Meet the Magnificent Vanguard ETF Obliterating the S&P 500 in 2026 Because of Its Unique Momentum-Driven Strategy
Most investors have probably never heard of this Vanguard ETF, but it routinely beats the market.
Meet the Magnificent Vanguard ETF Obliterating the S&P 500 in 2026 Because of Its Unique Momentum-Driven Strategy
Overview
Top fund managers like Paul Tudor Jones and Peter Lynch attribute a lot of their success to letting their winning stocks run while unceremoniously cutting their losers. In fact, Lynch often warns investors against pulling up the flowers and watering the weeds -- in other words, don't be so quick to sell high-performing stocks while holding on to laggards in the hope they will turn around.
The Vanguard U.S. Momentum Factor ETF (NYSEMKT: VFMO) is an exchange-traded fund (ETF) that exclusively backs winners. It uses a rules-based, mathematical model to buy stocks with upward momentum, placing greater emphasis on those showing sustained uptrends over the last 12 months of trading.
Details
Past performance isn't always a reliable indicator of future results, but the strategy appears to be working: The ETF has returned 24% in 2026 at recent prices, more than twice the return of the S&P 500 (SNPINDEX: ^GSPC) index. And its recent outperformance isn't a one-off, as it has beaten the market on average every year since its 2018 launch.
Source
Originally published at www.fool.com.
