Large Cap Growth index exclusively measures the performance of 146 of the most valuable growth companies listed on American stock exchanges. As their name implies, growth stocks typically deliver high capital gains, separating them from value stocks, which usually produce lower returns but provide dividend income. The Vanguard Morningstar Growth ETF (NYSEMKT: VUG) is an exchange-traded fund (ETF) that mimics the Morningstar U.S.
Large Cap Growth index by holding the same stocks. Because of its growth-oriented portfolio, which features a high degree of exposure to the technology sector, it has outperformed the benchmark S&P 500 (SNPINDEX: ^GSPC) index on average every year since its launch in 2004. This Rare Signal Is Flashing Again.
In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue » Focusing heavily on growth can lead to more volatility, but that might be a worthwhile trade-off for young investors in their 20s, because it can make a significant difference to their financial position when they eventually reach retirement.
If I were that age today, here's why I'd buy the Vanguard Morningstar Growth ETF and hold it forever. Technology companies operate at the forefront of some of the world's fastest-growing industries. Enterprise software, cloud computing, and artificial intelligence (AI) are just some examples that have created tremendous value over the last 20 years.
Therefore, although this Vanguard ETF invests across 11 different sectors of the economy, a whopping 69.2% of its assets are parked in the tech sector alone. AI is a central focus for most of the companies in the Vanguard ETF's top 10 holdings. They include chipmakers, cloud providers, software developers, and more.
Portfolio weightings are accurate as of June 30, 2026, and are subject to change. As far as AI companies go, none are growing quite as fast as those in the semiconductor industry. Nvidia's data center revenue increased by 92% year over year during its most recent reported quarter, while AMD's data center revenue soared by 107%.
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