If a Bear Market Is Coming in 2026, Here's 1 ETF That History Says Has Never Let Investors Down

If a Bear Market Is Coming in 2026, Here's 1 ETF That History Says Has Never Let Investors Down

Ben Gran, The Motley Fool

Tue, August 4, 2026 at 5:50 PM GMT+3 4 min read

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The U.S. stock market has been on a fantastic run for the past few years, but many investors are feeling nervous. Whether it's talk about high valuations of tech stocks, concerns about the sustainability of the artificial intelligence (AI) boom, or rising interest rates, there's always a chance that something could happen tomorrow that drives stocks into a sell-off.

What if a bear market is coming in 2026? Some investors might feel tempted to sell stocks and move to cash. Others might want to stop investing in stocks, keep cash on the sidelines, and wait until stock prices move lower. Here's the problem with timing the market: The market can move faster than you. Missing out on the best days of stock market performance can cause big damage to your portfolio in the long run.

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If you're truly a long-term investor and the money you're putting into stocks can be left invested for 10 years or more, you shouldn't worry about a bear market in 2026. In the long run, owning a diversified portfolio of stocks is often the best way for people to build wealth, because stocks let you gain from the future earnings of some of the world's most profitable companies.

One of the best stock ETFs for long-term investors is the Vanguard S&P 500 ETF (NYSEMKT: VOO). Let's look at why this Vanguard exchange-traded fund (ETF) could be a good buy for your portfolio -- no matter what happens with stock prices next year.

Vanguard S&P 500 ETF (VOO): 506 stocks, 15.04% annualized returns for 15 years

The Vanguard S&P 500 ETF is one of the world's most popular ETFs, with more than $1 trillion of investor assets under management. It's a low-cost index fund that lets you buy the entire S&P 500 index with one trade, one ticker, and one rock-bottom expense ratio (0.03%). For the past 10 years, this fund has delivered average annual returns (by net asset value) of 15.04%. In the past year, it's up even more: 19.53%.

What do you get when you buy VOO? You get 506 stock holdings, representing the 500 largest publicly traded companies in America. It's a passive index fund, so it doesn't pick stocks. Instead, the fund constantly rebalances and adjusts its holdings based on which companies' shares are doing better or worse over time.

Why buy VOO... even if there's a bear market

Some investors worry that the S&P 500 has gotten too top-heavy with major tech names. What if there's a tech sell-off or an AI bubble that bursts? It's important to look at the truly "long-term" view of stock market history. Ever since 1928, the S&P 500 has delivered a long-term average annual total return of 9.98% (about 10% per year).

That includes the Great Depression, World War II, the dot-com bubble, the global financial crisis of 2008, and the 2020 pandemic. Sometimes the S&P 500 (and the VOO ETF) declines in the short term. But even with all those global crises and stock market crashes along the way, investors still made great money by buying and holding the 500 largest names in American business.

Stock market volatility can be stressful. But owning broadly diversified index funds like the S&P 500 ETF can help reduce your worries.

Should you buy stock in Vanguard S&P 500 ETF right now?

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Ben Gran has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.

If a Bear Market Is Coming in 2026, Here's 1 ETF That History Says Has Never Let Investors Down was originally published by The Motley Fool