Vanguard Growth ETF: A Top Choice for Large-Cap Growth Investors

1 No-Brainer Large-Cap Growth ETF to Buy Right Now for Less Than $200 | The Motley Fool

This ETF has outperformed major indexes in the past and is doing the same today. The S&P 500 not only confirmed a bull market earlier in the year, but it also delivered a very solid first half. The index rose by double digits, marking one of the best such periods in the past 25 years. This year's first half was the fifth best during that time, according to J.P. Morgan Wealth Management, with the index climbing more than 14%. And much of this movement was led by growth stocks as investors became more optimistic about the general economy -- and placed bets on the promising area of artificial intelligence (AI). But if you're looking to add some growth to your portfolio, don't worry; it's not too late to get in on the action. And here's even more good news: You don't have to invest thousands of dollars or do the heavy lifting needed to build a portfolio from scratch. Instead, with one purchase, you can gain exposure to more than 200 exciting growth stocks. This particular investment has proven itself, too, outperforming both the S&P 500 and the Nasdaq so far this year and over the past five years. What asset am I talking about? The Schwab U.S. Large-Cap Growth ETF (SCHG -2.64%), and you can pick up a share of this exchange-traded fund (ETF) right now for well under $200. Let's find out more. First, a quick note about ETFs. These are funds that trade on the market just like a stock, so you can buy them as you would a stock. The difference is, as mentioned, they offer you ownership of many equities according to a specific theme. This could be one particular industry, or, like the fund we'll talk about here, a focus on growth and market capitalization. Before you consider buying an ETF, though, it's important to remember one other point that separates these assets from stocks, and that's cost. This is because they are managed either actively or passively, resulting in fees. (Passively managed funds attempt to mimic the performance of a benchmark, while actively managed funds try to beat the benchmark.) You'll want to choose an ETF with an expense ratio of less than 1% so that these costs won't eat heavily into your returns over time. And this brings me back to the Schwab U.S. Large-Cap Growth ETF, which easily fits our criteria, with an expense ratio of only 0.04%. This passively managed fund aims to replicate the returns of the Dow Jones U.S. Large-Cap Growth Total Stock Market index. This ETF not only mimics its benchmark but, as mentioned earlier, it's also shown its ability to generate returns superior to the S&P 500 and the Nasdaq this year and over time. For example, the ETF has advanced 25% in 2024 so far and 143% over the past five years. That's compared to gains of 18% and 87%, respectively, for the S&P 500. As you might have guessed, the Schwab ETF is heavily invested in today's top growth industry: Information technology companies make up more than 46% of the portfolio. Tech businesses, especially those active in AI, have driven stock market gains in recent years, and that's helped this ETF to climb. Among the fund's biggest positions are Microsoft, Nvidia, and Amazon -- companies that already are benefiting from demand for AI products and services. But with its broad focus on large-cap growth stocks, you don't have to worry about being too heavily exposed to only one sector or technology. For example, pharmaceutical giant Eli Lilly is among the ETF's top 10 holdings. The company has generated double-digit revenue gains in recent quarters thanks to its in-demand weight loss drugs. And the ETF is invested across 11 different industries, with sectors like consumer discretionary and healthcare each making up more than 12% of the fund. So, by investing in this ETF, you're adding exposure to today's high-powered AI players, as well as a broad selection of growth stocks in a variety of industries to your portfolio. Bull markets historically have lasted much longer than bear markets, so today's growth environment may have much further to go, and investing in the Schwab ETF will offer you an opportunity to benefit from that. Even better, this fund's long-term track record and the diversity of its holdings mean it also could deliver over time, and that makes it a no-brainer growth buy right now.

1 No-Brainer Large-Cap Growth ETF to Buy Right Now for Less Than $200

The S&P 500 not only confirmed a bull market earlier in the year, but it also delivered a very solid first half. The index rose by double digits, marking one of the best such periods in the past 25 years. This year's first half was the fifth best during that time, according to J.P. Morgan Wealth Management, with the index climbing more than 14%. And much of this movement was led by growth stocks as investors became more optimistic about the general economy -- and placed bets on the promising area of artificial intelligence (AI). But if you're looking to add some growth to your portfolio, don't worry; it's not too late to get in on the action. And here's even more good news: You don't have to invest thousands of dollars or do the heavy lifting needed to build a portfolio from scratch. Instead, with one purchase, you can gain exposure to more than 200 exciting growth stocks. This particular investment has proven itself, too, outperforming both the S&P 500 and the Nasdaq so far this year and over the past five years. What asset am I talking about? The Schwab U.S. Large-Cap Growth ETF (NYSEMKT: SCHG), and you can pick up a share of this exchange-traded fund (ETF) right now for well under $200. Let's find out more. First, a quick note about ETFs. These are funds that trade on the market just like a stock, so you can buy them as you would a stock. The difference is, as mentioned, they offer you ownership of many equities according to a specific theme. This could be one particular industry, or, like the fund we'll talk about here, a focus on growth and market capitalization. Before you consider buying an ETF, though, it's important to remember one other point that separates these assets from stocks, and that's cost. This is because they are managed either actively or passively, resulting in fees. (Passively managed funds attempt to mimic the performance of a benchmark, while actively managed funds try to beat the benchmark.) You'll want to choose an ETF with an expense ratio of less than 1% so that these costs won't eat heavily into your returns over time. And this brings me back to the Schwab U.S. Large-Cap Growth ETF, which easily fits our criteria, with an expense ratio of only 0.04%. This passively managed fund aims to replicate the returns of the Dow Jones U.S. Large-Cap Growth Total Stock Market index. Outperforming the S&P 500 and Nasdaq This ETF not only mimics its benchmark but, as mentioned earlier, it's also shown its ability to generate returns superior to the S&P 500 and the Nasdaq this year and over time. For example, the ETF has advanced 25% in 2024 so far and 143% over the past five years. That's compared to gains of 18% and 87%, respectively, for the S&P 500. As you might have guessed, the Schwab ETF is heavily invested in today's top growth industry: Information technology companies make up more than 46% of the portfolio. Tech businesses, especially those active in AI, have driven stock market gains in recent years, and that's helped this ETF to climb. Among the fund's biggest positions are Microsoft, Nvidia, and Amazon -- companies that already are benefiting from demand for AI products and services. Exposure to many industries But with its broad focus on large-cap growth stocks, you don't have to worry about being too heavily exposed to only one sector or technology. For example, pharmaceutical giant Eli Lilly is among the ETF's top 10 holdings. The company has generated double-digit revenue gains in recent quarters thanks to its in-demand weight loss drugs. And the ETF is invested across 11 different industries, with sectors like consumer discretionary and healthcare each making up more than 12% of the fund. So, by investing in this ETF, you're adding exposure to today's high-powered AI players, as well as a broad selection of growth stocks in a variety of industries to your portfolio. Bull markets historically have lasted much longer than bear markets, so today's growth environment may have much further to go, and investing in the Schwab ETF will offer you an opportunity to benefit from that. Even better, this fund's long-term track record and the diversity of its holdings mean it also could deliver over time, and that makes it a no-brainer growth buy right now. Should you invest $1,000 in Schwab Strategic Trust - Schwab U.s. Large-Cap Growth ETF right now? Before you buy stock in Schwab Strategic Trust - Schwab U.s. Large-Cap Growth ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Schwab Strategic Trust - Schwab U.s. Large-Cap Growth ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $774,281!* Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Adria Cimino has positions in Amazon. The Motley Fool has positions in and recommends Amazon, JPMorgan Chase, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. 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