The State Street SPDR S&P 500 ETF Trust (SPY +0.00%) and the Vanguard Mega Cap Growth ETF (MGK 1.22%) differ most in their sector exposure, number of holdings, and risk-return profiles, with MGK leaning harder into tech and growth while SPY offers broader diversification.
Both SPY and MGK target large U.S. companies, but SPY is designed to mirror the entire S&P 500 Index, while MGK focuses on the largest growth stocks. This analysis compares their costs, performance, portfolio makeup, and risk, helping investors see where each may fit in a portfolio.
Snapshot (cost & size)
| Metric | SPY | MGK |
|---|---|---|
| Issuer | SPDR | Vanguard |
| Expense ratio | 0.09% | 0.07% |
| 1-yr return (as of 2026-01-30) | 14.4% | 16.0% |
| Dividend yield | 1.0% | 0.4% |
| AUM | $713.5 billion | $32.5 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year weekly returns. The 1-yr return represents total return over the trailing 12 months.
MGK is slightly more affordable on fees, but delivers a much lower dividend yield compared to SPY, which could matter for investors seeking income alongside growth.
Performance & risk comparison
| Metric | SPY | MGK |
|---|---|---|
| Max drawdown (5 y) | -24.49% | -36.01% |
| Growth of $1,000 over 5 years | $1,839 | $1,965 |
MGK has delivered stronger total returns over the past five years, turning $1,000 into $1,965 versus SPY’s $1,839. However, MGK has also experienced much steeper losses during market downturns, with a five-year max drawdown of (36.01%) compared to SPY’s (24.49%).
What's inside
MGK tracks a basket of just 69 mega-cap growth stocks, with a pronounced tilt toward technology (55%), communication services (17%), and consumer cyclical companies (13%). Its top three holdings — NVIDIA Corp. (NVDA 1.27%) at 12.97%, Apple Inc. (AAPL 2.12%) at 12.07%, and Microsoft Corp. (MSFT 0.20%) at 10.62% — make up more than a third of the portfolio. The fund has an 18.1-year track record, and its concentrated approach means performance is closely tied to the biggest U.S. tech names.
SPY, by contrast, spreads its exposure across 503 S&P 500 constituents, with technology at 35%, financial services at 13%, and communication services at 11%. Its top positions — Nvidia, Apple, and Microsoft — are significant but less dominant, creating broader sector and company diversification than MGK.
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What this means for investors
For investors seeking an exchange-traded fund for exposure to large-cap stocks, both the State Street SPDR S&P 500 ETF Trust (SPY) and Vanguard Mega Cap Growth ETF (MGK) are good candidates for consideration. The decision to choose one comes down to the individual investor’s goals.
SPY is for investors who want diversification, lower volatility and risk, and income. The ETF provides this by mirroring the S&P 500. Its 1% dividend yield is far superior to MGK, but its expense ratio is higher, eating into some of that income.
MGK is for investors seeking growth stocks. SPY and MGK provide exposure to the tech sector and the rapidly expanding artificial intelligence industry, but MGK is weighted more towards AI stocks because of its focus on growth. This gives MGK a greater potential for higher returns than SPY, and its low expense ratio only adds to its appeal.
However, because MGK is so heavily concentrated in tech, any downturn in the sector, or its top holdings, could cause the ETF to underperform.
Ultimately, both ETFs are for investors who want to buy and hold for the long term, with MGK more for those who prioritize growth stocks and SPY for investors who want a lower risk fund with a larger dividend yield.
