ETF Versus

MGC vs VNQ

Vanguard Mega Cap Index Fund vs Vanguard Real Estate Index Fund ETF Shares

Last updated: 2026-04-02

MGC Vanguard

Vanguard Mega Cap Index Fund (MGC) is an exchange-traded fund issued by Vanguard that provides exposure to large-cap U.S. equities across growth and value styles. It charges a very low expense ratio of 0.05%. The fund offers a moderate dividend yield of 1.02%. Launched in 2007, the fund has a 19-year track record.

AUM: N/A ER: 0.05% Yield: 1.02% Since: 2007-12-27
VNQ Vanguard

Vanguard Real Estate Index Fund ETF Shares (VNQ) is an exchange-traded fund issued by Vanguard that provides exposure to U.S. real estate investment trusts (REITs) and real estate companies. It charges a low expense ratio of 0.12%. The fund offers an attractive dividend yield of 3.89%. Launched in 2004, the fund has a 22-year track record.

AUM: $65.8B ER: 0.12% Yield: 3.89% Since: 2004-09-29

Quick Verdict

MGC has a slightly lower expense ratio (0.05% vs 0.12%), saving about $139 per $10,000 over 10 years. Over the past year, MGC has significantly outperformed with a 16.9% return vs -1.5%. Income investors may prefer VNQ for its higher yield (3.9% vs 1.0%).

Key Metrics

Metric MGC VNQ
Expense Ratio 0.05% 0.12%
Dividend Yield 1.0% 3.9%
Fund Family Vanguard Vanguard
Category US Large Cap Blend US Real Estate

Performance Chart

Indexed to 100 at start (5-year comparison)

75 96 117 138 159 180 2021-04 2022-06 2023-10 2024-12 2026-04
MGC +65.4%
VNQ -4.4%

Performance Comparison

Period MGC VNQ Difference
1 Month -3.75% -5.96% +2.21%
3 Months -5.28% +1.37% -6.65%
6 Months -3.37% -0.92% -2.45%
YTD -5.28% +1.37% -6.65%
1 Year +16.90% -1.54% +18.44%
3 Years +65.43% +8.92% +56.51%
5 Years +65.38% -4.43% +69.81%

Fee Impact Over Time

Estimated fee cost difference assuming 8% annual returns

Investment Period MGC Fees VNQ Fees You Save
$10,000 10 years $100 $239 $139
$10,000 20 years $430 $1,025 $595
$10,000 30 years $1,388 $3,301 $1,912
$50,000 10 years $499 $1,193 $695
$50,000 30 years $6,941 $16,504 $9,562
$100,000 30 years $13,882 $33,007 $19,125

Risk Metrics

Based on 5 years of daily returns

Metric MGC VNQ
Annualized Volatility 17.2% 18.9%
Max Drawdown -26.6% -38.8%
Sharpe Ratio 0.41 -0.19

Dividend Comparison

Metric MGC VNQ
Annual Dividend (per share) $2.42 $3.49
Dividend Yield 1.02% 3.89%
Distribution Frequency Quarterly Quarterly

Top Holdings

VNQ Top Holdings

NameWeight
Vanguard Real Estate II Index Fund1451.51%
Welltower Inc707.58%
Prologis Inc688.22%
American Tower Corp476.51%
Equinix Inc456.02%
Simon Property Group Inc354.53%
Digital Realty Trust Inc321.26%
Realty Income Corp314.90%
CBRE Group Inc287.69%
Public Storage247.55%

Which One Should You Choose?

Choose MGC if...

you want the lowest fees and plan to buy and hold long-term. Over decades, the expense ratio difference compounds significantly.

Choose MGC if...

recent performance momentum matters to your strategy. Note that past performance doesn't guarantee future results.

Choose VNQ if...

you prioritize dividend income and want higher regular distributions from your portfolio.

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