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VTI vs. VTSAX: Which Total Market Index Fund is Right for You?

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A comparison of Vanguard's VTI and VTSAX total market index funds.

description: an image of a graph showing the performance of vti and vtsax over the past five years, with vtsax showing slightly higher gains.

Both Vanguard ETFs offer low-cost, broad U.S. market exposure, but there are some differences to take note of. VTI and VTSAX are two total market index funds, meaning that they track the overall performance of the U.S. stock market. They are both highly diversified and offer exposure to thousands of stocks across various sectors.

VTI has a portfolio of about 3,945 stocks, and this provides a good representation of the broader U.S. market. Despite the decline last year due to the pandemic, VTI has since made a strong recovery and has seen significant gains in recent months. On the other hand, VTSAX has a slightly larger portfolio of around 3,600 stocks and is geared towards long-term investors.

When it comes to expenses, VTI has a slightly lower expense ratio of 0.03%, compared to VTSAX's 0.04%. While this may seem like a minor difference, it can make a significant impact on your returns over the long term.

In terms of minimum investment requirements, VTSAX has a minimum investment of $3,000, while VTI has no minimum investment requirement. This makes VTI a more accessible option for beginner investors who may not have a significant amount of capital to start with.

When it comes to performance, both VTI and VTSAX have seen strong gains over the past few years. However, VTSAX has a slightly better track record, with an average annual return of 16.70% over the past five years, compared to VTI's 16.46%.

Investors should also consider their investment goals and risk tolerance when choosing between VTI and VTSAX. VTSAX may be more suitable for long-term investors who are willing to take on slightly more risk in exchange for potentially higher returns. On the other hand, VTI may be a better option for investors looking for a low-cost, diversified fund that offers broad market exposure.

Both VTI and VTSAX are excellent options for investors looking to gain exposure to the U.S. stock market. Ultimately, the decision between the two will depend on individual preferences and investment goals.

Ticker: VTI, VTSAX

vtivtsaxtotal market index fundsvanguarddiversifiedexpensesperformanceinvestment goalsrisk tolerance
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