This Is the Best Vanguard ETF to Buy Right Now, and It's Not Even Close

Every textbook tells you the same thing: Don't put too much money in sector-specific exchange-traded funds (ETFs)

But the economy is undergoing a fundamental transformation that makes the old playbook dangerously obsolete

It's your ticket to owning the companies building the next economy -- one that is rapidly emerging from the shadows

Image source: Getty Images

The numbers don't lie Look at the performance gap and try not to gasp

A respectable but comparatively pedestrian 11. 2-percentage-point difference might sound modest, but compound it over time, and you're talking life-changing wealth creation

VGT data by YCharts This isn't a temporary anomaly driven by euphoria

But here's what few investors understand: That figure barely scratches the surface

Nology isn't just growing as a sector

It's absorbing every other sector

They're nology companies that happen to move money

Companies that happen to sell ducts

Software companies wrapped in metal

When everything is nology, owning "just " means owning everything

Is the foundation of modern society

Why those sky-high valuations make perfect sense The "Magnificent Seven" stocks in this fund trade at valuations that make traditional investors uncomfortable

Apple is at 26 times forward earnings

Microsoft stock is commanding a premium of 32 times forward earnings

Nvidia, for its part, trades at over 35 times jected earnings

But here's what the bears miss: We're not pricing in yesterday's growth

We're pricing in tomorrow's revolution

Consider artificial general intelligence (AGI)

We're arguably witnessing its primitive birth

ChatGPT can write code, analyze data, and reason through complex blems

It's not true AGI yet, but it's close enough to transform industries

And this primitive version is only getting smarter

Every month brings breakthroughs that would have seemed impossible a year earlier

When AGI fully arrives -- and it's now a question of when, not if -- the economic implications are staggering

That's the equivalent of adding another economy the size of the United States

The companies building this future deserve premium valuations because they're not just growing revenues

They're creating entirely new of human possibility

Beyond the giants Yes, the Vanguard Information nology ETF is top-heavy

Critics point to this concentration as a weakness

They're missing the forest for the trees

These aren't just big companies -- they're the architects of our digital infrastructure

Microsoft's Azure powers the cloud

Nvidia's chips enable AI

Palantir nologies is turning data into strategic advantage

Cadence Design Systems creates the software that designs next-generation chips

Advanced Micro Devices is challenging Intel's dominance

Quantum computing pioneers

Cybersecurity innovators

Robotics manufacturers

The Vanguard Information nology Index Fund is the big tent of

This isn't picking winners in the AI race or betting on which quantum computing start-up will succeed

It's owning the entire ecosystem

When one company stumbles, another surges

When new nologies emerge, they're automatically added

The fund rebalances itself, ensuring you own tomorrow's giants, not just today's

The smart overweight strategy Traditional wisdom says to stay broadly diversified across most, if not all, sectors

But when one sector is rewriting the rules of every on Earth, traditional wisdom becomes tomorrow's regret

The tried-and-true strategies must be redrawn for a world where software eats everything, AI makes decisions, and quantum computers solve the unsolvable

The Vanguard Information nology ETF isn't just the best Vanguard ETF to buy right now

For investors who understand where the world is heading, it's not even close

George Budwell has positions in Apple, Microsoft, Nvidia, Palantir nologies, and Vanguard Information nology ETF

The Motley Fool has positions in and recommends Advanced Micro Devices, Apple, Cadence Design Systems, Intel, Microsoft, Nvidia, and Palantir nologies

The Motley Fool has a disclosure policy.