Vanguard funds have been quite popular among investors over the years.
The obvious reasons for their popularity are their authenticity as they come from a market player, their inexpensiveness, and their top-notch quality. In addition to these, vanguard funds attract individuals as anyone can understand and manage them.
If you are also planning to upgrade your investment portfolio, then you should also consider investing in Vanguard funds.
If you are not sure of the best investment options from Vanguard, then you should follow this post to get inspiration. In this post, we’ve enlisted the best Vanguard funds for 2023.
10 Best Vanguard Funds
The biggest enterprise in the mutual funds market, Vanguard is known for its extensive range of funds.
The company offers diverse investment opportunities catering to the diverse needs of investors. So, you can easily find the most suitable investment to add to your portfolio.
Here we’ve enlisted our recommendations for 10 best Vanguard funds in 2023. So, go through these options and choose the best Vanguard fund.
1. Vanguard Dividend Growth Investor
Vanguard Dividend Growth Investor (VDIGX) is one of the best Vanguard funds and even the best growth funds available in 2023.
It is a type of dividend growth fund having a market value of $40.8 billion, the dividend yield of 1.7%, and an expense ratio of 0.22% i.e. $22 for an annual investment of $10,000.
This fund has been captained by Donald Killbride of Wellington Management. 42-stock portfolios are held by it in Coca Cola and Medtronic.
The annual ROI for the past half-decade is 12.1%, below S&P 500 by a hair.
However, the returns have been garnered with as low as 15% volatility than the index. Less volatility signifies less risk.
Hence, it prevents investors from incurring heavy losses and making an early exit. Its 0.22% expense is the least in case of actively managed dividend funds.
2. Vanguard Dividend Appreciation ETF
Vanguard Dividend Appreciation ETF (VIG) is a type of dividend growth fund with a market value of $51.1 billion and a dividend yield of 1.7 %.
The Vanguard fund offers a 0.06% expense ratio i.e. $6 on an annual investment of $10,000. Though similar in approach to Vanguard Dividend Growth, it follows a rule-based system.
In addition to this fund, investors receive a customary mutual fund version of ETF with a 0.8% charge. The investment option stresses on large-cap stocks.
Must read: 10 ETfs to keep in your portfolio in 2023
Under this investment strategy, all such stocks are excluded that did not witness any boost in dividends in the last 10 years.
Furthermore, it also excludes those stocks that are not much profitable to continue boosting dividends. It stresses on dividend growth, so you can’t expect great yield.
This type of Vanguard fund is suitable to be held by stable companies that have constantly mounting profits, which can sustain hikes in the dividend.
3. Vanguard Wellington Investor
If you are looking to invest in old-fashioned type balanced funds, then this is the best bet. It is the oldest and most-valued Vanguard fund.
Vanguard Wellington Investor (VWELX) has a market value of $110.7 billion. It has a sec yield of 2.3% while the expense ratio is 0.25%. Wellington Management runs the fund and you can purchase it fro Vanguard. In the case of VWELX, almost two-third is invested in stocks and the rest is invested in bonds.
Its stocks are held in dividend-paying big players including JPMorgan, Chase and Microsoft. On the other hand, it sticks with rated single-A debt for bond holdings. However, the funds involve some risk especially on bonds with longer-term averaging to 7.5 years.
4. Vanguard Short-Term Investment-Grade Investor
Vanguard Short-term Investment Grade Investor (VFSTX) is one of the best Vanguard funds due to its super-conservative approach.
The investors put their money on short-term bonds having a duration of 2.5 years. It has a market value of $61.5 billion.
It has a sec yield of 2.2%, which is the interest earned post deducting expense for 30 days. Furthermore, the expense ratio is 0.2%.
In this investment option, your money will be invested in bonds that possess healthy credit ratings. They come with a few risks, however, the chances to earn huge returns are quite low.
Most of the funds are invested in corporate bonds while 25% is invested in securitized mortgages and almost 10% in government bonds of the U.S.
5. Vanguard Limited-Term Tax-Exempt Investor
VMLTX is a taxable version of VFSTX. It is a popular Vanguard fund that offers investment in the limited-term bond of the municipal.
Its market value is $29.5 billion, the expense ratio is 0.17% and the sec yield is 1.3%. It is somewhat similar to VFSTX as it too has 2.5 years of duration and single-A credit quality. VMLTX is a low-risk fund holding more than 6,000 municipal bonds.
Furthermore, it invests in the municipal bond, which has low chances of default in comparison to corporate bonds.
It yields moderate returns. An average ROI of 1.7% was generated in the last five years of VMLTX. Unlike VFSTX, VMLTX is not exempted from taxes. However, it offers a good holding for scary markets.
6. Vanguard Health Care Investor
It is one of the best Vanguard funds where you can invest your money in the health sector. The market value of this fund is $47.5 billion while the dividend yield is 1.1% and the expense ratio is 0.34%.
Vanguard Health Care Investor (VGHCX) is of the highest performing Vanguard funds that gave 9.2% ROI over the last five years.
It has some fraction of holdings in volatile biotechnology stocks and larger stocks in UnitedHealth Group, AstraZeneca, and Myers Squibb.
The funds are even suitable for a rocky market full of turbulence as it holds up much better than any of its rivals.
Wellington Management is responsible for managing VGHCX.
7. Vanguard Total Stock Market Admiral
It is undoubtedly the biggest Vanguard funds with a market value of $874.5 billion. Vanguard Total Stock Market Admiral (VTSAX) is a large blend index fund even available in ETF.
It offers a dividend yield of 1.7% and the expense is ratio is quite low at 0.04%. The stocks are weighted based on the capitalization of the market, which means that the most popular stocks will get maximum money.
The friction of trading is reduced with an annual turnover of 3%.
8. Vanguard International Growth
It is a kind of foreign investment offering a dividend yield of 1.2% and an expense ratio of 0.45%.
With a market value is $38.8 billion and a distinct growth tilt, it is among the best Vanguard funds. It is run by reputed European finance managers.
Vanguard International Growth (VWIGX) has 25% of its assets in emerging stocks.
Furthermore, it is held by top EM companies including Tencent Holdings and Alibaba Group. It is a high-performing fund with 8.6% of annual returns in the last ten years.
9. Vanguard S&P Small-Cap 600 ETF
If you are seeking decent small-cap funds, then you should bet on Vanguard S&P Small Cap 600 ETF (VIOO) that keeps a track on the S&P 600 SmallCap Index.
It is a type of small-cap stock index having a market value of $1.1 billion, a dividend yield of 1.4%, and an expense ratio of 0.15%.
It is a low-cost fund that periodically tracks the S&P Index and removes those stocks that are weak. In this way, it ensures stronger returns than other small-cap indices.
This ETF gave an average annual ROI of 10.3% in the previous five years, which is 93% better than all blended ETFs.
10. Primecap Odyssey Stock
Primecap Odyssey Stock (POSKX) is a large blend fund that is among the best Vanguard funds to invest in 2023. It was launched by Primecap and it has a market value of $10.8 billion.
The dividend yield of this fund is 1% while the expense ratio is 0.66%. When compared with other actively managed funds of Vanguard, it might not appear as a cheap investment.
However, it is known for solid ROI. It has given impressive average annual returns of 13.1% for the last ten years.
More than half of its assets are held in the health care and technology sector thereby making is a risky investment option.
These were 10 best Vanguard Funds in 2023. You can invest in some or all of them to widen your portfolio.
These funds are the best bet as they come from a reputable and authentic company, Vanguard. So, you can invest in them without a doubt.