Vanguard’s Growth ETFs: MGK and VOOG Face Off

Investors looking to bet on American growth stocks have plenty of options, but two Vanguard funds keep drawing attention from both beginners and seasoned traders: the Mega Cap Growth ETF (MGK) and the S&P 500 Growth ETF (VOOG). On the surface, they look similar—both charge the same rock-bottom fees and come from the same trusted fund manager. But dig deeper, and you'll find meaningful differences in what they own, how concentrated they are, and how they've performed.

Background

Vanguard created both funds to give investors exposure to large American companies with strong growth prospects. MGK launched 18 years ago and focuses exclusively on the biggest names in the market—companies worth at least $200 billion. VOOG, which started 15 years ago, takes a broader approach by tracking the growth stocks within the entire S&P 500.

The distinction matters because it shapes everything from how much you earn in dividends to how much your portfolio might swing during market downturns. For investors trying to decide between them, understanding these differences can mean the gap between a portfolio that matches their risk tolerance and one that doesn't.

"Both funds are managed by Vanguard and avoid use or other structural quirks, but MGK's narrower focus results in higher potential exposure to swings in the tech sector."

Key Details

Holdings and Diversification

MGK holds just 66 stocks, with nearly 70 percent of its money in technology companies. The three biggest positions—NVIDIA, Apple, and Microsoft—make up more than 38 percent of the entire fund. This concentration means MGK bets heavily on whether these mega-cap tech giants succeed or stumble.

VOOG, by contrast, holds 217 stocks spread across more sectors. Technology still dominates at 44 percent of assets, but communication services and consumer cyclical stocks also play meaningful roles at 15 percent and 12 percent respectively. NVIDIA remains the largest holding at 15.3 percent, followed by Microsoft at 6.2 percent and Apple at 5.7 percent. The broader mix means VOOG isn't as dependent on any single company or sector doing well.

Costs and Fees

Both funds charge identical expense ratios of 0.07 percent annually, making them equally affordable for investors. This low cost is one reason both have attracted billions in assets. VOOG does have higher turnover at 27 percent compared to MGK's 6 percent, meaning it trades its holdings more frequently, though this hasn't significantly impacted its overall expenses.

Performance and Volatility

Over the trailing 12 months through December 2025, VOOG edged out MGK with returns of 16.74 percent versus 15.09 percent. However, the longer-term picture shows a different story. Over the past five years, MGK delivered stronger cumulative growth, turning $1,000 into $2,083 compared to VOOG's $1,978.

The trade-off comes in volatility. MGK experienced a maximum drawdown of 36.02 percent over five years, meaning investors saw their holdings drop by more than a third during the worst market period. VOOG's maximum drawdown was 32.74 percent, suggesting gentler losses during downturns. This difference reflects MGK's heavier concentration in technology, a sector that can swing wildly.

Income and Yield

VOOG offers a slightly higher dividend yield than MGK, providing a bit more income for investors seeking regular payouts. This modest advantage appeals to those who want to live off their investments or reinvest dividends for compound growth.

What This Means

The choice between MGK and VOOG depends on what you're trying to accomplish. If you believe mega-cap technology companies will continue leading the market and you can stomach bigger swings in your portfolio's value, MGK offers concentrated exposure to industry leaders. Its smaller number of holdings means you're betting on fewer companies, which can amplify gains when those companies perform well.

If you prefer a smoother ride and want exposure to growth across different sectors, VOOG spreads your risk further. You're not as dependent on tech giants staying on top, and your portfolio won't fluctuate as dramatically. The slightly higher dividend yield and recent one-year performance advantage also appeal to income-focused investors.

Neither choice is objectively wrong. Both funds carry Vanguard's reputation for low costs and solid management. The real question is whether you want to concentrate your bets on the market's biggest winners or diversify your growth strategy across a wider range of companies. Your answer to that question should guide which fund makes sense for your situation.