VUG vs. RSP: Seriously?

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Okay, so you’re looking at these ETFs, right? The Vanguard Growth ETF (VUG 0.02%) and the Invesco S&P 500 Equal Weight ETF (RSP 0.26%). It’s not rocket science, but honestly, the whole thing just feels…off. VUG is all tech, all the time. It’s like they said, “Let’s just throw everything at Nvidia and hope for the best.” And RSP? They’re trying to be fair. Equal weight. As if the market cares about fairness. It’s a jungle out there!

The whole point of investing is to make money, but these fund descriptions…they’re just asking for trouble. They’re presenting it like a choice between being responsible and, well, not. It’s infuriating. Like they’re subtly judging your life choices.

Snapshot (Cost & Size)

Metric VUG RSP
Issuer Vanguard Invesco
Expense ratio 0.04% 0.20%
1-yr return (as of Jan. 13, 2026) 21.14% 13.23%
Dividend yield 0.41% 1.64%
Beta (5Y monthly) 1.21 1.00
AUM $352 billion $76 billion

So, VUG is cheaper, fine. But RSP actually pays you something. It’s like they’re acknowledging that your money has value. It’s a small victory, honestly. But then you look at the AUM…$352 billion? What is everyone doing throwing money at the same five companies? It’s madness!

Performance & Risk Comparison

Metric VUG RSP
Max drawdown (5 y) -35.61% -21.39%
Growth of $1,000 over 5 years $1,934 $1,501

Look at that drawdown. Thirty-five percent! That’s a punch to the gut. VUG made more money, sure, but at what cost? My blood pressure? The potential for a full-blown panic attack? And they expect you to just accept that level of risk? It’s outrageous!

What’s Inside

RSP has 504 stocks. Five hundred and four! It’s like they just threw darts at a list. It’s diversification for the sake of diversification. At least it’s not all riding on whatever Elon Musk is tweeting about today. It’s 16% tech, 15% industrials…it’s…sensible. Almost too sensible. It feels like they’re trying to lull you into a false sense of security.

VUG? One hundred and sixty stocks. And over half of that is tech? Apple, Nvidia, Microsoft…it’s the same three companies every time. It’s like they’re saying, “We’ve already made up our minds, so just go with it.” The top three holdings make up over 32% of the fund. Thirty-two percent! That’s not diversification; that’s gambling with other people’s money!

For more guidance on ETF investing, check out the full guide at this link. (As if a “full guide” will solve everything. It won’t. Trust me.)

What This Means for Investors

RSP is the responsible one. It spreads the risk around. It’s the kind of fund your accountant would recommend. It’s boring, but safe. VUG is the thrill-seeker. It’s all-in on tech, hoping for a quick payoff. It’s the kind of fund that will keep you up at night.

Look, I get it. Everyone wants to make money. But there’s a difference between investing and speculating. VUG is speculating. It’s betting that tech will continue to dominate the market. And what if it doesn’t? What then? You’re left holding the bag.

VUG outperformed RSP, yes, but with a higher beta and a deeper max drawdown, it also experienced more severe price swings. It’s like they’re saying, “We’ll give you higher returns, but you have to be okay with losing a significant portion of your investment.” It’s a terrible trade-off.

RSP’s expense ratio is higher, but it offers a significantly higher dividend yield. It’s like they’re saying, “We’ll take a little bit more of your money, but we’ll give you something in return.” It’s a small victory, honestly.

Which one should you choose? Honestly, I don’t know. It depends on your risk tolerance and your investment goals. But whatever you do, don’t let anyone tell you that there’s a right answer. There isn’t. It’s all just a crapshoot.

Glossary

ETF: Exchange-traded fund that holds a basket of assets and trades like a stock on exchanges. (Like we needed a definition for that.)
Expense ratio: Annual fund operating costs expressed as a percentage of the fund’s average assets. (The money they take from you.)
Dividend yield: Annual dividends paid by a fund divided by its current share price, expressed as a percentage. (A tiny little thank you for letting them manage your money.)
Beta: Measure of a fund’s volatility compared with the overall market, typically the S&P 500. (A fancy way of saying “how much this thing is going to swing around.”)
AUM: Assets under management; the total market value of all assets a fund manages. (The amount of money they’re playing with.)
Max drawdown: Largest peak-to-trough decline in a fund’s value over a specified period. (How much you could lose.)
Total return: Investment performance including price changes plus all dividends and distributions, assuming reinvestment. (The bottom line.)
Equal weight index: Index where each constituent receives the same weighting, regardless of company size. (Trying to be fair.)
Sector concentration: Degree to which a fund’s holdings are focused in a small number of industries or sectors. (Putting all your eggs in one basket.)
Large-cap: Companies with relatively large market values, typically tens or hundreds of billions of dollars. (The big boys.)
Growth stocks: Companies expected to grow earnings or revenues faster than the overall market, often reinvesting profits. (Hoping for a quick payoff.)
Drawdown: Decline from a portfolio’s or fund’s recent peak value to a subsequent low point. (When things go south.)

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2026-01-17 22:34