Core Insights - The Vanguard Growth ETF (VUG) is recommended for long-term investment due to its focus on growth stocks, which are expected to lead in innovation and economic progress [2][9] - The ETF has shown resilience in a changing economic landscape, particularly benefiting from strong earnings and a robust U.S. economy [1][8] Fund Overview - VUG tracks the CRSP US Large Cap Growth Index, which includes about 85% of the U.S. equity market capitalization, selecting stocks based on growth characteristics like earnings and sales growth [4] - The fund has a low expense ratio of 0.04%, making it cost-effective for investors [5][10] Portfolio Composition - The ETF has significant exposure to technology, accounting for 63% of the portfolio, with the "Magnificent Seven" stocks representing nearly 54% [5][8] - VUG includes approximately 160 stocks, allowing for a mix of large-cap leaders and smaller, fast-growing companies [9][10] Market Context - Mega-cap companies are currently outperforming due to the AI revolution, which is expected to continue driving revenue and earnings growth [8] - The strategy of including mid-cap stocks in VUG provides opportunities to capture emerging growth companies that may not be on the radar of other growth ETFs [10]
Why I Would Never Sell This Growth ETF
The Motley Fool·2026-01-04 11:30