5-Star ETFs Poised to Pop: Vanguard Mid-Cap

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, the Vanguard Mid-Cap ETF (AMEX: VO  ) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Vanguard Mid-Cap and see what CAPS investors are saying about the ETF right now.

Vanguard Mid-Cap facts

Inception January 2004
Total Assets $3.28 billion
Investment Approach Seeks to track the MSCI US Mid Cap 450 Index, which measures the performance of a diversified group of companies with market capitalizations of approximately $1 billion to $8.5 billion.
Expense Ratio 0.12%
1-Year / 3-Year / 5-Year Return 4.2% / 23.3% / 1%
Top Holdings with High CAPS Interest (at least 1,000 Active Picks) and Portfolio Weight Green Mountain Coffee Roasters (Nasdaq: GMCR  ) (0.62%)
Whole Foods Market (Nasdaq: WFM  ) (0.51%)
Chipotle Mexican Grill (NYSE: CMG  ) (0.49%)
Dividend Yield 1.2%
Alternatives iShares S&P MidCap 400 Index (NYSE: IJH  )
SPDR S&P MidCap 400 (NYSE: MDY  )

Sources: Morningstar and Motley Fool CAPS.

On CAPS, 94.5% of the 91 members who have rated Vanguard Mid-Cap believe the ETF will outperform the S&P 500 going forward. These bulls include JONATHANCO and acegdl007.

Having gotten on board a couple of years ago , JONATHANCO succinctly summed up the bull case:

Midcap beats large cap in most economic environments. Midcap is the sweet spot of [A]merican innovation. Large enough to be credible business, small enough to be flexible and innovate.

Vanguard Mid-Cap, in particular, sports a cheap expense ratio of 0.12%. That's lower than that of other midcap ETFs like iShares S&P MidCap 400 (0.21%) and SPDR S&P MidCap 400 (0.25%).

CAPS member acegdl007 elaborates on the outperform argument:

ETF version of its Mid Cap mutual fund. Vanguard has a great reputation for offering attractive funds and ETF's with some of the lowest management costs and fees. This is a great ETF/fund to include in a 401k portfolio that will add a comfortable dose of risk with potential for good growth in the long term.

What do you think about Vanguard Mid-Cap, or any other ETF for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional ETFs is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Interested in another easy way to track Vanguard Mid-Cap? Add it to your watchlist.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Fool owns shares of Chipotle and Whole Foods. Motley Fool newsletter services have recommended buying shares of Green Mountain, Whole Foods, and Chipotle, as well as creating a lurking gator position in Green Mountain and a put butterfly position in Chipotle. Try any of our Foolish newsletter services free for 30 days.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

Read/Post Comments (1) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 18, 2011, at 11:40 AM, PeyDaFool wrote:

    Hi Brian,

    Thank you for your review of VO, an ETF which I like very much.

    I'm curious, though, about your opening statement where you mention the "aggregated intelligence of 180,000" individuals helped determine that VO will outperform. I'm not so sure this is necessarily the case, as not everyone voted on VO, correct?

    It may be like saying, "based on the aggregate voices of the entire world, the United States picked President Obama to lead them in 2008." If not everyone voted, it may not be reasonable to say everyone had a voice.

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