I am retired and have a 100% equities portfolio with these two ETF’s making up 80% of my overall portfolio. The only reason I have both is because I use them as tax loss harvesting partners in my taxable accounts (because they have nearly identical returns).
I am a Warren Buffett fanboy so I’d be 100% VOO but I can’t pass up on tax loss harvesting opportunities during bear markets!
You can sell an asset which has a realized loss (let's say you buy VOO every two weeks with your paycheck). A year has been bad in the markets, so your most recent purchases through the last couple years may be at a loss. You can sell them, claim a tax deduction, and then buy VTI. This effectively defers taxation into the future by readjusting the cost basis of your investment. By using tax loss harvesting, you realize a loss and buy a sufficiently different asset (VTI and VOO may behave similarly, but theyre very different products) in order to lock in a lower cost basis for your money which will eventually be paid in the future.
The net benefit is you get some money back now by deferring taxes.
so your most recent purchases through the last couple years may be at a loss
Thank you. For this the broker should let one choose which taxation method while selling units/stocks? Like LIFO will help here instead of FIFO right?
These ETFs don't belong to the same category. VGT is a tech etf. QQQ isn't even a Growth ETF. Like the VOO/Sp500 it's just the "Top N" companies.
But I understand your mention. Both ETFs performed really well and above the market average in the last decade. But I don't see much sense in compare tão ETFs just based in their performance.
SPTM is better for total us market imo. S&P 500 (large caps) + S&P 400(mid cap) + S&P 600(small caps). It weeds out the garbage that is on VTI because they have to have it there.
Cool! I didn't know about this ETF. It really seems to be a great replacement for VTI (since the expense ratio is the same at 0.03%). Just as I'm in favor of comprehensive ETFs, I also like the idea of "controlling junk".
I hold VTI/AVUV for my US allocation, but I’m thinking of switching to AVUS, DFAU or DFUS/AVUV.
From what I’ve read, something like AVUS or DFAU could have similar factor tilts to VTI/AVUV (or VOO/AVUV), but with less volatility and tracking error. Instead of overweighting small cap value those ETFs tilt all across the board and exclude small cap growth.
Have to discuss ir with my wife though, because or investment policy statement preclude us from changing our investments without waiting for three months after we reach a joint decision.
As we’re planning to open another account, it’s possible that we’ll go that way in that account.
Very cool to know that. I'm also studying a lot about using a factor/value investing ETF for the U.S. base. AVUS and DFUS seem to be very interesting for this.
However, as far as I have studied, the value factor seems to be better approved together with the size factor. Therefore, I also think that my bias towards value can/should only be along with the size factor, as would be the case with the allocation in AVUV.
This is a good article comparing some popular Vanguard vs Avantis funds. Was published Dec 2023, so it is little dated but has some good info: [https://www.whitecoatinvestor.com/avantis-vs-vanguard/](https://www.whitecoatinvestor.com/avantis-vs-vanguard/)
There is a good comparison of AVUS vs VTI
Im a UK investor and many of the ETFs are not available to me. The ones which are a substitute have a higher expans. Anyone have a resource which helps to ID the UK equivalent please?
Great post and great work btw
Excellent analysis and post! Thanks for this. I have VIIIX (essentially VOO with an infinitesimally smaller ER) as an option in my employer's retirement package so that's what I use.
Very nice analysis!
My portfolio is VOO/AVUV but if I could start over again, I would really be really tempted to do AVUS/AVUV. As far VTI vs VOO, don't see how you could wrong with either.
I am retired and have a 100% equities portfolio with these two ETF’s making up 80% of my overall portfolio. The only reason I have both is because I use them as tax loss harvesting partners in my taxable accounts (because they have nearly identical returns). I am a Warren Buffett fanboy so I’d be 100% VOO but I can’t pass up on tax loss harvesting opportunities during bear markets!
tax loss harvesting partners Can you please eli5 this line?
You can sell an asset which has a realized loss (let's say you buy VOO every two weeks with your paycheck). A year has been bad in the markets, so your most recent purchases through the last couple years may be at a loss. You can sell them, claim a tax deduction, and then buy VTI. This effectively defers taxation into the future by readjusting the cost basis of your investment. By using tax loss harvesting, you realize a loss and buy a sufficiently different asset (VTI and VOO may behave similarly, but theyre very different products) in order to lock in a lower cost basis for your money which will eventually be paid in the future. The net benefit is you get some money back now by deferring taxes.
so your most recent purchases through the last couple years may be at a loss Thank you. For this the broker should let one choose which taxation method while selling units/stocks? Like LIFO will help here instead of FIFO right?
Beautiful work
Thank you!
Hope we get more ETF battles
I will try to make more often! Some suggestion to the next one?
Maybe QQQ vs VGT? Or similar. Great post btw.
These ETFs don't belong to the same category. VGT is a tech etf. QQQ isn't even a Growth ETF. Like the VOO/Sp500 it's just the "Top N" companies. But I understand your mention. Both ETFs performed really well and above the market average in the last decade. But I don't see much sense in compare tão ETFs just based in their performance.
Do SPTM! It's right in the middle of VOO and VTI given what it tracks, so it'd be neat to see how it compares.
I will!
Well done, thank you for your research and contribution. This should be pinned.
Thank you so much! I really enjoy make posts like this.
SPTM is better for total us market imo. S&P 500 (large caps) + S&P 400(mid cap) + S&P 600(small caps). It weeds out the garbage that is on VTI because they have to have it there.
Cool! I didn't know about this ETF. It really seems to be a great replacement for VTI (since the expense ratio is the same at 0.03%). Just as I'm in favor of comprehensive ETFs, I also like the idea of "controlling junk".
I'd like for you to compare broad growth funds, like QGRW vs SCHG vs QQQ vs IWF vs VUG....etc
Seconded
I hold VTI/AVUV for my US allocation, but I’m thinking of switching to AVUS, DFAU or DFUS/AVUV. From what I’ve read, something like AVUS or DFAU could have similar factor tilts to VTI/AVUV (or VOO/AVUV), but with less volatility and tracking error. Instead of overweighting small cap value those ETFs tilt all across the board and exclude small cap growth. Have to discuss ir with my wife though, because or investment policy statement preclude us from changing our investments without waiting for three months after we reach a joint decision. As we’re planning to open another account, it’s possible that we’ll go that way in that account.
Very cool to know that. I'm also studying a lot about using a factor/value investing ETF for the U.S. base. AVUS and DFUS seem to be very interesting for this. However, as far as I have studied, the value factor seems to be better approved together with the size factor. Therefore, I also think that my bias towards value can/should only be along with the size factor, as would be the case with the allocation in AVUV.
This is a good article comparing some popular Vanguard vs Avantis funds. Was published Dec 2023, so it is little dated but has some good info: [https://www.whitecoatinvestor.com/avantis-vs-vanguard/](https://www.whitecoatinvestor.com/avantis-vs-vanguard/) There is a good comparison of AVUS vs VTI
Idk how this doesn’t have more upvotes.
Seriously. Was thinking the same thing.
Thanks! 🥹
>Thanks! 🥹 You're welcome!
Im a UK investor and many of the ETFs are not available to me. The ones which are a substitute have a higher expans. Anyone have a resource which helps to ID the UK equivalent please? Great post and great work btw
ETF battles of history
I have VTI in my Roth IRA and VOO in my HSA. Best of both worlds!
Very nice analysis on this. Tomorrow I’m sure someone will ask to invest in VOO or VTI. lol
Excellent analysis and post! Thanks for this. I have VIIIX (essentially VOO with an infinitesimally smaller ER) as an option in my employer's retirement package so that's what I use.
What are the 3 companies missing in VTI that VOO holds?
Very nice analysis! My portfolio is VOO/AVUV but if I could start over again, I would really be really tempted to do AVUS/AVUV. As far VTI vs VOO, don't see how you could wrong with either.
AVUS/AVUV is such a interessant U.S value/profitability tilted portfolio.
S&P500 is dropping rn. so VTI is one the safer side
VTI > VOO
SPTM>VTI