VOO vs. VT: What’s The Difference?

The Vanguard S&P 500 ETF (VOO) and the Vanguard Total World Stock Index Fund ETF Shares (VT) are both among the Top 100 ETFs. VOO is a Vanguard Large Blend fund and VT is a Vanguard N/A fund. So, what’s the difference between VOO and VT? And which fund is better?

The expense ratio of VOO is 0.05 percentage points lower than VT’s (0.03% vs. 0.08%). VOO also has a higher exposure to the technology sector and a lower standard deviation. Overall, VOO has provided higher returns than VT over the past ten years.

In this article, we’ll compare VOO vs. VT. We’ll look at performance and holdings, as well as at their portfolio growth and industry exposure. Moreover, I’ll also discuss VOO’s and VT’s annual returns, risk metrics, and fund composition and examine how these affect their overall returns.

Summary

VOO VT
Name Vanguard S&P 500 ETF Vanguard Total World Stock Index Fund ETF Shares
Category Large Blend N/A
Issuer Vanguard Vanguard
AUM 753.41B 30.44B
Avg. Return 14.45% 10.42%
Div. Yield 1.34% 1.65%
Expense Ratio 0.03% 0.08%

The Vanguard S&P 500 ETF (VOO) is a Large Blend fund that is issued by Vanguard. It currently has 753.41B total assets under management and has yielded an average annual return of 14.45% over the past 10 years. The fund has a dividend yield of 1.34% with an expense ratio of 0.03%.

The Vanguard Total World Stock Index Fund ETF Shares (VT) is a N/A fund that is issued by Vanguard. It currently has 30.44B total assets under management and has yielded an average annual return of 10.42% over the past 10 years. The fund has a dividend yield of 1.65% with an expense ratio of 0.08%.

VOO’s dividend yield is 0.31% lower than that of VT (1.34% vs. 1.65%). Also, VOO yielded on average 4.03% more per year over the past decade (14.45% vs. 10.42%). The expense ratio of VOO is 0.05 percentage points lower than VT’s (0.03% vs. 0.08%).

Fund Composition

Industry Exposure

VOO vs. VT - Industry Exposure

VOO VT
Technology 24.24% 19.63%
Industrials 8.86% 10.7%
Energy 2.84% 3.48%
Communication Services 11.14% 9.02%
Utilities 2.43% 2.6%
Healthcare 13.1% 11.58%
Consumer Defensive 6.32% 6.71%
Real Estate 2.58% 3.64%
Financial Services 14.2% 15.36%
Consumer Cyclical 12.01% 12.32%
Basic Materials 2.27% 4.97%

The Vanguard S&P 500 ETF (VOO) has the most exposure to the Technology sector at 24.24%. This is followed by Financial Services and Healthcare at 14.2% and 13.1% respectively. Utilities (2.43%), Real Estate (2.58%), and Energy (2.84%) only make up 7.85% of the fund’s total assets.

VOO’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Healthcare stocks at 6.32%, 8.86%, 11.14%, 12.01%, and 13.1%.

The Vanguard Total World Stock Index Fund ETF Shares (VT) has the most exposure to the Technology sector at 19.63%. This is followed by Financial Services and Consumer Cyclical at 15.36% and 12.32% respectively. Energy (3.48%), Real Estate (3.64%), and Basic Materials (4.97%) only make up 12.09% of the fund’s total assets.

VT’s mid-section with moderate exposure is comprised of Consumer Defensive, Communication Services, Industrials, Healthcare, and Consumer Cyclical stocks at 6.71%, 9.02%, 10.7%, 11.58%, and 12.32%.

VOO is 4.61% more exposed to the Technology sector than VT (24.24% vs 19.63%). VOO’s exposure to Financial Services and Healthcare stocks is 1.16% lower and 1.52% higher respectively (14.2% vs. 15.36% and 13.1% vs. 11.58%). In total, Utilities, Real Estate, and Energy also make up 1.87% less of the fund’s holdings compared to VT (7.85% vs. 9.72%).

Holdings

VOO - Holdings

VOO Holdings Weight
Apple Inc 5.92%
Microsoft Corp 5.62%
Amazon.com Inc 4.06%
Facebook Inc Class A 2.29%
Alphabet Inc Class A 2.02%
Alphabet Inc Class C 1.97%
Tesla Inc 1.44%
Berkshire Hathaway Inc Class B 1.44%
NVIDIA Corp 1.37%
JPMorgan Chase & Co 1.3%

VOO’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 5.92%, 5.62%, 4.06%, 2.29%, and 2.02%.

Alphabet Inc Class C (1.97%), Tesla Inc (1.44%), and Berkshire Hathaway Inc Class B (1.44%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the VOO’s holdings at 1.37% and 1.3%.

VT - Holdings

VT Holdings Weight
Apple Inc 2.85%
Microsoft Corp 2.71%
Amazon.com Inc 1.98%
Facebook Inc Class A 1.1%
Alphabet Inc Class A 0.97%
Alphabet Inc Class C 0.95%
Tesla Inc 0.7%
NVIDIA Corp 0.64%
JPMorgan Chase & Co 0.62%
Tencent Holdings Ltd 0.6%

VT’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 2.85%, 2.71%, 1.98%, 1.1%, and 0.97%.

Alphabet Inc Class C (0.95%), Tesla Inc (0.7%), and NVIDIA Corp (0.64%) have a slightly smaller but still significant weight. JPMorgan Chase & Co and Tencent Holdings Ltd are also represented in the VT’s holdings at 0.62% and 0.6%.

Performance

Annual Returns

VOO vs. VT - Annual Returns

Year VOO VT
2020 18.35% 16.74%
2019 31.46% 26.8%
2018 -4.42% -9.67%
2017 21.78% 24.19%
2016 11.93% 8.77%
2015 1.35% -1.88%
2014 13.63% 3.97%
2013 32.33% 22.98%
2012 15.98% 17.33%
2011 2.09% -7.71%
2010 0.0% 13.05%

VOO had its best year in 2013 with an annual return of 32.33%. VOO’s worst year over the past decade yielded -4.42% and occurred in 2018. In most years the Vanguard S&P 500 ETF provided moderate returns such as in 2016, 2014, and 2012 where annual returns amounted to 11.93%, 13.63%, and 15.98% respectively.

The year 2019 was the strongest year for VT, returning 26.8% on an annual basis. The poorest year for VT in the last ten years was 2018, with a yield of -9.67%. Most years the Vanguard Total World Stock Index Fund ETF Shares has given investors modest returns, such as in 2016, 2010, and 2020, when gains were 8.77%, 13.05%, and 16.74% respectively.

Portfolio Growth

VOO vs. VT - Portfolio Growth

Fund Initial Balance Final Balance CAGR
VOO $10,000 $36,575 14.45%
VT $10,000 $24,537 10.42%

A $10,000 investment in VOO would have resulted in a final balance of $36,575. This is a profit of $26,575 over 10 years and amounts to a compound annual growth rate (CAGR) of 14.45%.

With a $10,000 investment in VT, the end total would have been $24,537. This equates to a $14,537 profit over 10 years and a compound annual growth rate (CAGR) of 10.42%.

VOO’s CAGR is 4.03 percentage points higher than that of VT and as a result, would have yielded $12,038 more on a $10,000 investment. Thus, VOO outperformed VT by 4.03% annually.


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