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VGT vs. SPY: A Detailed Comparison

In the world of investing, exchange-traded funds (ETFs) have become increasingly popular due to their low fees, diversified holdings, and ease of trading. Two prominent ETFs that often draw comparisons are the Vanguard Information Technology ETF (VGT) and the SPDR S&P 500 ETF (SPY).

10 Year Comparison - $VGT 505.68% (blue) | $SPY 201.72% (orange)

Key Facts About $VGT and $SPY


Performance Comparison

Over the past 20 years, VGT has outperformed SPY, with an average annual return of 16.06% compared to SPY's 9.79%. This difference in performance can be attributed to VGT's focus on the technology sector, which has been one of the best-performing sectors in the market over the past two decades.

Riskiness and Drawdowns

VGT is generally considered to be a riskier investment than SPY due to its narrower focus on the technology sector. This means that VGT is more likely to experience larger fluctuations in price than SPY. However, VGT has also historically had slightly lower drawdowns than SPY, which means that it has not lost as much value during periods of market decline.

Which ETF is Right for You?

The best ETF for you will depend on your individual investment goals and risk tolerance. If you are comfortable with a higher level of risk and are looking for exposure to the technology sector, then VGT may be a good option for you. However, if you are a more risk-averse investor, then SPY may be a better choice.

SPY Lags with Underperforming Companies

One of the criticisms of SPY is that it is overweight in underperforming companies. As an index ETF, SPY tracks the performance of the entire S&P 500, which includes some companies that are struggling financially. This can drag down the overall performance of the ETF. VGT, on the other hand, is focused on companies that are leaders in the technology sector, which are more likely to be successful and outperform the market.


VGT and SPY are both well-established ETFs with long track records of success. However, they have different investment objectives and risk profiles. VGT is a more focused ETF that offers exposure to the technology sector, while SPY is a broader ETF that tracks the performance of the entire S&P 500. The best ETF for you will depend on your individual circumstances and investment goals.

Additional Data

Here is some additional data on the performance of VGT and SPY over the past 20 years:


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