Shares of the Vanguard Russell 1000 Growth Index ETF (NASDAQ:VONG) returned 12.7% in the first half of 2021, according to data from S&P Global Market Intelligence. This performance is as investors would expect from an exchange-traded fund (ETF) designed to track the performance of a specific index, as we’ll get to in a moment.
For context, the S&P 500 Index returned 15.3% in the first half of the year.
Year to date (July 15) in 2021, the above noted Vanguard ETF has returned 14.9%, while the S&P 500 has returned 17%. However, over longer periods, the Vanguard Russell 1000 Growth Index ETF has outperformed the S&P 500. Over the last five years, for instance, this ETF has returned 169% versus the S&P 500’s 122%.
The Vanguard Russell 1000 Growth Index ETF is a non-actively managed fund that aims to track the performance of the Russell 1000 Growth Index, “a broadly diversified index predominantly made up of growth stocks of large U.S. companies,” according to Vanguard.
This ETF’s five largest holdings as of the end of June were:
- Apple (10.2% of total net assets)
- Microsoft (9.7%)
- Amazon (7.1%)
- Alphabet (5.9%)
- Facebook (3.9%)
As the above numbers suggest, this ETF is quite concentrated. It had a total of 501 stock holdings at the end of last month, with the 10 largest holdings making up 46.7% of total net assets.
In addition, the fund could also be considered a fairly decent play on big U.S. tech, as U.S. technology companies accounted for 45.8% of total net asset value as of the most recent sector data that Vanguard provides (end of May). The next three largest sectors were consumer discretionary (19.3%), healthcare (13.3%), and industrials (12.5%).
The Vanguard Russell 1000 Growth Index ETF is a solid choice for ETF investors who favor growth stocks over value stocks, large caps over small and medium caps, and U.S. stocks over a mix of domestic and foreign stocks. (Large-cap stocks have market capitalizations of at least $10 billion.)
This ETF has done a good job tracking the underlying index, as is usually the case for index funds, and Vanguard funds in general are known for having low expense ratios. The Vanguard Russell 1000 Growth Index ETF’s expense ratio is about 0.08%.
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