VTI: Total Market Funds Do Not Protect From Red Days Compared To S&P Index Funds
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The article compares VTI and VOO, highlighting VTI's underperformance during market downturns. VOO is preferred for long-term investors due to its higher allocation to top tech companies, offering better returns and risk mitigation.
December 30, 2024 | 2:15 pm
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NEGATIVE IMPACT
VTI underperforms compared to VOO, especially during market downturns, due to its broader market exposure.
VTI's broader market exposure results in underperformance during downturns compared to VOO, which has a higher allocation to top tech companies. This makes VTI less appealing for investors seeking risk mitigation.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100
POSITIVE IMPACT
VOO outperforms VTI, especially during market downturns, due to its higher allocation to top tech companies.
VOO's higher allocation to the Magnificent Seven tech companies provides greater growth potential and better performance during downturns, making it a superior choice for long-term investors.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100