Vanguard ETF Seeks Growth in Large-Cap Stocks

Doug Fabian

Doug Fabian is known for his expert knowledge of ETFs, bear funds and enhanced index funds to profit in any market climate.
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The Vanguard Growth ETF (VUG) focuses on a growth investment strategy for investors who are willing to accept additional risk. This Vanguard fund holds $16.4 billion in assets under management and has a low expense ratio of 0.09%, which is 92% less than the average cost of similar funds with other providers.

VUG specifically tracks the performance of an index of large-capitalization growth stocks. The ETF’s holdings are approximately in the same proportional weighting as those of the index it attempts to mirror. So far in 2014, VUG has gained 12.86%. This fund also offers a dividend yield of 1.17%.

VUG_112514

VUG has hefty weightings in technology, 25.74%; consumer cyclical, 17.23%; and healthcare, 12.94%. Its top 10 holdings account for 23.01% of its total assets. These holdings include Apple Inc. (AAPL), 7.11%; the Coca-Cola Company (KO), 1.98%; Google Inc. (GOOGL), 1.96%; Gilead Sciences, Inc. (GILD), 1.90%; and Facebook, Inc. (FB), 1.88%.

This ETF seeks to match the performance of the large-cap growth segment of the U.S. equity market. Vanguard Growth ETF (VUG) provides a simple and comparatively inexpensive way to invest in this market.

If you want my advice about buying and selling specific ETFs, including appropriate stop losses, please consider subscribing to my Successful ETF Investing newsletter. As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an e-mail. You just may see your question answered in a future ETF Talk.

In case you missed it, I encourage you to read my e-letter column from last week about Vanguard’s dividend-yield-focused ETF. I also invite you to comment in the space provided below.

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