For most long-term investors, a handful of low-cost, broadly diversified index ETFs do almost all the work. Lower fees mean more of your money stays invested and compounds over decades. Below are widely held, low-expense-ratio index ETFs and what each tracks. This is educational information, not investment advice.
| Ticker | Fund | What it tracks | Expense ratio |
|---|
| VTI | Vanguard Total Stock Market | The entire U.S. market — large, mid, and small caps | 0.03% |
| VOO | Vanguard S&P 500 | The 500 largest U.S. companies | 0.03% |
| ITOT | iShares Core S&P Total U.S. Stock Market | The total U.S. stock market | 0.03% |
| VXUS | Vanguard Total International Stock | Non-U.S. developed and emerging markets | 0.07% |
| VT | Vanguard Total World Stock | The entire global market, U.S. + international | 0.06% |
| BND | Vanguard Total Bond Market | U.S. investment-grade bonds | 0.03% |
| SCHD | Schwab U.S. Dividend Equity | About 100 quality U.S. dividend-paying stocks | 0.06% |
| QQQM | Invesco Nasdaq-100 | The 100 largest non-financial Nasdaq companies | 0.15% |
The three-fund portfolio
The most replicated long-term strategy is just three funds: a total U.S. stock fund (VTI), a total international fund (VXUS), and a total bond fund (BND). Together they hold thousands of companies worldwide at a blended cost under about 0.05% per year. You choose the stock-to-bond mix based on your time horizon and risk tolerance.
Why expense ratios matter so much
An expense ratio is the annual fee a fund charges as a percent of your balance. It sounds tiny, but over decades it compounds against you: a 0.03% fund costs $3 a year per $10,000, while a 1.0% fund costs $100 — and that gap, reinvested over 30 years, can add up to tens of thousands of dollars. For long-term investors, low cost is one of the few things you fully control.
What to look for
Broad diversification (thousands of holdings, not a niche bet), a very low expense ratio, deep liquidity and assets under management, and an index you actually understand. Total-market funds are hard to beat as a core holding. The expense ratios here are approximate and can change — always confirm on the fund issuer's page before investing.
Educational information only — not investment advice, and not a recommendation to buy any security. Expense ratios are approximate and can change; verify with the fund issuer. We are not a licensed financial advisor.