Vanguard’s VOO becomes first ETF to exceed $1 trillion

Vanguard’s S&P 500 ETF VOO passed $1 trillion in assets on Wednesday, becoming the first exchange-traded fund to reach that level. The fund overtook State Street’s SPY in February 2025 after quadrupling in size since 2022.

VOO has attracted more than $60 billion in inflows so far this year. Investors buying the fund cited gains in companies tied to artificial intelligence and a preference for low-cost, broad exposure to U.S. large-cap stocks. VOO’s annual fee is 0.03%, the same as BlackRock’s IVV; SPY’s fee is 0.0945%.

Todd Rosenbluth, head of research at TMX VettaFi, noted that VOO’s scale and low cost made it a leading choice for investors seeking exposure to the AI rally. Deborah Fuhr, managing partner at ETFGI, highlighted that even small differences in expense ratios can shape institutional and model portfolio allocations.

Global ETF assets reached $21.9 trillion at the end of April, up from $6.4 trillion at the start of 2020, and the industry recorded 83 consecutive months of net inflows through April. Mike Bell, head of market strategy at RBC, described the largest index-tracking funds as “gargantuan” after a decade of flows from active to passive strategies.

Companies tied to artificial intelligence are preparing public offerings later this year, with reported valuations for firms such as SpaceX, Anthropic and OpenAI ranging into the hundreds of billions and, in some estimates, into the trillions. Proposed changes at S&P Dow Jones Indices to shorten the waiting period for S&P 500 inclusion from 12 months to six months could affect demand from passive funds that must buy shares once a company is added to the index.

Rob Arnott, founder and chair of Research Affiliates, plans to participate in one expected offering and expects passive funds to buy at post-IPO prices that may rise in anticipation of index inclusion. VOO’s ETF share class combined with its mutual fund holds about $1.6 trillion; Vanguard’s Total Stock Market across ETF and mutual fund share classes holds roughly $2.2 trillion.

Todd Sohn, chief ETF strategist at Strategas Asset Management, identified BlackRock’s IVV as the main potential challenger to VOO because of BlackRock’s large model portfolio business.