welcome back to money and life TV I am Mike the CPA this is my sidekick chipper
YouTube family what is up! it is so good to see all of you once again and it is
so nice to be able to hang out with you again on YouTube to talk more about
investing in today's video I'm gonna be talking to you about Vanguard growth
ETFs in other words Vanguard growth index funds but before we dive into it I
just want to take a moment to say welcome to anybody who's brand-new to
this channel if you're somebody who wants to learn more about investing more
about taxes more about personal finances and subjects like that I would highly
consider subscribing to our channel and you can do that by hitting the red
subscribe button down below and if you guys liked the video make sure you hit
that like button to let me know you liked it and with that ladies and
gentlemen let's go ahead and dive right into this alright I don't know if a
health familiar you guys are with growth funds but growth funds it's kind of like
when Super Mario and Super Mario Brothers eats a mushroom it can start
the grill really fast and so in today's video we have four Vanguard ETFs these
are all four of them we're gonna cover them all and one by one and then we're
gonna compare them side-by-side to see what stocks they own and which one's
better or worse and which ones might be best for your portfolio just like all my
other Vanguard videos guys I'm gonna be allowing you to download the spreadsheet
you're about to see here on screen completely free you can do that down in
the description section down below I'll leave a Dropbox link there or if you
want to you can actually go to my website money in life tv.com and in the
download section you can download it for yourself there as well it's completely
free no strings attached so go ahead and make sure you check it out once you've
watched the video or even before you watch this video alright guys let's get
the show on the road kind of come join me on screen here we go
okay ladies and gentlemen before I start covering this in detail I just want to
make it clear because I've gotten a lot of questions on some of my other
Vanguard videos that you don't have to have an actual account with Vanguard in
order to buy these index funds that we're showing on screen or any of the
ones I've talked about in my other Vanguard videos you can have an account
with Robin Scottrade etrade pretty much any
platform at least to my knowledge will work so you just so you know you're not
limited just to buy things from Vanguard I personally don't have a Vanguard
account we have a Vanguard 401k through a previous employer but that's a
different story I don't have a separate Vanguard brokerage account so I just
want to make that clear so don't feel like you have to have a Vanguard account
in order to buy these because you absolutely do not have to okay guys
let's go over these in detail and let's let's have some fun with these first one
we're talking about today is vug and that's the Vanguard growth fund ETF and
just so you guys know all the research shown on this in this video and on this
spreadsheet it's all coming directly from the Vanguard website and you can
find links on each tab of this workbook to these different Vanguard funds and
they'll take you right through the Vanguard websites that date of research
I've done this is on January 27th of 2018 obviously the market goes up and
down so you know it might the result the numbers in this video might have changed
a little bit but for the most part they should be pretty solid because this
thing has been around for 14 years so this is based on 14 years of history so
it has a dividend yield of 1.2 2% and vug is a popular fund
I hear about through multiple youtubers and there's multiple people in the
community so I know this is a probably the most popular growth fund for
Vanguard at least from what I've heard out there in the community and online
I'm sorry that people are so jealous of me but I can't help it that I'm popular
so let's go down the line here let's look at its average annual performance
meaning this is what you can expect on average every year in terms of what kind
of returns you can get from this growth fund so notice in one year in this past
year well this past year was exceptional in the stock market but a 27 percent
rate of return just recently this thing has just been taken off in the past
three years you can expect about eleven to twelve percent return the past five
years you might get a sixteen percent return the last ten years you're
averaging anywhere from nine and a half since inception which is
back in January 26 of 2004 on average you've got you're gonna need like an
eight to nine percent return in this growth fund as you can see the graph has
been pretty stellar ever since now let's look at what this thing owns now I
should point out that pretty much any one of these guys remember there's
always market risk we have no clue how this thing's gonna perform in the future
right the results may change but you know if the market crashes is this kind
of crash with it well probably it's probably gonna go down pretty
significantly but maybe not as much as the overall market so just depends but
let's just keep that in mind that results in the feature could change
right but that's true of any kind of investment all right so the top 10
holdings number one a note owns Apple alphabet which is Google Amazon Facebook
Home Depot Visa credit card Comcast coca-cola Philip Morris @v if I don't
think I'm even saying that right so this is its top 10 holdings and but all in
all guys it owns three hundred and nineteen different stocks and lose my
online trying to keep track of all those but in on each tab this spreadsheet what
I've done is I'm giving you a list of their top 100 stocks in each one of
these growth funds so this is vug guys so go ahead and like I said download the
spreadsheet for yourself look it over see what kind of stocks it owns
see if it makes sense to you if you understand it and then if it makes sense
for your portfolio okay guys let's go on to the next one which is MGK the
Vanguard mega cap growth fund ETF I when I hear the name of this thing I'm
thinking like Megaman or something
this is a mega Growth Fund so this is MGK so has a dividend yield of 1.3 1% so
you're getting a small yield on top of the growth now this one's actually not
been around as long as the vug because notice it's only been around 11 years
Fuji was around 414 here so it has a little bit less of a track record all I
want to point out guys that the expense ratios right here is where you can find
the expense ratio it's less than 1% it's like point zero 7 so what I found is
that pretty much every expense ratio on these growth funds are in these ETFs for
Vanguard are all like point 0 7 percent so that's super cheap but you could
really can't get much cheaper than that guys not that I know of so let's go down
the line here let's see what kind of average annual performance we're gonna
get from this thing or what we can expect
now last year this thing actually outperformed VG look at this it almost
has a 30 percent rate of return twenty nine point four seven percent in the
last three years you can expect a little bit over a twelve percent rate of return
the last five years 16 and a half percent last ten years almost almost 10
percent right nine point eight five and since inception which is in 2007 it's
gotten we'll notice it's at the end of 2007 I want to point that out because
the market had pretty much I think the market yeah the market had already gone
down at that point but since inception you're getting like a 10 percent rate of
return every single year and that's not bad for a good track record okay let's
look at the top 10 holdings so here we go it owns Apple alphabet Amazon
Facebook Home Depot Visa Comcast it's like wait a minute
didn't we just read this list you guys noticed something right there
the only stock that's different on this list versus mvg is they have Boeing
whereas this one have a V and so it's just like it's almost the same stocks
all over again so it's really interesting so if you think you're gonna
get diversification between these two things I'm gonna prove to you that
that's not the case so this one doesn't own as many stocks as VG it only it owns
130 stocks in total which you can find that right there here's a list of the
top 100 holdings of this puppy and all you're gonna find a lot of
the same companies are on this list just as they were in vug so not a lot of
difference in terms of stock ownership they're between these two in next
month's okay guys let's go to the next one vot the Vanguard mid-cap Growth so
now so those so MGK and vug were looking primarily at large cap stock growth now
we're gonna look at mid cap level growth so these are smaller companies okay
these are mid cap sized companies the dividend yield it's smaller because the
companies are not as established it's point eight one percent so less than one
percent it's been around though for twelve years
okay twelve years so it's got a pretty good track record higher risk because
the companies are smaller they're less established so there's more risk
involved in this kind of fund so just keep that in mind there's more potential
room for growth but there's also more risk let's see what kind of returns the
themes been getting since inception over the course of one year this thing's
gotten around twenty one twenty two percent rate of return over three years
is getting about an eight percent rate of return five years fourteen percent
ten years in it's getting around a seven to seven point seven four percent rate
of return since inception you're getting about a nine percent rate of return on
average okay so not too bad I mean honestly guys
after reviewing these any one of these would work out pretty well in your favor
you'd still be beating the averages honestly but let's take a look at the
top ten holdings of this puppy and I don't even know what a lot of these
companies are but deserve Inc I don't know what that is I'm not gonna try to
go over all the names of these things but I know it's Dollar Tree the you guys
notice any other companies in here there's Moody's Corp there's Edwards
Lifesciences Corp Digital Realty Trust Inc so there's some different companies
in here I don't know how many of them you know but I don't know a lot of them
offhand I a lot of them I haven't heard of but like I said we probably haven't
heard of them because you know they're not as large as like Amazon and you know
Boeing and those kind of companies so this one owns a total of a hundred and
fifty six different stocks within this ETF and so you can go down the list here
and review it at your own time so go check that out
so 156 stocks remember vug so far has owned the most at over 300 different
stocks okay let's go on the vbk so we just
looked at the Vanguard mid-cap Growth ETF now let's look at VB K which is the
Vanguard small cap growth ETF now notice it does not have much of a dividend
yield but we would expect that right because it's smaller companies smaller
companies might not have have as much cash flow to be paying out dividends but
you know but they are expected to grow maybe a little quicker than some of the
larger companies because there's more room for them to potentially grow on the
risk meter look at that that's a five so it's very high risk because these
companies are not fully established in fact they're less established then the
mid cap size companies we just looked at let's go down the list here let's see
what kind of returns we're getting in this thing over one year we're getting
around the 21 to 22 percent rate of return three years we're getting about a
nine and a half percent rate of return five years a thirteen point six percent
rate of return on average ten-year return is about nine percent and overall
since inception you can expect about a nine percent rate of return so if you
you guys notice a pattern here all of these since inception on average are
giving us about a nine to ten percent rate of return eight to anyone from
eight to ten percent on average if we were to buy this close our eyes and walk
away that's the kind of return we could expect from these things
okay now this one talked about a lot of stock holdings yeah six hundred fifty
baby that's right 650
whoo lots of stockholdings here Diamondback
Energy Inc xpl logistics and TransUnion I think TransUnion is the only company I
even recognize on this list Bluebird bio in these top 10 rec it only
represent like there's only 6% of this index funds total holdings so wow
there's it it just has a lot of stocks in it and I've listed to the top 100
stocks here for you guys ok so we just looked at each one of these individually
now let's compare what stocks they own side by side and we can do that we're
gonna go to our stock holdings tab right here that I've put on the spreadsheet
and so what I've done for you guys is kind of like in my vanguard dividend ETF
video I'm gonna comparing each index fund listed here and showing you the top
100 stocks within these funds now this I was really blew me away when I put this
together and I for vug and MGK notice how all this is in green well what I've
done in this Excel spreadsheet is I have a to show duplication formula which
means that if something is duplicated it's gonna highlight it in green well
look how many of the same stocks each one of these owns so if you were
thinking like maybe I initially was is that you're gonna get a lot of
diversification between these two funds you're probably not because look at they
all owned the same stocks I didn't think that at first but apparently they do
look at this guy's they're like Illinois's Tool Works is one of the only
stocks that this other company ug doesn't have in MGK so look how many of
the stocks that MGK owns and vug own that are the exact same so the only
difference really between them once you've once you can visually see this is
that they own they might own different percentages of the company so like so
maybe this one has a hundred dollars invested in Apple over here right and
maybe this one only invested $80 in Apple over here but for the most part
guys these own the exact same stocks but of course vug and the other main
difference is that vog does have more stocks in total that it holds
so just something to keep in mind I thought that was really interesting now
the opposite is true for vo t & v UK so vo T is made up of mid cap size growth
stocks BBK is made up of small cap size growth stocks and they virtually have
nothing in common look if there's not a single stock on
this list between the two that they have in common at least not in the top 100
holdings of these index funds so keep that in mind alright let's do that thing
where we compare these against each other now let's look at view G versus
MGK and let's see how you would have done has you invested in either one of
these okay guys let's look at vug versus MGK and the way this works is you can
start this top half here is all about VG this bottom half here is all about MGK
so let's look at VG first so in just so you guys know the percentages here are
slightly different because the when I ran these numbers in yahoo finance
versus what running the numbers he on Vanguard there was a timing difference
there so just keep that in mind so after one year VG had a 35% change after 5
years is that one hundred and three percent and since inception it's gotten
around that your money would have grown by two hundred four percent after 14
years and remember guys it has a one point two two percent dividend yield and
I won't go over all these numbers but basically had you and I invested $10,000
in this thing our money would have grown to thirteen thousand five hundred
dollars after one year and after you know five years our money would have
grown to over twenty thousand dollars so it's not a battery to return let's look
at MGK same premise so if we invested $10,000 in MGK after one year our money
has grown to thirteen thousand four thirteen after five years the investment
has grown to over 20,000 dollars 625 so which one of these is better well I mean
it's hard to say because like MGK has a better short-term track record like
after five years basically it's like if you look at MGK here it's got a slightly
higher rate of return than VG but the gotta remember guys that vug has more
stocks and they've been around longer so for three years longer than MGK so just
keep that in mind so there overall in my opinion
they're pretty close so you go down here and look at the graphs I've compiled
from Yahoo Finance so this graph does a 5-year comparison I
mean look how closely these correlate guys I mean if these things follow each
other almost to the tee but in this example after five years you can see MGK
is the winner and but if you look at the max graph then you look at VG is the
long term winner but like I said guys VG has been around longer so of these two
if you were to if I said which one investment are we gonna choose view G or
MGK which one would you choose let me know in the comment section down below I
would love to hear what your guys thoughts are on that particular
investment okay guys now let's look at vo t vs vb k we're looking at mid cap
versus small cap let's let's do this
all right so this top half is all about vot which is the mid capsize fund vbk is
all about that Small Cap Growth Fund okay so after one year we're looking at
a 24 so after one year we're looking at a 24 percent rate of return and VOT
after five years the human of rate of return of eighty three percent after
after it's like max duration you're looking at one hundred and sixty three
percent rate of return on this money and basically if you haven't you and I and
if we invested $10,000 into this thing our ten thousand dollars isn't gonna
grow into twelve thousand for sixteen are then after five years it will grow
to eighteen thousand three hundred fifty dollars looking at vbk oh and it doesn't
have a small divin yield so for every ten thousand dollars you and I invest
you can expect the $81 in income so not a lot I wouldn't count on the income but
it's nice it probably pays for the investment fees on these things so
that's kind of nice vbk and we're looking in the first year
look at twenty five percent rate of return after five years is around
seventy nine percent after you know the max duration is thing I think which was
hold on watch how long this thing had been around saying about fourteen years
so vbk has been around for 14 years so 181 percent cumulative rate of return
after 14 years so after you know if you put $10,000 into this thing fourteen
years ago your money would now be worth twenty eight thousand one hundred eighty
two dollars so which one's better well we would expect at least the way I've
been taught and tell me you guys if you've heard differently but we would
expect small cap growth stocks to grow quicker right so and this makes sense
because the small cap growth stocks and within this ETF have outperformed VOT so
we're looking at 181 percent rate of return versus one hundred sixty three
percent but overall guys it's pretty close right it's pretty close like if
you once again you look at the graph here VOT is in gray vbk is in purple and
you can see there's a pretty close correlation so whatever happens to one
it's probably gonna happen to the other so just keep that in mind and down here
after the max comparison you can see vbk is the winner of you know if you're
thinking and do i do mid a poor small cap which one well I would
choose vbk if you want to get involved with some small cap base stocks that's
what I would that's what the index fund I would choose personally but let me
know what you guys think which what what do you think going forward is gonna have
better potential do you think it's gonna be V BK or do you think it's gonna be vo
T with the mid cap size growth stocks okay guys we just covered all for
Vanguard growth etf funds we've covered vug we've covered
MGK we've covered vo t and v BK and that's a lot of a lot of letters I'm
thrown at you guys but of these four growth funds I would be I'd love to hear
from you guys I'd love for you guys to engage in the comment section down below
let me know what you think which one of these would you be interested in
investing in first be sure to leave your thoughts comments opinions etc in the
comment section down below I would love to hear what you guys think about the
subject okay guys that is all the information I have for you today if you
liked the video make sure you smash that like button let me know you liked it be
sure to subscribe if you have not already because every single week
especially if you want to learn more about investing we produce videos around
that area as well as taxes finances etc and if you know somebody who would find
this information to be helpful please feel free to share it with them this
information and spreadsheet I've produced for you guys is meant to be
shared with others so make sure to share it with them and I'm sure they would
love to to learn about these growth funds especially if you're interested in
as well okay guys one of the investing videos all have coming up in the near
future it's not going to cover Vanguard for once but it's actually we're gonna
be looking at fidelity funds so stay tuned for that I should hopefully within
the next month I'll have that ready for you guys
I've gotten some requests from subscribers about doing videos on
fidelity funds because fidelity is a great platform as well so I definitely
want to do some videos in that area and to help you guys in myself included get
even more familiar with the funds that are available to fidelity and once we
have all this information guys we're gonna be able to say compare Vanguard
funds versus fidelity funds head-to-head so it should get exciting as we keep
doing these videos and as long as I keep here getting this positive feedback on
these types of videos which I have been I'll keep producing them so
if you have any suggestions on like what type of index funds you want to learn
more about just let me know in the comment section down below and I just
really hope you guys have a fantastic week thank you so much for supporting me
on this channel and just being being part of this all of all of you guys make
this worthwhile and until next time have a wonderful week and chipper and I will
see you then bye guys love you peace
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