The right investment can turn small monthly contributions into hundreds of thousands of dollars or more, and exchange-traded funds (ETFs) can make it easier to build a powerful portfolio while barely lifting a finger.
As we head into 2026, now is a good time to consider beefing up your portfolio. While nobody knows where stocks are headed in the next year and beyond, there's one Vanguard fund with a long history of beating the market -- the Vanguard Information Technology ETF (VGT 1.52%).
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A potentially lucrative investment
The tech sector can be volatile at times, but it can also be lucrative. The Vanguard Information Technology ETF contains 322 stocks, all of which are from the technology industry.
One major advantage of this particular fund over other tech ETFs is that it covers the entire tech sector. Some funds only contain semiconductor stocks, for example, or are focused solely on companies involved in artificial intelligence (AI). While investing only in tech stocks does limit diversification, a broader tech ETF that doesn't lean too heavily on any particular subsector can help mitigate some risk.
Also, the fund's top holdings include many industry leaders, with Nvidia, Apple, and Microsoft rounding out the top three. Investing heavily in larger stocks can further limit risk. Although no stock is immune to volatility, larger companies are more likely to survive market downturns and experience long-term growth.
Could you double your money with this ETF?
Again, nobody can say where this ETF or any other investment will be in a year or two. The market could always take a turn for the worse in 2026, and if that happens, this fund might be hit hard. That said, the market could also thrive next year, setting this ETF up for potentially lucrative returns in 2026 and beyond.
NYSEMKT: VGT
Key Data Points
As with any investment, it's wise to keep a long-term outlook. Tech stocks can be turbulent in the short term, but over several years, many of them have historically managed to outperform the market.
Over the last 10 years, the Vanguard Information Technology ETF has earned an average rate of return of around 22% per year. At that rate, it would take around 3.5 years to double your initial investment without any additional contributions.
To build wealth even faster, however, you could continue investing small amounts each month. For example, say you invest $1,000 today plus $100 per month going forward, while still earning a 22% average annual return. Over time, here's approximately how much you might earn in total:
| Number of Years | Total Portfolio Value |
|---|---|
| One | $2,400 |
| Five | $12,000 |
| 10 | $42,000 |
| 20 | $339,000 |
| 30 | $2,500,000 |
Data source: Author's calculations via investor.gov.
Time is your most valuable resource when investing in the stock market, and staying invested for the long haul can grow your savings exponentially. While you can still earn a substantial amount in just a couple of years, investing for a decade or two can build life-changing wealth.
There are no guarantees that this ETF will continue earning returns in line with its 10-year average, especially since tech stocks can experience significant price fluctuations -- both positive and negative. But staying invested for many years can help limit the impact of that volatility.
A tech fund like the Vanguard Information Technology ETF won't be right for everyone, especially investors who prefer more stability. In that case, a broad-market fund, like an S&P 500 ETF, may be a safer option. But for those looking to maximize returns with the ease and simplicity of an ETF, this fund could help you build substantial wealth over time.
