The Vanguard Mega Cap Growth ETF (MGK 0.90%) and Invesco QQQ Trust, Series 1 (QQQ 0.55%) both target large-cap U.S. growth stocks, but QQQ stands out for its deeper liquidity, broader sector reach, and slightly higher yield, while MGK keeps costs lower.
MGK tracks the CRSP U.S. Mega Cap Growth Index, focusing on the largest growth names. QQQ, by contrast, tracks the NASDAQ-100, covering 101 of the largest non-financial companies on the Nasdaq exchange. This match-up compares performance, cost, risk, and portfolio construction.
Snapshot (cost & size)
| Metric | MGK | QQQ |
|---|---|---|
| Issuer | Vanguard | Invesco |
| Expense ratio | 0.07% | 0.20% |
| 1-yr return (as of Dec. 14, 2025) | 15.8% | 15.7% |
| Dividend yield | 0.37% | 0.46% |
| Beta (5Y monthly) | 1.24 | 1.19 |
| AUM | $32.7 billion | $403.0 billion |
Beta measures price volatility relative to the S&P 500. The 1-yr return represents total return over the trailing 12 months.
MGK is more affordable on fees with a lower expense ratio, while QQQ pays a slightly higher dividend yield. MGK may appeal to fee-conscious investors, while QQQ can have an edge for those seeking more income from a growth-focused ETF.
Performance & risk comparison
| Metric | MGK | QQQ |
|---|---|---|
| Max drawdown (5 y) | -36.02% | -35.12% |
| Growth of $1,000 over 5 years | $2,083 | $2,033 |
What's inside
QQQ contains 101 holdings, around 54% of which are allocated to the technology sector. Its second- and third-largest sector allocations include communication services (17% of assets) and consumer cyclical (13%), respectively.
Its top positions are Nvidia, making up roughly 9% of the fund, Apple at 9%, and Microsoft at 8%. With no unique quirks or leverage, QQQ aims for broad representation of the NASDAQ-100.
MGK, in contrast, is more concentrated in technology (58%), with communication services (15%) and consumer cyclical (12%) as secondary allocations.
Its top holdings are Nvidia at 14%, Apple at 12%, and Microsoft at 12%, reflecting a heavier tilt toward the biggest tech leaders. MGK holds 66 stocks, offering a narrower slice of the large-cap growth universe.
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What this means for investors
QQQ and MKG both aim to provide exposure to the largest growth stocks, with an emphasis on the tech industry. QQQ, however, offers a broader portfolio with greater diversification, while MGK zeros in on the largest of the large-caps.
MGK focuses on mega-cap growth funds. Mega-cap stocks are generally defined as companies with a market capitalization of at least $200 billion, which is significantly larger than the large-cap cutoff of $10 billion.
This narrower focus can be an advantage when mega-caps are thriving, as we've seen the last few years with companies like Nvidia experiencing explosive growth. However, with fewer holdings and a larger portion of its portfolio allocated to just a handful of stocks, MGK is also at greater risk of volatility if those stocks experience a decline.
QQQ is a broader fund, encompassing both mega-cap and slightly smaller large-cap growth stocks. While its top sectors and holdings align with MGK's, it's not as heavily weighted toward those segments of the market. QQQ's top three holdings make up 25.57% of the fund's total assets, compared to MGK's 38.26% allocation to its top three stocks.
That extra diversification can help limit QQQ's risk, as seen with its slightly lower beta and milder max drawdown compared to MGK.
Investors seeking a lower expense ratio and more targeted access to mega-cap stocks may find MGK preferable, while those seeking slightly more diversification within a growth fund may opt for QQQ.
Glossary
ETF: Exchange-traded fund; a fund that trades on stock exchanges like a stock, holding a basket of assets.
Expense ratio: The annual fee, as a percentage of assets, that a fund charges to cover operating costs.
Liquidity: How easily an asset or fund can be bought or sold without affecting its price.
Dividend yield: Annual dividends paid by a fund or stock, expressed as a percentage of its current price.
Beta: A measure of an investment’s volatility compared to the overall market, typically the S&P 500.
AUM: Assets under management; the total market value of assets a fund manages for investors.
Max drawdown: The largest percentage drop from a fund’s peak value to its lowest point over a specific period.
Growth of $1,000 over 5 years: How much a $1,000 investment would have grown in the fund over five years, including returns.
Sector allocation: The distribution of a fund’s investments across different industries or sectors.
Consumer cyclicals: Companies whose performance tends to follow the economic cycle, such as retailers and automakers.
Portfolio construction: The process of selecting and weighting assets within a fund to achieve specific investment goals.
NASDAQ-100: An index of the 100 largest non-financial companies listed on the Nasdaq stock exchange.
