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Vanguard stock funds

88% of our low-cost stock mutual funds performed better than their peer-group averages over the past 10 years.*

Give your money a chance to grow over the long term

Get higher potential for investment growth

Stock mutual funds aim to provide long-term growth, unlike bond funds, which focus on income. In exchange for more growth, however, you're likely to experience more ups and downs in the value of your investment.

Increase diversification in your portfolio

A stock fund could give you access to hundreds—sometimes thousands—of stocks, which spreads out risk more than owning individual stocks.

Get broad exposure to the stock markets

You can use just a few funds to complete the stock portion of your portfolio. Each of these index funds gives you access to a wide variety of stocks in a single, diversified fund.

  • Vanguard Total Stock Market Index Fund holds more than 3,000 domestic stocks.
  • Vanguard Total International Stock Index Fund holds more than 7,000 non-U.S. stocks.

How to choose a stock fund

Here are a few questions to ask yourself while you're considering the right Vanguard stock fund for your portfolio:

How do stock mutual funds differ from one another?

When looking for a stock fund, consider these 2 characteristics:

  • Investing style. In general, stock funds invest in value stocks, growth stocks, or a blend of the 2.
  • Capitalization. Stock funds also choose investments based on the size, or capitalization, of a company. Companies are considered either small-, mid-, or large-cap.

Do I want domestic or international stocks?

Investing in both U.S. and international stock funds can add another level of diversification to an already well-balanced portfolio.

Would I prefer index or active funds?

A combination of index and active strategies can help you meet your goals. Many people start with a core portfolio of index funds and then add actively managed funds for certain market segments.

Index mutual funds & ETFs

You have a chance to keep pace with market returns because index funds try to mirror certain market segments. But not all index funds are created equal.

Actively managed mutual funds

Or you can try to beat market returns with investments hand-picked by professional money managers. You may be surprised by our active funds' performance.

Want to see a side-by-side comparison of the 2 types of funds?

What if I want to invest in companies that support my values?

Consider ETFs (exchange-traded funds) and mutual funds that take a company's environmental, social, and governance (ESG) track record into consideration.

We offer a lineup of ESG investments that can help you achieve your financial goals and match your dollars with what matters to you.

Should I focus on a specific industry?

You can choose a fund that invests solely in a specific sector of the market, like health care, technology, or telecommunications.

But remember, these funds have a very narrow focus and expose you to more risk. Sector and specialty funds should only be used to supplement an already diversified portfolio.

REFERENCE CONTENT

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Stock

Usually refers to common stock, which is an investment that represents part ownership in a corporation. Each share of stock is a proportional stake in the corporation's assets and profits.

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Value stock fund

A mutual fund that focuses on stocks from companies that are typically found in low-growth or mature industries, often produce higher and more regular dividend income, and sell at discounted prices.

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Growth stock fund

A mutual fund that focuses on stocks from companies that are expected to experience higher-than-average profitable growth because of their strong earnings and revenue potential.

Growth stocks typically produce lower dividend yields because they prefer to reinvest those earnings into research and development to help grow these companies and increase their profitability.

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Market benchmark

An unmanaged group of securities whose overall performance is used as a standard to measure investment performance.

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Index fund

A type of fund that tries to track the performance of a particular market index (sometimes referred to as a "benchmark") by buying and holding all or a representative sample of the securities in the index, in the same proportion as their weightings in the index.

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Portfolio

The sum total of all your investments.

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ETF (exchange-traded fund)

A type of investment with characteristics of both mutual funds and individual stocks. ETFs are professionally managed and typically diversified, like mutual funds, but they can be bought and sold at any point during the trading day.

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Market capitalization

A determination of a company's value, calculated by multiplying the total number of company stock shares outstanding by the price per share. Also called capitalization.

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Vanguard's market capitalization classifications

Small-cap stocks. The stocks of companies whose market value is less than $2.1 billion.

Mid-cap stocks. The stocks of companies whose market value is $2.1 billion to $15.6 billion.

Large-cap stocks. The stocks of companies whose market value is more than $15.6 billion.