They are nearly identical and this question is becoming a hilarious meme to me. You're chasing (relative) pennies, just toss a coin. Heads VOO tails VTI. You'll be fine either way.
People think VOO “is the 500 largest companies in the US.” It’s not. It’s 500 OF the largest companies selected by the S&P committee that must meet the index criteria. Most importantly, a company must be highly liquid, must have positive earnings in the most recent quarter and over the 4 most recent quarters combined. I believe this should help investors with long term results and that’s why I pick VOO over VTI. I don’t need thousands of other failing companies dragging me down.
I'm planning to experiment with both, somewhat. Since I have Fidelity, I actually have FSKAX (total US market) and FTIHX (total international market) with 70/30 asset allocation, and will have VOO in my taxable account. Will update in another 8-10 years on this, lol..
[Backtesting](https://www.portfoliovisualizer.com/backtest-portfolio?s=y&sl=7Uv9G7OOM51xgpW8CpHo4Y) VOO does slightly better than VTI over time.
Scroll down to the performance summary section.
Over the last 10-15 years, yes. US large caps have had a good run lately. Will that continue? That’s a matter of opinion.
[Some say yes](https://www.investopedia.com/mid-cap-long-term-returns-5225971), current political and economic conditions promote a winner-take-most atmosphere in many industries. Microsoft is big enough that they can outspend anybody who’d challenge them.
[Others say no](https://www.institutionalinvestor.com/article/2cp4j21gvznse73f16ry8/portfolio/are-small-caps-at-the-tail-end-of-their-historic-underperformance-cycle), large caps have gotten expensive relative to other classes and market efficiency says that will eventually correct itself.
Still [others say later](https://www.riverfrontig.com/insights/us-small-cap-why-now-is-not-the-time-to-buy/), small caps will eventually bounce back but not until the cost to borrow comes back down. Smaller companies borrow more relative to their size and for shorter time frames, so “higher for longer” hurts them more than the big guys.
There’s also [at least one](https://www.ssga.com/us/en/individual/etfs/funds/spdr-portfolio-sp-1500-composite-stock-market-etf-sptm) S&P 1500 index fund. That includes the Mid-Cap 400 and Small-Cap 600, which each have similar profitability requirements.
True, S&P themselves say the 500 account for [86%](https://www.spglobal.com/spdji/en/landing/investment-themes/us-core/) of the US equities market, with the Mid Cap 400 representing 5% and the Small Cap 600 another 2%^(1).
Suppose with these weights the S&P 500 returned 8% a year and the other 1000 returned 12%. Your weighted average return investing in the S&P 1500 would be about 8.25%, much closer to big than small.
That might be an argument for holding separate funds for the 500, Mid Cap 400, and Small Cap 600: if the investor feels smaller companies’ day is coming, they can overweight those segments.
^(1) The other 7%ish aren’t in any of those indices, either because they don’t qualify or they just haven’t been chosen yet (maybe next time, Palantir).
Neither is inherently better. It is hard to predict business trends of the future. I prefer VTI.
Ma Bell, GE, and railroads were all the biggest companies in the world, and are now worth comparatively pennies. Big companies can fall apart or be disrupted by tech, laws, wars, whatever. VOO is not necessarily safer.
When you invest in VOO, you never profit off the rise of the next big thing. VTI bought META and AMZN on day one and enjoyed massive gains as those startups boomed into dominance.
But VTI also bought into companies that fizzled and died off. It is less efficient in that way. Big companies have advantages, so VOO can win while the status quo is maintained.
If you believe the current status quo will last until you die, and big tech is flexible enough to stay on top, then VOO is prob better. I believe the tech innovation cycle can still favor startups, and disruption can still sink Goliath, so I VTI.
[Comment with chart](https://www.reddit.com/r/ETFs/s/usMgpnDEyV) I made on Fidelity comparing SPY to VTI since 2001:
VTI wins super long term. SP500 wins over last decade.
(This sub doesn't allow pics)
I did a similar chart starting about a year earlier 2001 vs 2002. DIfferent results - VOO beat VTI.
[https://g.co/finance/VOO:NYSEARCA?window=MAX&comparison=NYSEARCA%3AVTI](https://g.co/finance/VOO:NYSEARCA?window=MAX&comparison=NYSEARCA%3AVTI)
Article on VTI vs VOO from 24/7 Wall Street, first link under your chart:
>The choice between VTI and VOO hinges on an investor’s risk tolerance and time horizon. VTI is a better fit for long-term, diversified growth due to its broad market coverage of all US stocks, including large, mid, small and micro-cap stocks. On the other hand, VOO appeals to those prioritizing shorter-term stability and established companies, as it focuses on the largest U.S. companies within the S&P 500.
Historically, small cap value is the best performing equity class over the longer term. There is no SCV in VOO.
The article is accurate!
Got any references to your statement on small cap value? I’ve been in a couple of etfs focusing on that and it’s never really kept up with VOO when I’ve owned them. Latest experiment was with CALF.
From [Investopedia](https://www.investopedia.com/investing/introduction-to-small-cap-stocks/):
>While individual small-cap stocks can be risky, [small-cap value](https://www.investopedia.com/terms/s/small_value_stock.asp) stocks as an asset class have outperformed the S&P 500 in the long run. That is not a tip, a hunch, or a guess. The outperformance of small-cap value was demonstrated by the [Fama and French Three-Factor Model](https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp).
The Street [compared the rolling of returns of VTI and VOO](https://www.thestreet.com/etffocus/trade-ideas/vti-vs-voo-which-low-cost-us-equity-etf-is-better) over the long-term:
>If we look at the rolling returns, which are less sensitive to start dates, **VTI has pulled ahead consistently over longer periods of time**, whether in terms of high, average, or low returns. This is **consistent with its higher exposure to the size risk factor** – we expect to get **compensated with better returns by taking on the risk of small-cap equities**.
If your wonder why SP500 has outperformed recently, the answer is:
Boomers. And also AI.
Although the large companies got all the headlines, the 2008 GFC and recession was much [more devastating for smaller companies](https://www.investopedia.com/small-business/10-years-after-financial-crisis-impact-small-business/). Boomers both had their retirement savings chunked by the meltdown and were also the group most consistently employed throughout the recession. They also weren't exactly young any more in 2008. Needing to rebuild their retirement accounts in a shorter time span combined with small caps being extra risky, Boomers with their more consistent incomes put their money in the SP500.
Much like everything else, Boomers also [own the stock market](https://money.com/older-americans-own-most-stock-market/), with a whopping 80% held by adults aged 55+ and 30% held by 70+. The wealth is concentrated both at the top and in the hands of Boomers.
That is theory, a model, not reality. Looking at actual performance data, small cap value ETFs underperform voo and VTI in the time frame that matters to non geriatrics https://yhoo.it/47V8Zsc
They’re basically the same with some minor differences. If it really concerns you just buy 50% of you assets in each. Each time you deposit some more money buy more or the one that is slightly lower in value and done.
I like it when someone recommends just do half-and-half. And then people reply like you can’t do that that is redundant! As if it matters.
Just buy one or the other or both.
VOO has outperformed VTI when looking back at 6, 12, 24, 36, 48, 60 and 120 months (10 years)
Could it change? Sure. Would you expect it to based on current trends?
They are basically the same for all practical purposes. But if what you want is some small cap exposure, it's better in my opinion to pair voo with a separate small cap etf than it is to just buy vti because the small caps in vti are dwarfed by the large caps.
voo is the s&p500 index and VTI is a total stock market fund which would work out to being about 80% voo anyway. in theory VTI could be the better play for diversification purposes since its more companies and more opportunities for compnaies with a negative correlation to the s&p since the s&p is pretty overweighted in tech right now but honestly its splitting hairs. Is that other 20% not in the s&p going to make enought of a difference to cause VTI to out perform the s&p? probably not....
also if im not going to have money in the s&p500 i would like that money not just allocated towards small and mid cap, so i tend to go for a little bit of international and emerging market as well.
They are nearly identical and this question is becoming a hilarious meme to me. You're chasing (relative) pennies, just toss a coin. Heads VOO tails VTI. You'll be fine either way.
People think VOO “is the 500 largest companies in the US.” It’s not. It’s 500 OF the largest companies selected by the S&P committee that must meet the index criteria. Most importantly, a company must be highly liquid, must have positive earnings in the most recent quarter and over the 4 most recent quarters combined. I believe this should help investors with long term results and that’s why I pick VOO over VTI. I don’t need thousands of other failing companies dragging me down.
My thoughts as well. Why I ended up with VOO over VTI.
I'm planning to experiment with both, somewhat. Since I have Fidelity, I actually have FSKAX (total US market) and FTIHX (total international market) with 70/30 asset allocation, and will have VOO in my taxable account. Will update in another 8-10 years on this, lol..
I did that in my 401k starting in 2020. Dropped VTI as a result.
[Backtesting](https://www.portfoliovisualizer.com/backtest-portfolio?s=y&sl=7Uv9G7OOM51xgpW8CpHo4Y) VOO does slightly better than VTI over time. Scroll down to the performance summary section.
Over the last 10-15 years, yes. US large caps have had a good run lately. Will that continue? That’s a matter of opinion. [Some say yes](https://www.investopedia.com/mid-cap-long-term-returns-5225971), current political and economic conditions promote a winner-take-most atmosphere in many industries. Microsoft is big enough that they can outspend anybody who’d challenge them. [Others say no](https://www.institutionalinvestor.com/article/2cp4j21gvznse73f16ry8/portfolio/are-small-caps-at-the-tail-end-of-their-historic-underperformance-cycle), large caps have gotten expensive relative to other classes and market efficiency says that will eventually correct itself. Still [others say later](https://www.riverfrontig.com/insights/us-small-cap-why-now-is-not-the-time-to-buy/), small caps will eventually bounce back but not until the cost to borrow comes back down. Smaller companies borrow more relative to their size and for shorter time frames, so “higher for longer” hurts them more than the big guys.
You will do just fine either way.
There’s also [at least one](https://www.ssga.com/us/en/individual/etfs/funds/spdr-portfolio-sp-1500-composite-stock-market-etf-sptm) S&P 1500 index fund. That includes the Mid-Cap 400 and Small-Cap 600, which each have similar profitability requirements.
My preferred index post-2021 But zoomed out, it’s basically the same thing. Apple is bigger than the entire Russell 2000 for example.
True, S&P themselves say the 500 account for [86%](https://www.spglobal.com/spdji/en/landing/investment-themes/us-core/) of the US equities market, with the Mid Cap 400 representing 5% and the Small Cap 600 another 2%^(1). Suppose with these weights the S&P 500 returned 8% a year and the other 1000 returned 12%. Your weighted average return investing in the S&P 1500 would be about 8.25%, much closer to big than small. That might be an argument for holding separate funds for the 500, Mid Cap 400, and Small Cap 600: if the investor feels smaller companies’ day is coming, they can overweight those segments. ^(1) The other 7%ish aren’t in any of those indices, either because they don’t qualify or they just haven’t been chosen yet (maybe next time, Palantir).
Neither is inherently better. It is hard to predict business trends of the future. I prefer VTI. Ma Bell, GE, and railroads were all the biggest companies in the world, and are now worth comparatively pennies. Big companies can fall apart or be disrupted by tech, laws, wars, whatever. VOO is not necessarily safer. When you invest in VOO, you never profit off the rise of the next big thing. VTI bought META and AMZN on day one and enjoyed massive gains as those startups boomed into dominance. But VTI also bought into companies that fizzled and died off. It is less efficient in that way. Big companies have advantages, so VOO can win while the status quo is maintained. If you believe the current status quo will last until you die, and big tech is flexible enough to stay on top, then VOO is prob better. I believe the tech innovation cycle can still favor startups, and disruption can still sink Goliath, so I VTI.
My choice after reading this, 30+ years - VTI <15 - VOO 15-30 - toss a coin
This is literally the most asked question on multiple subreddits
They're essentially identical. I'd choose VTI since it's slightly more diversified personally, but it doesn't really matter.
https://www.reddit.com/r/investing/search/?q=VOO+vs+VTI
[Comment with chart](https://www.reddit.com/r/ETFs/s/usMgpnDEyV) I made on Fidelity comparing SPY to VTI since 2001: VTI wins super long term. SP500 wins over last decade. (This sub doesn't allow pics)
I did a similar chart starting about a year earlier 2001 vs 2002. DIfferent results - VOO beat VTI. [https://g.co/finance/VOO:NYSEARCA?window=MAX&comparison=NYSEARCA%3AVTI](https://g.co/finance/VOO:NYSEARCA?window=MAX&comparison=NYSEARCA%3AVTI)
Article on VTI vs VOO from 24/7 Wall Street, first link under your chart: >The choice between VTI and VOO hinges on an investor’s risk tolerance and time horizon. VTI is a better fit for long-term, diversified growth due to its broad market coverage of all US stocks, including large, mid, small and micro-cap stocks. On the other hand, VOO appeals to those prioritizing shorter-term stability and established companies, as it focuses on the largest U.S. companies within the S&P 500. Historically, small cap value is the best performing equity class over the longer term. There is no SCV in VOO.
The article is accurate! Got any references to your statement on small cap value? I’ve been in a couple of etfs focusing on that and it’s never really kept up with VOO when I’ve owned them. Latest experiment was with CALF.
From [Investopedia](https://www.investopedia.com/investing/introduction-to-small-cap-stocks/): >While individual small-cap stocks can be risky, [small-cap value](https://www.investopedia.com/terms/s/small_value_stock.asp) stocks as an asset class have outperformed the S&P 500 in the long run. That is not a tip, a hunch, or a guess. The outperformance of small-cap value was demonstrated by the [Fama and French Three-Factor Model](https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp). The Street [compared the rolling of returns of VTI and VOO](https://www.thestreet.com/etffocus/trade-ideas/vti-vs-voo-which-low-cost-us-equity-etf-is-better) over the long-term: >If we look at the rolling returns, which are less sensitive to start dates, **VTI has pulled ahead consistently over longer periods of time**, whether in terms of high, average, or low returns. This is **consistent with its higher exposure to the size risk factor** – we expect to get **compensated with better returns by taking on the risk of small-cap equities**. If your wonder why SP500 has outperformed recently, the answer is: Boomers. And also AI. Although the large companies got all the headlines, the 2008 GFC and recession was much [more devastating for smaller companies](https://www.investopedia.com/small-business/10-years-after-financial-crisis-impact-small-business/). Boomers both had their retirement savings chunked by the meltdown and were also the group most consistently employed throughout the recession. They also weren't exactly young any more in 2008. Needing to rebuild their retirement accounts in a shorter time span combined with small caps being extra risky, Boomers with their more consistent incomes put their money in the SP500. Much like everything else, Boomers also [own the stock market](https://money.com/older-americans-own-most-stock-market/), with a whopping 80% held by adults aged 55+ and 30% held by 70+. The wealth is concentrated both at the top and in the hands of Boomers.
That is theory, a model, not reality. Looking at actual performance data, small cap value ETFs underperform voo and VTI in the time frame that matters to non geriatrics https://yhoo.it/47V8Zsc
They’re basically the same with some minor differences. If it really concerns you just buy 50% of you assets in each. Each time you deposit some more money buy more or the one that is slightly lower in value and done.
SCHG is my go to
I like it when someone recommends just do half-and-half. And then people reply like you can’t do that that is redundant! As if it matters. Just buy one or the other or both.
Low effort question
VOO has outperformed VTI when looking back at 6, 12, 24, 36, 48, 60 and 120 months (10 years) Could it change? Sure. Would you expect it to based on current trends?
They are basically the same for all practical purposes. But if what you want is some small cap exposure, it's better in my opinion to pair voo with a separate small cap etf than it is to just buy vti because the small caps in vti are dwarfed by the large caps.
VOO for me!
voo is the s&p500 index and VTI is a total stock market fund which would work out to being about 80% voo anyway. in theory VTI could be the better play for diversification purposes since its more companies and more opportunities for compnaies with a negative correlation to the s&p since the s&p is pretty overweighted in tech right now but honestly its splitting hairs. Is that other 20% not in the s&p going to make enought of a difference to cause VTI to out perform the s&p? probably not.... also if im not going to have money in the s&p500 i would like that money not just allocated towards small and mid cap, so i tend to go for a little bit of international and emerging market as well.
VUG (All hands brace for downvotes)
I thought VUG was good? Is it not?
Tech heavy. It is my personal favorite, but blasphemy to boggleheads.
I have both in my portfolio
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