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[TSP_Strategy] Re: S Fund as an ETF?

 

Vanguard's VXF ETF tracks the same index as the TSP S fund and is a very low fee fund like TSP.  Vanguard's VEXAX or VEXMX also track the the same Dow Jones Total US Market Completion Index. I prefer to call the index the non-sp500 index for short since that is what it is - the index includes all the US listed companies not in the SP500 index.   I have not found any others that track the same index. 

I use the VXF ETF to chart the TSP S fund relative performance much of the time. The price of the ETF does not match the price of the S fund, but they have the same daily percentage gain/loss and matching long term performance.  I posted charts awhile back that show how closely they track at http://tspsmart.com/Index-Comparison-Charts.

You can check my ETF guide (http://tspsmart.com/ETF-Guide) or Mutual Fund guide to compare other low-fee broad index funds.  I am not affiliated with Vanguard or any financial service company and gladly recommend better funds when they come along.  I included the other low cost funds in my comparisons in case you have an account at one of the other brokerages.  Sometimes trading costs are reduced when you purchase the brokerages own funds.  

One minor issue with Vanguard's VTWO ETF is they do not push it and it lacks net assets so its bid/ask spread has been higher compared to iShares IWM ETF as you will see in the guide.  It is still a good fund otherwise.

If you look at (http://tspsmart.com/compare-equity-funds)  I attempted to provide a visual of the market and the major funds that track them.  The Russell 2000 holds the smaller 2000 companies in the US and accounts for 7% of the total US market cap.  The non-sp500 index (TSP S fund) accounts for 20% ish of the US market and the SP500 holds 80% ish of the total US market.  TSP was set up with the C and S fund so you can buy the entire US stock market.  But note you would need to allocate 80% to the C fund and 20% to the S fund to match the total market performance.  Or buy the Vanguard VTI ETF in a non-TSP account.

Cheers,

Michael








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Posted by: Michael Bond <michaelhbond@yahoo.com>
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Neither the TSP Strategy group, nor individual members, are licensed or authorized to provide investment advice. Any statements made herein merely reflect the personal opinions of the individual group member. Please make your own investment decisions based upon your personal circumstances.

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