4 Vanguard ETFs Hedge Funds Are Buying

Whether you’ve been investing for years or are simply starting out, buying exchange-traded funds (ETFs) can be a smart way to diversify your portfolio and invest in the best stocks in the market. ETFs are a low-cost option that offers targeted exposure to different sectors. They track an index and mimic its performance. 

Vanguard manages some of the best ETFs, and it is popular for the low costs. Well-known hedge funds have recently added Vanguard ETFs to their portfolios. Here’s a look at the 4 ETFs hedge funds are buying. 

Vanguard S&P 500 ETF

The Vanguard S&P 500 ETF (NYSEARCA:VOO) is one of the largest ETFs in the world. It is a very popular ETF that tracks the performance of the S&P 500 index. This index consists of the 500 largest companies in the U.S., and by investing in the ETF, you get to own a bite of the biggest companies. Very few ETFs have been able to beat the performance of the S&P 500 index, and VOO has managed to do that.

Plante Moran Financial Advisors increased its stake in the fund by 9.43%, and Acorns Advisors Limited increased its stake by 1.49%. TRB Advisors bought 225,000 shares of VOO, which now constitutes 37.44% of the portfolio. 

Exchanging hands for $611, the ETF has gained 13.76% in 2025 and 91% in five years. The stocks included in the index are weighted by market cap, so the largest companies have the biggest impact on the performance. VOO has an expense ratio of only 0.03% and a 30-day SEC yield of 1.12%. 

It holds 504 stocks and has the highest allocation in the technology sector (34.80%), followed by financials (13.50%) and consumer discretionary (10.50%). 

Since the fund is heavy on the tech sector, its top 10 holdings include the Magnificent Seven, such as Tesla, Nvidia, Microsoft, Apple, and Amazon. The 10 stocks constitute 38.74% of the portfolio. VOO has generated a cumulative 3-year return of 94.49% and a 5-year return of 113.86%. 

Vanguard FTSE Developed Markets ETF 

The Vanguard FTSE Developed Markets Index Fund ETF (NYSEARCA:VEA) invests in international stocks and offers ultimate diversification. It provides exposure to markets outside of the U.S., like Japan, Europe, and Australia. The ETF tracks the performance of the FTSE Developed All Cap ex U.S. Index. 

Hedge funds are diversifying their portfolios through ETFs that invest in global stocks, allowing them to make the most of the growth across different geographical locations. Beacon Financial Strategies increased its stake in VEA by 2.96%, and Mountain Capital Investment Advisors bought 719,329 shares. Jasper Ridge Partners increased its stake in VEA by 37.17%. 

It has an expense ratio of only 0.03% and invests in 3,883 stocks. VEA has the highest allocation in the European region (52.14%), followed by Pacific (35.36%) and North America (10.90%). Since the fund holds over 3,000 stocks, the weightage on individual stocks is low. No stock has a weightage higher than 2%. A few of its holdings include Nestle, Novartis, Novo Nordic, ASML Holding, and Toyota, to name a few. 

The fund has generated a 3-year cumulative return of 81.14% and a 5-year return of 70.82%. Exchanging hands for $60, the ETF looks fairly priced. It has gained 26% in 2025 and 45% in five years. 

International stocks have gained momentum recently, and VEA looks rather inexpensive right now. 

Vanguard Small-Cap Index Fund ETF

Hedge funds aim to make the most of the market upside, and investing in small-cap stocks is a way to do this. The Vanguard Small Cap ETF (NYSEARCA:VB) tracks the performance of the CRSP US Small Cap Index and measures the investment return on small-cap stocks. The fund is passively managed and has an expense ratio of 0.05%.

Beacon Financial Strategies increased its stake in VB by 0.22%, and Gibraltar Capital Management increased its stake by 57.77%. 

VB invests in a diversified group of companies and holds 1,332 stocks. Unlike tech-focused ETFs, VB has the highest allocation in the industrials sector (22.30%), followed by consumer discretionary (14.50%) and financials (14.20%). It invests only 13.60% in the technology sector. The fund pays quarterly dividends and has a yield of 1.34%.

VB is exchanging hands for $256 and has gained 6.7% year-to-date. It has gained over 50% in five years. The ETF has generated a cumulative 3-year return of 55.86% and 5-year return of 77.91%. An improvement in the market could help small caps see better growth. Historically, small caps have generated better growth for long-term investors. 

It is an exceptionally well-diversified ETF with an aggressive risk profile. VB is an ideal way to gain exposure to small caps at an ultra-low expense ratio. 

Vanguard Total International Stock Index Fund ETF

The Vanguard Total International Stock ETF (VXUS) tracks the performance of the FTSE Global All Cap ex US Index and invests in companies located outside of the U.S. It offers broad exposure across the emerging non-U.S. equity markets and is a passively managed fund. 

Sageworth Trust Company bought 730,369 shares, increasing its stake by 21.36%, while Peak Financial Management increased its stake by 1.14%, and Luminvest Wealth Management increased its stake by 5.82%. 

The ETF has gained 26% in 2025 and 17% in 12 months. It is exchanging hands for $74 and is at the 52-week high. The fund has a low expense ratio of 0.05%. VXUS invests in global stocks and holds over 8,000 stocks. 

The fund has the highest investment in Europe (37.96%), followed by emerging markets (27.58%) and the Pacific (25.41%). Across markets, it has the highest allocation in Japan, followed by China and Canada. VXUS has generated a cumulative 3-year return of 76.32% and a 5-year return of 64.01%. 

Since the fund holds over 8,000 stocks, the weightage on each stock is limited. No stock has a weightage higher than 3%. The fund holds top-notch companies, including Nestle, Taiwan Semiconductor Manufacturing, Alibaba, and Novartis. With VXUS, you get a slice of global companies, and you do not need to track the performance of each stock. The fund has generated annualized returns of 8.3% in the past decade. 

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