In this article, we discuss the 5 best index funds to invest in 2022. If you want to read our detailed analysis of these ETFs, go directly to the 10 Best Index Funds to Invest In 2022.
5. Vanguard Total Stock Market Index Fund Admiral Shares (NASDAQ:VTSAX)
Vanguard Total Stock Market Index Fund Admiral Shares (NASDAQ:VTSAX) is an index fund that tracks the performance of the CRSP US Total Market Index. The index aims to measure returns of the overall stock market. It includes large, mid, small, and micro cap firms. It tracks stocks that trade on the NYSE and NASDAQ exchanges.
A premier holding of the Vanguard Total Stock Market Index Fund Admiral Shares (NASDAQ:VTSAX) is NVIDIA Corporation (NASDAQ:NVDA), a visual computing company. At the end of the third quarter of 2021, 83 hedge funds in the database of Insider Monkey held stakes worth $10 billion in NVIDIA Corporation (NASDAQ:NVDA), compared to 86 in the preceding quarter worth $9 billion.
In its Q1 2021 investor letter, Vulcan Value Partners, an asset management firm, highlighted a few stocks and NVIDIA Corporation (NASDAQ:NVDA) was one of them. Here is what the fund said:
“NVIDIA Corp. is the dominant supplier of Graphics Processing Units (GPUs) worldwide. NVIDIA’s GPUs are at the intersection of a number of important computing trends including the movement to the Cloud, artificial intelligence, autonomous vehicles, edge computing, gaming, and more. We previously owned NVIDIA and sold it in the third quarter of 2020 as the price to value gap closed and our margin of safety was reduced. As with all our MVP companies, we continued to follow NVIDIA closely. Since that time, NVIDIA reported excellent results and its value has compounded rapidly. The technology selloff at the beginning of the year negatively affected the stock price while our estimate of NVIDIA’s value per share increased. This happy combination of events created a margin of safety and an opportunity to once again add NVIDIA to the portfolio.”
4. Wilshire 5000 Index Portfolio Investment Class Shares (NASDAQ:WFIVX)
Wilshire 5000 Index Portfolio Investment Class Shares (NASDAQ:WFIVX) is an index fund that aims to replicate the performance of the Wilshire 5000 Index SM. The fund invests 80% of assets in securities that trade on the index. Typically, the fund holds stocks representing nearly 90% of the market value of the index.
Wilshire 5000 Index Portfolio Investment Class Shares (NASDAQ:WFIVX) has invested heavily in Alphabet Inc. (NASDAQ:GOOG), a tech firm based in California. Among the hedge funds being tracked by Insider Monkey, London-based investment firm TCI Fund Management is a leading shareholder in Alphabet Inc. (NASDAQ:GOOG) with 2.9 million shares worth more than $7.8 billion.
In its Q1 2021 investor letter, Artisan Partners, an asset management firm, highlighted a few stocks and Alphabet Inc. (NASDAQ:GOOG) was one of them. Here is what the fund said:
“Large-cap tech companies have been resilient through the pandemic—Alphabet Inc. (NASDAQ:GOOG) among them. A top contributor, Alphabet’s Play Store and Google Cloud are in demand as businesses accelerate online activity which, along with strong YouTube user growth, is helping stabilize temporarily weaker search ad revenue trends. Through the lens of our disciplined bottom-up research process, we view Alphabet Inc. (NASDAQ:GOOG) as one of the best businesses in the world, capable of expanding revenues at a rapid rate for years to come, with a bullet proof balance sheet and an average asking price. It’s a name we’ve owned since 2012 and for which we continue to have high hopes regarding future prospects.”
3. Schwab Emerging Markets Equity ETF (NYSE:SCHE)
Schwab Emerging Markets Equity ETF (NYSE:SCHE) is an index fund that invests at least 90% of net assets in stocks on the FTSE Emerging Index The index comprises large and mid-cap companies working in emerging economies. The index invests in these firms through ADRs, GDRs and EDRs.
One of the biggest holdings of the Schwab Emerging Markets Equity ETF (NYSE:SCHE) is Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), a firm that makes and sells integrated circuits and semiconductors. At the end of the third quarter of 2021, 67 hedge funds in the database of Insider Monkey held stakes worth $9.5 billion in Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), up from 64 in the preceding quarter worth $10 billion.
In its Q1 2021 investor letter, Bonsai Partners, an asset management firm, highlighted a few stocks and Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) was one of them. Here is what the fund said:
“Taiwan Semiconductor is the world’s largest outsourced foundry of logic semiconductor chips. TSMC’s shares appreciated 8.9% during the quarter.
Similar to last quarter, the supply-demand imbalance in semiconductor chips continues to benefit TSMC. To fuel new technological advances and meet the current supply imbalance, we see significantly increased capital spending across the industry over the coming years.
TSMC has an extraordinary track record of return on these large investments despite their rapid historical cadence of expansion. I remain hopeful that the large capital expenditure plan they now have ($100 billion of investment over the next three years) will be money well spent and not lead to industry oversupply in the medium term. Hopefully, future returns on these investments will look as good as those of the past.”
2. Invesco QQQ Trust (NASDAQ:QQQ)
Invesco QQQ Trust (NASDAQ: QQQ) is an index fund that invests in stocks on the NASDAQ-100 Index. The fund aims to closely follow the performance of the underlying index and conforms to periodic changes in the identity and relative weights of index securities.
A flagship holding of the Invesco QQQ Trust (NASDAQ:QQQ) is PayPal Holdings, Inc. (NASDAQ:PYPL), a payments technology firm. At the end of the third quarter of 2021, 123 hedge funds in the database of Insider Monkey held stakes worth $12.8 billion in PayPal Holdings, Inc. (NASDAQ:PYPL), compared to 143 in the preceding quarter worth $16.4 billion.
In its Q4 2020 investor letter, Polen Capital Management, an asset management firm, highlighted a few stocks and PayPal Holdings, Inc. (NASDAQ:PYPL) was one of them. Here is what the fund said:
“For the full year 2020, one of the top performers was PayPal, which we purchased in 2019, the company continues to take market share in digital payments and has seen an acceleration in user adoption and engagement, especially within their “silver tech” or older user demographic. We expect many more years of ongoing double-digit growth from their various business segments and new initiatives.”
1. Vanguard S&P 500 ETF (NYSE:VOO)
Vanguard S&P 500 ETF (NYSE:VOO) is an index fund that invests in stocks on the S&P 500 Index. The index comprises 500 of the largest firms in terms of market capitalization that trade on exchanges in the United States. The fund holds each stock in almost the same proportion as its weighting in the index.
One of the premier holdings of Vanguard S&P 500 ETF (NYSE:VOO) is Meta Platforms, Inc. (NASDAQ:FB), a diversified technology company. At the end of the third quarter of 2021, 248 hedge funds in the database of Insider Monkey held stakes worth $38 billion in Meta Platforms, Inc. (NASDAQ:FB), down from 266 in the preceding quarter worth $42 billion.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Meta Platforms, Inc. (NASDAQ:FB) was one of them. Here is what the fund said:
“We continued to keep our learnings from 2020 in mind during the quarter as we sought to increase the up capture of the portfolio. We also made adjustments to the portfolio’s top 10 holdings to increase the participation of select stocks, including Facebook, while trimming our weighting to stable names, which now represent 47% of the portfolio. Our repositioning has been encouraging so far with the portfolio performing better on up days in the market while maintaining good down capture during more turbulent sessions.”
You can also take a peek at 10 Best Tech ETFs to Buy According to Reddit and Forget AMC and Gamestop: 10 New Stocks Reddit’s WallStreetBets Is Buying.
