The Vanguard Mega Cap Value Index Fund ETF Shares (MGV) was launched on December 17, 2007, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Value segment of the US equity market.
The fund is sponsored by Vanguard. It has amassed assets over $11.69 billion, making it one of the larger ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Companies that find themselves in the large cap category typically have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. While value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.05%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.89%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector -- about 23.6% of the portfolio. Healthcare and Industrials round out the top three.
Looking at individual holdings, Jpmorgan Chase & Co (JPM) accounts for about 4.72% of total assets, followed by Berkshire Hathaway Inc (BRK/B) and Exxon Mobil Corp (XOM).
The top 10 holdings account for about 18.63% of total assets under management.
Performance and Risk
MGV seeks to match the performance of the CRSP U.S. Mega Cap Value Index before fees and expenses. The CRSP U.S. Mega Cap Value Index is a float-adjusted, market-capitalization-weighted index designed to measure equity market performance of mega-capitalization value stocks in the United States.
The ETF has gained about 8.18% so far this year and is up about 17.39% in the last one year (as of 03/03/2026). In the past 52-week period, it has traded between $114.87 and $153.25.
The ETF has a beta of 0.76 and standard deviation of 12.03% for the trailing three-year period, making it a medium risk choice in the space. With about 126 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard Mega Cap Value Index Fund ETF Shares holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, MGV is a great option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value Index Fund ETF Shares (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $86.02 billion in assets, Vanguard Value Index Fund ETF Shares has $170.92 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.03%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Vanguard Mega Cap Value Index Fund ETF Shares (MGV): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
