If you're interested in broad exposure to the Large Cap Value segment of the US equity market, look no further than the Vanguard Mega Cap Value Index Fund ETF Shares (MGV), a passively managed exchange traded fund launched on December 17, 2007.
The fund is sponsored by Vanguard. It has amassed assets over $13.05 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. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain 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 1.86%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector -- about 23.2% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Jpmorgan Chase & Co (JPM) accounts for about 3.86% of total assets, followed by Exxon Mobil Corp (XOM) and Berkshire Hathaway Inc (BRK/B).
The top 10 holdings account for about 23.25% 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 return is roughly 17.41% so far this year and is up roughly 25.39% in the last one year (as of 07/07/2026). In the past 52-week period, it has traded between $129.46 and $165.02.
The ETF has a beta of 0.72 and standard deviation of 11.85% for the trailing three-year period, making it a medium risk choice in the space. With about 123 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 an outstanding 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 $97.34 billion in assets, Vanguard Value Index Fund ETF Shares has $185.42 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.
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Vanguard Mega Cap Value Index Fund ETF Shares (MGV): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).