Vanguard ETFs For Long-Term Growth And International Diversification


Vanguard exchange-traded funds are among the most popular ETFs. Known for their high intraday liquidity, low expense ratios and transaction costs, these funds can be especially advantageous for long-term portfolios.

As of January 2020, Vanguard had over $6 billion in global assets under management. The company’s founder, John Bogle, is widely regarded as a pioneer of index investing, with Warren Buffett saying in a 2016 letter to shareholders that “if a statue is ever erected to honor the person who has done the most for American investors, the hands-down choice should be Jack Bogle.”

Today, we’ll look at two Vanguard ETFs, one providing exposure to growth stocks and the other to international markets:

1. Vanguard Russell 1000 Growth Index Fund ETF Shares

  • Current Price: $229.06
  • 52-Week Range: $131.88 – $240.69
  • Dividend Yield: 0.76%
  • Expense Ratio: 0.08%

The Vanguard Russell 1000 Growth Index Fund ETF Shares (NASDAQ:) provides exposure to growth shares in US-based large-capitalization (cap) firms.

Vong Weekly Chart

VONG, which has 450 holdings, tracks a range of growth-oriented businesses from the Russell 1000 Growth Index, 1,000 of the largest public firms stateside.

The ten largest stocks in VONG make up over 45% of the fund’s net $8.1 billion assets.

In terms of sector allocation, technology tops the list with 44.6%, followed by consumer discretionary (20%), health care (13.70%), and industrials (12.10%). Apple (NASDAQ:), Microsoft (NASDAQ:), Amazon (NASDAQ:), Alphabet (NASDAQ:), (NASDAQ:), and Facebook (NASDAQ:) head the list of firms. Over the past decade, these businesses have become household names.

Since the start of the year, the fund is up over 25% and hit an all-time high of $240.69 on Sept 2. Trailing P/E and P/B ratios stand at 38.1 and 11.3, respectively.

In the coming days, many names that make up the top holdings will release . Therefore, further choppiness and short-term profit-taking are possible. Buy-and-hold investors who can ride out any short-term volatility should keep the fund on their radar.

Those who would like to invest in large-cap growth names could consider buying into the declines in price. The Street typically regards large-cap companies as stable long-term investments, thus, such names are unlikely to get held down by the market for too long.

2. Vanguard FTSE Developed Markets ETF

  • Current Price: $41.75
  • 52-Week Range: $28.46 – $44.67
  • Dividend Yield: 2.37%
  • Expense Ratio: 0.05%

For those looking to invest beyond the US, the Vanguard FTSE Developed Markets Index Fund ETF Shares (NYSE:) provides access to a diverse range of companies, primarily in Europe and the Pacific region as well as Canada.

VEA Weekly Chart

VEA has 3998 holdings and tracks the . The top ten names make up around 10% of net assets of 119 billion.

Switzerland-based consumer goods giant Nestle (OTC:), South Korea-based technology conglomerate Samsung Electronics (OTC:), Switzerland-headquartered pharma and health care companies Roche (OTC:) and Novartis (OTC:), Germany-based software business SAP (NYSE:), and Japan-headquartered Toyota Motor (NYSE:) lead the names of firms in the fund.

Year-to-date, VEA is down about 5%. Trailing P/E and P/B ratios stand at 18.3 and 1.5. In the short-run, declining gross domestic product across the world could pose a threat to returns. However, those investors who would like to diversify internationally but avoid may find value around $37.5.

Below are articles which addressed additional Vanguard ETFs worth considering:

  • Vanguard Consumer Staples Index Fund ETF (NYSE:) — covered ;
  • Vanguard Dividend Appreciation ETF (NYSE:) — covered ;
  • Vanguard FTSE Pacific ETF (NYSE:) — covered ;
  • Vanguard Materials ETF (NYSE:) — covered ;
  • Vanguard Mid-Cap Index Fund ETF (NYSE:) — covered
  • Vanguard Real Estate Index Fund ETF Shares (NYSE:) — covered
  • The Vanguard Total International Bond ETF (NASDAQ:) — covered
  • Vanguard Total Bond Market Index Fund ETF (NASDAQ:) — covered ;
  • Vanguard Total Stock Market ETF (NYSE:) — covered .

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