The stock market has outperformed expectations for an extended period, raising questions about its sustainability. The S&P 500 index has seen a remarkable 593% total return over the last 15 years, while the tech-heavy Nasdaq-100 has surged by 1,150%. Despite these gains, concerns linger about the potential for an overhyped AI boom and the looming possibility of a bear market.
Long-term investors are advised to focus on sustained strategies rather than worrying about short-term volatility. The Vanguard Morningstar Total Stock Market ETF (VTI) appears to be a promising investment option, providing diverse exposure across all U.S. stocks and outperforming traditional S&P 500 ETFs in recent years, with average returns of 14.8% over the last decade and 11.7% over the last five years.
Historically, the stock market has delivered average annual returns of around 10% since 1928, despite various economic upheavals. This resilience underscores the idea that long-term investing remains a sound strategy, particularly with low-cost options like VTI, which boasts a mere 0.03% expense ratio and a portfolio that includes a mix of large, mid, and small-cap stocks. With a solid track record and the potential for significant long-term gains, investing in VTI can be viewed as a prudent choice for those willing to commit to a long-term investment horizon.
