Skip to content

VV vs. VGK: What’s The Difference?

The Vanguard Large-Cap Index Fund ETF Shares (VV) and the Vanguard FTSE Europe Index Fund ETF Shares (VGK) are both among the Top 100 ETFs. VV is a Vanguard Large Blend fund and VGK is a Vanguard Europe Stock fund. So, what’s the difference between VV and VGK? And which fund is better?

The expense ratio of VV is 0.04 percentage points lower than VGK’s (0.04% vs. 0.08%). VV also has a higher exposure to the technology sector and a lower standard deviation. Overall, VV has provided higher returns than VGK over the past 11 years.

In this article, we’ll compare VV vs. VGK. We’ll look at performance and industry exposure, as well as at their fund composition and holdings. Moreover, I’ll also discuss VV’s and VGK’s portfolio growth, risk metrics, and annual returns and examine how these affect their overall returns.

TIP: Keep track of all your investments with Personal Capital. I use this amazing tool to aggregate all investments in one place and make sure I'm on track to financial freedom. Oh, and did I mention it's free? Try it out here (link to Personal Capital).

Summary

VVVGK
NameVanguard Large-Cap Index Fund ETF SharesVanguard FTSE Europe Index Fund ETF Shares
CategoryLarge BlendEurope Stock
IssuerVanguardVanguard
AUM37.65B25.7B
Avg. Return14.75%6.68%
Div. Yield1.26%2.52%
Expense Ratio0.04%0.08%

The Vanguard Large-Cap Index Fund ETF Shares (VV) is a Large Blend fund that is issued by Vanguard. It currently has 37.65B total assets under management and has yielded an average annual return of 14.75% over the past 10 years. The fund has a dividend yield of 1.26% with an expense ratio of 0.04%.

The Vanguard FTSE Europe Index Fund ETF Shares (VGK) is a Europe Stock fund that is issued by Vanguard. It currently has 25.7B total assets under management and has yielded an average annual return of 6.68% over the past 10 years. The fund has a dividend yield of 2.52% with an expense ratio of 0.08%.

VV’s dividend yield is 1.26% lower than that of VGK (1.26% vs. 2.52%). Also, VV yielded on average 8.07% more per year over the past decade (14.75% vs. 6.68%). The expense ratio of VV is 0.04 percentage points lower than VGK’s (0.04% vs. 0.08%).

FYI: The best way I've found to invest in ETFs is through M1 Finance. It's free and you even get an instant line of credit! Have a look here (link to M1 Finance).

Fund Composition

Industry Exposure

VV vs. VGK - Industry Exposure

VVVGK
Technology25.38%8.3%
Industrials8.39%15.58%
Energy2.62%4.3%
Communication Services11.68%5.09%
Utilities2.35%3.89%
Healthcare13.22%13.76%
Consumer Defensive6.06%11.39%
Real Estate2.7%2.57%
Financial Services13.82%15.85%
Consumer Cyclical11.65%11.6%
Basic Materials2.13%7.67%

The Vanguard Large-Cap Index Fund ETF Shares (VV) has the most exposure to the Technology sector at 25.38%. This is followed by Financial Services and Healthcare at 13.82% and 13.22% respectively. Utilities (2.35%), Energy (2.62%), and Real Estate (2.7%) only make up 7.67% of the fund’s total assets.

VV’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Consumer Cyclical, Communication Services, and Healthcare stocks at 6.06%, 8.39%, 11.65%, 11.68%, and 13.22%.

The Vanguard FTSE Europe Index Fund ETF Shares (VGK) has the most exposure to the Financial Services sector at 15.85%. This is followed by Industrials and Healthcare at 15.58% and 13.76% respectively. Utilities (3.89%), Energy (4.3%), and Communication Services (5.09%) only make up 13.28% of the fund’s total assets.

VGK’s mid-section with moderate exposure is comprised of Basic Materials, Technology, Consumer Defensive, Consumer Cyclical, and Healthcare stocks at 7.67%, 8.3%, 11.39%, 11.6%, and 13.76%.

VV is 17.08% more exposed to the Technology sector than VGK (25.38% vs 8.3%). VV’s exposure to Financial Services and Healthcare stocks is 2.03% lower and 0.54% lower respectively (13.82% vs. 15.85% and 13.22% vs. 13.76%). In total, Utilities, Energy, and Real Estate also make up 3.09% less of the fund’s holdings compared to VGK (7.67% vs. 10.76%).

Holdings

VV - Holdings

VV HoldingsWeight
Apple Inc5.7%
Microsoft Corp5.35%
Amazon.com Inc3.87%
Facebook Inc Class A2.19%
Alphabet Inc Class A1.93%
Alphabet Inc Class C1.81%
Tesla Inc1.37%
Berkshire Hathaway Inc Class B1.3%
NVIDIA Corp1.24%
JPMorgan Chase & Co1.24%

VV’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 5.7%, 5.35%, 3.87%, 2.19%, and 1.93%.

Alphabet Inc Class C (1.81%), Tesla Inc (1.37%), and Berkshire Hathaway Inc Class B (1.3%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the VV’s holdings at 1.24% and 1.24%.

VGK - Holdings

VGK HoldingsWeight
Nestle SA2.82%
ASML Holding NV2.2%
Roche Holding AG2.13%
LVMH Moet Hennessy Louis Vuitton SE1.58%
Novartis AG1.55%
AstraZeneca PLC1.27%
SAP SE1.25%
Unilever PLC1.23%
Novo Nordisk A/S B1.09%
Siemens AG0.96%

VGK’s Top Holdings are Nestle SA, ASML Holding NV, Roche Holding AG, LVMH Moet Hennessy Louis Vuitton SE, and Novartis AG at 2.82%, 2.2%, 2.13%, 1.58%, and 1.55%.

AstraZeneca PLC (1.27%), SAP SE (1.25%), and Unilever PLC (1.23%) have a slightly smaller but still significant weight. Novo Nordisk A/S B and Siemens AG are also represented in the VGK’s holdings at 1.09% and 0.96%.

NOTE: The easiest way to add diversification to your portfolio is to invest in real estate through Fundrise. You can become private real estate investor without the burden of property management! Check it out here (link to Fundrise).

Risk Analysis

VVVGK
Mean Return1.240.61
R-squared99.8692.76
Std. Deviation13.7516.65
Alpha-0.080.45
Beta1.011.06
Sharpe Ratio1.040.4
Treynor Ratio14.145.12

The Vanguard Large-Cap Index Fund ETF Shares (VV) has a Standard Deviation of 13.75 with a Beta of 1.01 and a Mean Return of 1.24. Its R-squared is 99.86 while VV’s Treynor Ratio is 14.14. Furthermore, the fund has a Sharpe Ratio of 1.04 and a Alpha of -0.08.

The Vanguard FTSE Europe Index Fund ETF Shares (VGK) has a Treynor Ratio of 5.12 with a Standard Deviation of 16.65 and a Mean Return of 0.61. Its Sharpe Ratio is 0.4 while VGK’s Alpha is 0.45. Furthermore, the fund has a R-squared of 92.76 and a Beta of 1.06.

VV’s Mean Return is 0.63 points higher than that of VGK and its R-squared is 7.10 points higher. With a Standard Deviation of 13.75, VV is slightly less volatile than VGK. The Alpha and Beta of VV are 0.53 points lower and 0.05 points lower than VGK’s Alpha and Beta.

FYI: Another great way to get exposure to the real estate sector is by investing in real estate debt. Groundfloor offers fantastic short-term, high-yield bonds that can add diversification to your portfolio!

Performance

Annual Returns

VV vs. VGK - Annual Returns

YearVVVGK
202020.99%6.5%
201931.39%24.26%
2018-4.44%-14.79%
201722.03%27.06%
201611.65%-0.59%
20151.07%-1.87%
201413.39%-6.56%
201332.65%24.93%
201216.09%21.01%
20111.58%-11.49%
201015.81%5.01%

VV had its best year in 2013 with an annual return of 32.65%. VV’s worst year over the past decade yielded -4.44% and occurred in 2018. In most years the Vanguard Large-Cap Index Fund ETF Shares provided moderate returns such as in 2014, 2010, and 2012 where annual returns amounted to 13.39%, 15.81%, and 16.09% respectively.

The year 2017 was the strongest year for VGK, returning 27.06% on an annual basis. The poorest year for VGK in the last ten years was 2018, with a yield of -14.79%. Most years the Vanguard FTSE Europe Index Fund ETF Shares has given investors modest returns, such as in 2016, 2010, and 2020, when gains were -0.59%, 5.01%, and 6.5% respectively.

Portfolio Growth

VV vs. VGK - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
VV$10,000$42,97014.75%
VGK$10,000$18,3506.68%

A $10,000 investment in VV would have resulted in a final balance of $42,970. This is a profit of $32,970 over 11 years and amounts to a compound annual growth rate (CAGR) of 14.75%.

With a $10,000 investment in VGK, the end total would have been $18,350. This equates to a $8,350 profit over 11 years and a compound annual growth rate (CAGR) of 6.68%.

VV’s CAGR is 8.07 percentage points higher than that of VGK and as a result, would have yielded $24,620 more on a $10,000 investment. Thus, VV outperformed VGK by 8.07% annually.


Current recommendations:

Over the past years, I have discovered several tools and products that have helped me tremendously on my path to financial freedom:

P.S.: The links below are affiliate links, which means I receive a small commission at no extra cost to you when you sign up for one of the services. Thank you for your support!

1)Personal Capital is simply the best tool out there to track your net worth and plan for financial freedom. Just their retirement planner alone has become an invaluable tool to keep myself on track financially. Try it out, it's free!

2) Take a look at M1 Finance, my favorite broker. I love how easy it is to invest and maintain my portfolio with them. I can set up automatic transfers, rebalance my portfolio with one click and even borrow up to 35% of my assets at super low interest rates!

3) Fundrise is by far the best way I've found to invest in Real Estate. You can diversify your portfolio by investing in their eREITs or even allocate capital to individual properties (without the hassle of managing tenants!).

4) Groundfloor is another great way to get exposure to the real estate sector by investing in short-term, high-yield real estate debt. Current returns are >10% and you can get started with just $10.

5) If you are interested in startup investing, check out Mainvest. I've started allocating a small amount of assets to invest in and support small businesses. Return targets are between 10-25% and you can start with just $100!

To see all of my most up-to-date recommendations, check out the Recommended Tools section.

Leave a Reply

Your email address will not be published. Required fields are marked *