Berkshire Hathaway Inc. (ticker: BRK.A, BRK.B) Chairman Warren Buffett once famously remarked in a letter to shareholders that “our favorite holding period is forever.”
Expanding on this point, Buffett stressed Berkshire’s approach to permanent capital, noting that he was personally not a fan of investors who hurry to take profits when companies perform well but “tenaciously hang on to businesses that disappoint.”
Buffett further cited legendary Fidelity mutual fund manager Peter Lynch, who once described this sort of behavior as “cutting the flowers and watering the weeds.”
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It is important to recognize, though, that individual investors are not Warren Buffett, lacking his network, reputation, capital and acumen. As a result, the psychological urge to take profits prematurely while failing to cut losses is extremely powerful.
That dynamic has contributed to significant “short-termism” in modern financial markets, particularly within the exchange-traded fund, or ETF, industry. Beyond leveraged ETFs promising explosive daily returns and thematic funds chasing the latest hot trend, providers have increasingly launched products designed to satisfy the investor urge to do something.
Covered-call ETFs are among the most popular examples. These funds cap upside potential in exchange for current income distributions, often paid monthly or even weekly. While attractive psychologically, many have historically underperformed comparable index funds over longer periods due to capped upside, higher fees and lower tax efficiency.
Investors who recognize these behavioral pitfalls and want to avoid them may instead find Vanguard’s domestic lineup of mutual funds and ETFs appealing. Many of these funds are suitable for a buy-and-hold strategy focused on staying the course and remaining hands-off.
Even though Vanguard has expanded significantly in recent years to currently encompass 115 ETFs and 267 mutual funds, many of its products still emphasize the same core principles that built the firm’s reputation: broad diversification, low fees and passive indexing.
“Investors who stay diversified, keep costs low and remain invested through market cycles are far more likely to reach their goals than those trying to outguess short-term market moves,” says Kathy Kellert, head of index equity product at Vanguard. “A buy-and-hold approach helps remove the pressure to constantly react, and instead lets compounding do its work.”
Here are seven of the best Vanguard funds to buy and hold today:
| Fund | Expense Ratio |
| Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) | 0.04% |
| Vanguard 500 Index Fund Admiral Shares (VFIAX) | 0.04% |
| Vanguard Extended Market Index Fund Admiral Shares (VEXAX) | 0.05% |
| Vanguard Total International Stock Index Fund Admiral Shares (VTIAX) | 0.09% |
| Vanguard Total World Stock Index Fund Admiral Shares (VTWAX) | 0.09% |
| Vanguard Wellington Fund Investor Shares (VWELX) | 0.24% |
| Vanguard Target Retirement 2060 Fund (VTTSX) | 0.08% |
Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX)
“VTSAX gives you complete exposure to the entire U.S. stock market, from the Magnificent Seven down to thousands of publicly traded small- and mid-cap stocks that could become the next Nvidia of the future,” says Henry Yoshida, senior vice president at Retired.com. “It represents the majority of my personal investment portfolio since it is so diversified, low-cost and tax efficient.”
VTSAX was a favorite of Vanguard’s late founder and chairman, John Bogle, who once remarked, “Don’t look for the needle in the haystack, just buy the haystack!” An investment in VTSAX captures a wide swathe of thousands of U.S. stocks from all 11 sectors and across both growth and value styles. VTSAX charges a 0.04% expense ratio and requires a $3,000 minimum investment to access.
Vanguard 500 Index Fund Admiral Shares (VFIAX)
“The S&P 500 index should be a staple of every investor’s portfolio,” Yoshida says. It captures a portfolio of large-cap stocks selected by a committee, screened for liquidity, size and earnings consistency. As a benchmark, the S&P 500 has been difficult for stock pickers to beat. According to the S&P Indices Versus Active study, 89.9% of U.S. large-cap active funds underperformed it over the last 15 years.
Investors can track the S&P 500 via VFIAX at a 0.04% expense ratio with the usual $3,000 minimum investment requirement. Historically, Vanguard’s excellent indexing techniques have contributed to a low tracking error for VFIAX versus its benchmark, at just four basis points, or 0.04% over the last decade. Over this period, VFIAX delivered a 15.2% annualized total return before taxes.
Vanguard Extended Market Index Fund Admiral Shares (VEXAX)
VFIAX’s benchmark is more curated than some investors realize. The S&P 500 does not simply hold the 500 largest companies. While size and liquidity are requirements, the index also includes a discretionary committee component that determines which companies are added or removed. Moreover, the S&P 500’s large-cap, blue-chip focus excludes a substantial portion of the mid- and small-cap universe.
Investors looking to complement VFIAX may find VEXAX appealing. The fund tracks roughly 3,000 stocks outside of the S&P 500, giving it a much stronger mid- and small-cap tilt. According to Vanguard, VEXAX currently has a median market capitalization of $9.1 billion, placing it firmly in the mid-cap range. The fund remains low cost with a 0.05% expense ratio, though it does require a $3,000 minimum investment.
[READ: 10 of the Best Vanguard ETFs to Buy for 2026]
Vanguard Total International Stock Index Fund Admiral Shares (VTIAX)
U.S. stocks may have strongly outperformed over the last decade, but that was not always the case. Older investors may remember the 1999 to 2009 period, often referred to as the “lost decade,” when U.S. equities delivered weak returns following both the dot-com crash and the 2008 financial crisis. During that stretch, international equities and bonds generally held up much better.
For international exposure, investors may find VTIAX an appealing complement to VTSAX. The fund tracks the FTSE Global All Cap ex U.S. Index, spanning more than 8,700 market-cap-weighted companies. Importantly, the fund’s portfolio includes both developed international markets and emerging-market countries. All of this comes at a relatively low 0.09% expense ratio.
Vanguard Total World Stock Index Fund Admiral Shares (VTWAX)
Investors can combine VTSAX and VTIAX to customize their U.S. versus international allocation. However, doing so requires resisting the urge to constantly tinker with the portfolio. After periods of strong U.S. outperformance, investors may be tempted to overweight domestic stocks further, while periods of international market strength can encourage performance chasing abroad.
A one-ticket solution like VTWAX removes much of that temptation. VTWAX tracks the FTSE Global All Cap Index, spanning more than 10,000 market-cap-weighted U.S., developed international and emerging-market stocks. Currently, U.S. equities account for roughly 62% of the portfolio, though those weights naturally shift over time as market leadership changes. VTWAX charges a 0.09% expense ratio.
Vanguard Wellington Fund Investor Shares (VWELX)
VWELX is one of Vanguard’s few active funds and follows a balanced allocation of two-thirds stocks and one-third bonds. On the equity side, the fund favors quality large- and mid-cap companies, particularly those in out-of-favor industries with above-average dividend yields, attractive valuations and improving fundamentals. The bond sleeve focuses primarily on intermediate-duration, investment-grade corporates.
“Launched in 1929, VWELX has seen it all: the Great Depression, World War II, the intense bear market of the 1970s, the subsequent bull market of the ’80s and ’90s, the global financial crisis, and the COVID-19 pandemic, just to name a few,” says Brian Miller, head of multi-asset product management at Vanguard. VWELX charges a 0.24% expense ratio, which is higher due to the use of active management.
Vanguard Target Retirement 2060 Fund (VTTSX)
VTWAX can be an appealing all-in-one holding for younger investors with a high risk tolerance. However, as investors age and their investment horizon shortens, a 100% equity allocation may become too volatile. One solution is adding bonds over time, though that requires manual adjustments unless investors use a target-date fund such as VTTSX that automatically lowers risk over time.
“Vanguard’s suite of target retirement funds can be a complete portfolio solution for investors who want a simple, globally diversified portfolio that adjusts its risk profile over time,” Miller says. “Simply pick the target date closest to when you plan to retire, and the fund allocates your assets to a low-cost mix of stocks and bonds that gradually gets more conservative as you approach retirement.”
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7 Best Vanguard Index Funds to Buy
7 Best Vanguard Funds to Buy and Hold originally appeared on usnews.com
Update 05/26/26: This story was published at an earlier date and has been updated with new information.
