If I Could Only Own 1 ETF Heading Into the Coming Fed Meeting, It Would Be This One

2 months ago 39

David Dierking, The Motley Fool

Sun, July 26, 2026 astatine 10:22 AM CDT 3 min read

For the archetypal clip successful respective quarters, there's genuine uncertainty astir what the Federal Reserve is going to bash astatine its upcoming July 28-29 meeting.

According to the latest dot crippled report, astir fractional of the Fed's voting members favour a complaint hike by year-end, portion the different fractional don't. New seat Kevin Warsh himself decided not to taxable his ain economical projection successful June and has been vague astir wherever and erstwhile helium thinks rates volition determination next. The lone existent denotation he's fixed is that helium has "no tolerance" for precocious inflation.

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The markets hatred uncertainty, and this concern is loaded with it. So however should you presumption your portfolio heading into the July Fed meeting? The champion solution mightiness beryllium the simplest one.

VOO helps debar the temptation to stake connected a circumstantial result

A batch of radical are going to beryllium tempted to marque trades oregon portfolio adjustments based connected whether they deliberation the Fed volition clasp rates dependable oregon hike them.

I deliberation the champion solution is to debar making immoderate predictions astatine all.

At its core, the Vanguard S&P 500 ETF (NYSEMKT: VOO) is simply a semipermanent buy-and-hold investment. The explanation of "long-term" is mostly respective years, if not decades. And "buy-and-hold" doesn't mean holding until immoderate short-term lawsuit happens that makes you privation to trade.

"Buy-and-hold" means riding retired the ups and downs, the bully and the bad, and thing that mightiness hap successful between. A azygous Fed gathering is not thing you should beryllium adjusting your semipermanent plus allocation for. Investing successful the Vanguard S&P 500 ETF allows you to put successful the immense bulk of the U.S. equity market. That takes distant the guesswork and keeps a semipermanent absorption connected your money.

Why VOO makes much consciousness than VTI successful this concern

There's an statement to beryllium made that the S&P 500 could travel retired up of an all-cap money similar the Vanguard Total Stock Market ETF (NYSEMKT: VTI) careless of the Fed meeting's outcome.

A complaint hike oregon hawkish clasp could deed tiny caps harder. VTI invests successful tiny caps, but VOO doesn't, creating the accidental for outperformance. A amazingly dovish code from Warsh could nonstop megacap maturation names higher, which VOO overweights comparative to VTI. I'd beryllium cautious saying that VOO is successful a win-win situation, but there's a tenable lawsuit for wherefore it outperforms successful either scenario.

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