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ETF Spotlight: Mega-Cap Value Stocks


ETF Spotlight on the Vanguard Mega Cap Value ETF (MGV) , part of an ongoing series.

Assets : $700.8 million

Objective : The Vanguard Mega Cap Value ETF tries to reflect the performance of the CRSP US Mega Cap Value Index, which tracks mega-capitalization stocks that represent the largest 70th percentile of the U.S. market and selects stocks with a value tilt

Holdings : Top holdings include the Exxon Mobile (XOM) 5.4%, General Electric (GE) 3.5%, Microsoft (MSFT) 3.4%, Johnson & Johnson 3.2% (JNJ) Chevron Corp (CVX) 2.9%.

What You Should Know :

  • Vanguard Group sponsors the fund.
  • MGV has a 0.11% expense ratio.
  • The ETF has 157 components and the top ten holdings make up 31.7% of the overall portfolio.
  • Sector allocations include basic materials 3.1%, consumer cyclical 3.8%, financials 22.7%, telecom services 4.4%, energy 13.7%, industrials 12.6%, tech 7.7%, consumer defensive 12.3%, healthcare 15.5% and utilities 4.4%.
  • MGV has a 12-month yield of 2.29%.
  • Capitalization weights include 58.1% mega-caps and 40.1% large-caps.
  • The fund is down 0.5% over the past month, up 0.3% over the last three months and up 16.2% over the past year.
  • The ETF tracks stocks based on value of book-to-price, forward an trailing earnings-to-price, dividend yield and sales-to-price.
  • “Historically, value stocks have outperformed growth stocks in nearly every market studied over long horizons,” according to Morningstar analyst Alex Bryan. “While large-cap stocks tend to exhibit a smaller value premium than their small-cap counterparts, they also tend to be less risky.”

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