 25% per year, you'd more than triple your funds to $3,052. Before you buy stock in Vanguard Index Funds - Vanguard Value ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard Index Funds - Vanguard Value 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 $722,181!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $968,402!* Now, it's worth noting Stock Advisor's total average return is 1,069% — a market-crushing outperformance compared to 177% 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 30, 2025 Lawrence Rothman, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard Index Funds-Vanguard Growth ETF and Vanguard Index Funds-Vanguard Value ETF. The Motley Fool has a disclosure policy. $1,000 in the Vanguard Value Index Fund ETF Could Turn Into $1,900 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
