8 Great Vanguard ETFs for a Low-Cost Core
Vanguard is the best-known pioneer of low-cost investing, including in the exchange-traded fund space. But it's hardly alone anymore, as providers such as Schwab, iShares and SPDR have all hacked away at each other with ever-shrinking fees.
Still, don't sleep on Vanguard ETFs. While Vanguard isn't always No. 1 among the cheapest index funds in every class, it's still a low-cost leader in several areas, and it's typically one of the least expensive options no matter where you look.
And inexpensive does matter. Let's say an investor puts $100,000 apiece in two different funds that both gain 8% annually, but Fund A charges 1% in fees while Fund B charges 0.5%. In 30 years, Fund A will be worth a respectable $744,335 ... but Fund B will be worth $865,775. That's roughly $120,000 lost not just in fees, but also lost opportunity cost from returns that could have been reinvested in the fund.
Here are eight low-cost Vanguard ETFs that investors can use as part of a core portfolio. All of these index funds are among the least expensive in their class and offer wide exposure to their respective market areas.
Vanguard S&P 500 ETF
Market value: $112.6 billion
Dividend yield: 2.0%
Expenses: 0.04%
Any portfolio can use a fund that tracks the Standard & Poor's 500-stock index. Every year, investors are reminded that the majority of active portfolio managers are unable to beat their benchmark indexes, and that includes a wide swath of large-cap managers that simply can't top the
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