Choosing Between MGK and VOOG: Which Vanguard Growth ETF Fits Your Portfolio?

The Core Difference: Focus vs. Breadth

When evaluating growth-focused ETFs, the Vanguard Mega Cap Growth ETF (MGK) and Vanguard S&P 500 Growth ETF (VOOG) appear similar on the surface—both offer low costs and growth exposure. However, their underlying strategies diverge significantly. MGK concentrates exclusively on the largest corporations, while VOOG casts a wider net across the growth segment of the S&P 500, holding substantially more securities. This fundamental distinction shapes everything from portfolio composition to risk profile.

Cost Structure: A Tie, With Subtle Income Differences

Both funds charge an identical 0.07% expense ratio, eliminating fees as a deciding factor. The competitive edge emerges in dividend yields: VOOG’s 0.48% yield slightly outpaces MGK’s 0.37%. For income-seeking investors, this modest advantage compounds over time. Recent performance data (as of December 2025) shows VOOG posting a 16.74% one-year total return, while MGK delivered 15.09%—a 1.65 percentage point spread worth noting.

Holdings and Sector Concentration

The portfolio size tells the story of each fund’s philosophy:

VOOG maintains 217 holdings, mirroring the diversified nature of S&P 500 growth companies. Its sector breakdown reflects balanced exposure: technology leads at 44%, with communication services and consumer cyclical rounding out meaningful positions. Nvidia, Microsoft, and Apple anchor the portfolio, but these mega-cap names carry proportionally less weight than in MGK.

MGK operates with surgical precision—just 66 holdings targeting exclusively mega-cap stocks (companies exceeding $200 billion in market capitalization). Technology dominates at 58% of assets, with the same trio of Nvidia, Apple, and Microsoft representing a substantially larger portfolio slice. This concentrated structure amplifies exposure to industry leaders while narrowing diversification.

Volatility and Drawdown Patterns

Historical volatility metrics reveal critical risk differences. MGK’s five-year beta of 1.24 exceeds VOOG’s 1.10, indicating greater price swings relative to broader market movements. This elevated volatility materialized during downturns: MGK experienced a maximum drawdown of -36.02% over five years, compared to VOOG’s -32.74%.

Yet concentration delivered growth rewards during the recent bull run. A $1,000 investment in MGK grew to $2,083 over the past five years, outpacing VOOG’s $1,978 return despite its higher risk profile. The tradeoff is explicit: MGK chased mega-cap momentum gains while accepting sharper volatility.

Performance Track Record and Operational Maturity

VOOG has established a 15-year operating history, demonstrating longevity and consistent execution. MGK, though newer to the market, has attracted $33.0 billion in assets under management compared to VOOG’s $21.7 billion. Both funds have delivered competitive returns, though timing and sector rotation matter considerably.

Making Your Decision: Risk Appetite Determines Strategy

Choose MGK if you believe mega-cap technology companies will continue leading market returns and you can tolerate higher volatility. The concentrated portfolio maximizes exposure to industry titans like Nvidia, Microsoft, and Apple—ideal for growth-aggressive investors seeking concentrated bets on market leaders.

Choose VOOG if you prefer smoother returns through broader diversification while still maintaining significant growth exposure. The 217-stock portfolio reduces single-sector risk, and the slightly higher dividend yield provides modest income supplementation. This approach suits investors prioritizing steady accumulation over concentrated gains.

Key Metrics Side-by-Side

Understanding the Terminology

ETF: Investment fund traded on exchanges like individual stocks, providing pooled exposure to multiple securities.

Mega-cap: Corporations with market capitalization exceeding $200 billion, representing the largest publicly traded companies.

Large-cap growth: Established companies with significant market value showing above-average earnings expansion potential.

Beta: Statistical measure comparing an investment’s volatility to the S&P 500 baseline (1.0 = market-equivalent risk).

Sector tilt: Portfolio allocation skewed toward specific industries relative to broader market representation.

Dividend yield: Annual dividend payments expressed as a percentage of current fund price.

Expense ratio: Annual operating fee charged as a percentage of assets managed.

Diversification: Risk-reduction strategy through spreading capital across numerous holdings and sectors.

Max drawdown: Largest peak-to-trough percentage decline during a specific period.

Both MGK and VOOG represent competent vehicles for large-cap growth exposure, each optimized for different investor philosophies. Your selection hinges on whether concentrated mega-cap positioning or diversified growth breadth aligns with your financial goals and risk tolerance.