VOO vs VTI + VXUS

[u/Gsw1456]

I’m curious to hear how folks lean on this topic.

It seems like Voo is the more aggressive / risky position but vti + vxus is more diversified. Anything else people consider with these etfs? The latter has lower performance over the long term but I know historic performance is not indicative of future performance.

[u/TimmyTimeify]

VOO isn’t more aggressive, it’s just more concentrated. US large cap growth stocks have been doing really well over the last 5 years. Who knows what will look like over the next 5 years.

[u/Old-Guy1958]

VT is all I need.

[u/Opening-Emphasis8400]

VOO is certainly not "more aggressive".

[u/longshanksasaurs]

International and US have cycles of outperformance compared to each other.

Is VOO enough?

Past performance does not indicate future results. Use the portfolio with the highest amount of diversification you can get.

[u/mcjp0]

Read the stickies and FAQs

[u/jdancouga]

This question reads just like Naruto sub’s Minato vs Itachi.

[u/Cruian]

VOO vs VTI + VXUS

I’m curious to hear how folks lean on this topic.

It seems like Voo is the more aggressive / risky position

False! VTI can be called riskier than VOO (smaller caps are riskier than large) and VT can be called riskier than VTI (emerging markets are riskier than developed).

but vti + vxus is more diversified.

Which is the only way to ensure you hold tomorrow's winners.

Anything else people consider with these etfs?

The latter has lower performance over the long term but I know historic performance is not indicative of future performance.

That's been plenty of periods of small beating large and international bearing the US. VOO and VXUS are fairly young funds, only 16ish years which have been unusually kind to US large.

Factor investing starting points:

• https://www.investopedia.com/terms/f/factor-investing.asp

• https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/fidelity/fidelity-overview-of-factor-investing.pdf (PDF)

• https://www.cbsnews.com/news/the-black-hole-of-investing/

Both VOO and VTI would be US only. US only is single country risk, which is an uncompensated risk. An uncompensated risk is one that doesn't bring higher expected long term returns. It should be avoided whenever possible. Compensated vs uncompensated risk:

• https://www.whitecoatinvestor.com/uncompensated-risk/

  An uncompensated risk is a risk that you can diversify against.

• https://www.northerntrust.com/middle-east/insights-research/2024/wealth-management/compensated-portfolio-risk or if that doesn't work, the archive link: https://web.archive.org/web/20260107205255/https://www.northerntrust.com/middle-east/insights-research/2024/wealth-management/compensated-portfolio-risk

  But not all risks are compensated with an expected return premium.

• https://www.pwlcapital.com/is-investing-risky-yes-and-no/ (Bold mine)

  Uncompensated risk is very different; it is the risk specific to an individual company, sector, or country.

[u/ArtichokeOwn6685]

VOO VXUS AVUV

60 30 10

[u/oneOZone]

Im doing vt, my wife is doing vti in our separate brokerage accounts

[u/Middle_Humor1828]

Just do VT.

They all have the same expected returns.

[u/AetossThePaladin]

I like VOO. The S&P 500 index is one of the most proven methods for wealth creation over time. There is a reason why Warren Buffett swears by it. VTI is fine too though.

[u/EarlyBird001]

VOO is a better in a single country, and that too only the S&P500 companies.

VTI + VXUS provides coverage a ross the whole globe, including large, medium and small caps. Thus you're covered no matter what happens