VTV Is a Great Choice for Most, but I Like the VUG ETF Better

I actually both ETFs a lot -- for different reasons

Exchange-traded funds (ETFs) have grown in ity over the past decade or two, and for good reason

Just mutual funds, they let you invest in a range of stocks (or other things) with one simple investment -- and they often sport lower expense ratios (annual fees), too

ETFs also make easy by trading stocks throughout the day in the stock market

One particularly ETF is the Vanguard Value ETF (VTV -0

I do it myself, but I'm a bit more jazzed by the Vanguard Growth ETF (VUG -0

Here's a look at both

Image source: Getty Images

First, let's tackle performance

Annual Return 10-Year Avg

Annual Return 15-Year Avg

ETF = exchange-traded fund

What's so great the Vanguard Value ETF

Before you write off the Vanguard Value ETF because of its slower growth, keep reading

The ETF is offering a different position than the other ETFs

It's focused on value -- meaning it's not chasing high-flying stocks and buying them at sometimes inflated prices

Instead, it's focused on seemingly undervalued stocks, ones that offer a margin of safety

For anyone skittish stocks in general, or just today, given that our economy is facing tariff complications, among other things, this ETF should vide some relief

If the market suddenly heads south (as it has always done every few years), value stocks will often drop less severely than their more richly valued counterparts

It tracks the CRSP US Large Cap Value Index, which focuses on the less expensive stocks in the broad U

What's so great the Vanguard Growth ETF

The Vanguard Growth ETF has an admirable track record, topping the other two ETFs above

Thus, many people, myself included, will be drawn to it, imagining our own portfolios growing at above-average rates

Still, it's important to remember that the stock market is volatile, and not every year will feature double-digit gains for this (or other) ETFs

Indeed, in market downturns, growth stocks can have further to fall

ETF = exchange-traded fund

There's a risk-and-reward trade-off there, right

That's why you might want to spread your dollars across several different kinds of ETFs to diversify by risk and return

Here are some more things to know the Vanguard Growth ETF: Its expense ratio is also 0

It tracks the CRSP US Large Cap Growth Index, which focuses on faster-growing stocks in the broad U

Its overall dividend yield was recently 0

That's not surprising, as growth stocks tend to reinvest most of their excess earnings to further their growth

They're generally not generous dividend payers

Ly, that's a different bunch of companies, including all the "Magnificent Seven" -- Apple, Microsoft, Google parent Alphabet, Amazon, Nvidia, Facebook parent Meta Platforms, and Tesla

So, really, both of these are solid, low-fee ETFs with a lot going for them

Think which might serve you best

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors

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Selena Maranjian has positions in AbbVie, Alphabet, Amazon, Apple, Berkshire Hathaway, Broadcom, Meta Platforms, Microsoft, Nvidia, cter & Gamble, and Vanguard Index Funds-Vanguard Growth ETF

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