Vanguard Mega Cap Growth ETF

MGK

Market cap $30.2B

The Vanguard Mega Cap Growth ETF has a proven track record of beating the market. ETFs perform best when given decades to grow.

Vanguard Mega Cap Growth Index Fund ETF is rated a buy, with a projected 20% upside to $500 by year-end. MGK's recent selloff presents an attractive entry, as its AI-centric mega-cap holdings are poised for robust earnings and revenue growth. Valuations have cooled, with mega-cap forward P/Es dropping from recent highs, and MGK's expense ratio reduced to 0.05%.

The Vanguard Growth ETF and Vanguard Mega Cap Growth ETF are cost-efficient ways to get exposure to a basket of growth stocks. Investors looking to target beaten-down software stocks may want to consider the iShares Expanded Tech Software Sector ETF.

The Vanguard S&P 500 ETF has been a top-tier performer for years. But the Vanguard Mega Cap Growth ETF has taken advantage of the tech and 'Magnificent Seven' rally.

The Vanguard Mega Cap Growth ETF tracks the performance of the CRSP U.S. Mega Cap Growth Index, which holds 65 of America's top growth companies. Those 65 companies represent 70% of the value of the entire U.S. stock market, and they include Nvidia, Apple, Microsoft, and Alphabet.

IWO charges a higher expense ratio but offers a slightly greater dividend yield than MGK. MGK has delivered stronger five-year growth and shallower drawdowns, while IWO brings broader diversification across small-cap growth stocks.

MGK tilts heavily toward technology and growth, with higher volatility and a deeper drawdown than VOO. VOO offers broader sector diversification and a much higher dividend yield.

MGK emphasizes large-cap growth stocks and holds a heavier tech weighting than SPY. SPY delivers broader sector diversification and a higher dividend yield.

MGK skews more heavily toward technology and growth stocks than VOO, resulting in higher volatility and deeper drawdowns. VOO offers a lower expense ratio and a higher dividend yield, with greater sector diversification.

MGK charges a slightly lower expense ratio than SPY but delivers a much lower dividend yield. MGK has outperformed SPY over the past year and five years, but with deeper drawdowns and higher volatility.