Vanguard S&P 500 ETF: Here’s why VOO is better than SPY

The Vanguard S&P 500 ETF (VOO) fund has done well in the past few months, helped by big tech companies like Nvidia, Microsoft, and Apple. VOO jumped to a high of $408.55, the highest level since April last year. It has soared by more than 27% from the lowest level in 2022.

Vanguard S&P 500 ETF is soaring

The Vanguard S&P 500 ETF is a major fund that tracks the S&P 500 index. It is a major fund with over $316 billion. It competes with other popular funds like the SPDR S&P 500 ETF (SPY) and the iShares S&P 500 ETF. The funds has over $408 billion and $330 billion, respectively.

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The VOO ETF tracks the S&P 500 index, which focuses on the biggest American companies like Apple, Microsoft, Google, Meta Platforms, and Nvidia among others. It has an expense ratio of just 0.03%, meaning a $10,000 investment in the fund attracts a $3 fee annually. 

In terms of returns, the fund has a dividend yield of 1.50%, a few points higher than the SPY ETF of 1.48%. Its five-year CAGR growth is 6.36%, which is higher than the SPY’s 5.77%. Most importantly, VOO tends to outperform the SPY fund. It has jumped by 20.23% in the past 12 months compared with SPY’s 19.88%.

Therefore, since the two funds track the same index, it makes sense to invest in the Vanguard S&P 500 ETF than the SPY. The only major caveat is that SPY is usually more liquid than the VOO ETF. Its avcrage daily volume is $1.43 billion compared to SPY’s $35.83 billion.

I believe that the S&P 500 index is one of the best places to pack your retirement money. And since you cannot invest in the index directly, VOO is the cheapest alternative.

VOO ETF stock price forecast

VOO chart by TradingView

The daily chart shows that the Vanguard S&P 500 ETF has been in a strong bullish trend in the past few months. It has moved above the important resistance level at $391.71, the highest level since August 16th. The shares have moved above the 50-day and 100-day exponential moving averages (EMA). It has also moved to the 78.6% Fibonacci Retracement level.

Therefore, there is a likelihood that the shares will continue rising as buyers target the next resistance point at $432, the highest point in June 2022. This price is about 6.95% above the current level.


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