Exchange-traded funds (ETFs) are convenient because they allow investors to gain exposure to a wide range of industries with a single, hands-off investment.
In terms of exchange-traded funds, VTI and VOO claim to be the two of the safest options out there.
Both tend to mirror the growth patterns of leading large-cap companies and have done so much for a considerable time.
Do you need to pick one to concentrate on in 2022, or can you afford to do both? Find out in this review!
This VTI vs VOO Review has been thoroughly researched with information and testimonials that are available online to anyone in the public. Any conclusions drawn by myself are opinions.
Table of Contents
Pros: What I Liked
- Both Have Low Cost
- Grow Investment Easily
- Good Performance
Cons: What I Didn't Like
- Many Similarities
- Both Are Still Risky
- Market Currently Weak
You probably discovered VTI vs. VOO for the same reason you might have come across any other financial newsletter, EFT, trading service, or investment program:
Because you want more money in less time.
And chances are, you want to quickly multiply the money you do have (as opposed to waiting months or even years to see a decent ROI).
This is a really exciting promise, and it’s probably why the financial publishing and training industry is worth billions of dollars.
The problem is that the idea of doubling, tripling, or 10X-ing your money in a few minutes to a few days is so enticing, there are a ton of shady characters in this space.
But, putting that aside, let’s say every investing guru and “trading expert” on the Internet had the best of intentions.
Even with proprietary algorithms, a room full of supercomputers, and a team of rocket scientists, most of these experts would be lucky to get it right 20% of the time.
Now sure, we’re talking about asymmetric bets here, so theoretically the winners should make up for the losers.
But in order to make that happen, you should NEVER miss a trade. With a 20% success rate (speaking optimistically), one missed victory could turn a profitable month into a loss.
That’s a lot of pressure and a lot of stress (not to mention a lot of losing) with not much certainty.
But what if there was a way you could build a passive income stream that’s actually passive?
An income stream that doesn’t require:
- Constant monitoring of your phone for buy/sell alerts
- Obsessive watching of charts and movement
- An emotional roller coaster and angst of hoping one winner can cover the last 8 losses
- Gambler’s odds (20% chance of success is worse than the odds of winning at Blackjack)
An income stream that brings in consistent revenues every single month (from a couple of thousand dollars to well over $10,000)?
An income stream you could actually build in your spare time, and grow as large or as small as you want to, without having to spend hours a day monitoring charts, trades, and alerts?
If that sounds like something you’d be interested in, check out Digital Real Estate.
However, if you’d still like to know more about VTI vs. VOO, keep reading.
VTI Vs. VOO: What Do You Need To Know?
Both VOO and VTI are exchange-traded funds (ETFs) that track a major index from Vanguard.
In contrast to VOO, which follows the S&P 500, VTI follows the Total Stock Market Index, which includes more than 4K publicly traded companies.
Both provide broad exposure to the stock market, which helps reduce risk.
About 82% of VTI is made up of VOO: therefore, the two have comparable performance, but VTI has more micro-cap stocks, mid-cap stocks, and small-cap stocks.
What Is VOO?
The Vanguard S&P 500 exchange-traded fund, often known as VOO (VOO.IV), is essentially a collection of assets that aim to replicate the performance of the S&P index.
The Standard & Poor’s (S&P) 500 Index is one of the most widely tracked indexes in the United States investable equity market.
It is a collection of the largest index funds in the United States that includes household brands like Apple, Microsoft, Amazon, Tesla, and Johnson & Johnson.
Large market capitalization corporations are typically considered secure, but they do not provide the same opportunity for growth as smaller companies.
VOO, which monitors the S&P 500 index, has 503 companies in its portfolio, with a median market cap of $161B.
What Is VTI?
Vanguard Total Stock Market ETFs (VTI) is a passive investment vehicle that tracks the performance of the CRSP Total Market Index, which represents the entire U.S. stock market.
It’s an ETF that tracks the whole investable equity market, including large and small companies.
This approach claims that investors may avoid the hassle of stock choosing altogether by purchasing a total market index fund.
There are probably going to be more successes than losses, thanks to the sheer number of equities the portfolio have.
Launched in 2001, the fund’s stated goal is to replicate the performance of the CRSP US Total Market Index.
About 82% of VTI’s value comes from large-cap stocks, 12% from mid-cap stocks, and 6% from small-cap companies.
The stocks in VTI are given more weight in proportion to their market capitalization. VOO contributes around 82% of VTI’s total weight.
On the other hand, the other 18% comes from smaller enterprises. Stocks from the VOO fund are already included in VTI.
VTI Vs. VOO – Performance
Both VTI and VOO allow your investment account works on its own in the stock market, with no need to actively manage the money.
Except for the year 2022, VOO’s price has risen steadily. Mutual funds have gained 13.29% since their start.
When looking at the market price of the funds’ returns each year, VTI returned 25.64% in 2021, and VOO returned 28.6%.
When comparing the quarterly returns of VOO and VTI, the two ETFs again showed the same performance.
The first quarter’s returns were approximately 6%, the second quarter was up somewhat, the third quarter was down to almost nil, and the fourth quarter’s returns were up significantly.
Investing in either of these funds would have yielded roughly the same returns.
VTI Vs. VOO – Dividends
Shareholders of both funds get dividends once every three months. Companies make these payouts to show appreciation to their most loyal shareholders.
As an investor, you stand to gain from the appreciation of your portfolio as a whole. You can also do that from the regular dividend yields made by a portion of the businesses in the fund.
Presently, the yearly dividend yield for VTI is $3.04, with a dividend yield of 1.59%. Similar dividend yields may be found in VOO (1.65%).
As of August 25, 2022, the price of a single share of VOO was $382: therefore, if you had 100 shares, you would have $38,200 in your investment account.
Taking into account only the first dividend payment and not the dividend’s potential growth through reinvestment/taxation, your annual dividend yield would be around $630.30 at a dividend yield of 1.65%.
If you had 100 shares of VTI, which were selling for around $209 each, you would have a total asset worth $20,900.
When applied to a $10,000 investment, VTI’s dividend yield of 1.59% produces $332.31 in income.
The lower share price of VTI translates to a smaller dividend payment compared to VOO.
VTI Vs. VOO – Similarities
It’s very evident that there are many similarities between VTI and VOO.
There is now an 82% stock holding overlap between the two funds, with just around 18% invested in equities exclusive to VTI.
They have the same top 10 holdings, with about equal weights across the board.
VOO and VTI have a lot in common, including a low expense ratio (0.03%), and the ability to be traded through many of the same brokerages.
You can’t go wrong with VOO or VTI in the long run.
While both funds have seen losses in the previous year, they have also had similar gains and losses over the past decade.
VTI Vs. VOO – Difference
Although both funds broadly follow the stock market, VOO follows only the S&P 500, and VTI is market cap weighted: hence, their respective compositions are different.
If you want your portfolio to comprise big companies, VOO will normally perform in line with the S&P 500.
However, VTI may be a better option if you’re looking to make a diversified investment in the stock market.
In addition, VTI’s weighting is less biased only large-cap stocks.
If you buy VTI, you will have a little stake in virtually every U.S. financial institution that is listed on a public stock exchange.
Large-cap equities make up 64.3% of the fund’s assets, while the fund invests more heavily in smaller companies than VOO does.
VTI’s market value is 6.8 percent in SMEs and 9.9 percent in micro-caps. However, VOO has a negligible holding in small enterprises (0.3%) and a considerable holding in mid-sized businesses (4.4%).
Investments in companies that haven’t quite made it onto the S&P 500, yet may carry a higher degree of risk, but also greater potential gain.
Companies with a market cap of less than $10 billion have more opportunities to expand in the future than those with a market cap of over $10 billion.
How Much Do VTI And VOO Cost?
Shares of VOO now trade at a premium over those of VTI, which may not seem like a big deal in the larger scope of things.
Take the values of VTI and VOO as of the end of trading on August 19, 2022: VTI was $211.79, and VOO was $388.17.
Some investors may be more enticed by VTI due to its cheaper share prices.
However, most investment companies enable customers to acquire fractional shares, making the large ETFs accessible to investors of varying financial means.
VOO Or VTI: Which One Is Better?
When considering your investment options, it may be difficult to choose between VTI and VOO due to the similarity in their offering of exposure to a large variety of assets at relatively low costs.
Since huge chunks of both ETFs are almost identical to each another, picking one over the other may not necessarily be more beneficial even in the present weak stock market.
The good news is that you can construct a diversified and easily accessible portfolio over time with either VOO or VTI.
Is VTI Vs. VOO A Scam?
So, is VTI vs. VOO a scam? Not technically. You can make money with it, but it’s definitely not as easy as VTI vs. VOO makes it sound.
Again, with any kind of financial product (especially trading), you’re taking on a lot of risks.
Sure, you could hit it big and retire in Italy, but chances are you need the stomach and financial cushion to weather tons of losses before you get there…and it may never happen.
Most of the big gains numbers these companies use in their marketing (“XYZ grew by 4,112% in 3 months” or “this option made 324% in just 2 days”) are cherry-picked.
They don’t tell you about the 10 100% losers that came before.
In other words, if you invested $100 into 11 recommendations, you’d lose $1,000, and make back $324…so you’d still be out almost $700.
Most people don’t have the fortitude to stick it out through 3 straight months of losers in the hopes of landing one big winner.
What if, instead, you took those same 3 months, invested just a couple hours a day (in your spare time), and your reward was a $500 to $2,000 payment that came in every single month?
And what if you actually didn’t need to wait 3 months? What if you could get started today and have your first payment in a week?
And what if you could double it next week?
Well, that’s the power of Digital Real Estate.
It’s a true lifestyle business.
Your laptop and an Internet connection are all you need.
Some of the most successful students in this program run their entire 6-figure businesses from:
- A camper in the middle of the woods
- A beach chair on the water in Mexico
- A small villa in Greece
They’re able to travel around, living their lives first, and focusing on their income second.
Because even if they stop working for an extended period of time, the money keeps coming in.
So, adventures, memories, and experiences are the top priority.
And they never have to worry about how to pay for the next trip or consider asking for time off.
If this sounds more like the type of life you want to lead, just click here to find out more about Digital Real Estate.
Are There Alternatives To VTI Vs VOO?
Yes, there are plenty of other business models to choose from if you want to pursue this making money online. Here are just a few:
What Is My Top Recommendation In Making Money From Home In 2022?
Our review team has spent months researching, reviewing, and vetting dozens of business models and thousands of programs.
While there may be no “perfect business,” the research IS conclusive:
Whether you’ve never made a dollar online, or you’ve been in this space for a while but never really “made it,” Digital Real Estate is for you.
1. It’s Flexible: got an hour a day? You can do this. Ready to drop everything else and dive in full-time? You can do this. Yes, the more time you put in, the faster you see results. But even with a little time each day, you can move the needle in a Digital Real Estate business.
And because this system is so flexible, you don’t have to constantly be working to make more money. It’s called PASSIVE INCOME because if you stop working, the money doesn’t.
Imagine taking 3 months off to just tour around Europe, rent a cabin in the woods to write a book, hike the Appalachian Trail, or live on the beach and surf all day.
This is only possible if you have an income stream that’s not tied to your time.
2. You Own & Control EVERYTHING: With anything in the financial markets, you own and control NOTHING. You have no say in price fluctuations, demand, or what the market will do.
Trying to beat the market is fighting against the tide. There’s just too much working against you, no matter how many supercomputers or rocket scientists are on your side.
With Digital Real Estate, you own the assets, which means you have all the power and control.
3. Little To No Startup Costs: It’s possible to get into Digital Real Estate with zero dollars upfront. Because, using the strategies outlined in this program, you can get a client to pay you BEFORE spending a penny out of your own pocket…even before you do any work.
Even without getting paid in advance, you can have your first Digital Rental Property up, running, and generating profits for less than $100.
4. Easy To Duplicate: Ok, here’s the best part: once you have your first Digital Rental Property up and running, you can literally DOUBLE your income with a few clicks, a couple of keystrokes, and a single phone call (and you don’t actually need the phone call).
Remember: Each Digital Rental Property is worth $500 to $2,000 a month in semi-passive income (over 95% profit). Every time you decide to create another one and increase your income, it gets easier.
Because you have more knowledge, more experience, more results, and more momentum.
If you wanted to double your income with any kind of trading or investing, you’d have to double your initial capital OR double the average order size of your existing trades.
And, guaranteed that’s a lot harder than a few clicks and a few minutes of your life.
5. Make Money Helping Real People: This part is what makes it all worth it. In the financial markets, you might be helping your family, but the impact never goes beyond you and maybe a few others.
But with Digital Real Estate, you’re actually helping people by solving your clients’ biggest problem:
Small, local businesses need more customers, and with Digital Real Estate, you are unleashing a flood of happy, paying customers for these businesses.
You make money by helping them make money.
Not a big, faceless corporation either…a small business owner who’s using that money to put food on the table for their family, start a college fund for their kids, or take care of a sick parent.
Once you see how Digital Real Estate makes a real impact on the lives of real people, you’ll sleep like a baby with a big smile on your face.
Now, the choice is yours. You could continue browsing, looking at opportunities like VTI vs. VOO which could one day make you money.
You could continue researching, never making a decision.
OR, you could take a look inside, consider what you really want, and join a program that makes your dreams a reality. At the same time, joining a community of over 2,000 successful students that are living life on their own terms thanks to Digital Real Estate.
A consistent, reliable, semi-passive stream of income that doesn’t depend on you or your time to keep producing profits.
All while genuinely helping real people who are grateful and happy to pay for it.
If this sounds more like what you want out of life (or if you just want some nice side income), click here to learn more about Digital Real Estate.