Of those ASX investors who love buying and investing in Vanguard index funds, there are two real choices if an investor wishes to gain broad exposure to the Australian share market. The preferred choice of many is, of course, the Vanguard Australian Shares Index ETF (ASX: VAS).

This exchange-traded fund (ETF) is, by a large margin, the most popular index fund and ETF in Australia, with more than $26 billion currently under management.

VAS offers investors simple, easy access to our most well-known shares by mirroring the S&P/ASX 300 Index (ASX: XKO). As its name implies, this index tracks the largest 300 stocks listed in Australia. That’s everything from Commonwealth Bank of Australia (ASX: CBA), Telstra Group Ltd (ASX: TLS), and Woolworths Group Ltd (ASX: WOW), to JB Hi-Fi Ltd (ASX: JBH), Ampol Ltd (ASX: ALD), and Metcash Ltd (ASX: MTS).

However, there is another Vanguard index fund that addresses one of investors’ chronic concerns about ASX index funds – that they are too heavy on sluggish bank shares and mining stocks.

That Vanguard ETF is the Vanguard MSCI Australian Small Companies Index ETF (ASX: VSO). Instead of buying 300 of the largest stocks listed on the public markets, VSO only holds about 170. These are all taken from the bottom end of the ASX 300, so no CBAs or Telstras here.

Instead, you’ll find the likes of BlueScope Steel Ltd (ASX: BSL), NextDC Ltd (ASX: NXT), and Orica Ltd (ASX: ORI) amongst its largest holdings. VSO is designed to give extra weight to these smaller, and potentially more nimble and mobile stocks, at the expense of the ASX’s largest blue chips.

That all sounds grand. But today, let’s check out the numbers, and see which ASX ETF has actually delivered the best returns for investors.

VSO or VAS: Which ASX index fund comes out on top?

Let’s start with the Vanguard Australian Shares ETF. As of 31 May, this index fund has delivered a 1.38% return year to date. Over the past 12 months, the number is 7.091%. That stretches to 10.94% per annum over the three years to 31 May, 7.92% over five years, and 9.03% over ten.

These returns account for fees and include both capital growth and dividend distribution returns.

Meanwhile, VSO units have gone backwards by 2.6% in 2026 so far. However, over 12 months, investors have enjoyed a 13.27% return. That morphs into 11.42% per annum over the past three years, 7.02% over five years, and 9.33% over ten years.

As you can see, there isn’t a lot of distance between these two Vanguard ETFs. Both VAS and VSO come out ahead over different periods, but an investor who put all of their eggs in either VAS or VSO five or ten years ago would largely come out level.

It seems, going off the historical data at least, it didn’t matter if investors chose one, the other, or both.

The post VAS vs VSO: Do small-cap stocks beat the ASX 300? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Vanguard Australian Shares Index ETF and Vanguard Msci Australian Small Companies Index ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

CSL Ltd (ASX: CSL) shares remain one of the most debated blue-chip stocks on the ASX.

The biotechnology giant is trading around $112.04, which is a long way below the levels investors were used to seeing in past years. That alone makes the stock interesting, but it does not make the investment case simple.

Ord Minnett has recently reviewed its CSL model and maintained a hold recommendation on the stock. The broker’s concern centres heavily on the Vifor nephrology business and the uncertainty around CSL’s earnings outlook as management works to reset the company.

So, is the broker right to stay cautious?

The cautious case

Ord Minnett’s concern is not hard to understand.

CSL is best known for its Behring plasma products business, but the group also includes Vifor and Seqirus. Vifor is exposed to nephrology therapies, while Seqirus operates in vaccines.

The broker believes Vifor’s challenges are being underestimated by the broader market. It has highlighted the loss of exclusivity rights for Injectefer, which is used to treat iron deficiency anaemia, as generic versions enter the US market. It also points to Velphoro, a therapy used by chronic kidney disease patients on dialysis, being removed from the US federal government’s transitional drug add-on payment adjustment program from January 2027.

Ord Minnett expects these issues to pressure pricing and has assumed a fall in Vifor revenue and profit of US$355 million in FY27.

That is not a minor concern.

The broker’s Vifor revenue and operating profit forecasts for FY27 sit below consensus estimates. It also expects Vifor operating profit across FY27 to FY29 to be more than 10% below market expectations.

That cautious view, combined with what it sees as a middling outlook for Seqirus, has led Ord Minnett to cut its CSL group earnings per share estimates for FY27 and FY28.

Why I see it differently

I understand the hold rating. CSL is dealing with genuine moving parts, and investors should not pretend the reset is already complete.

But I think the more interesting question is whether the current CSL share price is already giving patient investors a reasonable chance to be rewarded.

In my view, it is.

CSL is not just Vifor. The Behring division remains the core of the business, and Ord Minnett itself appears to see a modestly brighter outlook for this key plasma products operation.

That is important because plasma is the heart of CSL’s long-term investment case.

This is a global business with scale, specialist manufacturing capability, regulatory experience, collection infrastructure, and deep relationships across healthcare markets. Those strengths are difficult to recreate.

I also think the market’s view of CSL has changed dramatically. Investors are no longer treating it like a flawless compounder. Expectations are lower, the valuation has reset, and management has a clearer challenge: rebuild confidence through execution.

That does not need to happen quickly to make the stock attractive. It needs to happen steadily.

A patient buy

I would rate CSL shares as a buy for patient investors.

The word patient is important. Vifor’s challenges, Seqirus’ mixed outlook, margin pressure, and management’s broader reset all mean the recovery case may take time.

But I think the share price already reflects a lot of disappointment. CSL still has a globally important plasma business, exposure to healthcare demand, and the potential to improve earnings over time if management executes well.

Ord Minnett may be right to flag the risks in Vifor. I just think the hold rating is too cautious when looking at the broader business and the current valuation.

Foolish takeaway

CSL is no longer the easy blue-chip story it once seemed to be. Investors now have to weigh a high-quality global healthcare franchise against real earnings uncertainty and a business reset that still needs proof.

That tension is exactly why the opportunity exists.

I would not ignore Ord Minnett’s concerns. Vifor could remain a drag, and CSL has work to do. But for investors willing to look beyond the next couple of reporting periods, I think the balance of risk and reward now looks attractive.

CSL shares may require patience, but I think they are worth buying at current levels.

The post Is this broker right about CSL shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino has positions in CSL. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has recommended CSL. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Income can come from many different places on the ASX.

This variety can be useful for investors who want to build a passive income stream over many years.

With that in mind, here are three ASX dividend shares from different parts of the market that could be worth buying and holding.

Flight Centre Travel Group Ltd (ASX: FLT)

The first ASX dividend share to look at is Flight Centre.

It gives investors exposure to the travel market, operating across leisure travel, corporate travel, and online travel services.

Its income profile is likely to be more cyclical than many defensive dividend shares.

That is because travel demand can move with economic conditions, airfares, consumer budgets, and business confidence. But this same cyclicality can create strong cash flow when conditions are supportive.

For investors prepared to accept some variability in dividends, Flight Centre could offer income and recovery potential over the long term.

Rural Funds Group (ASX: RFF)

Another ASX dividend share to consider is Rural Funds.

It gives investors access to Australian agriculture through a portfolio of farming assets and water-linked properties.

This is a different kind of income investment. Rather than relying directly on supermarket sales, bank profits, or consumer spending, Rural Funds generates rental income from agricultural assets leased to operators.

The company’s assets sit in an essential part of the economy. Food production, agricultural land, and water rights all have long-term relevance, even though the sector can still be affected by weather, commodity prices, debt costs, and asset valuations.

This could make Rural Funds an interesting option for income investors wanting something outside the usual ASX dividend names.

Transurban Group (ASX: TCL)

A third ASX dividend share to look at is Transurban. It owns toll roads in major cities across Australia and North America. This includes CityLink in Melbourne, Cross City Tunnel in Sydney, and AirportlinkM7 in Brisbane.

These roads are used by commuters, freight operators, businesses, airport travellers, and households moving across key transport corridors. That gives the company exposure to urban mobility.

As cities grow and congestion remains a challenge, well-located roads can become highly valuable assets. Transurban’s roads can save drivers time, provide access to important routes, and support the movement of goods and people.

As a result, for investors wanting income from infrastructure, Transurban could be a strong ASX dividend share to buy and hold for years.

The post 3 ASX dividend shares to buy and hold for years of income appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Transurban Group. The Motley Fool Australia has positions in and has recommended Rural Funds Group and Transurban Group. The Motley Fool Australia has recommended Flight Centre Travel Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.