The Vanguard Growth ETF (NYSEMKT:VUG) and the Vanguard Mega Cap Growth ETF (NYSEMKT:MGK) both offer broad U.S. growth exposure, but with different approaches: VUG tracks a wider basket of large-cap growth names, while MGK zeroes in on the largest mega-cap growth stocks.
Investors comparing these two may want to weigh differences in sector tilts, portfolio concentration, and cost.
Metric | VUG | MGK
|
|---|
Issuer | Vanguard | Vanguard |
Expense ratio | 0.04% | 0.07% |
1-yr return (as of Dec. 22, 2025) | 17.44% | 18.90% |
Dividend yield | 0.42% | 0.37% |
AUM | $353 billion | $33 billion |
Beta (5Y monthly) | 1.23 | 1.24 |
Beta measures price volatility relative to the S&P 500. The 1-yr return represents total return over the trailing 12 months.
VUG is more affordable on fees with a lower expense ratio than MGK, though both are among the cheapest index ETFs. Dividend yields are also similar, but VUG offers a slight edge for income-focused investors.
Metric | VUG | MGK |
|---|
Max drawdown (5 y) | -35.61% | -36.02% |
Growth of $1,000 over 5 years | $1,953 | $2,058 |
Over the past five years, MGK delivered a higher total return. However, both funds experienced similar maximum drawdowns, suggesting comparable downside risk during market stress.
MGK focuses on mega-cap growth stocks and holds just 66 companies, with technology making up 58% of assets. Its top holdings are Nvidia, Apple, and Microsoft. With a heavy concentration in tech, this fund’s performance is closely tied to the largest U.S. tech names.
By contrast, VUG is spread across 160 large-cap growth stocks, with a sector mix of 53% technology, 14% communication services, and 14% consumer cyclical. Its leading positions are also Nvidia, Apple, and Microsoft, but each makes up a smaller slice of the portfolio compared to MGK. This broader diversification may appeal to those wanting less exposure to tech mega-caps.
For more guidance on ETF investing, check out the full guide at this link.
Both VUG and MGK are focused on tech-heavy growth, but VUG contains large- and mega-cap growth stocks, while MGK is focused exclusively on mega-caps.
Mega-cap stocks are the largest of the large, generally defined as companies with a market cap of at least $200 billion — compared to the $10 billion threshold for large-cap stocks. These stocks are industry-leading juggernauts, which can add some stability, as they’re often more likely to recover from market downturns.
That said, MGK’s hyperfocus on a small selection of mega-cap growth stocks significantly limits its diversification. It’s more heavily weighted toward the tech industry, and while its top three holdings match VUG’s, those three stocks alone make up 38.26% of the fund’s total assets — compared to 33.51% for VUG.
Performance-wise, the two funds are similar. While MGK has slightly outperformed VUG in both 12-month and five-year total returns, the difference is marginal. With similar expense ratios and dividend yields, investors also won’t notice a significant difference in fees or investment income.
The primary difference between the two comes down to diversification. Those seeking a greater focus on mega-cap growth might prefer MGK’s targeted approach, while investors looking for more diversification within the growth sector might opt for VUG.
ETF: Exchange-traded fund; a fund that trades on stock exchanges and holds a basket of securities.
Expense ratio: The annual fee, as a percentage of assets, that a fund charges to cover operating costs.
Assets under management (AUM): The total market value of all assets managed by a fund.
Mega-cap: Companies with extremely large market capitalizations, typically among the largest in the market.
Large-cap: Companies with a large market capitalization, generally considered to be $10 billion or more.
Growth stock: A stock expected to grow earnings or revenue faster than the market average.
Sector tilt: When a fund has a higher allocation to certain industries or sectors compared to a benchmark.
Portfolio concentration: The degree to which a fund’s assets are invested in a small number of holdings.
Dividend yield: Annual dividends paid by a fund or stock, expressed as a percentage of its price.
Beta: A measure of a security or fund’s volatility compared to the overall market, often the S&P 500.
Max drawdown: The largest percentage drop from a fund’s peak value to its lowest point over a specific period.
Total return: The investment’s price change plus all dividends and distributions, assuming those payouts are reinvested.
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $489,202!*
Apple: if you invested $1,000 when we doubled down in 2008, you’d have $52,090!*
Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $504,994!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.
See the 3 stocks »
*Stock Advisor returns as of December 22, 2025
Katie Brockman has positions in Vanguard Index Funds – Vanguard Growth ETF. The Motley Fool has positions in and recommends Apple, Microsoft, Nvidia, and Vanguard Index Funds – Vanguard Growth ETF. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
Battle of the Tech Giants: Is MGK or VUG the Better ETF for Long-Term Growth? was originally published by The Motley Fool
