1 hour ago
2
Ben Gran, The Motley Fool
Fri, June 5, 2026 astatine 10:50 AM CDT 4 min read
Recent run-ups successful tech banal valuations and all-time highs successful the S&P 500 scale person led immoderate investors to interest that maturation stocks are overpriced. Buying inferior stocks and inferior exchange-traded funds (ETFs) tin beryllium a bully determination for immoderate situations and strategies -- similar if you privation to hedge against a imaginable tech downturn oregon aboriginal recession.
Utility stocks thin to gain dependable income and wage above-average dividends. These companies person besides benefited from rising request for energy related to the artificial quality (AI) information halfway build-out. But utilities person a fewer risks and downsides. They're not the close acceptable for each investor.
Missed Nvidia successful 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" awesome flashed for a little-known chipmaker called Nvidia. For the archetypal clip successful years, that aforesaid "Total Conviction" awesome is flashing for a institution 1/100th the size of Nvidia. Continue »
The Vanguard Utilities ETF (NYSEMKT: VPU) is simply a low-cost mode to put successful dozens of inferior companies that administer electricity, gas, water, oregon run arsenic autarkic powerfulness producers. This money has underperformed the S&P 500 for the past 5 years. But investors who privation vulnerability to this circumstantial country of the system tin usage the Vanguard Utilities ETF to easy bargain a portfolio of inferior stocks astatine a debased disbursal ratio of 0.09%.
Let's instrumentality a person look astatine this Vanguard ETF and spot if it mightiness marque consciousness for your portfolio.
67 stocks, 22 years of 9.8% annualized returns
The Vanguard Utilities ETF holds a full of 67 stocks. This Vanguard ETF has delivered mean yearly returns (by nett plus value) of 11.9% successful the past year, 14.4% successful the past 3 years, 9.6% successful the past 5 years, and 9.4% successful the past 10 years. Since the fund's inception successful January 2004, it's delivered mean yearly returns of 9.8%.
Most of the fund's assets are successful electrical utilities (62.4% of the fund) and multi-utilities (24.2%) that supply much than 1 benignant of inferior service. Gas utilities marque up 4.9% of the fund, and autarkic powerfulness producers relationship for different 4.9%. The money besides holds shares successful h2o utilities (2.8%) and renewable energy companies (0.8%).
Those returns mightiness look beauteous steady, and the Vanguard Utilities ETF has paid a beardown dividend output of 2.52% successful the past 12 months. But this money has underperformed the S&P 500 for astir of the past 10 years. If you'd invested $10,000 successful the S&P 500 10 years ago, you'd person $42,850 contiguous -- portion that aforesaid $10,000 concern successful the Vanguard Utilities ETF would person lone grown to $23,740.
.png)
English (CA) · 
English (US) · 
Spanish (MX) ·