Ought to Vanguard Mid-Cap Progress ETF (VOT) Be on Your Investing Radar?

Searching for broad publicity to the Mid Cap Progress phase of the US fairness market? It’s best to contemplate the Vanguard Mid-Cap Progress ETF (VOT), a passively managed trade traded fund launched on 08/17/2006.

The fund is sponsored by Vanguard. It has amassed belongings over $14.26 billion, making it one of many largest ETFs making an attempt to match the Mid Cap Progress phase of the US fairness market.

Why Mid Cap Progress

In comparison with giant and small cap corporations, mid cap companies are inclined to have greater development prospects and are much less risky, respectively, with market capitalization between $2 billion and $10 billion. Thus, corporations that fall underneath this class present a secure and growth-heavy funding.

Progress shares have greater than common gross sales and earnings development charges. Whereas these are anticipated to develop quicker than the broader market, in addition they have greater valuations. One thing to bear in mind is the upper degree of volatility that’s affiliated with development shares. When you think about development versus worth, development shares are normally the clear winner in sturdy bull markets however are inclined to fall flat in almost all different environments.

Prices

Since cheaper funds have a tendency to provide higher outcomes than costlier funds, assuming all different elements stay equal, it will be important for buyers to concentrate to an ETF’s expense ratio.

Annual working bills for this ETF are 0.07%, making it one of many least costly merchandise within the house.

It has a 12-month trailing dividend yield of 0.74%.

Sector Publicity and High Holdings

ETFs supply a diversified publicity and thus decrease single inventory danger however it’s nonetheless necessary to delve right into a fund’s holdings earlier than investing. Most ETFs are very clear merchandise and lots of disclose their holdings each day.

This ETF has heaviest allocation to the Data Expertise sector–about 23.10% of the portfolio. Industrials and Healthcare spherical out the highest three.

Taking a look at particular person holdings, Welltower Inc (WELL) accounts for about 2.49% of complete belongings, adopted by Palantir Applied sciences Inc (PLTR) and Amphenol Corp (APH).

The highest 10 holdings account for about 14.44% of complete belongings underneath administration.

Efficiency and Danger

VOT seeks to match the efficiency of the CRSP U.S. Mid Cap Progress Index earlier than charges and bills. The CRSP U.S. Mid Cap Progress Index measures the funding return of mid-capitalization development shares.

The ETF has misplaced about -7.40% to date this 12 months and was up about 6.45% within the final one 12 months (as of 04/18/2025). Prior to now 52-week interval, it has traded between $216.28 and $276.98.

The ETF has a beta of 1.16 and customary deviation of twenty-two.43% for the trailing three-year interval, making it a medium danger alternative within the house. With about 145 holdings, it successfully diversifies company-specific danger.

Alternate options

Vanguard Mid-Cap Progress ETF holds a Zacks ETF Rank of two (Purchase), which is predicated on anticipated asset class return, expense ratio, and momentum, amongst different elements. Due to this, VOT is a wonderful choice for buyers looking for publicity to the Type Field – Mid Cap Progress phase of the market. There are different further ETFs within the house that buyers may contemplate as effectively.

The iShares S&P Mid-Cap 400 Progress ETF (IJK) and the iShares Russell Mid-Cap Progress ETF (IWP) monitor an identical index. Whereas iShares S&P Mid-Cap 400 Progress ETF has $8.01 billion in belongings, iShares Russell Mid-Cap Progress ETF has $16.14 billion. IJK has an expense ratio of 0.17% and IWP fees 0.23%.

Backside-Line

Retail and institutional buyers more and more flip to passively managed ETFs as a result of they provide low prices, transparency, flexibility, and tax effectivity; these type of funds are additionally glorious autos for long run buyers.

To be taught extra about this product and different ETFs, display for merchandise that match your funding targets and browse articles on newest developments within the ETF investing universe, please go to Zacks ETF Center.