A total stock market index fund is an investment vehicle that contains a basket of stocks within a mutual fund or exchange traded fund (ETF) that tracks an equity index. An equity index contains numerous stocks across various industries designed to represent the performance of the overall equity market. However, investors can't buy an index directly, but instead, can invest in a fund that mirrors a broad-based index, such as the Russell 3000 Index, the , or the Wilshire 5000 Total Market Index.
By investing in stocks linked to a given index—called a benchmark—a total market index fund's performance aims to mirror the equities within the underlying. The stocks within these funds may include those issued by large, well-known corporations and stocks of smaller, lesser-known companies.
In this article, we highlight four of the most prominent total market index funds, including their one-year performance, investment minimums, and the expense ratio for each of the funds.
Key Takeaways
- A total stock market index fund is an investment vehicle that contains a basket of stocks within a fund that tracks an equity index.
- The major broad-based indexes used as benchmarks include the Russell 3000, the S&P 500, and the Wilshire 5000 Total Market Index.
- The best total market index funds by popularity include the Vanguard Total Stock Market Index Admiral Shares (VTSAX), the Schwab Total Stock Market Index Fund (SWTSX), the iShares Russell 3000 (IWVB), and the Wilshire 5000 Index Investment Fund (WFIVX).
The Vanguard Total Stock Market Index Admiral Shares (VTSAX)
The Vanguard Total Stock Market Index Admiral Shares (VTSAX) seeks to track the investment results of the CRSP U.S. Total Market Index. The fund is designed to provide investors exposure to the entire U.S. equity market, which includes small, mid-sized, and large companies. The fund's goal is to provide low-cost, broad exposure to the equity markets by investing in companies that primarily trade on the New York Stock Exchange (NYSE) and NASDAQ.
Some of the characteristics of the fund include:
- Total net assets: $1.4 trillion
- One-year return: 25.71% as of Dec. 31, 2021
- Expense ratio: 0.04% as of April 29, 2021
- The VTSAX has a $3,000 minimum investment requirement
For those who can't meet the $3,000 initial investment requirement, Vanguard also offers an exchange traded fund (ETF) called the Vanguard Total Stock Market ETF (VTI). The ETF version is similar to the VTSAX and reduces the costs to the price of a single ETF share.
Equity Sector Diversification
Below are the weightings of the major industries within the VTSAX portfolio:
- Technology companies: 29.00%
- Consumer discretionary: 16.00%
- Industrials: 12.80%
- Healthcare companies: 12.80%
- Financial services: 10.90%
Stock Holdings
The Vanguard Total Stock Market Index Admiral Shares is considered a large-cap blend, evidenced by some of its top 10 holdings, which make up 25.20% of the fund as of Dec. 31, 2021:
- Apple, Inc. (AAPL)
- Microsoft Corp. (MSFT)
- Amazon.com (AMZN)
- Alphabet Inc. (GOOG)
- Meta (META), formerly Facebook
- Tesla Inc. (TSLA)
The Schwab Total Stock Market Index (SWTSX)
The Schwab Total Stock Market Index (SWTSX) tracks the total return of the entire U.S. equity market as measured by the Dow Jones U.S. Total Stock Market Index. The fund is designed to be a comprehensive blend of large, small, and mid-sized corporations. The SWTSX has a low cost with no investment minimum.
Some of the characteristics of the fund include:
- Assets under management: $19.09 billion
- One year return: 25.63% as of Dec. 31, 2021
- Expense ratio: 0.030%
- Investment minimum: None
Equity Sector Diversification
Below are the weightings of the major industries within the SWTSX as of Dec. 31, 2021:
- Technology: 28.2%
- Healthcare: 13.3%
- Consumer discretionary: 12.5%
- Financial services: 11.3%
- Communication services: 9.2%
Stock Holdings
The SWTSX's top 10 holdings comprise approximately 24.38% of the portfolio and include the following as of September 30, 2021:
- Apple, Inc. (AAPL)
- Microsoft Corp. (MSFT)
- Amazon.com (AMZN)
- Meta (META)
- Alphabet Inc. (GOOGL)
- Tesla Inc. (TSLA)
The iShares Russell 3000 ETF (IWV)
The iShares Russell 3000 (IWV) by BlackRock Inc. is an exchange-traded fund (ETF) that tracks the performance of the Russell 3000 Index, which measures the investment results of the broad U.S. equity market. Like its peers, IWV uses an indexing approach to select a sample of stocks that represent the underlying benchmark.
Some of the characteristics of the fund include:
- Assets under management: $13.03 billion
- One year return: 25.45% as of Dec. 31, 2021
- Expense ratio: 0.20%
- Investment minimum: None
Equity Sector Diversification
IWV's sector allocations are similar to those of the Vanguard and Schwab funds. As of Dec. 31, 2021, the top industries within the IWV include:
- Technology: 28.21%
- Healthcare: 13.36%
- Consumer discretionary: 12.34%
- Financial services: 11.27%
- Communication services: 9.15%
Stock Holdings
Similar to the previous two funds, the IWV also has more than 24.60% of its assets weighted in its top 10 holdings as of Dec. 31, 2021. Some of those holdings include:
- Apple, Inc. (AAPL)
- Microsoft Corp. (MSFT)
- Amazon.com (AMZN)
- Meta (META)
- Alphabet Inc. (GOOGL)
- Tesla Inc. (TSLA)
Small stocks listed in a total market index fund are often thinly traded, which may result in high trading spreads and significant transaction costs.
The Wilshire 5000 Index Investment Fund (WFIVX)
The Wilshire 5000 Index Investment Fund (WFIVX) is a mutual fund that tracks the investment results of the Wilshire 5000 Index, a capitalization-weighted index of the market value of all actively traded U.S.-headquartered stocks. The index typically holds more than 3,000 stocks.
Some of the characteristics of the fund include:
- Assets under management: $258 million
- One year return: 25.59% as of Dec. 31, 2021
- Expense ratio: 0.62%
- Investment minimum: $1,000
Equity Sector Diversification
The sector allocations for the WFIVX as of Dec. 31, 2021 include:
- Technology: 25.52%
- Healthcare: 13.16%
- Consumer discretionary: 12.36%
- Financial services: 13.70%
- Communication services: 9.39%
Stock Holdings
Similar to the previous funds, the WFIVX also has more than 20% of its assets weighted in its top 10 holdings as of Dec. 31, 2021. Some of those holdings include:
- Apple, Inc. (AAPL)
- Microsoft Corp. (MSFT)
- Amazon.com (AMZN)
- Alphabet Inc. (GOOG)
- Meta (META)
- Tesla Inc. (TSLA)
| Comparing 4 Total Stock Market Index Funds | |||
|---|---|---|---|
| Total Stock Market Index Fund | Assets Under Management | One Year Return | Expense Ratio |
| Vanguard Total Stock Market Index Admiral Shares (VTSAX) | $1.4 trillion | 25.71% | 0.04% |
| Schwab Total Stock Market Index (SWTSX) | $19.09 billion | 25.63% | 0.030% |
| iShares Russell 3000 ETF (IWV) | $13.03 billion | 25.45% | 0.20% |
| Wilshire 5000 Index Investment Fund (WFIVX) | $258 million | 25.59% | 0.62% |
Total Stock Market Funds FAQs
What Is a Total Stock Market Index Fund?
A total stock market index fund is a mutual fund or exchange-traded fund (ETF) that tracks an equity index such as the Russell 3000 Index, the S&P 500, or the Wilshire 5000 Total Market Index, as its benchmark.
How Many Stocks Are in the Vanguard Total Stock Market Index Admiral Shares Fund?
The Vanguard Total Stock Market Index Admiral Shares Fund has more than 3,000 equity holdings.
How Do I Invest in a Total Market Index Fund?
Investors can invest in a total market index fund by opening a brokerage account that offers ETFs and index funds including the Vanguard Total Stock Market Index Admiral Shares Fund (VTSAX), the Schwab Total Stock Market Index Fund (SWTSX), the iShares Russell 3000 (IWVB), and the Wilshire 5000 Index Investment Fund (WFIVX).
What Companies Are in the Vanguard Total Stock Market Index Admiral Shares Fund?
With 29% of its portfolio invested in the technology sector, companies in the Vanguard Total Stock Market Index Admiral Shares fund (VTSAX) include Apple, Inc., Microsoft Corp., Amazon.com, Meta A, and Alphabet Inc. A.
