VONE - VONE: Netter Than The S&P 500

2024-07-08 16:20:29 ET

Summary

• The Russell 1000 is a viable alternative to the S&P 500 and Nasdaq, with Vanguard Russell 1000 Index Fund ETF Shares worth considering.
• The VONE ETF tracks the Russell 1000 Index, providing diversified exposure to large-cap US stocks with minimal tracking error.
• The VONE ETF has a concentration in the tech sector, outperforms iShares Russell 1000 ETF but underperforms S&P 500 due to small and mid-cap holdings.

While everyone automatically assumes “the market” means either the S&P 500 (SP500) or the Nasdaq (COMP.IND), you shouldn’t ignore another proxy for stocks, which is the Russell 1000. Now to be clear, all market-cap weighted averages, no matter how many stocks are in them, largely look the same in this cycle. Both the S&P 500 and the Russell 1000 are market-cap weighted, and this has been a “market” where only a select number of large-cap stocks are pulling the averages higher. I’m not bullish on market-cap weighted strategies in general, but so think at the margin, there’s a case to be made for choosing the Russell 1000 over the S&P 500 (just given the larger number of stocks). If you agree, then Vanguard Russell 1000 Index Fund ETF Shares ( VONE ) is worth considering....

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