The U.S. has been the leading economy in the world for many decades, and the stock market has outperformed international markets for the past 15 years. Despite the challenges posed by its big deficits, plus uncertainty posed by the upcoming Trump administration’s policies, top U.S. companies will continue to offer great investment opportunities.

Here’s an ETF that provides exposure to the top publicly listed companies in the U.S. It’s for investors who want to tap the country’s attractive long-term prospects.

VANGUARD TOTAL STOCK MARKET ETF $115.59 (Toronto symbol VUN; TSINetwork ETF Rating: Aggressive; Market Cap: $10.0 billion) aims to track the performance of a broad basket of U.S. listed companies. There is also a Canadian dollar hedged version of this fund (Toronto symbol VUS). Investors should note that these ETFs invest all of their assets in the U.S. listed equivalent fund (New York symbol VTI).

Technology stocks account for 31% of its assets, while Healthcare (12%), Financial Services (13%), Consumer Cyclicals (10%), Industrials (9%), Communication Services (9%), Consumer Defensives (6%), and Energy (4%) are other key segments.

The ETF holds a large portfolio of 3,642 stocks. The top 10 holdings make up 30% of its assets. They are Apple (6.0%), Nvidia (5.7%), Microsoft (5.5%), Alphabet (3.3%), Amazon (3.2%), Meta (2.3%), Berkshire Hathway (1.5%), Broadcom (1.4%), Eli Lilly (1.3%) and Tesla (1.2%).

The ETF started up in May 2001 and charges an MER of 0.17% (the U.S.-listed version charges 0.03%). With an average of $3.6 million in units trading daily, the fund provides good liquidity. It has a p/e of 20.7 based on its forward earnings and pays a fluctuating quarterly dividend. Over the past 12 months, the dividend amounted to $1.04 for a yield of 0.9%.

The ETF gained 38.3% over the past year compared to the 26.5% gain of the MSCI All-Country Equity Index. Over the past 5 years, the ETF is up by 107.1% compared to 73.6% of the benchmark index.

The U.S. has a population of 335 million, growing at a rate of just under 1% per year. But, the U.S. population is getting older—the U.S. Census Bureau predicts that the number of people over 65 will almost double over the next 35 years and the old age dependency ratio, (which measures the population over 65 as a percentage of the working age group) is expected to increase drastically to reach 41% by 2060. Like many European and Asian nations, the U.S. is graying, posing challenges for the workforce, the economy, and social programs.

The labour force counts 168 million and the current unemployment rate remains low at 4.1%. GDP per capita amounts to $81,695. On this measure, the U.S. population is one of the richest in the world.

Long-term problems for the U.S. include stagnation of wages for lower-income families, inadequate investment in deteriorating infrastructure, rapidly rising medical and pension costs of an aging population, and sizable federal budget deficits and rising debt levels.

The size of the U.S. economy measures $27 trillion—the largest in the world. The services sector makes up 80% of the economy while industry contributes 19% and agriculture, 1%.

Exports of goods and services account for 12% of the economy, while imports account for 15%. Notably, the value of imports exceeds exports resulting in an ongoing trade deficit.

Machinery, motor vehicles, airplanes, agricultural products, computers, and telecommunication equipment are major export products. Canada, Mexico, China, Japan, and Germany are the main trading partners.

The sub-prime mortgage crisis, falling home prices, investment bank failures, tight credit, and the global economic downturn pushed the U.S. into a recession in mid-2008. GDP contracted until the third quarter of 2009, the deepest and longest downturn since the Great Depression.

Between 2010 and 2019, U.S. economic growth fluctuated between 1.5% to 3.0% per year, But this steady growth came to an abrupt halt with the onset of Covid-19 in 2020.

After a 2.2% decline in 2020, the U.S. economy recovered in 2021 to 2022, helped along by massive fiscal and monetary stimulus programs. Growth stabilized in 2023 with longer-term growth rates of between 1.5% and 2.0% expected going forward.

In 2020, the U.S. Federal Government recorded a budget deficit equivalent to 15% of the country’s GDP—the largest deficit since the Second World War.

The deficit improved to 6% by 2023, but it is expected to remain above 5% for the foreseeable future. That will add to the already massive government debt every year.

The current Federal U.S. government debt is $36 trillion—double 10 years ago. The U.S. debt relative to the size of its economy is about 125%, this compares to 106% for Canada, 101% for the U.K., and 62% for Germany.

The IMF predicts that the U.S. government debt-to-GDP ratio will reach 175% by 2040 as the high cost of services provided to an aging population pushes up the debt levels.

In theory, the U.S. has an unlimited capacity to issue government bonds to fund its debt. This will continue as long as investors trust that the U.S. government will be able to service and repay its debt, keep inflation under control, and maintain the value of its currency.

Inflation spiked in 2021 to 2022 but receded in 2023 to 2024—with forecasts of core inflation (excluding food and energy) indicating a rate of 2.5% for 2025.

The Federal Reserve also started to lower interest rates in 2024. The main central bank policy rate is now at 4.75% and the bond yield at 4.41%—still sharply higher than the very low rates that prevailed over the past decade.

Now that the U.S. has had a decisive outcome for its 2024 Presidential Election, it seems possible that things will cool down and run more smoothly in American political circles. The U.S. is positioned for robust growth in 2025

For investors who want exposure to the U.S., the Vanguard Total Stock Market ETF is a sound choice. It’s an ETF buy.