|Bid||161.33 x 800|
|Ask||162.55 x 900|
|Day's Range||161.38 - 162.10|
|52 Week Range||134.91 - 163.90|
|PE Ratio (TTM)||N/A|
|YTD Daily Total Return||0.17%|
|Beta (5Y Monthly)||0.62|
|Expense Ratio (net)||0.10%|
[Editor's note: This article is regularly updated to include the most relevant information available.]If you're looking for the best Vanguard ETFs to buy for 2020, you'd be wise to consider those that can perform well in a slowing economy.There are plenty of arguments out there about the timing of the next recession, but there's no question that growth in the U.S. economy, as measured by gross domestic product (GDP), will be moderating, if not slowing, in 2020.InvestorPlace - Stock Market News, Stock Advice & Trading TipsHere are signs of a slowing economy in 2020: * Yield Curve Inversion: When the yields on 10-year Treasury bonds fall below the yields on the 2-year Treasury note, it indicates that fixed-income investors foresee slow rates of growth and low inflation in the years ahead. The last time this occurred was June 2007. Based on history, stock performance is mixed after a yield curve inversion but this asset class tends to remain positive for about 18 months. Counting from August 2019, that makes January 2021 a possible beginning for the next downturn. * Weaker Leading Economic Indicators: In the second half of 2019, key economic indicators showed that the U.S. economic growth rate declined for the first time since May 2016. There are 10 components included among the key leading economic indicators, such as manufacturers new orders, building permits and consumer expectations. * Declining U.S. Gross Domestic Product (GDP): The first three quarters of 2019 showed declining GDP. The Conference Board's Dec. 11, 2019 update showed expectations for growth to remain the same or slightly higher (up to 2%) in Q4. The expectation is for GDP to hover around 2% in 2020. * 8 of the Strangest Stocks Worth Your Time In summary, it's wise for investors to expect, at best, a continuation of slow growth but no acceleration in 2020. At worst, investors should expect declining GDP throughout the year, nearing recession by Q1 2021. With that backdrop, and in no particular order, here are seven of the best Vanguard ETFs to buy in 2020: Best Vanguard ETFs for 2020: Vanguard S&P 500 ETF (VOO)Expenses: 0.03%, or $3 annually for every $10,000 investedIf you want to build around a core holding that could be a smart bet in 2020, and in the long run, Vanguard S&P 500 ETF (NYSEARCA:VOO) is arguably the best ETF to do the job.Picking the best sectors for 2020 could prove to be challenging because of uncertainties over trade and the presidential election. Because of this, an ETF like VOO, which is diversified across all sectors, can be a wise choice for the foreseeable future.Being cap-weighted, shareholders of VOO will naturally get more exposure to mega-caps like Microsoft (NASDAQ:MSFT), Apple (NASDAQ:AAPL) and Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL). But having additional exposure to roughly 500 U.S. large-cap stocks will add to VOO's appeal in 2020. Vanguard Health Care ETF (VHT)Expenses: 0.10%After lagging the S&P 500 in 2019, health sector funds like Vanguard Health Care ETF (NYSEARCA:VHT) may be due for a comeback in 2020.The primary drag on performance for health stocks in 2019 was the fear and uncertainty over the Medicare-for-All idea promoted by Democratic presidential nominees, Elizabeth Warren and Bernie Sanders. By the end of 2019, the fear began to fade and price declines for healthcare stocks appeared to be overdone. Combine this oversold status with their defensive qualities in the face of a potential slowing economy, health sector funds look attractive in 2020.To get broad exposure to the healthcare industry, ETFs like VHT are smart plays. VHT's multi-cap exposure means top holdings are large health stock names like Johnson & Johnson (NYSE:JNJ), Merck & Co (NYSE:MRK) and UnitedHealth Group (NYSE:UNH). But investors also get exposure to small- and mid-cap health stocks. Vanguard Consumer Staples ETF (VDC)Expenses: 0.10%Investors expecting a slowing economy in 2020 may like what they see in Vanguard Consumer Staples ETF (NYSEARCA:VDC).Although economic recession does not appear likely in 2020, it's also unlikely the economy will expand, especially in the absence of further rate cuts from the Fed or fiscal stimulus from new legislation.When the economy is moderating or slowing, consumers tend to become more selective in their buying habits. While they may buy less non-essential items, such as automobiles, apparel and entertainment, consumers will continue to buy the necessary consumer staples, such as food, beverages and household goods. * 5 Semiconductor Stocks Soaring Higher To take advantage of potential strength in the consumer staples sector, investors can gravitate toward equities like VDC top holdings Coca-Cola (NYSE:KO), Procter & Gamble (NYSE:PG), and Walmart (NYSE:WMT). Vanguard High Dividend Yield ETF (VYM)Expenses: 0.06%There's no question that the U.S. economy is in the mature phase of the business cycle, which can be a favorable environment for funds like Vanguard High Dividend Yield ETF (NYSEARCA:VYM).Investments that tend to perform well in the mature phase of the business cycle include dividend paying stocks, such as VYM top holdings JPMorgan Chase (NYSE:JPM), JNJ and PG. In a year that may bring the economy to the edge of recession, high value, high-yielding stocks like these can bring a combination of growth and relatively stability your portfolio needs.Since VYM tracks the FTSE High Dividend Yield Index, shareholders will get exposure to more than 400 U.S. dividend paying stocks. Vanguard Dividend Appreciation ETF (VIG)Expenses: 0.06%The best dividend funds to buy for both 2020 and the long term are arguably those that hold stocks of companies that consistently increase their dividends. To get broad exposure to these stocks, investors can buy Vanguard Dividend Appreciation ETF (NYSEARCA:VIG).Although Vanguard ETFs that provide high yields can be smart plays now, funds like VIG can be smarter, especially if you're looking for a combination of short-term and long-term benefit. In the short term, meaning the year 2020, value-oriented stocks that pay dividends are wise additions to a portfolio. For the long run, holding stocks that increase their dividends is also a wise move. * The Top Tech From CES 2020 VYM tracks the NASDAQ US Dividend Achievers Index, which emphasizes large U.S. stocks that have a record of growing dividends year over year. Therefore shareholders get access to dividend stocks like MSFT, PG and WMT. Vanguard FTSE Emerging Markets ETF (VWO)Expenses: 0.12%Having been in an extended slump, which was aggravated by trade tensions in 2019, funds like Vanguard FTSE Emerging Markets ETF (NYSEARCA:VWO) could see a comeback in 2020.VWO tracks the FTSE Emerging Markets All Cap China A Inclusion Index, which means that shareholders get a diversified mix of large-, mid- and small-cap stocks of companies located in emerging markets all around the world. Top five countries, from highest to lowest allocation percentage, are China, Taiwan, India, Brazil and South Africa.The underlying index is cap-weighted, which means the holdings are less geared toward mid- and small-caps and more concentrated in large-cap emerging market stocks like Tencent Holdings (OTCMKTS:TCEHY), Alibaba (NYSE:BABA) and Taiwan Semiconductor Manufacturing (NYSE:TSM). Vanguard Total Bond Market ETF (BND)Expenses: 0.035%Bonds aren't expected to beat stocks in 2020, but the best bond fund to hold will likely be Vanguard Total Bond Market ETF (NASDAQ:BND).The Federal Reserve Board has signaled that it will not move on rates in 2020. The monetary policy impact on bond prices will not be significantly positive or negative, but investors are wise to expect a below-average year for fixed income. At the same time, monetary policy has not exactly been predictable over the past year.Because of the potential for a lackluster year for bonds, combined with uncertainty in the direction of rates, investors are wise to stick with a broadly diversified bond fund with extremely low expenses like BND. Since the fund tracks the Bloomberg Barclays U.S. Aggregate Float Adjusted Index, shareholders are essentially holding the entire U.S. bond market.As of this writing, Kent Thune did not personally hold a position in any of the aforementioned securities. However, he holds VOO in some client accounts. Under no circumstances does this information represent a recommendation to buy or sell securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 8 of the Strangest Stocks Worth Your Time * 7 Stocks to Buy That Trump's Tax Cut Truly Rewarded * 5 Stocks That Could Double in 2020 The post 7 Best Vanguard ETFs for 2020 appeared first on InvestorPlace.
While U.S. markets are hovering near record highs, high net-worth investors are wary of what the future may hold and are getting more defensive. ETF investors can also shift their portfolios into a more defensive posture through sector-specific strategies.
[Editor's note: This story was last updated in September 2019. It has since been updated and republished.]Vanguard should probably be thanking Warren Buffett.In Berkshire Hathaway's (NYSE:BRK.B) 2014 shareholders letter, Buffett mentioned Vanguard funds in a big way. Specifically, he recommended that the cash left to his wife be invested 10% in short-term government bonds and 90% in a very low-cost S&P 500 index fund. Not just any index fund mind you, but a Vanguard fund in particular.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Hot Stocks Staging Huge Reversals Whether it be exchange-traded funds (ETFs) or mutual funds, the Oracle of Omaha believes Vanguard funds are the way to go. With that in mind, I've put together a portfolio of two ETFs, two mutual funds and a fifth wildcard. The resulting portfolio should be appropriate for Buffett's wife -- or anyone else, for that matter. 1\. Vanguard 500 Index Fund Admiral Shares (VFIAX)Source: Shutterstock Allocation: 50% of Portfolio 10-year performance: 13.2%The goal is to keep costs to a minimum while generally sticking to Buffett's hypothesis when it comes to his wife's investments.In that case, it makes more sense for the S&P 500 investment to be a mutual fund rather than an ETF (although Vanguard Funds do offer commission-free ETFs) to avoid paying commissions on the largest segment of the portfolio. The Vanguard 500 Index Fund Admiral Shares (VFIAX) charge an annual expense ratio of just 0.04%.Your annual fees would amount to a mere $20 on a $50,000 portfolio. That's hard to beat, and Buffett knows it. The largest holdings in this fund include Apple (NASDAQ:AAPL), Exxon Mobil (NYSE:XOM) and Google (NASDAQ:GOOGL, NASDAQ:GOOG). The minimum investment is $10,000. 2\. Vanguard Mid-Cap Index Fund Admiral Shares (VIMAX)Allocation: 20% of Portfolio 10-year performance: 13% The VFIAX covers the large-cap portion of the portfolio quite nicely. While Buffett might not be fond of mid-cap stocks being added to the mix, but evidence suggests mid-caps outperformed large-cap stocks over a four-year period between 2009 and 2013.In fact, John Hancock published a report in 2012 that cautions investors about underweighting mid-caps because of an assumption that a large-cap fund combined with a small-cap fund will do the job. That's simply not the case.Mid-cap stocks tend to provide an attractive combination of risk and reward. For this reason, I recommend the Vanguard Mid-Cap Index Fund Admiral Shares (VIMAX), which tracks the CRSP Mid Cap Index, an index composed of stocks that fall between the top 70%-85% of investable market capitalization. * 10 Hot Stocks Staging Huge Reversals They're big enough to survive an economic hit but small enough to still be growing. With an expense ratio of 0.05%, this entry on our list of Vanguard funds is giving you safety and performance in one. Top holdings include Moody's (NYSE:MCO) and Roper Technologies (NYSE: ROP). 3\. Vanguard FTSE All-World ex-US Small-Cap ETF (VSS)Source: Shutterstock Allocation: 10% of Portfolio 3-year performance: 3.75% Although I just said mid-caps are a key part of any portfolio and tend to outperform small caps while utilizing less risk, there is always a place for small caps in your portfolio.That's especially true when the two previous picks from Vanguard Funds are almost 100% invested in the U.S. with virtually no international exposure. For this reason, a little bit of love outside America makes total sense.My recommendation is to go with the Vanguard FTSE All-World ex-US Small-Cap ETF (VSS), a fund that tracks the performance of the FTSE Global Small Cap ex US Index, which consists of over 3,000 stocks in dozens of countries. Investing in both developed and emerging markets, the fund provides good exposure to some of the world's future stars at an annual expense ratio of just 0.12%.With such low fees, it's no wonder $6.37 billion is invested in this ETF. 4\. Vanguard Short-Term Government Bond ETF (VGSH)Source: Shutterstock Allocation: 10% of Portfolio 5-year performance: 1.26% Buffett recommends that 10% of his wife's portfolio go to short-term government bonds. Vanguard Funds has an ETF that does exactly that.The Vanguard Short-Term Government Bond ETF (VGSH) invests in investment-grade U.S. government bonds with average maturities between one and three years. The risk, on a scale of one to five, is one -- meaning this Vanguard ETF is for conservative investors looking for stable share prices. * 10 Hot Stocks Staging Huge Reversals And with an expense ratio of 0.07%, this ETF should give you peace of mind for your short-term needs. 5\. Vanguard Consumer Staples ETF (VDC)Source: Shutterstock Allocation: 10% of Portfolio 10-year performance: 12.26% On this final piece of the puzzle, I'm going defensive. The mutual fund version of the S&P 500 has less than 10% invested in consumer staples' stocks. I mean to remedy that by putting the final 10% in the Vanguard Consumer Staples ETF (VDC), a collection of 109 household names including Procter & Gamble (NYSE:PG) and Coca-Cola (NYSE:KO).Since its inception in 2004, VDC has had but one year of negative annual total returns, and that was in 2008 when it experienced a 17% decline -- 20 percentage points better than the S&P 500. When the you-know-what hits the fan, you'll be glad you own this particular low-cost ETF (with a 0.10% expense ratio) from Vanguard Funds.It seems the "keep it simple" rule holds true, and Warren Buffett is the No. 1 follower.As of this writing, Will Ashworth did not own a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Hot Stocks Staging Huge Reversals * 7 Under-The-Radar Growth Stocks That Could Benefit New Investors * 5 Excellent High-Yield Dividend Stocks to Buy The post Take Buffett's Advice: 5 Vanguard Funds to Buy appeared first on InvestorPlace.
Consumer Staples ETFs have been firing on all cylinders in the past three months, beating their discretionary counterparts. Let's find out what's driving the rally.