If You'd Invested $1,000 in the Vanguard S&P 500 ETF 10 Years Ago, Here's What You'd Have Today
2026-08-09 08:14
•Neil Patel •The Motley Fool
•••• •••• Axe Cap view
Why SA Investors Should Think Twice Before Chasing the US Tech Rally
The US S&P 500’s 10-year surge, led by tech giants, poses challenges—and opportunities—for South African investors.
The Vanguard S&P 500 ETF’s 322% return over the past decade masks a tech sector fueled by a handful of giants like Apple, Microsoft, and Nvidia. For South African investors, this is a double-edged sword. While the US tech boom has dazzled, the rand’s relative weakness versus the dollar dulled some gains for local holders. Moreover, the US market’s current lofty valuations suggest the party may pause or even reverse soon. On the JSE, the closest proxy to ride global tech’s coattails is Prosus, which has suffered from valuation cuts and local sentiment issues despite valuable stakes in global tech. At the same time, domestic banks like Standard Bank or FirstRand offer more tangible earnings visibility amid global uncertainty and rand volatility. If the dollar strengthens further against the rand, it will pressure SA importers and consumers, but exporters like AngloGold Ashanti or Sasol might benefit, hedging some risk in a more defensive way. Patience and selective exposure, rather than chasing headline US returns, remain prudent. this is just our opinion and not financial advice
Avoid loading up on Prosus or broad US tech through the rand, as valuations look stretched and currency risks high. Focus on domestic stocks with earnings power like FirstRand and AngloGold Ashanti to balance currency exposure and market risk.
- Prosus
- FirstRand
- AngloGold Ashanti
- USD/ZAR
- Further US tech sell-off dragging global sentiment
- Rand weakening sharply against USD increasing cost pressures
6/10
A $1,000 investment in the Vanguard S&P 500 ETF 10 years ago would be worth over $4,200 today, representing a 322% total return and 15.4% annualized return. The stellar performance has been driven by dominant technology companies, which represent 38% of the ETF. While current market valuations raise concerns about future returns, the article emphasizes that patient, long-term investors are historically rewarded.
Our take is based on reporting first published by The Motley Fool.