Thanks to their reputation for low costs and high quality, Vanguard mutual funds are widely popular. With more than $6 trillion in assets, Vanguard dominates the mutual fund and exchange-traded fund landscape in the United States. In the U.S., Vanguard offers 204 funds with an average 2022 asset-weighted expense ratio of 0.08%, a testament to its commitment to low fees. In this article, we'll take a closer look at some of the top Vanguard mutual funds to invest in for the long term.
An index fund is an investment fund – either a mutual fund or an exchange-traded fund (ETF) – that is based on a preset basket of stocks, bonds, or other assets. Index funds aim to replicate the performance of a specific market index, such as the S&P 500 or the Dow Jones Industrial Average. Vanguard is known for its index funds, which are designed to provide broad exposure to various market segments at a low cost.
One of Vanguard's most popular mutual funds is the Vanguard Total Stock Market Index Fund (VTSMX). This fund aims to replicate the performance of the CRSP US Total Market Index, which includes nearly 4,000 stocks. VTSMX has an expense ratio of just 0.14% and has consistently outperformed the S&P 500 over the long term. This fund is an excellent choice for investors looking for broad exposure to the U.S. stock market.