Vanguard Information Technology ETF

VGT

Market cap $113B

The Vanguard Information Technology ETF has lower fees than most dedicated AI ETFs. Plus, most of the leading technology stocks are also the top AI companies right now.

The Vanguard Information Technology ETF is well diversified and can be purchased through many brokerages for $100 or less. Technology is driving the growth of the stock market and is likely to benefit as artificial intelligence continues to evolve.

Vanguard's mutual ownership structure enables the company to operate at cost, delivering industry-low expense ratios that compound into significant savings over time. International dividends, U.S. technology, and small-cap value offer three distinct return drivers that contribute to a well-rounded portfolio.

You can tap into the tech sector's largest trends like AI via the Vanguard Information Technology ETF.  Buy Vanguard's S&P 500 index fund to own one of Warren Buffett's key recommendations.

These Vanguard ETFs are set to outperform if growth stocks continue to lead the market higher. All three ETFs are heavily weighted to megacap tech stocks benefiting from AI.

In a world that is full of potential market volatility, and maybe there is, maybe there isn't “AI bubble,” investors, mostly of the retail variety, are looking for a safe place to park their cash.

The Vanguard S&P 500 ETF delivered average annual returns of 14.5% over the past 10 years, while charging just 0.03% in expenses, making it one of the most cost-effective ways to own America's largest companies. The Vanguard Growth ETF tracks large-cap growth stocks and has returned 17.4% annually over the past 10 years, concentrating its exposure in companies that prioritize revenue expansion over current profitability.

Vanguard Information Technology ETF charges a much lower expense ratio and offers a higher yield than iShares US Technology ETF IYW has delivered a slightly higher 1-year return, but VGT has a milder historical drawdown and holds over twice as many stocks VGT is nearly six times larger by assets under management compared to IYW.

FTEC and VGT deliver near-identical exposure, sector weights, and top holdings within U.S. technology stocks VGT manages a far larger asset base and trades with higher liquidity, but charges a nearly identical expense ratio to FTEC Both ETFs show similar recent returns and risk profiles, with negligible differences in yield and drawdown

As temperatures grow cooler, apparently so does the market's immediate-term conviction on some of the year's favorite bets. Consider technology stocks.