Wall Street analysts favor information technology and materials stocks for potential upside, with IT outperforming by 460 percentage points in the last decade. The Vanguard Information Technology ETF includes top holdings like Nvidia, Apple, and Microsoft, trading at a premium but expected to grow earnings by 26% next year, driven by AI technology.

On the other hand, the materials sector underperformed the S&P 500 by 340 percentage points in the last decade. The Vanguard Materials ETF focuses on companies like Linde, Newmont, and Sherwin-Williams, trading at a premium valuation with modest earnings growth forecasts. Historical performance and valuation suggest broader market investments may be a safer bet.

Read more at Nasdaq: The 2 Best Vanguard Sector Index Funds to Buy Ahead of 2026, According to Wall Street