Uncertainty fills the air. Will President Donald Trump’s steep tariffs ignite a global trade war? Could the U.S. economy slip into a recession? Will the stock market sink a lot more than it already has?
These and other questions might make it difficult for investors to determine the best approach to take. This is true even if you’re considering which exchange-traded funds (ETFs) to buy. There are many options. As a case in point, Vanguard alone offers 90 ETFs.
What’s the smartest Vanguard ETF to buy with $1,000 right now? The answer depends on how much flexibility you have.
Image source: Getty Images.
If the focus is strictly on stocks
If we’re only talking about funds that focus on stocks and you’re focused on the long term (10 years or more), I think several Vanguard ETFs are worthy contenders. For example, the Vanguard S&P 500 ETF is a tried-and-true vehicle for making money over the long term.
The Vanguard Russell 1000 Growth ETF, which owns large-cap U.S. growth stocks, is the best-performing Vanguard ETF since its inception. I suspect the fund will continue its winning ways over the next decade and beyond, especially with several of its top holdings poised to benefit from increased adoption of artificial intelligence (AI).
However, if you’re concerned about near-term volatility, my pick for the best Vanguard ETF to buy is the Vanguard Utilities ETF (VPU 1.92%). This fund owns 69 utility stocks. Its top holdings include NextEra Energy, Constellation Energy, Southern Company, Duke Energy, and Vistra Energy.
The Vanguard Utilities ETF has delivered a higher return over the last 12 months than any other Vanguard ETF. It has risen so far in 2025 while the broader market has floundered in large part because investors view utility stocks as safe havens. The surging demand for energy driven by AI data centers has also provided a strong tailwind.
Casting a wider net
What if you’re not limited to only investing in ETFs that own stocks but are worried about economic and market dynamics? If you’re willing to cast a wider net, I think the Vanguard Long-Term Treasury ETF (VGLT -0.51%) is arguably the best choice in the Vanguard family right now.
As its name indicates, this Vanguard ETF primarily focuses on long-term U.S. Treasury bonds. It currently owns 88 bonds with an average effective maturity of 22.3 years. Almost all (99.9%) of the Vanguard Long-Term Treasury ETF’s portfolio consists of U.S. government bonds.
One reason to park your money in the Vanguard Long-Term Treasury ETF is that long-term U.S. Treasuries are viewed as safe. Another is that the fund will pay you to wait for an opportunity to shift your money into a higher-growth asset. Its 30-day SEC yield (the fund’s annualized yield to maturity over the last 30 days divided by its total assets) is 4.7%.
The Vanguard Long-Term Treasury ETF hasn’t delivered the greatest price gain in 2025 of all Vanguard ETFs. However, its total return (including its juicy yield) makes it one of the top-performing Vanguard funds year to date.
Two key caveats
Neither the Vanguard Utilities ETF nor the Vanguard Long-Term Treasury ETF are perfect picks. Two key caveats especially stand out with these funds.
First, even though they’re safe havens (relatively speaking), you could lose money with either of these Vanguard ETFs. Both ETFs have plunged 20% or more multiple times over the last 10 years. Second, as alluded to earlier, these ETFs probably won’t deliver the highest returns over the long term.
That said, different market conditions make some ETFs more attractive than others — at least temporarily. With the current turbulence and uncertainty, I think the time is ripe for the Vanguard Utilities ETF and the Vanguard Long-Term Treasury ETF.
Keith Speights has positions in Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends NextEra Energy and Vanguard S&P 500 ETF. The Motley Fool recommends Constellation Energy and Duke Energy. The Motley Fool has a disclosure policy.
