Keith Speights, The Motley Fool

Sat, Jun 21, 2025, 2:41 AM5 min read

• Only two Vanguard ETFs have outperformed Buffett's favorite ETF over the long run.

• Both of these winners focus on large-cap growth stocks.

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Warren Buffett has dropped enough hints to ascertain that his favorite exchange-traded fund (ETF) is the Vanguard S&P 500 ETF (NYSEMKT: VOO). This ETF has been a huge winner historically, but which Vanguard ETFs have beaten Buffett's favorite ETF since inception?

Only two make the list: the Vanguard Russell 1000 Growth Index Fund ETF (NASDAQ: VONG) and the Vanguard S&P 500 Growth Index Fund ETF (NYSEMKT: VOOG).

Of Vanguard's 94 ETFs, the Vanguard Russell 1000 Growth ETF has been the best performer over the long run. This fund's average annual return since its inception on Sept. 20, 2010, is an impressive 16.4%. By comparison, the Vanguard S&P 500 ETF's average annual return since its inception on Sept. 7, 2010, is 14.24%.

This Vanguard ETF attempts to track the return of the Russell 1000 Growth Index. The index includes growth stocks in the large-cap Russell 1000 index. The Vanguard Russell 1000 Growth ETF currently owns 392 stocks. Its largest positions are Microsoft, Nvidia, Apple, Amazon, and Meta Platforms. Not so coincidentally, these are also the five largest holdings of the Vanguard S&P 500 ETF.

Many of the stocks in the Vanguard Russell 1000 Growth Index Fund ETF are also in the Vanguard S&P 500 ETF, so how has it delivered such a higher average annual return? One key is that the ETF's focus on growth stocks eliminates some of the S&P 500 members that don't typically generate outstanding returns.

Granted, there is at least one way that the Vanguard S&P 500 ETF beats the Vanguard Russell 1000 Growth ETF. Its annual expense ratio of 0.03% is lower than the latter's expense ratio of 0.07%. Of course, that small difference doesn't matter much with the Vanguard Russell 1000 Growth ETF's higher returns.

Also, if you're interested in income, you'll probably prefer the Vanguard S&P 500 ETF. Its 30-day SEC yield (which reflects a fund's projected annual dividend yield over a trailing-30-day period) is 1.24%, versus only 0.53% for the Vanguard Russell 1000 Growth ETF.

Since the Vanguard Russell 1000 Growth ETF has outperformed the Vanguard S&P 500 ETF over the long term, it isn't surprising that the Vanguard S&P 500 Growth ETF has also been a bigger winner. This Vanguard ETF has delivered an average annual return since its inception on Sept. 7, 2010, of 16.01%.