Buy 2 Vanguard Index Funds to Beat the S&P 500 in the Next Year, According to Wall Street

Core Viewpoint - Wall Street analysts predict that the S&P 500 will rise by 18% to 8,200 over the next year, with the information technology and consumer discretionary sectors expected to outperform this benchmark with projected gains of 33% and 22%, respectively [1][2]. Information Technology Sector - The Vanguard Information Technology ETF is projected to have a 33% upside based on median target prices [2][4]. - This ETF tracks 320 stocks in the information technology sector, which includes software and cloud services, technology hardware and equipment, and semiconductors [4]. - The top holdings in the ETF include Nvidia (17.4%), Apple (14.9%), and Microsoft (12.1%) [6]. - The ETF has a low expense ratio of 0.09% and is expected to benefit from increasing artificial intelligence spending [7]. - The total return of the Vanguard Information Technology ETF over the last decade was 776%, averaging 24% annually [5]. Consumer Discretionary Sector - The Vanguard Consumer Discretionary ETF is projected to have a 22% upside based on median target prices [2][8]. - This ETF tracks 288 stocks in the consumer discretionary sector, covering manufacturing and services [8]. - The top holdings in the ETF include Amazon (21.1%), Tesla (18.1%), and Home Depot (4.6%) [14]. - The ETF also has a low expense ratio of 0.09% and is expected to perform well as long as the economy remains healthy [11]. - The total return of the Vanguard Consumer Discretionary ETF over the last decade was 311%, averaging 15% annually [10]. Concentration Risk - The Vanguard Information Technology ETF is highly concentrated, with Nvidia, Apple, and Microsoft accounting for 44% of its performance [12]. - Similarly, the Vanguard Consumer Discretionary ETF has a concentration risk, with Amazon, Tesla, and Home Depot making up 43% of its performance [12].