The Vanguard Growth Index Fund ETF (NASDAQ: VUG) employs an indexing investment approach designed to track the performance of the index, a broadly diversified index predominantly made up of growth stocks of large U.S. companies. The advisor attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the index, holding each stock in approximately the same proportion as its weighting in the index.
Fund Overview
- Net Assets: 222.21 Billion
- NAV: 337.99
- PE Ratio: 40.69
- Dividend Yield: 0.53%
- Expense Ratio: 0.04%
- Inception Date: 01-26-2004
The Vanguard Growth ETF is a large-cap growth stock ETF. The fund aims to replicate the CRSP U.S. Large Cap Growth Index, which constitutes half of the CRSP U.S. Large Cap Index. The latter comprises the top 85% of U.S. stocks weighted by market capitalization, which includes companies with market caps as small as $535 million. So, while the index is primarily composed of large-cap stock, it includes some mid-cap stocks as well. Those are filtered by certain metrics, such as earnings-per-share growth and return on assets, to divide the index into half — one half growth stock, the other value stocks.
While weighting the fund by market capitalization keeps fees and asset turnover low, it results in heavy allocations toward the market’s biggest companies. The 10 largest holdings account for more than 50% of the portfolio. Likewise, more than 50% of the portfolio is invested in technology companies.
Top 10 Holdings (56.26% of Total Assets)
| Name | Symbol | % Assets |
|---|---|---|
| Microsoft Corp | MSFT | 12.86% |
| Apple Inc | AAPL | 11.17% |
| NVIDIA Corp | NVDA | 7.76% |
| Amazon.com Inc | AMZN | 6.87% |
| Meta Platforms Inc Class A | META | 4.55% |
| Alphabet Inc Class A | GOOGL | 3.43% |
| Alphabet Inc Class C | GOOG | 2.84% |
| Eli Lilly and Co | LLY | 2.69% |
| Tesla Inc | TSLA | 2.28% |
| Visa Inc Class A | V | 1.81% |
The ETF boasts an impressive tracking history. Over the past 10 years, it trailed its benchmark index by just 6 basis points, which is right in line with its minuscule expense ratio. With an expense ratio of just 0.04%, the Vanguard Growth ETF is one of the most efficient ways to gain additional exposure to growth stocks in your portfolio. Therefore, VUG is one of the best ETF to own for long-term investors.