Stocks have experienced remarkable growth since the lows observed in March, with the easing of peak tensions in the Middle East and a successful first-quarter earnings season serving as tailwinds. The S&P 500’s impressive year-over-year earnings growth of 27% has created a favorable environment for stocks.
However, with various economic, geopolitical, and financial factors unfolding in the first half of the year, many investors are reassessing whether it’s the right time to invest in global equities. While concerns about inflation and geopolitical conflicts, such as the situation in Iran, remain, strong corporate earnings are providing a silver lining.
In this context, several Vanguard ETFs present appealing opportunities for investors as summer approaches.
The Vanguard S&P 500 ETF offers a straightforward way to invest in the largest U.S. companies without the need for individual stock selection. As the largest ETF in the world, it delivers broad market exposure at a low cost, making it a cornerstone asset for many portfolios. The ETF’s performance can be traced back to a market rotation that began in January, which saw value, small-cap, and defensive stocks take the lead. A subsequent 9% correction due to geopolitical tensions was followed by a substantial 20% rally in technology stocks. Instead of juggling individual investments, a long-term position in the Vanguard S&P 500 ETF allows investors to maintain consistent exposure to various segments of the market while minimizing the risk of poor timing.
As of today, the Vanguard S&P 500 ETF has seen a modest increase of 0.23%, with a current price of $695.49 and a volume of 5.1 million shares traded.
The Vanguard Dividend Appreciation ETF is another intriguing option, despite its more defensive reputation. This fund focuses on companies with a consistent track record of increased dividends over at least ten years. While it may seem counterintuitive to invest in such an ETF given the dominant tech sector, the fund is actually heavily weighted toward larger companies, many of which are in technology. The current top holdings—Broadcom, Apple, and Microsoft—constitute about 13% of the portfolio, which makes this ETF growth-oriented despite its dividend focus.
The tech sector holds 26% of the overall fund, positioning it favorably in a market that’s currently gravitating towards tech growth. Therefore, for investors looking to diversify beyond pure tech or growth stocks, this ETF can serve as a balanced entry point.
Lastly, the Vanguard Total International Stock ETF introduces an international perspective that many investors frequently overlook. Since the beginning of 2025, this ETF has posted returns of 45%, significantly outperforming the S&P 500’s 27%, all while maintaining relatively low volatility. This fund is comprised of a diverse range of sectors, including a sizable allocation to financials (23%) and industrials (16%), which tends to make it more cyclically sensitive. With a 15% allocation to tech—the third-largest sector in the fund—international stocks provide a different exposure than their U.S. counterparts, often with more attractive valuations.
Each of these Vanguard ETFs caters to distinct investment needs and comes with potential catalysts for strong performance as we move further into the year. Investing in a mix of these funds could enhance overall portfolio performance, especially as market dynamics continue to shift.
