2 ETFs I'd Buy in November and Hold for the Next 20 Years

Investing doesn't have to be a time-consuming endeavor. Index exchange-traded funds (ETFs) offer a simple solution for investors who want broad market exposure without the hassle of managing individual stocks. Two ETFs, in particular, stand out for long-term investors: the Vanguard Morningstar Total Stock Market ETF (VTI) and the Vanguard Total International Stock ETF (VXUS).

VTI invests in over 3,500 U.S. stocks, spanning across various sectors and company sizes. The top 10 holdings represent around 35% of its assets, primarily large tech companies such as Nvidia, Apple, and Microsoft. This concentration in tech means VTI's performance is closely tied to the sector's health. Over the past five years, VTI has delivered a total return of 65%, or a 10.6% compound annual growth rate.

To create a more globally diversified portfolio, VXUS is an excellent complement. This ETF owns nearly 9,000 non-U.S. stocks across continents, with Asia-Pacific leading at 49%, followed by Europe at 38%. Adding international exposure is crucial because the U.S. economy may not always be the top performer. However, international investing brings its own risks, like currency fluctuations and geopolitical concerns.

ETFs like VTI and VXUS also have low expense ratios, typically around 0.03% and 0.05% respectively. Investing a hypothetical $1,000 in each ETF—$600 in VTI and $400 in VXUS—would provide a balanced mix of domestic and international stocks. Regular contributions could significantly boost the portfolio's value over time. For instance, a $100 monthly investment would grow to $13,000 after ten years and $25,000 after twenty years.

In summary, a VTI/VXUS investment strategy offers broad market exposure, low costs, and minimal ongoing management. While more complex investment strategies may yield better returns, the simplicity and accessibility of VTI and VXUS make them an excellent choice for anyone looking to start investing.