Not Sure Which Stocks to Buy? This Vanguard ETF Makes It Simple.
Key Points
The Vanguard Total Stock Market ETF (VTI) covers the entire investable U.S. stock market of more than 3,500 stocks for an expense ratio of 0.03%.
Studies show that most investors and pro money managers fail to keep up with the broad market averages over time.
By buying VTI, you can just try to match the market while removing the headaches.
- 10 stocks we like better than Vanguard Total Stock Market ETF ›
In my younger years, I used to spend a lot of time trying to pick individual winners in the stock market. At best, my track record really wasn't better than anyone else's. At worst, the bursting of the tech bubble did more damage to my portfolio than I care to remember.
That's a big reason why I've mostly switched over to exchange-traded funds (ETFs) from stocks. Now I prefer buying broad themes. Owning the Vanguard Total Stock Market ETF (NYSEMKT: VTI), for example, allows me to participate in overall U.S. economic growth. I can simply buy this fund and let the long-term power of compounding do its thing. It's easier. It's cheaper. And it's arguably more successful.
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Why the Vanguard Total Stock Market ETF beats stock picking
The Vanguard Total Stock Market ETF covers the entire investable U.S. stock market, about 3,500 stocks in total. I prefer this one over the Vanguard S&P 500 ETF because I want to own more than just large caps.
As we've seen this year, small caps can have periods where they significantly outperform the S&P 500. The Vanguard Russell 2000 ETF is beating VOO by an 11% to 20% margin year to date. With small-cap earnings beginning to grow faster than those of the S&P 500, there's a real opportunity for small caps to lead for more than just a few months. I want that opportunity in my portfolio.
And it does all of this with a 0.03% annual expense ratio. With so many investors and professional money managers failing to beat the broader market over time, simply buying the market and avoiding the headache is the wiser path.
Where stock picking can fail
There's nothing inherently wrong with researching companies to find an edge for your portfolio. But social media and financial news programs can create a lot of noise that isn't always built on the best information.
Many investors are tempted to simply chase whatever's been doing well lately. Or they'll buy a stock based on what they heard from a friend or whatever is being talked about on a Reddit message board.
That's not a quality process. It may work from time to time, but the odds of lagging over time are pretty strong.
That's why I've largely removed individual stock picking from my investment strategy. Buying themes and broad indexes lets me participate in the growth story without risking picking a stock that struggles to keep up.
If you feel like you just own a collection of stocks instead of a well-constructed portfolio, the Vanguard Total Stock Market ETF is a great way to start building it the right way.
Should you buy stock in Vanguard Total Stock Market ETF right now?
Before you buy stock in Vanguard Total Stock Market ETF, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard Total Stock Market ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $400,964!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,272,955!*
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See the 10 stocks »
*Stock Advisor returns as of July 18, 2026.
David Dierking has positions in Vanguard Total Stock Market ETF. The Motley Fool has positions in and recommends Reddit and Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.
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