{"id":385,"date":"2022-01-29T09:33:03","date_gmt":"2022-01-29T09:33:03","guid":{"rendered":"https:\/\/investorimpactlab.com\/?p=385"},"modified":"2022-01-31T23:46:53","modified_gmt":"2022-01-31T23:46:53","slug":"vt-vs-vti","status":"publish","type":"post","link":"https:\/\/investorimpactlab.com\/vt-vs-vti\/","title":{"rendered":"VT vs. VTI – Which is the Better Stock Market Index Fund?"},"content":{"rendered":"\n
The Vanguard Total Stock Market Index Fund<\/strong> (VTI) is an index fund for American Public Companies that have been around for 20 years<\/strong>. The Vanguard Total World Stock Index Fund<\/strong> (VT) was created in 2008<\/strong> as a response to the global financial crisis. VT offers investors exposure to international stocks.<\/p>\n\n\n\n
VT vs VTI! Both are pretty popular stock market index funds from Vanguard<\/strong>. To many people, they may seem to be identical, but they differ in terms of their returns, expense ratios, yield,<\/strong> and many other things that I will discuss further.<\/p>\n\n\n\n
The Vanguard Total Stock Market Index fund holds enough stocks to gain exposure to the US stock market. On the other hand, the Vanguard Total World Stock ETF is a way for most investors looking for exposure to international stocks beyond their domestic investments.<\/p>\n\n\n\n
Both have many similarities and dissimilarities<\/strong>, which I will explain so that nobody who invests in these funds gets the money plunge.<\/p>\n\n\n\n
Let\u2019s take a look at what each exchange-traded fund offers:<\/p>\n\n\n\n
Key Takeaways<\/h3>\n\n\n\n
Vanguard issues both VT and VTI.<\/li>
VTI \u200b\u200bonly tracks the future performance of the CRSP US Total Market Index.<\/strong><\/li>
However, VT Tracks the performance of the FTSE Global All Cap Index.<\/strong><\/li>
VT is more diversified than VTI as it covers the international market.<\/li>
VT\u2019s expense ratio is 0.08%<\/strong>.<\/li>
The expense ratio of VTI is 0.03% <\/strong>making it much more viable.<\/strong><\/li>
There is no minimum initial investment required in both VTI and VT.<\/li><\/ul>\n\n\n\n\n\n
VT vs. VTI – Composition<\/h2>\n\n\n\n
As stated above, both have similarities and little downside, making them two different category index funds. Both stocks can\u2019t be used to replace one another as their concentrated market and relevancy have a huge difference.<\/p>\n\n\n\n
The VT stocks have a heavy concentration in the US, which is not surprising since it was created to mimic the VTI. It holds over 57% of its portfolio in companies from the US <\/strong>but also has significant exposure to foreign markets like Japan and the United Kingdom. The Vanguard Total International Stock Index Fund (VT) currently offers investors a meager expense ratio of 0.08%.<\/p>\n\n\n\n
VT vs. VTI: portfoliovisualizer.com<\/figcaption><\/figure>\n\n\n\n
On the other hand, VTI consists of companies traded on both the NYSE & NASDAQ and smaller markets, thus lower concentration in different countries.<\/strong> By name, it might sound like it is also an international stocks market fund like VT; However, it\u2019s a total U.S stock market fund. <\/p>\n\n\n\n
It covers all market-cap sizes, sectors, styles within the USA. VTI doesn\u2019t hold any internal stocks and is more concentrated than VT, which holds the US plus internal stocks. Moreover, the mutual funds equivalent of VT and VTI are VTWAX<\/a> and VTSAX<\/a>. <\/p>\n\n\n\n