Hello, I am 53 and my full 401k has been in short-term reserves with Vanguard. I have 13-15 more years till retirement and I’d like to invest into Vanguard Domestic Stocks to maximize my returns.
I was interested in investing in VOO until I have 4-5 years left to retire, then my plan is to re-allocate more into bonds. However I don’t see an option for VOO or an ETF that tracks the S&P 500 index. I have these options to invest:
– VFTNX
– Vanguard Institutional Total Stock Market Index Trust
Which one of these track the S&P 500 index closer?
Vanguard VFTNX or Institutional Total Stock Market Index
byu/Aggravating-Buy-1695 ininvesting
Posted by Aggravating-Buy-1695
4 Comments
Vanguard Institutional Total Stock Market Index is close enough to VOO for most people; maybe even slightly preferred by most for diversification.
It and VTI both “seek to track the performance of the CRSP US Total Market Index”, so it’s basically the VOO vs. VTI discussion.
Best to post your full fund list to be sure. Neither of these are a 500 index fund.
* FTSE Social Index is a large cap growth fund whereas the S&P is large cap blend (growth + value). This is also an [ESG](https://www.investor.gov/introduction-investing/investing-basics/glossary/environmental-social-and-governance-esg-investing) fund so it screens out certain companies.
* Total Stock is the S&P 500 + small and mid cap companies. So of the two, this is the closest to the S&P 500. They have ~80% overlap.
You have it backwards.
VOO is an S&P500 fund. The S&P500 fund was developed to track the US market, and be a decent proxy for the US market. The S&P500 has done well because the US market has done well.
Now that information for index tracking is readily available basically instantly, we now have true total US market funds. This is what the S&P500 wanted to be, during a time when it couldn’t.
Total US market and S&P500 have like 99% correlation, so it literally doesn’t matter. Just use the Vanguard total market fund.
I wouldn’t recommend investing 100% into US stocks though. Single country is not a compensated risk.
VFIAX is the vanguard sp500 etf.