What are the main differences in tracking focus between FTEC and VOO?

FTEC is a sector-specific ETF focusing exclusively on the technology industry, aiming to mirror the performance of companies within that asset class. In contrast, VOO is a broad-market ETF that tracks the S&P 500, which includes large companies across eleven different sectors. This fundamental difference means FTEC is a specialized tool for investors wanting pure-play tech exposure, while VOO serves as a core holding for diversified participation in the US equity market.

How do the expense ratios of FTEC and VOO compare?

Both funds are considered low-cost, but there is a slight difference. FTEC has an expense ratio of 0.08%, whereas VOO has an expense ratio of 0.03%. The 0.05% difference is small, but over extended periods, lower fees can theoretically support better compounding of returns. However, the primary distinction remains their portfolio structure rather than the marginal cost difference, as both are highly cost-efficient relative to active funds.

How significant is the holdings overlap between these two funds?

There is substantial overlap in the top holdings, which reflects the dominance of major tech firms in the US economy. Five stocks appear in both top-10 lists: NVDA, AAPL, MSFT, MU, and AVGO. However, FTEC concentrates much more heavily on these names, with NVDA at 17.49% and AAPL at 16.69% compared to VOO's 8.08% and 7.03%. FTEC holds these tech companies because they fit its mandate, whereas VOO holds them as part of a wider market balance.

What is the difference in dividend yields between the funds?

VOO provides a dividend yield of 1.03%, reflecting the broader distribution payments from the S&P 500 constituents. FTEC has a lower yield of 0.37%, which is typical for a technology-heavy ETF where growth companies often reinvest earnings rather than paying them out. VOO might suit those prioritizing income, while FTEC's lower yield is often acceptable to investors seeking high capital appreciation potential rather than regular cash flows.

How does the concentration risk differ between the two funds?

FTEC presents a higher concentration risk due to its sector focus and heavy weighting in a few key stocks. VOO, while still concentrated in mega-cap tech due to the index methodology, mitigates risk through diversification. VOO's top holding is under 10%, whereas FTEC holds two top positions near 17%. This makes FTEC more volatile if the tech sector underperforms, while VOO is more balanced by other industry groups like healthcare or financials.

How do the assets under management affect the ETFs?

VOO manages $1.08 trillion in assets, indicating very high liquidity and widespread institutional use. FTEC is smaller at $21.3 billion, but this is still a substantial asset base. Generally, larger funds like VOO may offer tighter bid-ask spreads for large-scale trading due to higher volume. FTEC, while smaller, remains a major player in the tech sector. The difference in size primarily reflects the broader appeal of a total market index compared to a sector-specific strategy.

Which investing goals are typically associated with each fund?

VOO is generally viewed as a foundational core holding for long-term wealth accumulation and broad market participation. It suits investors looking for diversified exposure to US equities without trying to pick specific sectors. Conversely, FTEC is typically used as a satellite or tactical allocation. It appeals to investors who specifically want to overweight the technology sector to capture growth trends, accepting the higher volatility and sector-specific risks that come with this concentrated approach.

What practical considerations should investors make regarding fees?

While both funds are inexpensive, investors should consider the impact of fees over decades. The 0.05% difference between FTEC and VOO is small, but when compounded, it can have a minor effect on net returns. However, the primary consideration should be the portfolio fit. Choosing based on fee differences alone should not override the structural choice between a diversified market fund (VOO) and a specialized sector fund (FTEC).

Why do top holdings differ in weight despite being the same companies?

The difference in weight occurs because the funds track different indices with different rules. FTEC tracks a tech-only index, so its capital is divided only among technology firms. This results in higher percentages for companies like NVDA (17.49%) and AAPL (16.69%) compared to VOO, where the total capital is spread across all major US sectors, diluting the weight of tech names to 8.08% and 7.03% respectively.

What does 'sector-specific' vs 'broad-market' actually mean for ETFs?

Sector-specific ETFs like FTEC (Technology) concentrate their assets within a single industry. This creates higher correlation to that specific economic trend. Broad-market ETFs like VOO (Large Blend) invest across various sectors, mimicking the wider economy. This diversification reduces the impact of any one industry's downturn but also caps the upside potential if a single specific sector significantly outperforms the general market average.

What are the risks of sector rotation when comparing FTEC to VOO?

Investors using FTEC are effectively betting on the technology sector's continued outperformance. If economic cycles shift and the tech sector lags behind other industries like financials or healthcare, FTEC will likely underperform VOO. VOO mitigates this specific risk by automatically adjusting its holdings based on the S&P 500 composition, ensuring that no single sector dominates the portfolio to the same extent.

Disclaimer: Is this content financial advice?

The information provided in these FAQs is for educational purposes only and does not constitute financial advice. The comparisons rely on factual data regarding expenses, holdings, and yields from Yahoo Finance. Investors should always conduct their own due diligence, review prospectuses, and consider their individual financial circumstances and risk tolerance before making any investment decisions.

FTEC vs VOO

Two funds, one decision: we compare cost, performance and what each ETF actually holds in November 2026.

Compare Fidelity MSCI Information Tech ETF (FTEC) and S&P 500 Vanguard ETF (VOO) by examining fees, holdings, and dividends. This page highlights how each fund tracks its respective market focus. Educational content, not financial advice.

Fund Snapshot

Key Fund Metrics

FTEC

Metric

VOO

0.08%

Expense Ratio

0.03%

0.37%

Dividend Yield

1.03%

$21.25B

Net Assets

$1.08T

298

Holdings

516

Oct 21, 2013

Inception Date

Sep 7, 2010

–

Index Tracked

–

Technology

Fund Category

Large Blend

VOO costs about $5.00 less per year for every $10,000 invested.

Shared Top Holdings

Holding	FTEC	VOO
NVDANVIDIA Corporation	17.49%	8.08%
AAPLApple Inc.	16.69%	7.03%
MSFTMicrosoft Corporation	11.22%	5.70%
MUMicron Technology, Inc.	4.25%	1.63%
AVGOBroadcom Inc.	4.21%	2.65%

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Investment Analysis

FTEC

Pros

FTEC offers concentrated exposure to technology sector leaders, with top holdings including NVDA at 17.49% and AAPL at 16.69%.
Managed by Fidelity, a reputable asset manager, the fund provides access to innovation-driven companies through a structured ETF.
Its low expense ratio of 0.08% supports efficient long-term holding within a technology-focused portfolio allocation.

Considerations

The fund's top 10 holdings account for a significant portion of assets, increasing single-stock concentration risk.
Dividend yield is only 0.37%, which may deter income-focused investors seeking regular cash distributions from the portfolio.
Sector weights are not available, limiting transparency into broader industry diversification within the technology asset class.

VOO

Pros

VOO tracks the S&P 500 and offers broad large-cap U.S. exposure, with major positions like NVDA at 8.08% and AAPL at 7.03%.
It has the lowest expense ratio of 0.03%, making it a highly cost-efficient core holding for diversified equity portfolios.
The fund manages $1.08 trillion in assets, ensuring deep liquidity and tight bid-ask spreads for large-scale trading activity.

Considerations

Despite its broad index approach, VOO still exhibits notable concentration in mega-cap tech and communication stocks.
Dividend yield is modest at 1.03%, which may not satisfy investors prioritising high-income equity strategies.
Index methodology and detailed sector weights are not available, restricting a full independent analysis of risk exposure.

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About FTEC and VOO

FTEC (FTEC)

The Fidelity MSCI Information Tech ETF offers investors a cost-effective way to gain exposure to the U.S. technology sector. With an expense ratio of just 0.08%, this fund tracks a broad index of American companies involved in software, hardware, and services. Holding 298 different stocks, it provides diversified access to the sector's largest players as well as smaller emerging firms. Since its inception in October 2013, the fund has amassed substantial assets, currently exceeding USD 21 billion. Investors should note that while the fund offers low fees and wide coverage, its performance is directly tied to the technology sector's cyclical nature and growth prospects. Like all investments, values can rise and fall.

VOO (VOO)

VOO is Vanguard’s exchange-traded fund designed to track the S&P 500 Index, offering broad exposure to about 500 of the largest publicly traded US companies. It aims to replicate the index’s performance minus fees by holding the same stocks in similar proportions, making it a straightforward, passive way to access large‑cap US equities. Investors commonly use VOO as a core holding for long‑term growth or as a simple building block in a diversified portfolio. It typically offers high liquidity and regular dividend distributions from underlying companies. As with any equity investment, VOO’s value can rise or fall with the market, and past performance is not a guide to future returns. Fees, trading costs and potential tracking error reduce returns slightly. This information is general and educational only and not personalised financial advice — consider your own circumstances or speak to a qualified adviser before investing.

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FTEC vs VOO

Fund Snapshot