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