Vanguard Growth ETF outperforming S&P 500 with focus on tech stocks, poised for further success.

From Nasdaq: 2024-12-01 03:37:00

The S&P 500 has seen a 27.3% gain this year, but the Vanguard Growth ETF is outperforming with a 30.9% year-to-date increase. This ETF focuses on tech stocks, which are driving the market higher in 2024 due to trends like artificial intelligence (AI).

The Vanguard ETF consistently beats the S&P 500, with a track record of outperformance since its establishment in 2004. Its high weighting in technology stocks, including Apple, Nvidia, and Microsoft, has led to better returns compared to the broader market index.

The Vanguard ETF holds top growth stocks like Amazon and Meta Platforms, with a heavy emphasis on the tech sector. These stocks have delivered impressive returns in 2024, particularly Nvidia, which has surged by 173% on the back of strong demand for its AI data center chips.

With a compound annual return of 11.4% since inception, the Vanguard ETF has outperformed the S&P 500. If AI stocks continue to lead the market in 2025, this ETF is poised for further success. However, a potential market correction could shift investor focus towards dividend payers.

The Vanguard Growth ETF has consistently performed better than the Vanguard Dividend Appreciation ETF. While growth stocks have higher P/E ratios than the S&P 500, a correction in 2025 could alter this trend temporarily before growth stocks bounce back.

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Read more at Nasdaq: Prediction: This Unstoppable Vanguard ETF Will Beat the S&P 500 Again in 2025