Proprietary Data Insights
Financial Pros’ Top Equity Index ETF Searches in the Last Month
Another Interesting Alternative to the SPY
Unless you’ve been living under a rock, you know about the market’s most popular, most liquid ticker – SPY, State Street’s S&P 500 ETF.
Up 66.5% over the last five-years, it’s not hard to see why folks love it.
But we’re not here to talk about the SPY today.
Instead, we’re going to talk about one of the least well-known index ETFs out there – VTI, Vanguard’s Total Market ETF.
It holds a unique position amongst index ETFs as one of the most popular with investors looking for lower risk equity returns, at least according to our Trackstar Data.
As we dug into the details, it turns out there is a LOT to love about this ETF.
Key Facts About VTI
The S&P 500 Index holds the largest 500 equities by market capitalization.
The Total Market Index just owns EVERY investable stock there is, from Apple all the way down to micro-caps. It does not hold REITs and preferred shares.
Like the S&P 500, the Total Market Index is weighted by market cap, giving the largest companies more weight.
That’s why the top 10 holdings don’t look all that different from the S&P 500.
Unsurprisingly, you get similar sector weightings to the major indexes.
The big difference is when you add in those other 3,300+ companies to the S&P 500, you get higher diversification, a bit less volatility, and still maintain a good amount of the performance.
The big difference is when you add in those other 3,300+ companies to the S&P 500, you get higher diversification, a bit less volatility, and still maintain a good amount of performance.
As we noted earlier, the 5-year cumulative return on the S&P 500 is 66.5%.
The cumulative return for the Total Market Index during that same period is 60%.
So, let’s see how the VTI stacks up against the other major index ETFs:
What you’ll find below is technology-leaning, and large-cap indexes still reign supreme.
However, the VTI has a dirt-cheap expense ratio that’s only 1/3rd the cost of the SPY.
Our Opinion 10/10
We were quite impressed with the performance of this index as well as its cost structure.
For those who want a bit less volatility without sacrificing too much in the way of returns, the VTI is an excellent choice as a core holding.
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