It’s only natural that investors and analysts alike lean on metrics like recent returns, market trading ranges, expense ratios and net asset values to gauge exchange-traded fund investment decisions.
Rarely, it seems, do investors leverage total fund assets in making those decisions — even though they should. Basically, higher assets under management, or AUM, means higher liquidity.
When investors monitor AUM over different periods, they’re doing themselves a big favor, as assets under management reveal a great deal about an ETF’s performance and capabilities. For instance, a fund with a high AUM tends to outperform funds with a low AUM, as ETFs with larger assets attract more cash from investors who likely consider a deep-pocketed ETF to be successful and reliable.
As ETFs with bigger assets usually come with greater trading liquidity and lower costs, those features are going to appeal to even more investors.
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Another boost for high-asset ETFs is that savvy investors often view funds with larger AUMs as being better managed and more dependable than funds with lower AUMs.
Which larger-asset ETFs are most popular with investors these days, and how would they fit into your investment portfolio? Here’s a snapshot of both the top-of-the-line funds and their asset picture as of Dec.1:
| ETF | AUM | Expense ratio |
| SPDR S&P 500 ETF Trust (ticker: SPY) | $438.4 billion | 0.09% |
| iShares Core S&P 500 ETF (IVV) | $381 billion | 0.03% |
| Vanguard S&P 500 ETF (VOO) | $357.2 billion | 0.03% |
| Vanguard Total Stock Market ETF (VTI) | $332.3 billion | 0.03% |
| Invesco QQQ Trust Series I (QQQ) | $218.3 billion | 0.2% |
| Vanguard FTSE Developed Markets ETF (VEA) | $117 billion | 0.05% |
| iShares Core MSCI EAFE ETF (IEFA) | $102.2 billion | 0.07% |
| Vanguard Value ETF (VTV) | $101.9 billion | 0.04% |
| Vanguard Total Bond Market ETF (BND) | $100.5 billion | 0.03% |
| Vanguard Growth ETF (VUG) | $99.9 billion | 0.04% |
Sources: Morningstar, fund companies.
SPDR S&P 500 ETF Trust (SPY)
AUM: $438.4 billion
This fund tracks the core stocks included in the S&P 500. The fund has returned 21.4% so far in 2023 as of Dec. 1 and has a 12.6% annualized return for the past five years. Its net expense ratio is low, at 0.09%, and it has a 1.4% 12-month trailing dividend yield to boot.
iShares Core S&P 500 ETF (IVV)
AUM: $381 billion
This iShares fund also tracks the main stocks in the S&P 500 and features a solid 1.5% 12-month trailing dividend yield. The fund has returned a robust 21.5% on a year-to-date basis and has returned an annualized 12.6% over the past five years. The fund’s net expense ratio is one of the ETF industry’s lowest, at 0.03%.
Vanguard S&P 500 ETF (VOO)
AUM: $357.2 billion
Another fund that mirrors the core stocks included in the S&P 500, VOO is one of the top index funds in the U.S. With over $357 billion in assets under management, the fund’s ultra-low management fee of 0.03% allows fund holders to reduce their “cost of participation,” one of the biggest drivers of fund underperformance. A 1.5% trailing dividend yield provides more incentive to invest in the fund.
Vanguard Total Stock Market ETF (VTI)
AUM: $332.3 billion
Vanguard scores another direct hit in the top AUM ETF rankings with this low-turnover fund, which is up 20.7% so far in 2023 as of Dec. 1, compared with about 18% for its category. The ETF is another good example of investors opting for simplicity and reliability in a large fund that tracks the whole investable U.S. equity market. This fund holds not only the largest stocks in the U.S. trading universe, but quality small- and midsize companies, too.
Invesco QQQ Trust Series I (QQQ)
AUM: $218.3 billion
The Invesco QQQ fund could be the all-star large ETF of 2023, with year-to-date returns of 47.1% as of Dec. 1, compared with a category average return of roughly 31%. The fund is technology-heavy, and that’s a good thing in a year when large tech stocks like Apple Inc. (AAPL) and Microsoft Corp. (MSFT) are outperforming. The two tech stocks compose 21.6% of QQQ holdings. A low net expense ratio of 0.2% makes it even easier to afford entry to this longtime ETF winner.
[READ: 5 Biggest ETF Brands and Their Issuers]
Vanguard FTSE Developed Markets ETF (VEA)
AUM: $117 billion
This Vanguard favorite has a low expense ratio, at 0.05%, and an international flavor, tracking stocks in major markets in Europe and Asia. The ETF’s holdings are also more spread out than most large AUM funds, with Novo Nordisk A/S (NOVO-B.CO) as the largest fund holding but only making up 1.5% of the portfolio. The fund is lagging a bit behind some of the other ETF giants, up 12.8% this year as of Dec. 1, but it’s still beating the category average by roughly a percentage point and it offers a 3% trailing yield.
iShares Core MSCI EAFE ETF (IEFA)
AUM: $102.2 billion
This fund also falls into the lower cost category, with a net expense ratio of just 0.07%. It has a 2.4% trailing dividend yield, adding more luster to this ETF for income investors. The fund is up 12.9% on a year-to-date basis as of Dec. 1, which beats its category average.
Vanguard Value ETF (VTV)
Assets: $101.9 billion
Vanguard Value ETF generally tracks the performance of the CRSP U.S. Large Cap Value Index, with value-friendly heavyweights like Berkshire Hathaway Inc. (BRK.B), UnitedHealth Group Inc. (UNH) and Exxon Mobil Corp. (XOM) holding sway in the fund. There’s also value in the fund’s low net expense ratio of 0.04%. The ETF is up only 5% on a year-to-date basis as of Dec. 1, but it has an average five-year return of 8.7% against a Factset segment average of 3.8%, according to data published by VettaFi.
Vanguard Total Bond Market ETF (BND)
AUM: $100.5 billion
The large AUM ETF field also holds room for a big bond fund, and BND is an undeniable heavyweight. The fund comes with a 0.03% expense ratio, making it one of the most cost-efficient ETFs around. Like most bond funds, BND is struggling in 2023, returning 2.9% as of Dec. 1. The main issue is consistently high interest rates, which pose a return problem as bond prices move inversely to interest rate hikes. But investors have had a 3.1% trailing yield to console them.
Vanguard Growth ETF (VUG)
AUM: $99.9 billion
Another Vanguard ETF with an ultra-low 0.04% cost of entry, VUG tracks the MSCI US Prime Market Growth Index. With 2023 stalwarts like Apple, Microsoft and Amazon.com Inc. (AMZN) composing 32.3% of the fund, it’s no surprise that the well-managed VUG is outperforming this year, returning 41.3% year to date compared with a category return of about 31%.
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