Investing doesn’t have to be complicated. Of course, you can research stocks in depth and buy potential winners. Many investors can and do make a lot of money in the long run. However, you can also use a much easier method.

Exchange-traded funds (ETFs) It offers a simple and convenient way to buy a broad basket of stocks. Vanguard markets a variety of ETFs with low annual costs. Here are three Vanguard ETFs you can buy with $1,000 and hold forever.

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1. Vanguard S&P 500 ETF

There is perhaps no other ETF more important to building a solid investment portfolio than the ETF. Vanguard S&P 500 ETF (NYSEMKT:VOO). You can purchase one share of this ETF for approximately $550. With this money, you will own shares of the 500 largest US companies that make up the world. S&P 500 Index.

The beauty of this Vanguard tracking S&P 500 is that the index rebalances regularly. big winners like Apple, Microsoft, Nvidiagoogle parent AlphabetAnd Amazon Due to their size, they make up a larger percentage of the fund’s portfolio. Stocks that have underperformed for too long will be replaced.

The Vanguard S&P 500 ETF has returned an average of 14.52% annually since its inception in September 2010. It has recorded an average annual growth of 15.21% in the last five years. Dividends help increase the ETF’s total return.

With this fund, fees won’t take much away from your earnings. Annual expense ratio It’s a low 0.03%, compared to an average of 0.78% for similar funds.

2. Vanguard S&P Mid-Cap 400 ETF

Consider investing $112 or more of your first $1,000 to buy a share. Vanguard S&P Mid-Cap 400 ETF (NYSEMKT:IVOO). This ETF attempts to track the performance of the S&P MidCap 400 Index, which includes 400 mid-market companies. Some of the members of this index have performed particularly well over time and have been promoted to the S&P 500 Index.

Unlike the Vanguard S&P 500 ETF, no single stock is particularly heavily weighted in the Vanguard S&P Mid-Cap 400 ETF. This Vanguard fund’s top holding accounts for just 0.71% of the total portfolio.

Vanguard launched its mid-cap ETF in September 2010, around the same time it introduced the S&P 500 ETF. Since then, the Vanguard S&P Mid-Cap 400 ETF has returned an average of 12.09% annually. Its average return over the last five years was 11.26%.

You’ll pay a slightly higher annual expense ratio of 0.1% with this Vanguard ETF. But this is still well below the 0.89% average expense ratio for similar funds.

3. Vanguard Small-Cap ETF

To supplement your interest in US stocks, just over $250 will buy you a share of the shares. Vanguard Small-Cap ETF (NYSEMKT:VB). As the name suggests, this Vanguard ETF holds shares in smaller companies.

Vanguard Small-Cap ETF has 1,384 stocks in its portfolio. None of them make up more than 0.47% of the fund’s total portfolio. This diversification helps reduce the impact of high volatility associated with small-cap stocks.

The Vanguard Small-Cap ETF has returned an average of 9.24% annually since its inception in January 2004. Its average annual return over the last five years was 10.14%. These returns are lower than the returns of the Vanguard S&P 500 ETF and Vanguard S&P Mid-Cap 400 ETF. But over the long term, small-cap stocks have outperformed other stocks.

Similar small-cap ETFs have an average expense ratio of 0.99%. But as always, Vanguard easily beats its competitors when it comes to cost. The Vanguard Small-Cap ETF has an annual expense ratio of just 0.05%.

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*Stock Advisor returns as of November 11, 2024

John Mackey, former CEO of Whole Foods Market, a subsidiary of Amazon, is a board member of The Motley Fool. Suzanne Frey, an executive at Alphabet, is a board member of The Motley Fool. Keith Speights It has positions in Alphabet, Amazon, Apple, Microsoft and the Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Microsoft, Nvidia, Vanguard Index Funds-Vanguard Small-Cap ETF and Vanguard S&P 500 ETF. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a feature disclosure policy.