This Fund Offers S&P Investing on the Cheap

Doug Fabian

Doug Fabian is known for his expert knowledge of ETFs, bear funds and enhanced index funds to profit in any market climate.

This week’s ETF Talk returns us to the realm of large American companies. There are a variety of ways to track the S&P 500 in exchange-traded fund (ETF) form, and this week’s featured fund offers a similar approach to those we have highlighted in recent weeks. But this one is a Vanguard fund, Vanguard S&P 500 ETF (VOO).

Since we last examined this fund in November, the big picture of the market has shifted. The S&P has been in an overall uptrend in the intervening months that seems to have tapered off and lost some steam early in 2015.

As usual for a Vanguard fund, VOO sports the provider’s characteristic low expense ratio, which in this instance is 0.05%. Good luck trying to find a cheaper way to own the S&P 500. This fund holds $26.5 billion in assets. Its 1.81% dividend yield provides another reason for owning it.


The biggest S&P 500 sectors, which VOO is designed to match, are technology, which weighs in with 19.90% of the index’s and fund’s assets; financials, at 16.00%; and healthcare, at 14.80%.

In addition, 17.70% of VOO’s funds are invested in its 10 largest positions. These positions include big, well known U.S. companies, such as Apple Inc. (AAPL), 4.0%; ExxonMobil Corporation (XOM), 2.0%; Microsoft Corp. (MSFT), 1.9%; Google Inc. (GOOGL), 1.7%; and Johnson & Johnson (JNJ), 1.5%.

It is hard to go too wrong investing in the S&P, since these large companies are relatively stable while tending to exhibit solid growth figures. If you feel there is safety in numbers, consider trying Vanguard S&P 500 ETF (VOO).

If you want my advice about buying and selling specific ETFs, including appropriate stop losses, please consider subscribing to my Successful ETF Investing newsletter. As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an e-mail. You just may see your question answered in a future ETF Talk.

In case you missed it, I encourage you to read my e-letter column from last week about a growth-focused ETF. I also invite you to comment in the space provided below.

share on:
share on:


Dr. Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen is a professional economist, investment expert, university professor, and author of more than 25 books.

Product Details

  • Forecasts & Strategies
  • Home Run Trader
  • Fast Money Alert
  • Five Star Trader
  • TNT Trader

Bryan Perry

A former Wall Street financial advisor with three decades' experience, Bryan Perry focuses his efforts on high-yield income investing and quick-hitting options plays.

Product Details

  • Cash Machine
  • Premium Income (exclusively for subscribers of Cash Machine)
  • Quick Income Trader
  • Breakout Options Alert
  • Hi-Tech Trader

Jim Woods

Jim Woods has over 20 years of experience in the markets from working as a stockbroker,
financial journalist, and money manager. As well as a book author and regular contributor to
numerous investment websites, Jim is the editor of:

Product Details

  • Successful Investing
  • High Velocity Options
  • Intelligence Report
  • Bullseye Stock Trader
  • Eagle Eye Opener

Bob Carlson

Bob Carlson provides independent, objective research covering all the financial issues of retirement and retirement planning. In addition, Bob serves as Chairman of the Board of Trustees of the Fairfax County (VA) Employees’ Retirement System, which has over $2.8 billion in assets.

Product Details

  • Retirement Watch
  • Retirement Watch Spotlight Series
  • Lifetime Retirement Protection Program

Jon Johnson

Jon Johnson's philosophy in investing and trading is to take what the market gives you regardless if that is to the upside or downside. For the past 21 years, Jon has helped thousands of clients gain success in the financial markets through his newsletters and education services:

Product Details

  • Investment House Daily
  • Stock of the Week
  • Technical Traders Alert
  • Rapid Profits Stock Trader

Used by financial advisors and individual investors all over the world, is the premier provider and one-stop shop for dividend information and research.

Product Details

Popular tools include our proprietary Dividend Calendar, Dividend Calculator, Dividend Score Card, and many more.

  • Dividend Investor