Mad Money Machine

VTI vs SPY

VTI is the Vanguard Total Stock Market Index ETF and SPY tracks the S&P 500.
This article by Mark Hulbert explains in detail how buying and holding the 500 stocks in the S&P 500 when it started 50 years ago would have dramatically outperformed investing in the actual S&P 500 itself with all of its changes over time.

That’s why I like the VTI. It represents many more stocks and could get us closer to that buy and hold ideal. I Like Buy and Hold Now, Boy!

Update 3/11/07: I am part-way through John Bogle’s new book and he shows a chart that compares the performance of the S&P 500 with the total market and they look almost identical. He says there is a 98% correlation between the two. The S&P 500 makes up 80% of the total market index.