Morningstar Rating

ETF Research and Analysis

by Robert Goldsborough
Suitability
Vanguard Information Technology ETF VGT offers investors broad exposure to the technology sector. As a sector-specific exchange-traded fund, VGT should be viewed as a tactical investment, suitable only for the satellite   Read more 

Bull Case

This fund has a very high-quality portfolio. About 84% of VGT's investments are in companies that have economic moats, or firms that our equity analysts believe have durable competitive advantages.
The top holdings in this fund have strong balance sheets, which should support continued investment in R&D and growth strategies.
This ETF has the lowest expense ratio of any large and liquid technology-sector ETF. Read more 

Bear Case

The top-10 holdings account for 56% of this fund's portfolio, which means that this fund's performance and risk attributes are closely tied to just a handful of stocks.
A pullback in IT spending could weigh on the performance of this ETF.
The companies in this ETF operate in highly competitive industries characterized by rapid innovation that could quickly erode a company's economic moat. Read more 

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Broad Fixed-Income Exposure At a Low Cost 
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