Vanguard Tot𝕴al Stock Market Index Fund vs. Vang🦄uard 500 Index Fund: An Overview

Two of Vanguard’s most popular products are the Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) and the Vanguard 500 Index Fund Admiral Shares (VFIAX). Both can serve as suitable core holdings in a stock port🐽folio, but these two mutual funds pursue different investment strategies.

As its name implies, the Total Stock Market Index Fund is highly diversified, investing in stocks across the entire U.S. equities market, using as a benchmark the Center for Research in Security Prices (CRSP) U.S. Total Market Index of nearly 4,000 stocks.

The 500 Index Fund invests in the largest U.S. companies, similar to the list that makes up the S&P 500 Index. That 澳洲幸运5开奖号码历史查询:gives the investor a stake in the biggest players in all of the major U.S. sectors.

Vanguard Total Stock Market Index Fund (VTSAX)

The Vanguard Total Stock Market Index Fund (VTSAX) is based on a total market index that tracks the prices of about 4,000 American comဣpanies across♒ all major industry sectors.

It's a wide-ranging group with built-in diversity, as it includes 澳洲幸运5开奖号码历史查询:small-cap, midcap, and 澳洲幸运5开奖号码历史查询:large-cap stocks as well as growth and 澳洲幸运5开奖号码历史查询:value stocks that are traded on the Nasdaq and New York Stock Exchange (NYSE).

The fund managers employ a representative sampling approach to approximate the entire index and its key characteඣristics. Technology, industrials, financial, healthcare, and consumer discretionary companies make up its largest holdings.

In fact, its top holdings as of January 2025 were all technology stocks: Apple Inc., Microsoft Corp., NVIDIA Corp., and Amazon.com Inc.

As of January 2025, the fu🧸nd held 3,609 stocks and controlled netꦿ assets of $1.8 trillion.

VTSAX charges an 澳洲幸运5开奖号码历史查询:extremely low expense ratio of 0.04% and requires a minimum investment of $3,000.

Top 10 Holdings

The top 10 holding🥀s of VTSAX🐟 are as of year-end 2024:

Vanguard 500 Index Fund (VFIAX)

The Vanguard 500 Index Fund (VFIAX)—the first index fund for individual investors, according to the company—provides exposure to a subset of the entire U.S. equity market: the Standard & Poor’s 500 (S&P 500) Index, whose component companies are the 500 largest U.S. companies and account for about three-fourths of the value of the entire stock market.

The Vanguard 500 Index Fund seeks to replicate its 澳洲幸运5开奖号码历史查询:benchmark index by investing its assets in the stocks comprising the index and holding each component with approximately the same weight as the index. In this way, the fund barely devia♔tes from the S&P 500, which it is designed to mimic. 

As of Jan. 18, 2025, the Vanguard 5🀅00 Index F🍒und had $1.4 trillion in total net assets and, despite its name, holds 500 stocks.

Like its sister fund, VTSAX charges an expense ratio of 0.04% and requires a minimum investment of $3,000.

Top 10 Holdings

The top 10 ho🎃ldings of VFIAX are (as of end of year 2024):

Key Differences

You'll notice that the lists of top 10 holdings in these two funds are very similar, although their 澳洲幸运5开奖号码历史查询:portfolio weights differ. They diverge farther down the list, as the 500 Index Fund tracks only the biggest companies and the Totaꩲl Stock Market Index ranges widely among companies of different sizes, profiles, and industries.

The Vanguard Total Stock Market Index Fund is best suited for moderately to highly 澳洲幸运5开奖号码历史查询:risk-tolerant investors seeking low-cost exposure to the entire U.S. stock mar𓂃ket. It could also function as a single domestic equity fund in a portfolio.

The Vanguard 500 Index Fund is suitable as a core equity holding for investors with a long-term investment horizon and a 澳洲幸运5开奖号码历史查询:preference for the lower risk of the large-cap equity market. Since it con🔯centrates on more conservative, large-cap stocks, the fund might work best in a diversified portfolio that also contains exposureꦬ to aggressive growth stocks.

In comparison to the Vanguard Total Stock Market Index Fund, the Vanguard 500 Index Fund has historically experienced slightly lower 澳洲幸运5开奖号码历史查询:volatility and return. However, the 澳洲幸运5开奖号码历史查询:Sharpe ratios (the most widel🔥y used method for calculating risk-adjusted return) are nearly identical, which indicates that investors in both funds had similar returns on a risk-adjusted basis.

The Bottom Line

The Vanguard Total Stock Market Index Fund and the Vanguard 500 Index Fund are superficially similar, especially when you take a look at the top selections inꦫ their holdings. But they are very d✨ifferent animals.

The Total Stock Market Index fund gives you a stake in companies of all sizes and in ever major sector of the U.ꦓS. economy. That makes it, 🎃by nature, a little more aggressive and a little riskier.

The Vanguard 500 Index Fund gives you a stake in America's current biggest and best companies, the components of the S&P 500.