Better Large-Cap ETF: Vanguard's MGK vs. State Street's SPY

Core Insights - The State Street SPDR S&P 500 ETF Trust (SPY) and the Vanguard Mega Cap Growth ETF (MGK) differ significantly in sector exposure, number of holdings, and risk-return profiles, with MGK focusing more on technology and growth while SPY offers broader diversification [1][2] Cost and Size Comparison - SPY has an expense ratio of 0.09% and assets under management (AUM) of $713.5 billion, while MGK has a lower expense ratio of 0.07% and AUM of $32.5 billion [3] - The one-year return for SPY is 14.4% compared to MGK's 16.0%, and SPY offers a dividend yield of 1.0% versus MGK's 0.4% [3][4] Performance and Risk Comparison - Over the past five years, MGK has delivered stronger total returns, growing $1,000 to $1,965, while SPY grew the same amount to $1,839 [5] - MGK has a higher maximum drawdown of -36.01% compared to SPY's -24.49%, indicating greater volatility [5] Portfolio Composition - MGK consists of 69 mega-cap growth stocks, heavily weighted towards technology (55%), communication services (17%), and consumer cyclical (13%), with top holdings including NVIDIA, Apple, and Microsoft [6] - SPY includes 503 S&P 500 constituents, with technology at 35%, financial services at 13%, and communication services at 11%, providing broader sector diversification [7] Investor Considerations - SPY is suitable for investors seeking diversification, lower volatility, and income, while MGK is aimed at those looking for growth stocks [9][10] - MGK's focus on growth stocks and the tech sector offers higher potential returns but comes with increased risk due to concentration [10][11]