Warren Buffett Says Buy This S&P 500 Index Fund. It Could Soar by 139%, According to a Top Wall Street Analyst
Key Takeaways
Warren Buffett is one of the world's top investors (which is quite significant). In 1965, he acquired a controlling stake in a struggling textiles enterprise called Berkshire Hathaway (BRK. 59%),...
Article Overview
Quick insights and key information
7 min read
Estimated completion
real estate
Article classification
July 18, 2025
03:55 AM
The Motley Fool
Original publisher
Warren Buffett is one of the world's top investors (which is quite significant)
In 1965, he acquired a controlling stake in a struggling textiles enterprise called Berkshire Hathaway (BRK. 59%), and converted it into a holding company which is now worth over $1 trillion
Nevertheless, Berkshire owns a number of subsidiaries GEICO Insurance and Dairy Queen, in addition to a $288 billion portfolio of publicly traded stocks and securities which Buffett and his team oversee
On the other hand, Had you invested just $500 in Berkshire stock in 1965, it would have grown to a whopping $22. 3 million at the end of 2024, thanks to Buffett's incredible ability to pick stocks
But he is a full-time fessional with decades of experience, so he knows the average investor would struggle to replicate his results
That's why he often recommends they buy an exchange-traded fund (ETF) that tracks the performance of a diversified index the S&P 500 (^GSPC 0, amid market uncertainty
What the data shows is Vanguard S&P 500 ETF (VOO 0. 65%) is one Buffett has by name in the past, and it's for its extremely low cost
According to Wall Street analyst Tom Lee from Fundstrat Global Advisors, the S&P 500 could soar by 139% by 2030, so investors who buy the Vanguard ETF today could earn a very nice return over the next five years
Image source: The Motley Fool (this bears monitoring)
The most diversified major U
Furthermore, Stock market index The U
Meanwhile, Is to several stock market indexes, but these three receive the lion's of the attention: The Dow Jones Industrial Average (DJINDICES: ^DJI), the Nasdaq Composite (NASDAQINDEX: ^IXIC), and the S&P 500, in today's market environment
This leads to the conclusion that Dow is made up of just 30 stocks, and the Nasdaq is very nology-heavy, so the S&P 500 tends to be the benchmark for most investors
The evidence shows S&P 500 hosts 500 companies from 11 different sectors of the economy
However, So it's highly diversified, but it still offers ample exposure to the high-growth segments of the market
Information nology is the largest sector in the index, with a weighting of 33. 4%, and it's to the world's three largest companies: Nvidia, Microsoft, and Apple, which have a combined value of $10, in light of current trends
Additionally, 9 trillion
Below is a list of each S&P 500 sector, its weighting, and a few of its most noteworthy stocks
Additionally, S&P 500 Sector Sector Weighting Noteworthy Stocks Information nology 33. 4% Nvidia, Microsoft, Apple Financials 13. 9% Berkshire Hathaway, JPMorgan Chase, Visa Consumer Discretionary 10, in light of current trends. 4% Amazon, Tesla, McDonald's Communication Services 9. 5% Alphabet, Meta Platforms, Netflix Health Care 9
Additionally, 3% Eli Lilly, Johnson & Johnson, UnitedHealth Group Industrials 8. 6% GE Aerospace, Uber nologies, Boeing Consumer Staples 5. 4% Walmart, Costco, and cter & Gamble
Furthermore, Meanwhile, 1% ExxonMobil, Chevron, Kinder Morgan Utilities 2 (an important development), in today's financial world. 4% NextEra Energy, Vistra Corp, American Electric Power Company Real Estate 2% logis, American Tower Corporation, Equinix Materials 1. 9% Linde Plc, Sherwin-Williams, Newmont Corporation Data source: State Street
At the same time, Sector weightings are accurate as of July 10, 2025, and are subject to change, amid market uncertainty
Conversely, Getting into the S&P 500 isn't easy, given current economic conditions
On the other hand, Companies must have a market capitalization of at least $22 (noteworthy indeed)
Moreover, 7 billion, and the sum of their earnings (fits) must be positive over the most recent four quarters
A special committee meets once per quarter to decide which companies make the cut, giving investors confidence that only the highest-quality names make it into the index
The Vanguard S&P 500 ETF is one of the cheapest ways to invest in the index
In contrast, With an expense ratio of 0. 03%, an investment of $10,000 would incur an annual fee of just $3
Vanguard says that competing funds across the industry charge an average expense ratio of 0
Moreover, 75%, an eye-popping 25 times higher (this bears monitoring), in today's market environment
This can dent investors' returns over the long run
Tom Lee predicts 139% upside by 2030 No Wall Street analyst is right all the time, so investors should take every forecast with a grain of salt
But Lee has made a string of extremely accurate predictions over the last couple of years, so it's always worth taking his viewpoint into consideration
Lee predicted that the S&P 500 would climb to 4,750 in 2023, while many other analysts were still cautious because of the bear market the year before
Furthermore, The index wound up closing the year at 4,769, almost exactly as he forecasted
Lee then issued five predictions for the S&P 500 throughout 2024, telling investors it could hit 5,200, 5,500, 5,700, 6,000, and 6,300
Conversely, The index hit the first four of those targets, only just falling shy of the last one
Then, after the Trump administration's tariff-induced 19% collapse in the S&P 500 in April this year, Lee was one of the only analysts on Wall Street predicting a V-shaped recovery (a rapid rebound back to new highs) (something worth watching)
The index ceeded to set a new record high in June, given the current landscape
Furthermore, But Lee isn't just focused on the near term, in today's financial world
Last year, he forecasted that the S&P 500 will hit 15,000 by 2030, which implies a return of 139% from where it's trading as of this writing (July 14), in this volatile climate
That's the return investors can expect from the Vanguard S&P 500 ETF over the next five years if he's right, in this volatile climate
On the other hand, Lee believes artificial intelligence (AI) will play a major role in that upside, as companies could invest trillions of dollars in automation to offset labor shortages, in light of current trends
Additionally, He also thinks the S&P 500 will benefit from a demographic shift as millennials and Gen Zers enter their highest-earning years (between ages 30 and 50), which is when they make important life decisions
The S&P 500 has always climbed to new highs since it was established in 1957, despite experiencing several corrections and bear along the way, so reaching 15,000 seems inevitable, given current economic conditions
However, Even if it doesn't happen by 2030, it's ly to happen at some point in the future, so ing Buffett's advice by buying the Vanguard S&P 500 ETF is bably a smart decision
JPMorgan Chase is an advertising partner of Motley Fool Money
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors
Additionally, Additionally, Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors
Anthony Di Pizio has no position in any of the stocks mentioned
Nevertheless, However, The Motley Fool has positions in and recommends Alphabet, Amazon, American Tower, Apple, Berkshire Hathaway, Chevron, Costco Wholesale, Equinix, JPMorgan Chase, Kinder Morgan, Meta Platforms, Microsoft, Netflix, NextEra Energy, Nvidia, logis, Tesla, Uber nologies, Vanguard S&P 500 ETF, Visa, and Walmart, considering recent developments
The Motley Fool recommends GE Aerospace, Johnson & Johnson, Linde, Sherwin-Williams, and UnitedHealth Group and recommends the ing options: long January 2026 $180 calls on American Tower, long January 2026 $395 calls on Microsoft, long January 2026 $90 calls on logis, short January 2026 $185 calls on American Tower, and short January 2026 $405 calls on Microsoft
The Motley Fool has a disclosure policy.
Related Articles
More insights from FinancialBooklet