Many investors don't have the time required to research individual stocks as thoroughly as they'd like. However, extensive research is absolutely needed before risking your money.
Fortunately, there's an easy solution to this dilemma. Exchange-traded funds (ETFs) own baskets of stocks. You don't need to analyze each stock in their portfolios. You only need to choose a good ETF.
A good first step is to select a strong fund manager. Vanguard ranks among the best. But what's the best Vanguard ETF to invest $1,000 in right now?
Image source: Getty Images.
Great candidates
We're faced with a problem in answering this question. However, it's a good kind of problem to have. There are many great candidates in the Vanguard family from which to choose.
Vanguard markets a whopping 103 ETFs. Forty-nine of them delivered double-digit returns over the last 12 months. All but 15 of the 103 funds generated positive returns during the period.
I'll assume, though, that we want to focus on stock ETFs. Vanguard has 65 ETFs that only own stocks, including 11 sector and specialty funds. There are lots of winners in this group, too. Forty-eight had double-digit returns over the last 12 months. Only four posted losses during the period.
Top contenders
I think several Vanguard ETFs especially stand out for 2026. Top contenders include the Vanguard International High Dividend Yield ETF (VYMI +0.57%), the Vanguard Russell 1000 Growth ETF (VONG +0.43%), and the Vanguard Utilities ETF (VPU 0.47%).
The Vanguard International High Dividend Yield ETF ranks as the top-performing Vanguard ETF over the last 12 months with a total return of over 38%. As you might expect, part of this stellar total return stemmed from the fund's attractive distributions. This ETF owns 1,533 international stocks with above-average dividend yields.
NASDAQ: VYMI
Key Data Points
The Vanguard Russell 1000 Growth ETF lagged far behind the Vanguard International High Dividend Yield over the last 12 months. However, it still delivered a solid gain of over 18%. More importantly, the ETF is the biggest winner among Vanguard ETFs since inception, with a sizzling long-term annualized return of 17%.
As its name suggests, this ETF aims to track the Russell 1000 Growth index. It owns 392 stocks with high growth potential. The fund's largest holdings include Nvidia (NVDA +1.60%), Apple (AAPL 0.07%), Microsoft (MSFT +3.45%), Broadcom (AVGO 1.61%), and Amazon (AMZN +2.12%).
The Vanguard Utilities ETF owns 67 utility stocks. Nearly 62% of them are the stocks of electrical utility companies.
NYSEMKT: VPU
Key Data Points
This ETF looks appealing to me in 2026 for two key reasons. First, utility stocks tend to fare better than most stocks during periods of high volatility. Years with U.S. mid-term elections often exhibit such volatility. Second, the rapid construction of new data centers is driving increased electricity demand. This trend serves as a significant tailwind for many utility stocks.
The best pick
While I like the Vanguard International High Dividend Yield ETF, the Vanguard Russell 1000 Growth ETF, and the Vanguard Utilities ETF, I think another Vanguard ETF is the best pick for 2026. It's the Vanguard Information Technology ETF (VGT +0.10%).
NYSEMKT: VGT
Key Data Points
This Vanguard ETF owns 320 U.S.-based information technology stocks. Its top holdings include Nvidia, Apple, Microsoft, and Broadcom. These four tech stocks account for roughly 49% of the ETF's portfolio.
I believe the momentum of the artificial intelligence (AI) boom will continue throughout 2026 and beyond. In particular, I predict that the rising adoption of agentic AI will tremendously benefit Nvidia, Microsoft, and Broadcom. I also expect that Apple will enjoy a nice catalyst later this year when it introduces the newest generation of iPhones and unveils its much-anticipated AI smart glasses.
If these four stocks perform well in 2026, so will the Vanguard Information Technology ETF. I don't think investors will go wrong buying any of the Vanguard ETFs mentioned, but the Vanguard Information Technology ETF has the best chances of success this year, in my opinion.
