VONG vs. SCHG: Which of These Popular Growth ETFs Is the Better Choice for Investors?

Core Insights - The Vanguard Russell 1000 Growth ETF (VONG) and the Schwab U.S. Large-Cap Growth ETF (SCHG) provide broad exposure to growth-focused U.S. large-cap stocks, but differ in cost, portfolio construction, sector exposure, and historical risk [1][2]. Cost & Size Comparison - VONG has an expense ratio of 0.07% and AUM of $45 billion, while SCHG has a lower expense ratio of 0.04% and AUM of $53 billion [3]. - The 1-year return for VONG is 19.84% compared to SCHG's 18.77%, and VONG offers a higher dividend yield of 0.45% versus SCHG's 0.36% [3]. Performance & Risk Comparison - Over the past five years, VONG experienced a max drawdown of -32.72%, while SCHG had a max drawdown of -34.59% [4]. - A $1,000 investment in VONG would have grown to $1,980, while the same investment in SCHG would have grown to $2,049 over five years [4]. Portfolio Composition - SCHG consists of 198 holdings, with 45% in technology, 16% in communication services, and 13% in consumer cyclical, featuring top positions in Nvidia, Apple, and Microsoft [5]. - VONG has a more diversified portfolio with 391 stocks, where technology makes up 53% of total assets, and its top holdings are similar to SCHG but with higher individual weights [6]. Sector Exposure & Concentration - Both funds have similar top three holdings, but these stocks constitute about 35% of VONG's portfolio compared to 29% for SCHG, indicating a greater concentration in VONG [7]. - The concentration on a small number of stocks can present both risks and opportunities depending on their performance [7]. Future Outlook - If the technology sector, particularly Nvidia, Apple, and Microsoft, continues to perform well, VONG may have a slight advantage in returns; however, underperformance could impact VONG more severely than SCHG [8]. - Investors will pay $4 annually for every $10,000 invested in SCHG and $7 for VONG, but VONG's higher dividend yield may offset some of the cost [8].