Vanguard Total Stock Market Index: Simple Approach

This index fund gives you broad exposure to small-, midsize- and large-company stocks.

Editor's note: This is part of a continuing series of articles looking at the 20 biggest no-load stock funds.

For people who like a one-stop fund, Vanguard Total Stock Market Index just may be the ticket. What this index fund gives you is not only a piece of Standard & Poor's 500-stock index, but the extended market, which includes shares of small and midsize companies. In total, this fund gives you exposure to 3,900 companies in the MSCI US Broad Market Index.

Obviously, plenty of folks like this low-cost, broadly diversified approach to indexing. Vanguard's Gus Sauter says Total Stock Market has been Vanguard's best-selling fund the past four years.

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Over the long term, Total Stock's holdings in small-company stocks should give it a slight edge over Vanguard 500. Over the past ten years through January 31, Total Stock has outpaced 500 by a mere 0.35 percentage point per year. On a year-to-year basis, Total Stock will perform better when small-cap stocks are in vogue and will lag when large-cap stocks are performing well. If you already own the fund, we suggest you HOLD it.


Vanguard Total Stock Market Index (VTSMX)

Assets: $39.1 billion

Manager (year started): Gerard O'Reilly (1994)

Returns (vs. S&P 500)*

One year: 13.7% (14.5%)

Three years annualized: 11.1% (10.3%)

Five years annualized: 8.1% (6.8%)

Ten years annualized: 8.2% (7.9%)

Expense ratio: 0.19%

Portfolio turnover: 12%

Initial minimum investment: $3,000

Phone: 800-662-2739

Web site:

*Returns through Jan. 31.

Fund Fact sources: Standard & Poor's, Morningstar

View updated data for this fund and compare the performance of the 20 biggest no-load stock funds.

Go to A Close Look at the 20 Biggest No-Load Stock Funds.

Contributing Writer, Kiplinger's Personal Finance