Better Vanguard Growth ETF: MGK vs. VONG

The Vanguard Mega Cap Growth ETF (NYSEMKT:MGK)and Vanguard Russell 1000 Growth ETF (NASDAQ:VONG) both target large-cap U.S. growth stocks with similar low costs, but MGK is more tech-heavy and concentrated, while VONG is broader and pays a marginally higher yield.

This comparison looks at two popular growth ETFs from Vanguard: VONG, tracking the Russell 1000 Growth Index, and MGK, following the CRSP US Mega Cap Growth Index. Both aim for long-term capital appreciation from large-cap growth companies, but differ in portfolio makeup, diversification, and recent performance.

Snapshot (cost & size)

Beta measures price volatility relative to the S&P 500; beta is calculated from five-year weekly returns. The 1-yr return represents total return over the trailing 12 months.

Both funds are equally affordable at a 0.07% expense ratio, but VONG pays a slightly higher dividend yield while MGK focuses more narrowly on capital appreciation.

Performance & risk comparison

What's inside

MGK focuses on the largest U.S. growth stocks, with 70% of assets in technology, 12% in consumer cyclicals, and 6% in healthcare. The fund holds just 69 companies, and as of its 18.1-year history, the top three positions — NVIDIA (NASDAQ:NVDA) at 12.97%, Apple (NASDAQ:AAPL) at 12.07%, and Microsoft (NASDAQ:MSFT) at 10.62% — dominate its portfolio, reflecting a heavy tilt toward mega-cap tech names.

VONG is more diversified with 394 holdings and a sector mix of 53% technology, 13% consumer cyclicals, and 13% communication services. Its top three stocks — NVIDIA at 12.22%, Apple at 11.12%, and Microsoft at 10.14% — are similar to MGK’s, but their weights are smaller, indicating less concentration risk. VONG’s broader basket may appeal to those seeking exposure across more growth companies.

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What this means for investors

The Vanguard Mega Cap Growth ETF (MGK) and Vanguard Russell 1000 Growth ETF (VONG) are both for investors looking to invest in growth stocks, but they have meaningful differences.

MGK contains a much smaller basket of stocks, giving its top three holdings greater weight. If these stocks do not perform well, the ETF’s return is affected to a larger extent than VONG despite both holding the same three companies in the top positions.

Also, MGK’s 70% allocation to the tech industry means if the sector experiences a downturn, the ETF’s performance will suffer as well. That said, given the booming artificial intelligence market, MGK has the potential for a greater return than VONG, which it did deliver over the past year. However, MGK investors face higher volatility as well.

VONG’s far greater number of holdings compared to MGK gives it broader diversification. This helps to shield investors from a decline in any given sector or group of stocks, which provides more stability than MGK.

Ultimately, MGK is for investors who are bullish on AI and want to take advantage of the sector’s growth in exchange for higher volatility and risk. VONG is for investors who want growth but also prefer a greater degree of stability and lower risk.

Robert Izquierdo has positions in Apple, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Apple, Microsoft, and Nvidia. 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.