10 Best Vanguard ETFs to Diversify Your Portfolio
Our Methodology
The ETFs listed below are discussed with regards to their top holdings. The aim of the article is to provide readers with a basic rundown of some of the top Vanguard ETFs in the US that have the best chance to provide investors with some diverse options in an uncertain economic environment. All the ETFs listed below trade on exchanges in the United States.
10. Vanguard Dividend Appreciation Index Fund ETF Shares (NYSE:VIG)
Vanguard Dividend Appreciation Index Fund ETF Shares (NYSE:VIG) is an exchange traded fund that tracks the investment returns of an index which comprises common stocks of companies that have a record of increasing dividends over time.
One of the top holdings of Vanguard Dividend Appreciation Index Fund ETF Shares (NYSE:VIG) is Johnson & Johnson (NYSE:JNJ), a corporation that makes and sells a range of health-related products globally. At the end of the first quarter of 2022, 83 hedge funds in the database of Insider Monkey held stakes worth $7.4 billion in Johnson & Johnson (NYSE:JNJ), the same as in the previous quarter worth $7.3 billion.
Just like Amazon.com, Inc. (NASDAQ:AMZN), Sea Limited (NYSE:SE), and Shopify Inc. (NYSE:SHOP), Johnson & Johnson (NYSE:JNJ) is one of the stocks that elite investors are monitoring.
9. Vanguard Value Index Fund (NYSE:VTV)
Vanguard Value Index Fund (NYSE:VTV) is a fund that tracks the performance of the CRSP US Large Cap Value Index. The index comprises value stocks of large companies that trade on exchanges in the United States. It has over $146 billion in net assets with a yield of 2.42%.
One of the biggest holdings of Vanguard Value Index Fund (NYSE:VTV) is Berkshire Hathaway Inc. (NYSE:BRK-B), a conglomerate with interests in the insurance, freight rail transportation, and utility businesses. At the end of the first quarter of 2022, 104 hedge funds in the database of Insider Monkey held stakes worth $19 billion in Berkshire Hathaway Inc. (NYSE:BRK-B), compared to 108 in the preceding quarter worth $19.3 billion.
In its Q1 2022 investor letter, Diamond Hill Capital, an asset management firm, highlighted a few stocks and Berkshire Hathaway Inc. (NYSE:BRK-B) was one of them. Here is what the fund said:
“Diversified holding company Berkshire Hathaway Inc. (NYSE:BRK-B) reported strong earnings during the quarter and benefited from continued share repurchases below intrinsic value. The company also announced significant deployments of excess cash during the quarter, including the acquisition of Alleghany and a large increase in its stake in Occidental Petroleum.”
8. Vanguard Consumer Staples Fund (NYSE:VDC)
Vanguard Consumer Staples Fund (NYSE:VDC) is an exchange traded fund that invests in securities on the MSCI US Investable Market Index/Consumer Staples 25/50. The index comprises large, mid-cap, and small-cap companies that operate in the consumer staples sector in the United States.
Vanguard Consumer Staples Fund (NYSE:VDC) holds a large stake in The Procter & Gamble Company (NYSE:PG), a company that markets consumer packaged goods. Among the hedge funds being tracked by Insider Monkey, Florida-based investment firm GQG Partners is a leading shareholder in The Procter & Gamble Company (NYSE:PG), with 9.9 million shares worth more than $1.5 billion.
7. Vanguard 500 Index Fund (NYSE:VOO)
Vanguard 500 Index Fund (NYSE:VOO) is a fund that tracks the performance of the S&P 500 Index. The index is widely considered the benchmark index of the US stock market and comprises 500 of the biggest companies in the US based on their market capitalizations. The fund aims to replicate the returns of the index by holding each stock in the same proportion as the index.
One of the biggest holdings of Vanguard 500 Index Fund (NYSE:VOO) is Tesla, Inc. (NASDAQ:TSLA), a firm that markets electric vehicles and clean energy solutions. At the end of the first quarter of 2022, 80 hedge funds in the database of Insider Monkey held stakes worth $11 billion in Tesla, Inc. (NASDAQ:TSLA), compared to 91 in the previous quarter worth $12 billion.
Here is what Grantham Mayo Van Otterloo & Co. LLC has to say about Tesla, Inc. (NASDAQ:TSLA) in its Q1 2022 investor letter:
“To put the demand growth for clean energy materials into perspective, let’s look at Tesla, Inc. (NASDAQ:TSLA). At its Battery Day last year, Tesla, Inc. (NASDAQ:TSLA) projected three terawatt hours of lithium-ion battery capacity needed in 2030 for the EVs and storage they expect to produce. To reach this target, Tesla alone would gobble up approximately 75% of the world’s current nickel production and four times the world’s current lithium production. These numbers are astounding enough, but when one considers that EVs currently represent just 15% of global nickel demand and about 45% of lithium demand and that Tesla will likely be producing only a small proportion of the world’s EVs in 2030, the implications are staggering. Clean energy materials companies will make a lot more money in the decades to come than they ever have both because they will be selling a lot more metric tons of material and because there are certain to be shortages where supply can’t keep up with the rapidly growing demand.”
6. Vanguard Total Stock Market Index Fund (NYSE:VTI)
Vanguard Total Stock Market Index Fund (NYSE:VTI) is an exchange traded fund that invests at least 80% of net assets in securities on an index that comprises 100% of investable companies in the US stock market. The fund employs a sampling strategy to invest in securities on the index.
A key holding of the Vanguard Total Stock Market Index Fund (NYSE:VTI) is Apple Inc. (NASDAQ:AAPL), a firm that makes and sells consumer electronics. At the end of the first quarter of 2022, 131 hedge funds in the database of Insider Monkey held stakes worth $182 billion in Apple Inc. (NASDAQ:AAPL), compared to 134 in the preceding quarter worth $186 billion.
Along with Amazon.com, Inc. (NASDAQ:AMZN), Sea Limited (NYSE:SE), and Shopify Inc. (NYSE:SHOP), Apple Inc. (NASDAQ:AAPL) is one of the stocks that hedge funds are keeping a close eye on.
In its Q4 2021 investor letter, Berkshire Hathaway highlighted a few stocks and Apple Inc. (NASDAQ:AAPL) was one of them. Here is what the fund said:
“Apple Inc. (NASDAQ:AAPL) – our runner-up Giant as measured by its yearend market value – is a different sort of holding. Here, our ownership is a mere 5.55%, up from 5.39% a year earlier. That increase sounds like small potatoes. But consider that each 0.1% of Apple’s 2021 earnings amounted to $100 million. We spent no Berkshire funds to gain our accretion. Apple’s repurchases did the job. It’s important to understand that only dividends from Apple are counted in the GAAP earnings Berkshire reports – and last year, Apple paid us $785 million of those. Yet our “share” of Apple’s earnings amounted to a staggering $5.6 billion. Much of what the company retained was used to repurchase Apple Inc. (NASDAQ:AAPL) shares, an act we applaud. Tim Cook, Apple’s brilliant CEO, quite properly regards users of Apple Inc. (NASDAQ:AAPL) products as his first love, but all of his other constituencies benefit from Tim’s managerial touch as well.”
5. Vanguard Total World Stock Index Fund (NYSE:VT)
Vanguard Total World Stock Index Fund (NYSE:VT) is an exchange traded fund that invests in securities on the FTSE Global All Cap Index. The fund invests a majority of assets in securities on the index and also holds a representative sample of securities that resembles the full index.
Vanguard Total World Stock Index Fund (NYSE:VT) holds a large stake in JPMorgan Chase & Co. (NYSE:JPM), a financial services firm. Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in JPMorgan Chase & Co. (NYSE:JPM), with 7.7 million shares worth more than $1.1 billion.
In its Q1 2022 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and JPMorgan Chase & Co. (NYSE:JPM) was one of them. Here is what the fund said:
“More cyclical sectors, including technology and consumer discretionary, were among the weakest, likely due to rising interest rates and inflation. It was encouraging to see the quarter finish on a strong note with the S&P 500 only about 5% away from its all-time highs. Shares of JPMorgan Chase & Co. (NYSE:JPM) detracted from performance due to the company’s increased expense guidance, announced in January.”
4. Vanguard Real Estate Index Fund (NYSE:VNQ)
Vanguard Real Estate Index Fund (NYSE:VNQ) is an exchange traded fund that invests exclusively in stocks that real estate investment trusts (REITs) invest in. REITs usually focus on firms purchasing office buildings, hotels, and other real property.
A premier holding of the Vanguard Real Estate Index Fund (NYSE:VNQ) is Prologis, Inc. (NYSE:PLD), a real estate investment trust that focuses on high-barrier markets. Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm AEW Capital Management is a leading shareholder in Prologis, Inc. (NYSE:PLD), with 2 million shares worth more than $326 million.
3. Vanguard Small-Cap Index Fund ETF Shares (NYSE:VB)
Vanguard Small-Cap Index Fund ETF Shares (NYSE:VB) is an exchange traded fund that tracks the investment returns of the CRSP US Small Cap Index, which comprises a diverse group of companies that have small market capitalizations and are trading in the United States.
Vanguard Small-Cap Index Fund ETF Shares (NYSE:VB) has a large stake in Diamondback Energy, Inc. (NASDAQ:FANG), an independent oil and natural gas firm. Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Harris Associates is a leading shareholder in Diamondback Energy, Inc. (NASDAQ:FANG) with 2.4 million shares worth more than $331 million.
In its Q4 2021 investor letter, Miller Value Partners highlighted a few stocks and Diamondback Energy, Inc. (NASDAQ:FANG) was one of them. Here is what the fund said:
“Diamondback Energy, Inc. (NASDAQ:FANG) returned 14.4% in the quarter as oil price rose and fell during the quarter ending the period largely in the same place that it started. The company reported strong 3Q results beating on the top and bottom line. Diamondback Energy, Inc. (NASDAQ:FANG) reported revenue of $1.9B beating consensus of $1.5B with EPS of $2.94 beating expectations for $2.79. The beat was driven by a combination of higher volumes, higher realizations, and efficiency gains. The company increased its total production guidance for the year to 370-372mboe/d1 (up from 363-370mboe/d) while lowering Capital Expenditure (CAPEX) guidance for the second time this year to $1.49-1.53B. Diamondback Energy, Inc. (NASDAQ:FANG) raised the dividend for the third time this year to $2/share annually while authorizing a new $2B share repurchase program. Starting in 4Q21, the company plans to return 50% of Free Cash Flow to shareholders through the base dividend and a combination of buybacks and special dividends. Finally, the CEO Travis Stice announced plans to reduce methane emissions by 70% as part of the firm’s ESG initiative.”
2. Vanguard Information Technology Index Fund ETF Shares (NYSE:VGT)
Vanguard Information Technology Index Fund ETF Shares (NYSE:VGT) is an exchange traded fund that tracks the investment returns of the MSCI US Investable Market Index/Information Technology 25/50 Index which comprises a diverse group of companies that are working in the information technology sector in the US.
A top holding of Vanguard Information Technology Index Fund ETF Shares (NYSE:VGT) is Microsoft Corporation (NASDAQ:MSFT), a Washington-based technology firm. Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Microsoft Corporation (NASDAQ:MSFT), with 27.8 million shares worth more than $8.5 billion.
In its Q1 2022 investor letter, Carillon Tower Advisers, an investment management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ:MSFT) was one of them. Here is what the fund said:
“Stock selection contributed the most while sector allocation was also positive. An underweight to communication services and an overweight to energy helped performance, while an underweight to consumer staples and an overweight to materials detracted. Stock selection was strong within healthcare and materials but was weak within information technology and industrials. Microsoft Corporation (NASDAQ:MSFT) reported positive results driven by personal computing strength, but analysts were especially positive on its growth outlook for its Azure cloud-computing services.”
1. Vanguard Mid-Cap Index Fund ETF Shares (NYSE:VO)
Vanguard Mid-Cap Index Fund ETF Shares (NYSE:VO) is an exchange traded fund that tracks the investment returns of the CRSP US Mid Cap Index which comprises a diverse group of mid-sized companies that are working in the US.
Vanguard Mid-Cap Index Fund ETF Shares (NYSE:VO) holds a large stake in DocuSign, Inc. (NASDAQ:DOCU), a firm that offers cloud-based software services. Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Tiger Global Management LLC is a leading shareholder in DocuSign, Inc. (NASDAQ:DOCU), with 3.3 million shares worth more than $363 million.