An investor with a long-term focus on compounding capital expresses concern over holding Vanguard 500 Index ETF and Invesco QQQ Trust ETF due to high market valuations and slowing earnings growth. Despite a seemingly reasonable forward P/E of 19.6x, the Shiller CAPE ratio is at 42.38x, near historic highs since 2000. Earnings growth for Q2 has slowed significantly when excluding large unrealized gains from Alphabet and Amazon, indicating a weaker base for future estimates. Additionally, the top holdings in these ETFs are heavily concentrated and reliant on substantial capital expenditures funded by credit, while the equity risk premium is low compared to bond yields, prompting the investor to consider reallocating new funds elsewhere.
Dividend reinvestment in Vanguard's S&P 500 ETF (VOO) can trigger the IRS wash sale rule, which disallows losses if substantially identical shares are bought within 30 days before or after a sale at a loss. However, the impact is minor, affecting onl...
Investors who delayed buying the Vanguard S&P 500 ETF (VOO) until tariff headlines calmed missed significant gains. A $10,000 investment at the end of April 2025 grew to $14,260 by October 2026, while waiting until the end of June 2025 resulted in on...
The well-known State Street SPDR S&P 500 ETF Trust (SPY) charges a 0.0945% expense ratio, higher than Vanguard's VOO and BlackRock's IVV, both at 0.03%. All three ETFs track the same S&P 500 index with nearly identical holdings, but SPY's higher fee ...
The article explains a preference for the Vanguard S&P 500 ETF (VOO) over the Invesco QQQ Trust (QQQ) for long-term investing due to VOO's stability and quality filter. VOO excludes unprofitable and speculative firms, reducing risk compared to QQQ, w...
The SPDR Portfolio S&P 500 ETF (SPYM) charges a lower fee of 0.02% compared to Vanguard's VOO at 0.03%, making it slightly cheaper for investors seeking S&P 500 exposure. However, SPYM's long-term performance record is based on four different indexes...
