Build Funds Compared: VOO vs VTI vs SPY vs QQQ

Side-by-side comparison

Verify current data with fund sponsors. Numbers change daily.

The key takeaway

VOO and VTI are the clear winners on cost and simplicity. Both charge just 0.03% — that's $3 per year on a $10,000 investment. SPY charges 0.09% (three times more) and QQQ charges 0.20% (six times more). Over a 30-year horizon on $10,000 invested annually, the fee difference between VOO (0.03%) and QQQ (0.20%) costs roughly $15,000–$20,000 in lost compounding.

The performance difference between VOO and VTI is negligible — they track nearly identical market segments with only small-cap exposure separating them. QQQ's higher returns come from its tech concentration, which also means higher volatility and drawdowns. If you want pure S&P 500 exposure, VOO is the answer. If you want the entire US market including small caps at no extra cost, VTI is equally good.

VOO — The default pick

Vanguard S&P 500 ETF (VOO) is the Build slot's default recommendation for good reason. It tracks the S&P 500 — the 500 largest US publicly traded companies — at just 0.03% expense ratio. Its AUM has grown to over $600 billion, making it one of the largest ETFs in the world.

The S&P 500 has returned approximately 10% annually over the long term (before inflation), and VOO captures that return almost exactly after fees. The 0.03% expense ratio means for every $10,000 you invest, Vanguard keeps just $3 per year. That's essentially free diversification across 500 companies.

VOO's main advantage over its peers is the combination of lowest cost, massive scale (tight bid-ask spreads), and Vanguard's investor-aligned structure. Unlike SPDR (owned by State Street) or iShares (BlackRock), Vanguard is owned by its funds — which are owned by you, the investors. This structural alignment means Vanguard has less incentive to charge high fees.

VTI — The total market alternative

Vanguard Total Stock Market ETF (VTI) does everything VOO does but covers the entire US stock market. While VOO tracks the S&P 500 (~500 large-cap stocks), VTI tracks the CRSP US Total Market Index, which includes large, mid, small, and micro-cap stocks — roughly 3,800 holdings.

The performance difference between VOO and VTI is tiny. Both have 0.03% expense ratios, and since large caps dominate the total market (~85% of market cap), their returns are nearly identical. VTI's small-cap exposure adds marginal diversification but also marginal complexity.

The case for VTI over VOO: you want maximum diversification at the same cost. The case against it: small caps have underperformed large caps for much of the past decade, and the difference is so small it rarely matters in practice. If you're already using VTI as your total market fund, there's no reason to also hold VOO — they overlap by ~85%.

SPY — The original

SPDR S&P 500 ETF Trust (SPY) is the original S&P 500 ETF and remains the most traded security in the world by volume. It tracks the same index as VOO (the S&P 500) but charges 0.09% — three times Vanguard's fee.

SPY's massive trading volume makes it the preferred choice for options traders and institutional investors who need to move large amounts of capital without slippage. For individual buy-and-hold investors, this advantage doesn't matter — you're not trading options or moving millions.

The 0.09% expense ratio means $9 per year on a $10,000 investment vs. $3 for VOO. Over 30 years of annual contributions, that extra $6 per year compounds to roughly $5,000–$7,000 in lost returns. There's no performance reason to choose SPY over VOO for a long-term Build slot fund.

QQQ — The growth tilt

Invesco QQQ Trust (QQQ) tracks the Nasdaq-100 — 100 of the largest non-financial companies on the Nasdaq exchange. It's heavily concentrated in technology: Apple, Microsoft, Nvidia, Amazon, Meta, Alphabet, and a handful of other mega-cap tech stocks make up roughly 50% of the fund.

QQQ has delivered significantly higher returns than VOO over the past decade — roughly 19% annualized vs. 13.5%. But that outperformance came from a tech bull market, and it's not guaranteed to continue. QQQ's 50% tech weight means it can swing dramatically when tech stocks correct. During the 2022 bear market, QQQ fell roughly 33% vs. VOO's ~19%.

The 0.20% expense ratio is the highest in this comparison — nearly seven times VOO's fee. And QQQ only has 100 holdings vs. VOO's 503, meaning less diversification despite the higher concentration in large caps.

Who should use what

The honest answer: VOO is the best Build slot pick for virtually every investor. It's the simplest, cheapest option with massive scale. VTI is equally good if you prefer total market exposure. SPY and QQQ are fine funds but offer no compelling advantage over VOO for a long-term core holding.