9 Top Vanguard ETFs for Ultimate Diversification: Assessing Costs, Returns, and Performance

Many investors prefer to invest using passive investment strategies and “lazy” (but smart?) portfolio management. Increased knowledge, lower costs, and a rise in fund offerings (both ETFs and mutual funds) have contributed to this.

Passive strategies include a popular asset allocation strategy that extensively uses various Vanguard ETFs. In this article, we review and describe what we consider the 9 best Vanguard ETFs for ultimately diversification.

We’d also like to mention that we have plenty of similar profitable investment strategies on our major landing page.

Table of contents:

What is Vanguard Group

Vanguard is the market leader in mutual and exchange-traded funds in the USA. An asset manager is the preferred choice for long-term investors for many reasons:

Vanguard funds are generally inexpensive. Vanguard is one of the leading low-cost asset managers in the industry;
Vanguard funds usually follow simple and reliable strategies. Vanguard index funds are simple in their approach and reliable in their operations;
Long-term investors can easily build well-diversified portfolios exclusively from top-rated Vanguard ETFs;
Vanguard offers an excellent picking of three major asset classes: US equities, international equities and bonds;
Vanguard comes in handy when it comes to more well-defined strategies, with highly valued style-focused funds, dividend stocks, real estate, and inflationary bonds;
Vanguard has over $6 trillion in assets.

John Bogle founded Vanguard

The Vanguard Group was established by John Bogle, a highly respected figure in the investment industry. Regrettably, Bogle passed away in 2019, leaving behind a remarkable legacy as the “father of passive investing.” He garnered a substantial following during his lifetime.

Two of John Bogle’s legacies are the Bogleheads 3 And 4 Fund Portfolio.

Vanguard Ultimate Diversified ETFs Backtesting

Let’s backtest the performance of each ETF individually using a “buy and hold” strategy. The testing interval is from the inception date of each ETF to today date. All quotes are adjusted for dividends.

We get the following results for each ETF:

Fund Name	Fund Ticker	Total Profit (%)	Annual Return (CAR) (%)	Max. Drawdown (MDD) (%)	CAR/MDD	Annual Standard Deviation (%)	Sharpe Ratio (3% Risk-Free Rate)
Vanguard Total