The 1 ETF I'd Buy if I Could Only Own One

2 months ago 26

David Dierking, The Motley Fool

Wed, July 22, 2026 astatine 9:50 AM CDT 3 min read

If I could lone ain 1 ETF close now, I'd bargain the Vanguard Total Stock Market ETF (NYSEMKT: VTI). By owning astir 3,500 U.S. stocks, it's 1 of the astir divers ETFs you'll find. It's the perfect instauration for gathering the remainder of your portfolio. And with an disbursal ratio of conscionable 0.03%, it costs astir thing to ain it.

Why take a full banal marketplace ETF implicit the S&P 500?

The biggest selling constituent for this fund, successful my opinion, is that it targets the full investable U.S. banal market. A batch of radical volition usage thing similar the Vanguard S&P 500 ETF (NYSEMKT: VOO) for this purpose. I don't blasted them, and it's a perfectly tenable prime for a portfolio centerpiece.

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A mates reviewing fiscal statements connected a laptop with an advisor.

But I similar the Vanguard Total Stock Market ETF's all-cap attack versus the S&P 500's large-cap focus. Mid-cap and small-cap stocks lone marque up astir 10% to 15% of the portfolio overall, but it's important to see them. Smaller companies person historically experienced extended periods of outperformance comparative to ample caps, and investors should privation that successful their portfolios. Plus, the Vanguard Russell 2000 ETF (NASDAQ: VTWO), a proxy for small-caps, has a overmuch antithetic assemblage creation than the Vanguard S&P 500 ETF. That diversification tin besides assistance creaseless retired the thrust successful the agelong term.

The S&P 500 is arsenic top-heavy arsenic it's ever been close now. The Vanguard Total Stock Market ETF isn't overmuch amended due to the fact that it besides weights by marketplace cap, but it offers amended diversification.

Why VTI is simply a amended prime than VOO for your portfolio close present

Small-cap show has intelligibly been an anchor connected full banal marketplace ETFs for respective years. That's mostly been a relation of this group's comparatively mediocre fiscal performance.

Earnings maturation for small-caps had been minimal astatine a clip erstwhile large-cap net were inactive increasing astatine a steadfast rate. That's rapidly becoming a happening of the past. Earnings maturation for the S&P 600 Small Cap Index is expected to travel successful astir 18% successful 2026 and different 18% successful 2027. That puts small-caps successful a overmuch healthier presumption contiguous and could mean they yet instrumentality vantage of immoderate of the comparative worth presently built into stock prices.

That puts all-cap funds similar the Vanguard Total Stock Market ETF successful a comparatively advantageous presumption for the archetypal clip successful a while. That's wherefore I judge this is the 1 money to ain some successful the short-term and long-term. It won't ever outperform, but its diversification, debased cost, and quality to seizure the full marketplace alternatively of conscionable a subset are what acceptable it apart.

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