Is It Too Late to Buy the Vanguard S&P 500 ETF? Here's What History Says.
2026-07-23 19:03
•Selena Maranjian •The Motley Fool
•• ••• Axe Capital view
Is the S&P 500 ETF Still Worth It for South African Investors?
Despite recent US market strength, history favours steady exposure to the S&P 500, even from a South African perspective.
Many South African investors watch the US market with interest, especially through ETFs like Vanguard's S&P 500 (VOO). After strong gains, it’s tempting to think the rally is overdone. But history shows the S&P 500 keeps bouncing back after corrections, rewarding those who stay invested. For locals, this means exposure to US tech and consumer giants—beneficial, though filtered through USD/ZAR moves. Since the rand’s value impacts the effective returns back home, timing the market in dollars and rands is a double challenge. If you dislike the megacaps dominating the index, the equal-weighted RSP offers a more balanced approach, reducing single-stock risk. For diversification beyond the US, VXUS can complement exposure. That said, a rising US interest rate cycle or a faster rand recovery could shift the playbook, making South African stocks more appealing. The key is patience and not waiting for the “perfect” moment—markets don't hand those out often. this is just my opinion and not financial advice
Buy VOO gradually through dollar-cost averaging, consider adding RSP for balance, and keep VXUS on watch for global diversification. Avoid trying to perfectly time USD/ZAR moves.
- VOO
- RSP
- VXUS
- USD/ZAR
- US interest rate hikes hurting equity valuations
- Unexpected rand strength reducing offshore returns
6/10
Despite concerns about market valuations after recent strong gains, the article argues that long-term investors should still consider investing in the S&P 500 ETF. While a market correction is possible, history shows the market always recovers over time, and attempting to time the market is difficult. The article also presents alternative investment options for those with different risk preferences.
This article was originally published by The Motley Fool and has been adapted here for Axe Capital Trading News.
Publisher: The Motley Fool
Author: Selena Maranjian
Categories: Forex, Equities
Tickers: VOO, RSP, VXUS
Sentiment: Positive - The article recommends this ETF for long-term investors despite current market valuations, citing historical recovery patterns and the difficulty of timing market entries. Presented as a viable alternative for investors concerned about concentration in mega-cap tech stocks, offering equal weighting across 500 components.
Keywords: S&P 500, ETF, market correction, long-term investing, dollar-cost averaging, diversification
Insights:
- VOO: Positive: The article recommends this ETF for long-term investors despite current market valuations, citing historical recovery patterns and the difficulty of timing market entries.
- RSP: Positive: Presented as a viable alternative for investors concerned about concentration in mega-cap tech stocks, offering equal weighting across 500 components.
- VXUS: Positive: Suggested as a diversification option for investors worried about U.S. market exposure, providing international market exposure.