Vanguard US Total Market Shares Index ETF (VTS) — Review & Analysis

VTS is Australia's tenth-largest ETF, with $6.7 billion in assets as at May 2026 — about 1.9% of the entire $358 billion Australian ETF market. It's the broadest and cheapest US equity ETF available to Australian investors. VTS sits behind IVV ($13.5B) in size but offers significantly broader US coverage — IVV holds the largest 500 US companies while VTS holds approximately 3,500 US-listed companies across large, mid and small caps. Vanguard launched VTS on the ASX in May 2009 (the same day as VAS) and it has been the cheapest equity ETF on the ASX for most of its 17-year history. The management fee is just 0.03% per annum — the lowest of any ASX-listed equity ETF, costing just $3 per year per $10,000 invested.

To compare VTS side-by-side with every other ETF on the ASX, see the full ETF directory.

VTS is dominated by the same US mega-caps that drive IVV and VGS — Microsoft, Apple, Nvidia, Amazon, Meta, Alphabet, Berkshire, Eli Lilly, Broadcom and Tesla make up the top 10. The difference is in the long tail: VTS holds the other ~3,000 small- and mid-cap stocks that aren't in the S&P 500. In market-cap-weighted terms, these are only ~17% of the fund, but they capture US small- and mid-cap performance that IVV completely misses. Over the 5 years to May 2026, VTS returned +91.4% total return — slightly behind IVV (+101.8%) because US small-caps lagged mega-caps over that window. Over very long periods (50+ years of US data), small-caps have historically outperformed large-caps — VTS captures that premium where IVV doesn't.

VTS pays distributions quarterly (late March, June, September and December) at a modest ~1.2% gross yield as at May 2026. There are no franking credits — the underlying holdings are US-domiciled. One important wrinkle: VTS is technically a US-domiciled fund cross-listed on the ASX. This means you need to lodge a W-8BEN form with your broker to claim the reduced 15% US withholding tax rate on dividends (otherwise 30% applies). Most brokers handle this automatically. There's also a small US estate tax exposure for very large holdings (>$60k USD) — relevant only for very high-net-worth investors. By comparison, IVV is now Australian-domiciled and avoids both issues.

VTS is the choice for investors who want maximum US market breadth at minimum cost. If you believe US small-caps will eventually mean-revert and outperform mega-caps (as they did from 2000-2020), VTS captures that better than IVV. The W-8BEN paperwork is a one-time hassle but otherwise VTS at 0.03% is the cheapest equity exposure money can buy on the ASX. A $10,000 investment in VTS at its May 2009 launch (with all distributions reinvested) would be worth roughly $80,000 as at May 2026 — an annualised return of about 13.0% per year over the 17-year period. For the comparison, see IVV vs VGS vs VTS — which international ETF should you buy.