Vanguard Mega Cap ETF vs. S&P 500 ETF: A Focus on Top Stocks
The Vanguard Mega Cap ETF (MGC) offers a concentrated bet on mega-cap stocks, with just 185 holdings compared to the Vanguard S&P 500 ETF's 504. Its expense ratio of 0.07% is marginally higher than the S&P 500 ETF's 0.03%, but the difference is negligible for most investors.
MGC's top holdings, including Nvidia, Microsoft, and Apple, are weighted more heavily than in the S&P 500 ETF. This focus on the largest companies reflects a strategy betting on their continued outperformance over smaller S&P 500 components.
Unlike specialized Vanguard funds that exclude growth or value stocks, MGC provides exposure to both, making it a versatile tool for investors seeking mega-cap exposure without sector bias.