VOO or VTI is the most common question I get from readers starting a US index position, and this week it was the headline of a Motley Fool piece that leaned towards VTI. The two funds cost the same 0.03% a year, come from the same manager and have moved together with a correlation of 0.996 in monthly returns since 2010. The difference between them is real but small, and for a reader outside the United States it is the least important decision in the chain. Here are the numbers, and then the part that matters more.
Two funds, one decision
VOO tracks the S&P 500: 516 holdings, about $1.09 trillion in assets, launched in September 2010. VTI tracks the CRSP US Total Market Index: 3,514 holdings, about $701 billion in the ETF share class alone, launched in May 2001. Both charge 0.03%. Both yielded about 1.05% over the last twelve months: 1.05% for VOO, 1.04% for VTI. On 25 September VOO closed at $710.79 and VTI at $379.77.
The extra 3,000 names in VTI are mid- and small-cap companies, weighted by market value, so they add up to a modest slice of the fund. That is why the two lines in the chart above are nearly indistinguishable. The question is not which fund is better in general, but whether that slice of smaller companies helps or hurts over the period you hold it.
| VOO | VTI | |
|---|---|---|
| Index | S&P 500 | CRSP US Total Market |
| Holdings | 516 | 3,514 |
| Expense ratio | 0.03% | 0.03% |
| Assets | $1.09 trillion | $701 billion |
| Top 10 holdings | 37.81% | 33.43% |
| Magnificent Seven | 33.53% | 29.60% |
| Trailing P/E | 27.05 | 26.32 |
| Dividend yield | 1.05% | 1.04% |
What 25 years of data say
Since VOO launched, the S&P 500 has won. From September 2010 to 25 September 2026 VOO returned 14.47% a year with dividends reinvested and VTI 14.09%. Over ten years the gap is 15.44% against 14.84%, and over five years 14.03% against 12.83%. This year the two are level: 14.03% and 13.95%.
The longer record says the winner depends on the decade. VTI has existed since 2001, and against SPY as a proxy for the S&P 500 it has returned 9.82% a year to 9.56%, a small edge of 0.26 percentage points. That edge was built entirely in the first decade: from July 2001 to January 2011, after the dot-com bust, the total market returned 3.73% a year against 2.52% for the S&P 500, because smaller companies led. From 2015 to 2025, in the mega-cap and AI-led market, the S&P 500 was ahead by 13.64% to 13.15%.
| Period | S&P 500 | Total US market | Leader |
|---|---|---|---|
| Jul 2001 – Jan 2011 | 2.52% a year | 3.73% a year | Total market |
| Jan 2015 – Jan 2025 | 13.64% a year | 13.15% a year | S&P 500 |
| Jul 2001 – Sep 2026 | 9.56% a year | 9.82% a year | Total market |
| Sep 2010 – Sep 2026 | 14.47% a year | 14.09% a year | S&P 500 |
So the history does not settle it. It tells you that choosing between VOO and VTI is a small, implicit bet on whether large companies keep beating small ones.
The case for VTI now
Concentration and price are the two arguments. VOO's ten largest holdings are 37.81% of the fund, led by Nvidia at 8.08%, Apple at 7.03% and Microsoft at 5.70%; the Magnificent Seven are 33.53%. In VTI the top ten are 33.43% and the seven are 29.60%. The gap is smaller than most readers expect, about four percentage points, but it runs in one direction.
The valuation gap is wider. On trailing earnings the S&P 500 trades at about 27 times, the S&P MidCap 400 at 19.42, the Russell 2000 at 18.81 and the S&P SmallCap 600 at 16.77. The Motley Fool's David Dierking, who favours VTI, notes that the Russell 2000 is ahead of VOO by about 2% this year. One year is not a trend, but a large company premium of this size is the kind of starting point from which the 2001–2011 pattern began.
My own position is simple: I hold the S&P 500 as a core and do not expect the difference to decide anything. If I were starting today with a 20-year horizon and no view on large versus small companies, I would take VTI for the extra diversification at no extra cost, and I would not switch an existing VOO position to do it, because selling means paying tax on the gain.
If you are not a US investor
This is where the real decision is. For a reader in Ukraine or the EU, three rules matter more than the index.
Access. Under the EU's PRIIPs regulation a fund must publish a key information document before it is sold to retail investors, and US issuers do not produce them for US-listed ETFs. That is why EU-regulated brokers do not sell VOO or VTI to retail clients. The substitutes are Irish-domiciled UCITS funds: Vanguard S&P 500 UCITS in accumulating (VUAA) and distributing (VUSA) classes, and iShares Core S&P 500 UCITS (CSPX), all at 0.07% a year. There is no UCITS fund tracking the whole US market with VTI's size and cost; the usual approximation is an S&P 500 UCITS fund plus a separate US small-cap fund, or a global all-cap fund such as SPDR MSCI ACWI IMI at 0.17%, which is not US-only.
Estate tax. For a non-US person, shares of US-domiciled funds are US-situs assets. If their value exceeds $60,000 at death, the IRS requires an estate tax return, and without a treaty the exemption is only the equivalent of that $60,000. Irish-domiciled funds are not US-situs assets. For a portfolio above that level this rule alone decides the question.
Dividends and tax at home. With a W-8BEN form, US dividends paid to a Ukrainian resident are withheld at 15% under the treaty instead of 30%. At home, foreign dividends are taxed at 9% plus the 5% military levy, and gains on sale at 18% plus 5%, as the review of foreign-broker taxes and the dividend tax guide set out. An Irish accumulating fund also suffers 15% US withholding inside the fund, but it pays no dividend to you, so there is nothing to declare until you sell.
In analyst Ruslan Averin's view, for a Ukrainian investor the order of decisions is: domicile first, accumulation versus distribution second, and the index last. An accumulating Irish S&P 500 fund at 0.07% gives up about 0.04 percentage points a year in cost against VOO and removes the estate-tax problem entirely. The VOO-versus-VTI gap, a few tenths of a percentage point a year in either direction, is smaller than the cost of getting the wrapper wrong.
Related: the S&P 500 valuation wall, AI concentration in the S&P 500, taxes on a foreign brokerage account in Ukraine and the 60/40 portfolio at 5% yields.