The Vanguard S&P 500 ETF (VOO) Offers Broader Diversification Than the Vanguard Mega Cap Growth ETF (MGK)

Core Insights - The Vanguard Mega Cap Growth ETF (MGK) and the Vanguard S&P 500 ETF (VOO) differ significantly in cost, yield, and diversification, with VOO providing broader market exposure while MGK focuses on growth stocks [1][2] Cost and Size Comparison - MGK has an expense ratio of 0.07%, while VOO has a lower expense ratio of 0.03% [3][4] - As of November 28, 2025, MGK's one-year return is 21.8%, compared to VOO's 13.5% [3] - MGK offers a dividend yield of 0.4%, whereas VOO provides a higher yield of 1.1% [4] - MGK has assets under management (AUM) of $33.0 billion, while VOO has a significantly larger AUM of $1.5 trillion [3] Performance and Risk Comparison - Over the past five years, MGK experienced a maximum drawdown of -36.01%, compared to VOO's -24.52% [5] - An investment of $1,000 in MGK would have grown to $2,110 over five years, while the same investment in VOO would have grown to $1,889 [5] Portfolio Composition - VOO tracks the S&P 500 Index and holds 505 stocks, with major sector allocations in technology (36%), financial services (13%), and consumer cyclicals (11%) [6] - The largest holdings in VOO include NVIDIA, Apple, and Microsoft [6] - MGK is heavily concentrated in technology, with 71% of its portfolio, and holds only 69 stocks [7] - The top holdings in MGK are also NVIDIA, Apple, and Microsoft, but with higher portfolio weights [7] Investment Focus - Investors in MGK should be comfortable with significant exposure to large tech stocks, particularly in the artificial intelligence sector, with NVIDIA making up 14.3% of the fund [8] - VOO investors have substantial exposure to tech giants like Nvidia, Alphabet, Apple, and Microsoft, which collectively account for about 27% of the fund [9] - VOO has shown a steady increase in dividend payouts, with the latest quarterly payout being 25.8% higher than five years ago, while MGK's dividends have been more volatile [9]