Feeling Anxious About Investing? Consider These 3 Vanguard ETFs for Uncertain Times

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Key Points

• The Vanguard Short-Term Inflation-Protected Securities ETF is a reliable sanctuary during market upheaval.

• The Vanguard Consumer Staples ETF historically outperforms the broader market during downturns.

• The Vanguard Dividend Appreciation ETF comprises top-quality dividend stocks that remain robust amid uncertainty.

Financial Jitters: Current Market Landscape

The stock market seems a tad wobbly at present. Valuations were already steep, with the S&P 500 Shiller CAPE ratio hitting levels not seen since the dot-com bubble. Furthermore, oil prices have surged due to ongoing uncertainties involving the U.S. and Iran. Inflation remains a concern. The U.S. economy appears on shaky ground, with GDP growth underwhelming and job losses numbering 92,000 in February.

Seeking Stability: Vanguard’s Offerings

It’s perfectly reasonable to feel a bit apprehensive. But fear not, as there are three Vanguard exchange-traded funds (ETFs) well-suited for such times.

1. Vanguard Short-Term Inflation-Protected Securities ETF

What might be the ultimate sanctuary when market clouds look ominous? The Vanguard Short-Term Inflation-Protected Securities ETF (NASDAQ: VTIP) is a top contender.

This fund holds short-term U.S. Treasury Inflation-Protected Securities (TIPS), instruments the U.S. government issues. They adjust based on the Consumer Price Index, providing a hedge against inflation erosion. Over the last decade, it returned a modest 3.15%, yet provides stability that allows investors to rest easy. It’s affordable, with an expense ratio of just 0.03%.

TIPS: A Reliable Choice

Though the returns are not astronomical, this ETF offers a secure spot for the nervous investor—a more attractive option than a traditional savings account.

2. Vanguard Consumer Staples ETF

Yearning for stock exposure while anxious about market tremors? The Vanguard Consumer Staples ETF (NYSEMKT: VDC) might just fit the bill.

Launched in 2004, it holds 104 consumer staples stocks like Walmart (NASDAQ: WMT), Costco (NASDAQ: COST), and Procter & Gamble (NYSE: PG)—firms that thrive irrespective of economic climate. In the 2022 bear market, it declined a meager 4%, while the S&P 500 dropped 19%. Its expense ratio is a mere 0.09%, quite a bargain compared to the average 0.73% of similar funds.

Consistent Performers

These stocks are particularly appealing as they cater to essential consumer needs, regardless of financial ups and downs.

3. Vanguard Dividend Appreciation ETF

High-quality dividend stocks attract investors amidst turbulence. Instead of picking individual winners, consider the Vanguard Dividend Appreciation ETF (NYSEMKT: VIG).

This ETF mirrors the S&P U.S. Dividend Growers Index, which features large-cap stocks known for dividend growth, like Apple (NASDAQ: AAPL) and Microsoft (NASDAQ: MSFT). With 338 stocks, it manages better than the S&P 500 during downturns, though not entirely immune to sell-offs. The expense ratio is a modest 0.04%.

Dividends: A Cushion Against Inflation

Steady increases in dividend payouts can soften the blow of inflation, making this ETF a wise choice in uncertain times.

Final Thoughts on Vanguard Dividend Appreciation ETF

Before investing in the Vanguard Dividend Appreciation ETF, reflect on this:

The Motley Fool Stock Advisor team recently highlighted what they believe to be the 10 best stocks currently, and this ETF wasn’t on their list. Stocks like Netflix have yielded extraordinary returns over time, exemplifying the advisor’s track record.

Exploring Further

With an average return of 884% compared to 179% for the S&P 500, Stock Advisor’s insights shouldn’t be overlooked. Dive into their recommendations and seize the opportunity to bolster your portfolio.

*Stock Advisor returns as of March 30, 2026.

JPMorgan Chase, a Motley Fool Money advertiser, is mentioned here. Disclosure policy.