Trying to decide between VOO and VOOG for your investment portfolio? These two popular Vanguard ETFs offer different approaches to tracking the S&P 500, but choosing the right one can significantly impact your returns and align with your financial goals.
VOO vs VOOG: Which Vanguard ETF Is Better for Your Portfolio in 2025?
This comprehensive comparison will help you understand the key differences and make an informed decision on which ETF best fits your investment strategy in 2025. Let's dive in!
What is VOO?
The Vanguard S&P 500 ETF (VOO) is one of the most popular exchange-traded funds that tracks the performance of the S&P 500 index. Launched in 2010, VOO provides investors with exposure to 500 of the largest U.S. companies, representing about 80% of the available market capitalization.
VOO is designed to give investors broad market exposure through a single investment vehicle. With an extremely low expense ratio of just 0.03%, it's one of the most cost-effective ways to invest in the entire S&P 500 index. This fund follows a full replication strategy, meaning it attempts to hold all the stocks in the S&P 500 index in the same proportions.
What is VOOG?
The Vanguard S&P 500 Growth ETF (VOOG) takes a more targeted approach. Rather than tracking the entire S&P 500, VOOG specifically focuses on growth stocks within the index. These are companies that typically show above-average growth in earnings, sales, and return on equity.
VOOG holds approximately 230-260 stocks, which is roughly half of what VOO holds. These companies are selected based on growth factors determined by the S&P 500 Growth Index methodology. The expense ratio for VOOG is 0.10%, slightly higher than VOO but still very competitive in the ETF market.
Key Differences Between VOO and VOOG
| Feature | VOO | VOOG |
|---|---|---|
| Investment Approach | Tracks the entire S&P 500 index (broad exposure) | Tracks only growth stocks within the S&P 500 |
| Expense Ratio | 0.03% ($3 per $10,000 invested) | 0.10% ($10 per $10,000 invested) |
| Number of Holdings | 500+ stocks | 230-260 stocks |
| Technology Allocation | ~25-30% (2025) | ~40-45% (2025) |
| Dividend Yield | ~1.4% (2025) | ~0.9% (2025) |
| Portfolio Turnover | 2-4% annually | 5-7% annually |
| Risk Level | Moderate | Moderate-High |
| Best Market Conditions | All market conditions; slightly better in value-oriented markets | Bull markets, economic expansion, low interest rates |
1. Investment Approach
VOO: Provides broad market exposure across all 500 companies in the S&P 500, including both value and growth stocks.
VOOG: Focuses specifically on growth-oriented companies within the S&P 500, offering more concentrated exposure to stocks with higher growth potential.
2. Expense Ratio
VOO: 0.03% expense ratio (just $3 annually per $10,000 invested)
VOOG: 0.10% expense ratio ($10 annually per $10,000 invested)
3. Portfolio Composition
VOO: Contains all 500+ stocks in the S&P 500, with larger allocations to companies with larger market capitalizations.
VOOG: Contains approximately 230-260 growth-oriented stocks from the S&P 500, with a higher concentration in sectors like technology, consumer discretionary, and communication services.
4. Sector Allocation
VOO: More balanced sector allocation, though still has significant technology exposure (around 25-30% in 2025).
VOOG: Heavily weighted toward technology (approximately 40-45% in 2025), with less exposure to traditionally defensive sectors like utilities, consumer staples, and energy.
5. Performance Characteristics
VOO: Tends to be less volatile with more consistent returns over long periods.
VOOG: Typically outperforms during bull markets but may experience deeper drawdowns during market corrections.
Performance Comparison: VOO vs VOOG
Historical performance shows that growth stocks (VOOG) tend to outperform the broader market (VOO) during bull markets and economic expansions, particularly in low-interest-rate environments. However, VOO often provides more stability during market downturns and may outperform when value stocks come back into favor.
Here's how these ETFs have performed in recent years:
- 1-Year Performance (2024-2025): VOOG outperformed VOO by approximately 3-5% as technology and growth stocks continued their strong performance.
- 3-Year Performance (2022-2025): VOOG averaged annual returns about 2% higher than VOO, largely due to the strong performance of large technology companies.
- 5-Year Performance (2020-2025): VOOG outperformed VOO by an average of 2-3% annually, though with greater volatility.
- 10-Year Performance (2015-2025): VOOG has generally outperformed VOO, but the difference narrows over longer time horizons.
It's important to note that past performance does not guarantee future results, and periods of outperformance can be followed by underperformance as market conditions change.
Which ETF is Better for Your Portfolio?
Choose VOO if:
- You want broader market exposure with less sector concentration risk
- You prefer lower volatility and more consistent returns
- You're looking for the absolute lowest cost S&P 500 exposure
- You're planning for very long-term investing (10+ years) and want simplicity
- You're concerned about overvaluation in growth stocks
- You want a slightly higher dividend yield (approximately 1.4% vs. 0.9% for VOOG in 2025)
Choose VOOG if:
- You have a higher risk tolerance and longer time horizon
- You believe growth companies will continue to outperform
- You want more exposure to innovative, technology-oriented companies
- You're comfortable with potentially higher volatility for higher expected returns
- You already have exposure to value stocks through other investments
- You're investing in a bull market or economic expansion period
Tax Efficiency Considerations
Both VOO and VOOG are structured as ETFs, making them relatively tax-efficient compared to mutual funds. However, there are some nuances to consider:
- Capital Gains Distributions: VOO typically has lower portfolio turnover (around 2-4% annually) than VOOG (around 5-7% annually), potentially resulting in slightly fewer capital gains distributions.
- Dividend Taxation: VOO has a slightly higher dividend yield than VOOG, which means slightly higher dividend taxes in taxable accounts.
- Tax-Loss Harvesting: Both ETFs can be used for tax-loss harvesting strategies, though they cannot be used as direct replacements for each other due to IRS wash sale rules.
For most investors, these tax differences are minimal and shouldn't be the primary factor in choosing between these ETFs.
Portfolio Integration Strategies
Rather than viewing VOO and VOOG as mutually exclusive choices, many investors find value in incorporating both into their portfolios. Here are some common strategies:
1. Core-Satellite Approach
Use VOO as your "core" U.S. large-cap holding (e.g., 70-80% of your U.S. large-cap allocation) and VOOG as a "satellite" position (20-30%) to potentially enhance returns.
2. Age-Based Allocation
Younger investors with longer time horizons might allocate more heavily toward VOOG, while gradually shifting toward VOO as retirement approaches.
3. Market Timing Strategy (Advanced)
Some sophisticated investors adjust their allocations between VOO and VOOG based on economic conditions, increasing VOOG exposure during expansionary periods and shifting toward VOO during late-cycle or recessionary environments.
4. Index Diversification
Use VOO alongside other ETFs that focus on different segments like mid-caps, small-caps, or international markets, while using VOOG for targeted growth exposure.
If you're interested in learning more about how to track your investments across different funds, check out these investment portfolio trackers that can help you monitor performance and maintain your desired allocations.
Common Questions About VOO and VOOG
Are VOO and VOOG Good for Beginners?
Yes, both ETFs are suitable for beginners, though VOO may be slightly more appropriate for those just starting out due to its broader diversification and lower volatility. If you're new to investing, you might want to explore some stock market basics courses to build a stronger foundation.
Can VOO and VOOG Be Held in Retirement Accounts?
Absolutely. Both ETFs are excellent options for IRAs, 401(k)s, and other retirement accounts. Since these accounts provide tax advantages, the slightly higher turnover in VOOG becomes less of a concern.
How Much of My Portfolio Should Be in These ETFs?
This depends on your overall asset allocation strategy. Many financial advisors suggest that U.S. large-cap stocks (whether through VOO, VOOG, or similar ETFs) should make up anywhere from 30-60% of an equity portfolio, depending on your age, risk tolerance, and other factors.
Are There Alternatives to VOO and VOOG?
Yes, several alternatives exist:
- SPY (SPDR S&P 500 ETF) - The oldest and most liquid S&P 500 ETF
- IVW (iShares S&P 500 Growth ETF) - Direct competitor to VOOG
- SPYG (SPDR Portfolio S&P 500 Growth ETF) - Another growth-focused alternative
- QQQ (Invesco QQQ Trust) - Tracks the Nasdaq-100, with even heavier tech exposure than VOOG
For a comprehensive overview of all your options, check out our guide to the best ETFs in the USA.
How to Buy VOO and VOOG
Both ETFs can be purchased through most brokerage platforms with no commission fees. Here's how to get started:
1. Choose a Brokerage
Popular options include Vanguard, Fidelity, Charles Schwab, Robinhood, and many others. For a detailed comparison, see our guide to investment apps.
2. Fund Your Account
Transfer money from your bank account to your brokerage account.
3. Place Your Order
Enter the ticker symbol (VOO or VOOG) and specify how many shares you want to purchase or how much money you want to invest.
4. Choose Your Order Type
A market order executes immediately at the current price, while a limit order executes only at or better than a price you specify.
5. Review and Confirm
Double-check your order details before finalizing the transaction.
Building a Broader ETF Portfolio
While VOO and VOOG focus on U.S. large-cap stocks, a well-rounded portfolio typically includes exposure to other asset classes. Consider complementing these ETFs with:
- International Stocks: VXUS (Vanguard Total International Stock ETF)
- Bonds: BND (Vanguard Total Bond Market ETF)
- Small-Cap Stocks: VB (Vanguard Small-Cap ETF)
- Real Estate: VNQ (Vanguard Real Estate ETF)
Understanding how index funds work and how they differ from individual stock picking can help you make more informed decisions about your overall portfolio construction.
Final Words
Both VOO and VOOG are excellent ETFs with strong track records, low costs, and solid management. Your choice between them should ultimately depend on your investment goals, risk tolerance, and market outlook. VOO offers broader diversification and slightly lower costs, making it ideal for those seeking a set-and-forget core holding. VOOG provides more targeted exposure to growth companies, potentially offering higher returns with somewhat higher volatility.
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Frequently Asked Questions About VOO vs VOOG
What is the difference between VOO and VOOG?
VOO (Vanguard S&P 500 ETF) tracks the entire S&P 500 index with 500+ stocks across all sectors, while VOOG (Vanguard S&P 500 Growth ETF) focuses only on growth-oriented companies within the S&P 500, holding approximately 230-260 stocks. VOO has a lower expense ratio (0.03%) compared to VOOG (0.10%) and provides broader market exposure, while VOOG offers more concentrated exposure to growth sectors like technology.
Which performs better, VOO or VOOG?
Historically, VOOG has outperformed VOO during bull markets and periods of economic expansion, particularly in low-interest-rate environments. Between 2020-2025, VOOG generated 2-3% higher annual returns than VOO on average. However, VOO tends to be more stable during market downturns and may outperform when value stocks come back into favor. Performance varies depending on market conditions and economic cycles.
Should I invest in VOO or VOOG in 2025?
For 2025, VOO may be better if you prefer broader diversification, lower costs, and less volatility. Choose VOOG if you have higher risk tolerance, believe growth stocks will continue to outperform, and want more exposure to technology and innovative companies. Many investors include both in their portfolios - VOO as a core holding and VOOG as a growth-oriented satellite position, adjusting the allocation based on market outlook and personal risk tolerance.
Can I hold both VOO and VOOG in my portfolio?
Yes, many investors hold both VOO and VOOG in their portfolios using various strategies. A common approach is the core-satellite strategy, using VOO as the core U.S. large-cap holding (70-80% of the U.S. large-cap allocation) and VOOG as a satellite position (20-30%) to potentially enhance returns. This provides broad market exposure while tilting toward growth stocks that may outperform in certain market conditions.
What are the expense ratios for VOO and VOOG?
VOO has an expense ratio of 0.03%, meaning you pay just $3 annually per $10,000 invested. VOOG has an expense ratio of 0.10%, costing $10 annually per $10,000 invested. While VOOG's expense ratio is slightly higher, both are considered very low compared to the ETF industry average of around 0.44% in 2025, making them both cost-effective investment options.
