SWPPX Vs. VOO - Which Is The Better Option?

Affiliate Links

If you are looking to invest in financial securities, there are two securities you should know about, and they are SWPPX vs. VOO. If you are looking for some diversification, continue reading and see which is the better option for you and your investment portfolio.

Portfolios tend to differ as investment objectives may differ between traders and investors. Some only consider passive investing while others look into active management of their investment as a way to increase their capital gains.

So which investment should you consider to include in your fund management regardless of your investment objectives?

SWPPX and VOO are similar because they are financial securities offered by an investment company. But the main difference is that SWPPX is a mutual fund while VOO is an Exchange-Traded Fund (ETF). Mutual funds are a combination of different investments placed in a single holding, and they generate income that is paid to holders of the funds in the form of a dividend.

In this article, let’s find out the differences between SWPPX and VOO and find out which one is a good investment to add to your portfolio.

But before that, there are investment platforms that can help you with your investment needs. These are:

Empower – is a free online platform that helps you track your investments and gives recommendations to pay the lowest fees possible. Read our full Empower review for more information about the platform.

Track Your Net Worth For FREE

M1 Finance – is a stock and ETF brokerage that helps you invest in stocks for as low as $100. With no trading or brokerage fees. Check out our M1 Finance review and learn more about the platform’s services and start investing now!

What Is The Difference Between SWPPX And VOO?

When discussing the difference between SWPPX vs. VOO, we need to understand the features of each of the funds. Besides their different classification, VOO is much more circulated because it is an ETF, and ETFs are tradable assets.

You can buy it on various platforms just the same way you can buy and sell stocks and other financial assets like cryptocurrencies, stocks, and more.

Mutual funds, on the other hand, are only issued via their creators. So their mode of creation and circulation are two of the major differences between SWPPX and VOO.

Essentially, SWPPX and VOO are US-based because they invest in US stocks. A review of their holdings will show that they hold some stocks issued by the same publicly listed companies.

SWPPX: Schwab® S&P 500 Index Fund

SWPPX or Schwab® S&P 500 Index Fund is a mutual fund that has a net expense ratio of 0.20%. This fund is designed to track returns from the S&P 500. The creators of SWPPX invest a minimum of 80% of their funds on stocks listed on the US Stock Exchange. However, in some cases, this figure could be higher.

So, what SWPPX does is replicate the performance of the S&P 500 by giving a similar weight to stock, just like the S&P 500 index does.

This mutual fund is low-cost, and there is no minimum investment amount you are required to invest. When you invest in SWPPX, you are investing in a fund that gives you access to about 500 of the best-performing stocks in the US stock market.

VOO: Vanguard S&P 500 Index Fund

Vanguard S&P 500 Index Fund (also known as VOO) is a fund that seems to invest in stocks issued by the biggest companies in the United States. VOO is an ETF that keeps track of the S&P 500 index by mirroring the index.

VOO is quite popular because it is a reputation fund.VOO is a fund that invests in some of the largest companies within the United States and an ETF that tracks the S&P 500 index by owning all of the equities within the S&P.

Man Investing MSN computer working stock market — Image Credit: iwatchwater/Depositphotos.

It’s a passive stock, all they do is try to mirror the S&P 500 as precisely as possible. That’s why the fees you pay for managing the ETF are relatively low.

VOO is appealing to many investors because it is diversified. Also, you can constantly buy or sell VOO during stock market hours. More importantly, the stocks in VOO are large-cap stocks. They are relatively stable and less vulnerable to value drops due to volatility. So such a fund containing stocks with strong track records offers more opportunities for value growth, unlike stocks of smaller companies.

Note: SWPPX and VOO are two securities with diversified assets. By buying diversified assets, you diversify your risks which may happen due to market price corrections. Investing in either of these securities makes perfect sense if you want to diversify your risk as an investor.

SWPPX Vs. VOO: Key Differences

So what are the major differences between SWPPX and VOO?

The biggest difference is that SWPPX is a mutual fund while VOO is an ETF. Secondly, SWPPX can only be bought at Charles Schwab, so it is not as widely circulated. VOO, on the other hand, does circulate like every other traded ETF.

Another difference has to do with their cost and returns. Over a period of 5 years, SWPPX has a lower return compared to VOO. SWPPX’s return is 15.21%, while VOO is 19.72%. As for their cost, SWPPX costs 0.02% compared to VOO’s 0.03%.

SWPPX Vs. VOO: Composition Differences

As you can see, both SWPPX and VOO try to mirror the S&P 500 index. They’re both invested in large-cap stock and they’re trying to keep their expense ratios low.

	SWPPX	VOO
Security Type	Mutual Fund	ETF
Segment	US Equity (Large Blend)	US Equity (Large Cap)
Issuer	Charles Schwaab	Vanguard
Net Asset	$64.41 billion	$268.04 billion
Expense Ratio	0.02%	0.03%
Management	Passive	Passive
Dividend Yield	1.46%	1.34%
Minimum investment	$1,000	N/A
YTD Returns	17.97%	26.16%
1-year Return	5.50%	37.95%
3-year Return	18.32%	21.95%
5-year Return	15.21%	19.72%
10-Year Return	15.27%	16.36%

Let’s review SWPPX top 10 holdings:

Asset	Holdings %
Total	27.71%
Apple	6.62%
Microsoft Corp.	5.66%
Amazon Inc.	4.77%
Facebook Inc Class A	2.24%
Alphabet Inc Class A	1.57%
Alphabet Inc Class C	1.53%
Berkshire Hathaway Class B	1.50%
Johnson & Johnson	1.39%
Procter & Gamble	1.23%
Visa Inc Class A	1.20%

Let’s take a look at VOO’s Top 10 holdings

Asset	Holdings%
Total	28.0%
Apple Inc.	6.10%
Microsoft Corp.	5.80%
Alphabet Inc.	4.20%
Amazon	3.90%
Facebook	2.20%
Tesla Inc.	1.70%
NVIDIA Corp.	1.40%
Berkshire Hathaway	1.40%
JP Morgan Chase & Co.	1.30%
Johnson & Johnson	1.20%

SWPPX Vs. VOO: Performance Differences

Besides their compositional differences, the performance of SWPPX vs. VOO is also markedly different. Let’s review both.

SWPPX Performance & Returns:

Performance	Returns
YTD	26.45%
1-month return	3.34%
3-month return	5.06%
1-year return	32.97%
3-year return	23.38%
5-year return	16.61%
10-year return	17.22%

VOO Performance & Returns:

YTD	15.29%
1-Month Return	2.26%
3-Months Return	8.39%
1-Year Return	40.97%
3-Year Return	18.56%
5-Year Return	17.60%
10-Year Return	14.80%

SWPPX Vs. VOO: Fees

Both funds have virtually the same fees. SWPPX has an expense ratio of 0.02%, while VOO has an expense ratio of 0.03%.

Businessman reading documents with laptop — Image credit: gpointstudio/Depositphotos.

As you can see, both funds have very low expense ratios. These funds are quite attractive to investors because of their low transaction costs, which will only dip slightly into the dividends they generate at the end of a trading period.

Frequently Asked Questions – SWPPX Vs. VOO

Here are some frequently asked questions on SWPPX vs. VOO.

What Is The Difference Between VOO And SWPPX?

There are a few differences between VOO and SWPPX. VOO is an ETF, while SWPPX is a mutual fund. VOO is publicly traded, so it can be bought and sold across many platforms. SWPPX, on the other hand, is not widely circulated because mutual funds can only be bought and sold by the firm managing them. Despite their differences, both funds have a similar portfolio because they tend to hold similar stocks.

Is SWPPX A Good Investment?

SWPPX is a good investment if you consider how well it has performed over the last two years. Looking at data of its past performance, you will see that over the last five years, its annualized returns have been 17.60%. Also, in the category of mutual funds, SWPPX sits in third place based on performance and returns. For the last three years, the return was 18.56% which is a healthy return for a mutual fund.

So SWPPX is indeed a very good investment with a high yield if you are looking for long-term accumulated benefits.

Does SWPPX Pay Dividend?

Yes, it does pay dividends and has done so for years now. As of November 2021, this mutual fund was paying investors an average of 1.45%. The dividends issued to investors are relative to the earnings of stocks in their holding.

Conclusion – SWPPX Vs. VOO

Which fund is right for you? That will depend on your personal preferences. SWPPX is a mutual fund, while VOO is an ETF. However, SWPPX is not a tradable asset, unlike VOO. SWPPX was created by Charles Shwab while VOO is a Vanguard Finance Group creation.

Both are passively managed and are valuable assets containing similar stocks. Fund investing is a great way to reach your financial goals because a sound investment strategy and objective will definitely help maximize your plans.

Knowing these managed funds is already a great way to start off formulating your investment strategies. Before investing, knowing the best allocation for your hard-earned money is as important as a diversified portfolio so make sure that you understand these asset classes to make the best decision for yourself.

SWPPX Vs. VOO – Which Is The Better Option?