What is the key difference between a mid-cap blend ETF and a mid-cap growth ETF?

A mid-cap blend ETF, like Vanguard Mid-Cap ETF (VO), combines growth and value characteristics within medium-sized companies. In contrast, a mid-cap growth ETF, such as Vanguard Mid-Cap Growth ETF (VOT), focuses exclusively on companies exhibiting strong growth potential. This structural distinction influences their holdings and performance drivers. While both target the mid-cap segment, the blend approach seeks balance between value and growth, whereas the growth approach tilts entirely toward companies expected to expand earnings and revenues faster than the average. This fundamental difference shapes the investment thesis for each fund.

How do expense ratios impact the net returns of ETFs like VO and VOT?

Expense ratios represent the annual fee charged by a fund to manage investor assets, deducted directly from the fund's returns. For instance, VO charges 0.03%, while VOT charges 0.05%. Although the difference of 0.02 percentage points appears minor, it compounds over time, slightly reducing the net return for VOT shareholders relative to VO shareholders, assuming all other factors remain equal. Investors should view these fees as a permanent drag on performance, making lower-cost options like VO marginally more efficient in preserving capital over long holding periods compared to slightly higher-cost alternatives like VOT.

Which investment goal is typically associated with Vanguard Mid-Cap Growth ETF (VOT)?

VOT is typically associated with investors seeking capital appreciation through exposure to medium-sized companies with above-average growth metrics. Because it strictly targets growth stocks, it may offer higher potential returns during bull markets driven by innovation and expanding earnings. However, this focus can also lead to greater volatility compared to more diversified blends. Investors often choose funds like VOT when they have a longer time horizon and a higher risk tolerance, aiming to capture the upside potential of companies expected to outpace the broader mid-cap market in terms of revenue and earnings growth.

How does the dividend yield differ between VO and VOT?

VO offers a dividend yield of 1.33%, whereas VOT provides a lower yield of 0.61%. This disparity reflects their differing strategies: growth-oriented companies in VOT often reinvest profits to fuel expansion rather than distributing them as dividends. In contrast, the blend strategy of VO includes value stocks that frequently have more mature cash flows and higher payout ratios. Investors prioritizing income may find VO more attractive, while those focused on total return, including capital appreciation, might not view the lower yield in VOT as a drawback if it is outweighed by growth performance.

What level of concentration risk exists in the top holdings of VOT?

VOT exhibits higher concentration risk in its top holdings compared to VO. For example, Vertiv Holdings Co (VRT) and Howmet Aerospace Inc (HWM) each account for over 2% of VOT's assets, specifically 2.23% and 2.20% respectively. This weight is significantly higher than in VO, where these same stocks represent less than 1% of the fund. Greater concentration means VOT's performance is more sensitive to the movements of these specific companies. If one of these top holdings underperforms, it could have a more pronounced negative impact on the fund's overall value compared to the more evenly distributed VO.

Are there common holdings between Vanguard Mid-Cap ETF and Vanguard Mid-Cap Growth ETF?

Yes, there is notable overlap in their top ten holdings. Six companies appear in both lists: VRT, HWM, NET, STX, PWR, and CEG. This overlap occurs because many large mid-cap companies can exhibit both growth and value characteristics depending on market conditions. However, the weightings differ significantly. VOT allocates more heavily to these names due to its growth screen, while VO holds them as part of a broader, more balanced portfolio. This shared exposure means that both funds can react similarly to major economic shifts affecting these specific sectors and companies.

How does the inception date of an ETF like VOT relate to its history?

VOT was launched in August 2006, providing nearly two decades of operational history. While VO is older, having started in January 2004, both funds have survived various market cycles, including major downturns and recoveries. An established inception date allows investors to analyse long-term tracking error and performance consistency. Although neither fund's index tracking methodology is currently available, the length of time they have been in existence offers a reasonable basis for evaluating their structural resilience and management stability within the Vanguard family of products.

How is the mid-cap definition applied in these funds?

Mid-cap typically refers to companies with market capitalisations generally between $2 billion and $10 billion, though definitions can vary. Both VO and VOT focus on this segment, which is often considered a sweet spot offering a balance between the stability of large caps and the growth potential of small caps. However, the underlying index methodologies for both funds are not available in the provided data, so the precise criteria used to include or exclude specific companies remain undisclosed. Investors rely on the fund category designation to understand the general size exposure.

What does the Net Assets value tell us about VO compared to VOT?

VO has net assets of $108.0 billion, while VOT holds $19.6 billion. This significant difference indicates that VO is a much larger and more widely held fund within the Vanguard suite. Larger asset bases, like that of VO, often correlate with higher liquidity and potentially tighter bid-ask spreads due to greater trading volume. However, both are substantial funds with robust liquidity. The size difference primarily reflects the broader appeal of a mid-cap blend strategy compared to the more niche mid-cap growth focus, but it does not inherently imply one is riskier or less stable than the other.

Can investors rely on sector weights for these funds?

Currently, the sector weights for both VO and VOT are not available in the provided data. This lack of transparency regarding sector allocation means investors cannot precisely compare how diversified each fund is across industries like technology, healthcare, or consumer discretionary. While the top holdings offer some insight into their composition, the absence of full sector weight data requires investors to exercise caution. Without this information, understanding the complete risk profile related to industry concentration remains difficult, necessitating reliance on the available holdings and fund category descriptions.

How might market conditions affect VOT differently than VO?

Market conditions favouring growth stocks, such as low interest rate environments or periods of technological disruption, typically benefit VOT more than VO due to VOT's exclusive growth focus. Conversely, during periods where value stocks outperform, such as high inflation or economic uncertainty, VO's blend strategy may provide a cushion by holding value-oriented companies. This cyclical sensitivity means that the performance gap between VOT and VO often widens or narrows based on the prevailing market regime. Investors must recognise that VOT's performance is more leveraged to the growth factor's relative strength against value.

What is the significance of the shared top holdings for diversification?

The presence of shared top holdings like VRT, HWM, and NET in both funds means that owning both simultaneously may not provide as much diversification as expected. If an investor holds equal amounts of VO and VOT, their portfolio will have an increased combined exposure to these specific companies. While this doesn't necessarily negate the benefits of holding both if the goal is to capture different factors, it does concentrate risk. Investors should check the total weight of these overlapping stocks across their entire portfolio to ensure they are not inadvertently overexposed to a few mid-cap names.

VO vs VOT

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

Compare VO (Vanguard Mid-Cap ETF) and VOT (Vanguard Mid-Cap Growth ETF) on fees, holdings and dividends, while exploring how each fund tracks its market. VO charges a 0.03% expense ratio and holds $108.0 billion; VOT charges 0.05% and holds $19.6 billion. Educational content, not financial advice.

Fund Snapshot

Key Fund Metrics

Metric

VOT

0.03%

Expense Ratio

0.05%

1.33%

Dividend Yield

0.61%

$107.97B

Net Assets

$19.59B

288

Holdings

125

Jan 26, 2004

Inception Date

Aug 17, 2006

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Index Tracked

–

Mid-Cap Blend

Fund Category

Mid-Cap Growth

VO costs about $2.00 less per year for every $10,000 invested.

Shared Top Holdings

Holding	VO	VOT
VRTVertiv Holdings Co	0.95%	2.23%
HWMHowmet Aerospace Inc.	0.93%	2.20%
NETCloudflare, Inc.	0.93%	2.19%
STXSeagate Technology Holdings plc	0.89%	2.08%
PWRQuanta Services, Inc.	0.87%	2.04%
CEGConstellation Energy Corporation	0.85%	2.00%

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Investment Analysis

VO

Pros

VO offers a low expense ratio of 0.03% for mid-cap blend exposure.
pros2
The fund has a long history, with an inception date in January 2004.

Considerations

The specific index methodology is not available from the provided data.
cons2
Top holdings weight limits mean concentration risk is present.

VOT

Pros

VO T provides targeted mid-cap growth exposure with a 0.05% expense ratio.
pros2
Recent performance focus is evident given its inception date in August 2006.

Considerations

The specific index methodology is not available from the provided data.
cons2
Higher concentration in top holdings, such as VRT and HWM at over 2%, increases risk.

About VO and VOT

VO (VO)

The Vanguard Mid-Cap ETF (VO) offers investors broad exposure to the US mid-cap market through a low-cost, diversified approach. With net assets of approximately USD 107.97 billion and 288 holdings, this fund aims to track the performance of the mid-cap segment, balancing growth potential with stability. Investors appreciate its blend strategy, which combines value and growth characteristics within mid-sized companies. The fund features an expense ratio of 0.03%, making it an attractive option for cost-conscious investors. Its dividend yield stands at 1.33%, providing some income potential alongside capital growth opportunities. Inception date is January 26, 2004, reflecting a long-standing track record. Please note that values can rise and fall, and returns are not guaranteed. This fund may suit those seeking diversified mid-cap exposure but requires careful consideration of individual investment goals and risk tolerance.

VOT (VOT)

The Vanguard Mid-Cap Growth ETF (VOT) offers investors access to a diversified portfolio of US mid-cap companies, specifically those with growth characteristics. This fund is managed passively, aiming to track a mid-cap growth benchmark. With a very low expense ratio of 0.05%, it stands out as a cost-efficient way to include mid-cap growth stocks in a portfolio. The fund holds approximately 125 stocks, providing a balanced exposure to companies that may have higher growth potential than large-cap firms but are typically more established than small-cap ones. Launched in August 2006, it manages substantial net assets of USD 19.59 billion. While it pays a dividend yield of 0.61%, investors should note that the primary objective is capital appreciation through stock growth. As with any equity investment, values can fluctuate, and returns are not guaranteed.

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VO vs VOT

Fund Snapshot