VTSAX vs VTI vs VOO: Vanguard Funds Full Review 2021

saltmoney author
By: Michael Restiano
Updated On: March 15, 2022
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This is the most comprehensive article on the comparison of VTSAX vs VTI vs VOO.

Ever since the world has been hit by the coronavirus pandemic and the various economies in the world are having a tough time coping with the ordeal, people have taken interest and refuge in stock markets and in the field of a financial investment as a whole, the number of people actively investing their money in the stock and equity market is at an all-time high.

When it comes to investing and especially investing as a beginner, going for investing in index funds is one of the smartest decisions one can possibly make. Also, it is a step in the right direction in your financial investment journey.

Choosing to invest in index funds quite easy as it is also advised by many of the experts to be one of the best options for investment. However, the real question is which index funds you should choose to invest in and to be honest; it can be quite challenging to find the answer to this question.

Today, in this article, we will discuss three of the top-rated index funds from Vanguard: VTSAX vs VTI vs VOO.

Vanguard is one of the most preferred choices of brokers among many investors; though it has more tax-efficient funds, it also offers both high-quality and low-cost index funds and ETFs, and let's be real, this is what most of us investors are looking for in our broker.

Along with everything, it has a wide variety of benefits to offer to its investors. This is what makes Vanguard one of the top brokers, and VTSAX vs VTI vs VOO are some of the most prominent index funds offered by Vanguard.

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Let Us First Start Off By Getting A Bit Of Background Information Regarding Vanguard

Vanguard was founded by one of the most prominent figures of the investing community in the year 1975, whose name was John Bogle. John Bogle, also known as John “Jack” Bogle, founded Vanguard, a company where its investors are the owners.

The company was famous for its unique and one-of-a-kind structure. The company did quite well in its initial days because they reinvested their profits back in the company and tried to keep the overall cost as minimum as possible, which proved that the company is focused on serving their investors.

The Vanguard company structure was quite revolutionary for its time, and the founder of the company John Bogle is also credited with creating the first index fund.

The fund launched by Vanguard, which went by the name Vanguard 500 Index Fund, abbreviated as VFINX, was term as “un-American” and was heavily criticized at the time of its launch because it was a norm at that time to buy individual stocks on your own or either hire an experienced person to do the job and manage your portfolio by using their expertise.

At that time, the investors criticized Vanguard because it was stupid and extremely risky to concede to match the market instead of trying to beat it like the others.

But, the man John Bogle was a revolutionary as well as a visionary as he stood is his ground because he knew for sure that indexing has the ability to outperform the traditional management of funds by a fund manager and people, though heavily criticized Bogle at first followed him eventually in large numbers.

Some Of The Milestones Achieved By Vanguard Are As Follows

The company has been a pioneer in the field of investment and has been at the top of the game for the past 40 years; some of its important milestones are mentioned below.

As mentioned earlier, the company was founded by John Bogle, and Bogle and Vanguard created the first index fund; both events took place consecutively in the year 1975 and 1976, respectively.

In the year 1977, the company reduced its operational costs by eliminating loads or sales commissions. Vanguard created the first international stock index fund in the year 1990, and in the year 2001, the company began offering ETFs to its customers.

Here Is A List Of Vanguards Index Funds

Vanguard’s Index funds include the U.S and International Bond Funds and EFTs, U.S and International Stock Funds and EFTs along with Balanced and Sector and Speciality funds and EFTs; these funds give a sufficient enough range for the investors to choose from.

Before we start discussing the various Index funds offered by Vanguard, we will like to establish that Vanguard currently deals with approximately 62 index mutual funds and 74 EFTs, which is an abbreviation of the term exchange-traded funds.

Index funds and EFTs are usually traded in a similar manner barring the fact that index funds are traded only once during the end of the day while EFTs are traded throughout the trading day, making them a preferred choice of investment among the people who are new to the field and not very well aware of the time-sensitive nature of the market.

As we all know by now that VTSAX, which is a mutual fund, and VTI and VOO, which are EFTs, are some of the most popular funds that Vanguard has to offer to its clients, and all three of them are also classified as U.S Stock Funds and EFTs

VTSAX vs VTI vs VOO Comparision

All the three funds offered by Vanguard are quite similar to each other as they all have rock-bottom fees and are focused on large-cap and even their performance is quite similar to each other.

Though there are a few prominent differences in the as well like, VTSAX and VTI are US stock market funds while VOO is an S&P 500 fund and that VTSAX is an index mutual fund while on the other hand VTI and VOO are EFTs.

Another major difference is in terms of investment as VTSAX has a minimum investment of $3000 while VTI and VOO do not have any minimum investment attached to them.

Now that we have pointed out the major differences, let’s move towards the conclusion of this article. As VTSAX vs VTI vs VOO is similar, choosing between them can be quite a task.

Here are a few things you should look for in an index fund or ETF: the funds should match a broad underlying index, and the expense ratios and costs should be as low as possible.

If you are going for a 3 fund portfolio that has the ultimate goal to build a diversified portfolio without any hassle, one of the funds is above the other two, which is usually in combination with international equity and a bond fund.

Suppose you are going for a single fund portfolio that is even easier to choose and manage as you have to choose one of the funds. Whichever option you go for being specific and clear about your goals and requirements and do thorough research at the time of investing.