uploads///Portfolio Breakdown of the VMRGX

Vanguard Morgan Growth Fund’s Sector Composition in YTD 2016


Sep. 1 2016, Updated 8:06 a.m. ET

Vanguard Morgan Growth Fund overview

The Vanguard Morgan Growth Fund (VMRGX) invests in stocks of large-cap and mid-cap US companies. Its fund managers look for companies whose revenues or earnings are expected to grow more quickly than those of the average company.

A key feature of the fund is that it is managed by four advisers, each of whom follows a distinct investment strategy. Apart from using multiple advisers, the fund invests in over 300 stocks, spreading the assets across a variety of companies.

Oracle (ORCL), McDonald’s (MCD), Costco Wholesale (COST), CR Bard (BCR), and Vantiv (VNTV) were among the fund’s 307 holdings at the end of July. In July 2016, the fund was managing $11.4 billion in assets.

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Portfolio changes in the Vanguard Morgan Growth Fund

Information technology is by far the biggest invested sector in the Vanguard Morgan Growth Fund (VMRGX), forming over a third of the total portfolio. Consumer discretionary and healthcare are the other sectors that lie at the heart of VMRGX. Combined, these three sectors form 74.3% of the assets. No other sector forms 10% or more of the assets.

Compared to the Russell 3000 Growth Index, VMRGX is overweight in the information technology sector. Meanwhile, it is underweight in the consumer staples, financials, industrials, and materials sectors.

We’ve looked at the quarterly portfolios of VMRGX for the past three years through June 2016. Both consumer-focused sectors—discretionary and staples—form a bigger portion of the portfolio than they did three years ago.

The fund’s exposure to healthcare stocks has also increased, but it is lower than the 22% mark seen in 2Q15. A reduction in the industrials, energy, and materials sector has made way for the increase in the portfolio’s weight of information technology and telecoms services stocks.

In the next article, we’ll see whether this portfolio composition has helped the Vanguard Morgan Growth Fund – Investor Shares (VMRGX) in 2016 so far, and which sectors have contributed to its performance.


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