VOO is an exchange traded fund (ETF) that tracks the S&P 500 index by owning all of the equities within the S&P 500.
Vanguard S&P 500 ETF (VOO) is the ETF equivalent of the top-rated index fund, VFIAX. VOO provides investors with the same market exposure as its admiral version VFIAX but at a lower expense ratio of 0.03%.
VOO is a low-cost index fund that charges an expense ratio of 0.03% and does all of the work, allowing you to benefit from the 500 largest companies in America.
Vanguard S&P 500 ETF seeks to track the investment performance of the S&P 500 Index, a widely recognized benchmark of U.S. stock market performance that is dominated by the stocks of large U.S. companies. Vanguard S&P 500 ETF is an exchange-traded share class of Vanguard 500 Index Fund.
As its name suggests, the Vanguard S&P 500 tracks the S&P 500 index, and it's one of the largest funds on the market with hundreds of billions in the fund. This ETF began trading in 2010, and it's backed by Vanguard, one of the powerhouses of the fund industry. Expense ratio: 0.03 percent.
VOO is an exchange traded fund (ETF) that tracks the S&P 500 index by owning all of the equities within the S&P 500. The S&P 500's investment return is considered a gauge of the overall U.S. stock market.
Vanguard S&P 500 ETF (VOO)
VOO has a dividend yield of 1.57% and paid $5.65 per share in the past year. The dividend is paid every three months and the last ex-dividend date was Jun 29, 2022.
Compared to VOO, VTI holds over 3,000 more mid-, small-, and micro-cap stocks. Roughly 82% of VTI is VOO, making their performance and composition somewhat similar. Surprisingly, VTI is just as inexpensive as VOO is, costing just 0.03% in MER.
The primary difference between SPY, VOO and IVV is cost. SPY has an expense ratio of 0.09% while VOO and IVV only cost 0.03%.
Key Takeaways
Exchange-traded funds (ETFs) are a good way for investors to gain exposure to these three categories. The best U.S. stock ETFs for Roth IRAs are funds in a seven-way tie: IVV, VOO, SPLG, SPTM, ITOT, VTI, and BKLC. The best bond ETF for Roth IRAs is BKAG.
Even with these risks, however, investors have long done well by investing in the index – and at 0.03% in annual expenses, there's no cheaper way to go about it. That's why VOO belongs among our 22 best ETFs to buy for 2022.
Thus, for long-term retail investors who don't need high liquidity or options, IVV and VOO are both good choices.
VOO is rated a 5 out of 5.
ETFs are more tax-efficient than index funds by nature, thanks to the way they're structured. When you sell an ETF, you're typically selling it to another investor who's buying it, and the cash is coming directly from them. Capital gains taxes on that sale are yours and yours alone to pay.
Vanguard Extended Market ETF (VXF): To complement VOO, and complete your exposure to the U.S. stock market, VXF holds all of the U.S. stocks that are not in the S&P 500.
If you want a single diversified investment that may not earn as much but carries less risk, VOO may be your best. On the other hand, if you're willing to take on more risk for the chance at earning higher returns, QQQ could be a solid addition to your investments.
The main difference between VOO and VTI is the index they track. VOO tracks the S&P 500 index while VTI tracks the total U.S. market. This gives VTI more diversification and less volatility compared to VOO.
The Vanguard S&P 500 ETF (VOO) is also charging 0.04 percent per year, down from 0.05 percent.