VUG vs. RSP: How Tech-Heavy Growth Compares to Balanced S&P 500 Diversification

• VUG features overmuch heavier exertion vulnerability and a little disbursal ratio than RSP.

• RSP offers a higher dividend output and a milder drawdown implicit the past 5 years.

• RSP distributes value much evenly crossed sectors, portion VUG concentrates successful a fistful of mega-cap stocks.

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The Vanguard Growth ETF (NYSEMKT:VUG) tracks the show of large-cap U.S. maturation stocks, dominated by technology. By contrast, the Invesco S&P 500 Equal Weight ETF (NYSEMKT:RSP) arsenic weights each S&P 500 companies, starring to broader assemblage balance.

This examination highlights however each fund’s attack affects returns, risk, and income potential, helping investors determine which 1 is champion for their portfolio.

Beta measures terms volatility comparative to the S&P 500. The 1-yr instrumentality represents full instrumentality implicit the trailing 12 months.

VUG charges a overmuch little disbursal ratio, appealing to investors looking to minimize fees. However, RSP has a wide vantage successful presumption of income, with its substantially higher dividend yield.

RSP holds 504 stocks, allocating astir adjacent value to each S&P 500 stock. It tilts toward exertion (making up 16% of full assets), industrials (15%), and fiscal services (14%), with each of its apical holdings making up little than 0.25% of its portfolio. The money has a astir 23-year way record, offering diversified vulnerability without favoring mega-cap stocks.

By contrast, VUG holds conscionable 160 stocks and packs 51% of its portfolio into technology, 15% into connection services, and 14% into user cyclical. Its apical 3 positions -- Apple, Nvidia, and Microsoft -- unneurotic marque up much than 32% of assets, making it acold much concentrated successful a fewer ample companies.

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VUG and RSP connection chiseled approaches that entreaty to antithetic types of investors, depending connected their goals.

RSP is acold much diversified, with implicit 3 times arsenic galore holdings and a little pronounced tilt toward immoderate 1 industry. While tech is the astir salient assemblage successful some funds, it makes up conscionable 16% of RSP's portfolio compared to implicit 50% for VUG.