Better Vanguard ETF Buy: Mega-Cap Giant MGK vs. S&P 500 Powerhouse VOO

Core Viewpoint - The Vanguard Mega Cap Growth ETF (MGK) and the Vanguard S&P 500 ETF (VOO) cater to investors interested in large U.S. companies, but they differ in their investment strategies, cost structures, performance metrics, and risk profiles [1]. Cost & Size - VOO has a lower expense ratio of 0.03% compared to MGK's 0.07% - VOO offers a higher dividend yield of 1.13% versus MGK's 0.35% - As of February 2, 2026, VOO's 1-year return is 15.60%, while MGK's is 16.88% - VOO has an Assets Under Management (AUM) of $839 billion, significantly larger than MGK's $32 billion [2][3]. Performance & Risk Comparison - Over the past five years, VOO experienced a maximum drawdown of -24.53%, while MGK faced a steeper drawdown of -36.02% - An investment of $1,000 would have grown to $1,850 in VOO and $1,970 in MGK over the same period [4]. Portfolio Composition - MGK focuses on 60 large U.S. growth stocks, with 55% in technology, 17% in communication services, and 13% in consumer cyclical sectors - The top three holdings in MGK—Nvidia, Apple, and Microsoft—constitute nearly 36% of its assets [5]. - VOO tracks the S&P 500 and includes 504 stocks, providing broader diversification with 35% in technology, 13% in financial services, and 11% in communication services - The top holdings in VOO are similar to those in MGK but represent a lower combined weight of around 21% [6][9]. Implications for Investors - MGK targets mega-cap stocks with market caps of at least $200 billion, leading to a more concentrated portfolio that may be more volatile - VOO's broader diversification makes it slightly more stable and less susceptible to market swings, as indicated by its lower beta and maximum drawdown [7][8].