You are currently viewing VTSAX vs VFIAX: Side By Side Comparison With Investing Tips

VTSAX vs VFIAX: Side By Side Comparison With Investing Tips

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We compare VTSAX vs VFIAX:

Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) vs Vanguard 500 Index Fund Admiral Shares (VFIAX)

One of the most common questions I get is which Vanguard Admiral Fund is the best investment.  So I’ve compared many of Vanguard’s most popular funds.

I also share how you can start taking advantage of these two funds by investing in the equivalent exchange-traded funds (ETFs), buying fractional shares, or getting started with investor shares.

VTSAX vs VFIAX Graphic

 

VTSAX vs VFIAX

The primary difference between VTSAX and VFIAX is the index they track.  VTSAX tracks the CRSP US Total Market index, while VFIAX tracks the S&P 500 index.

Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) provides investors with exposure to the entire United States equity market.  The U.S equity market includes small, mid, large-cap growth, and value stocks.

Vanguard 500 Index Fund Admiral Shares (VFIAX) provides investors with exposure to 500 of the largest companies in the United States.  This accounts for about three-quarters of the U.S stock market’s value.

Another significant difference is the number of stocks in each, with VTSAX having 3,535 different companies in the index compared to 509 with VFIAX.

VTSAX

  • Fund Inception: 2000
  • Tracks the CRSP US Total Market Index
  • Expense Ratio: 0.04%
  • Vanguard Fund
  • Minimum Initial Investment: $3,000
  • Number Of Stocks: 3535
  • Equivalent ETF (VTI)

VFIAX

  • Fund Inception: 2000
  • Tracks the S&P 500 Index
  • Expense Ratio: 0.04%
  • Admiral Mutual Fund
  • Minimum Investment: $3,000
  • Number Of Stocks: 509
  • Top 10 Holdings: 30%
  • Yield 1.27%

 

VTSAX vs VFIAX Performance

Although VTSAX and VFIAX track different indexes, their performance is similar.  For example, over the last 5 years, VFIAX has outperformed VTSAX by 0.5% per year.

Here is how their performance compares over the last 10 years:

VTSAX vs VFIAX Performance

 

As you can see from the chart, they perform almost identically, with VFIAX outperforming slightly.

Similarities between VFIAX and VTSAX:

  • Vanguard Admiral Funds
  • Similar Performance
  • Broad Diversification
  • Low Expense Ratios

 

VFIAX and VTSAX Differences

The main difference between VFIAX and VTSAX is the index they track.  VFIAX tracks the S&P 500 index while VTSAX tracks the CRSP US Total Market Index.  This gives VTSAX more diversification.

VTSAX vs VFIAX Comparison Chart

Differences between VFIAX and VTSAX:

  • Track Different Indexes
  • Number Of Holdings
  • Diversification

 

VTSAX Profile

  • Fund Inception: 2000
  • Tracks the CRSP US Total Market Index
  • Expense Ratio: 0.04%
  • Vanguard Fund
  • Minimum Initial Investment: $3,000
  • Number Of Stocks: 3535
  • Equivalent ETF (VTI)

Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) represents close to 100% of the U.S. equity market that is publicly traded.  It also tracks the CRSP U.S. Total Market Index.

Vanguard’s VTSAX has an expense ratio of 0.04%.

This notably implies that the fund has limited exposure to several international stocks.

However, this does not affect the companies represented in the fund.  These stocks have a significant international presence.

 

VTSAX Performance

Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) is popular for so many reasons, of which consistent returns are a significant part.

VTSAX Performance Chart

Its risk level is similar to that of the S&P 500.

VTSAX Performance Chart

 

VTSAX Holdings

Vanguard’s VTSAX is largely made up of Apple, Microsoft, Google, Amazon, and Tesla and provides exposure to over 3500 stocks.

Here are the top 10 holdings for VTSAX:

VTSAX Top 10 Holdings

Major sectors in the index include:

  • Healthcare
  • Technology
  • Consumer Services
  • Financials
  • Industrials

The top 10 holdings make up 25% of its total net assets.

 

VFIAX Profile

  • Fund Inception: 2000
  • Tracks the S&P 500 Index
  • Expense Ratio: 0.04%
  • Admiral Mutual Fund
  • Minimum Investment: $3,000
  • Number Of Stocks: 509
  • Top 10 Holdings: 30%
  • Yield 1.27%

Vanguard 500 Index Fund Admiral Shares (VFIAX) provides investors with exposure to 500 of the largest companies in the U.S.

This accounts for about three-quarters of the United States stock market’s value.

VFIAX is the admiral version of the Vanguard S&P 500 ETF (VOO).

VFIAX was created in 2000 and currently has an expense ratio of only 0.04%.

Super low expense ratios and strong diversification make Vanguard funds like VFIAX very attractive for long-term investors.

 

VFIAX Performance

Vanguard’s VFIAX aims to have the same performance returns as the S&P 500 index.  Therefore, VFIAX and the S&P 500 should always overlap closely.

VFIAX vs S&P 500 Index Performance

VFIAX (Blue)             S&P 500 (Yellow)

 

VFIAX Holdings

These are the top 10 holdings for VFIAX:

VFIAX Top Holdings

VFIAX is largely made up of Apple, Microsoft, Alphabet, Amazon, and Tesla and provides exposure to over 500 other stocks.

 

Admiral Funds Have A Minimum Investment

Vanguard characterizes both VTSAX and VFIAX as admiral funds.  One of the benefits of admiral funds is their lower management fee (expense ratio).

The downside is Vanguard admiral funds have a minimum investment threshold.

This minimum used to be $10,000, but recently Vanguard reduced it to $3,000.  Once the $3,000 minimum threshold is met, there is no minimum investment.

 

Investing Tips

Now that we have seen the differences and similarities, we can go into how to use this information to our advantage.

We will do this by taking advantage of these two funds right away.

We can do this by:

  1. Investing In Equivalent Exchange-Traded Funds (ETFs)
  2. Buying Fractional Shares
  3. Starting With Investor Shares

 

Equivalent Exchange-Traded Funds

Both VTSAX and VFIAX have equivalent ETFs, and they both do not have a minimum investment.

The equivalent ETFs are the same in performance, but they can differ slightly in expense ratio.

Here Are Their Equivalent ETFs:

VTSAX = VTI

VFIAX = VOO

If the minimum investment of $3000 is an obstacle for you, one option is to invest in either Vanguard Total Stock Market ETF (VTI) or Vanguard S&P 500 ETF (VOO).

 

Buying Fractional Shares

Another way to take full advantage of your investment money is to invest every dollar by purchasing fractional shares of these Exchange-Traded Funds (ETFs).

Typically, if you have $100 to invest and an ETF like VTI costs $150, you would have to wait until you save another $50 to purchase one whole share.

However, recently I’ve discovered you can purchase fractional shares of ETFs with no commissions using M1 FinanceUse this link for a $50 Bonus)

So now you don’t have to leave your money sitting in your account, earning nothing until you can purchase a total share.

You can invest the money you want to invest right away and take advantage of any market gains.

This is especially important because missing out on only a few days of market gains can devastate your portfolio’s performance.

Here is what Fidelity found would happen to your portfolio by not being invested in the market on its best days:

Missing Out On Market Gains

If you were incredibly unlucky and missed the best 5 days in 38 years, it would result in a decline of 35% in your portfolio balance!

Since we have no idea when those best days will occur, always staying invested is best.

Time In The Market Beats Timing The Market!

– Ken Fisher

Buying fractional shares allows you to maximize your investment.

This is especially beneficial if you’re interested in investing in higher-priced funds like VOO.

 

Starting With Investor Shares

There is yet one other option to start investing as soon as possible into VTSAX or VFIAX, starting with their investor share funds.

Investor share funds have no minimum investment threshold, allowing you to start investing right away.

Equivalent Investor Share Funds

VTSAX = VTSMX

VFIAX = VFINX

These investor share funds have the same performance because they hold the same stocks.

Their management fee is higher, so it’s best to convert to an admiral fund once you pass the $3000 minimum.

Related Posts:

 

Which Is Better VTSAX vs VFIAX?

VTSAX and VFIAX are both excellent investments depending on your investment goals.  They are also both Admiral Shares Funds with super-low expense ratios.

However, I would give a slight upper hand to VTSAX.

VTSAX has about 7 times more stocks spread out more evenly.  This means VTSAX has more diversification compared to VFIAX.

I believe both VTSAX and VFIAX can get you to Financial Independence Retire Early (FIRE).

They both have rock bottom expense ratios (0.04%).  So, either option is an excellent investment for financial independence.

After keeping fees to a minimum, you can work on increasing your savings rate and prioritizing your investments.

Then, you will be well on your way to Financial Independence and Early Retirement!

FIRE Calculator

Calculate Your FI Number With My Free FIRE Calculator

 


Disclaimer
This post may have affiliate links, which means I may receive commissions if you choose to purchase through links I provide (at no extra cost to you). Thank you for supporting the work I put into this site!

This information is my opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.