Vanguard Mega Cap Growth ETF

MGK

Market cap $32B

DIA holds blue chip stocks with a value and financials tilt, while MGK is concentrated in mega-cap tech growth names. DIA charges a higher expense ratio but offers a noticeably higher dividend yield.

ETFs can help diversify your portfolio with minimal effort. The right investment can help mitigate risk while still earning substantial returns.

SCHG costs less to own than MGK, with a lower expense ratio. MGK has outperformed over the past year, but both funds show similar long-term risk and drawdown profiles.

The Vanguard Mega Cap Growth ETF tracks the performance of the CRSP U.S. Mega Cap Growth Index, which holds 66 of America's largest companies. Those 66 companies represent 70% of the total value of the entire U.S. stock market, and they include artificial intelligence powerhouses like Nvidia and Alphabet.

If you're interested in broad exposure to the Large Cap Growth segment of the US equity market, look no further than the Vanguard Mega Cap Growth ETF (MGK), a passively managed exchange traded fund launched on December 17, 2007.

Vanguard Mega Cap Growth Index Fund ETF is rated Buy due to its high concentration in high-quality growth stocks. MGK is highly concentrated, with the top 10 holdings accounting for 67% of exposure and its top four accounting for 47% of exposure. Notable investors, including Warren Buffett, Bill Ackman, and Chris Hohn, also employ a highly concentrated approach and own a number of the top stocks held by the fund.

MGK carries a much lower expense ratio and holds far fewer stocks than IWO. MGK delivered a much stronger five-year return and shallower drawdown, but its portfolio is heavily tilted toward technology giants.

Both funds share identical expense ratios, but VONG offers a slightly higher dividend yield and holds more stocks. MGK has delivered a higher 1-year total return and larger technology sector tilt, while VONG spreads its bets across nearly 400 holdings.

MGK concentrates more heavily in technology and holds fewer stocks than VUG. VUG offers a lower expense ratio and much higher assets under management.

VOO offers broader sector diversification and a higher dividend yield than MGK. MGK has delivered stronger one-year and five-year total returns, but with deeper drawdowns.