Vanguard's VGT and VUG are top-performing ETFs, with both offering solid long-term returns. VGT allocates 99.3% of its assets to tech stocks, leading to outsized performance, while VUG diversifies with only 51.6% in tech, making it a less risky option. Despite VUG's lower expense ratio, the difference is negligible, and investors should consider the heavy concentration on major tech companies, such as Apple, Nvidia, and Microsoft, which comprise a larger portion of VGT. Ultimately, investors must weigh the potential for growth against volatility when deciding between the two funds.
Both funds have ( ( (NASDAQ:AAPL), NASDAQ:NVDA), and NASDAQ:MSFT) as their top three holdings. However, the concentrations are different.
VGT's outsized tech exposure has helped it outperform VUG over the long run, but VUG is the less risky option.
Both of these funds place a big emphasis on VGT allocates 99.3% of its total assets into tech stocks, while VUG puts 51.6% tech stocks.
The heavy focus on tech stocks has helped VGT outperform VUG, but it has also resulted in more volatility.
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