How Vanguard’s Growth ETF Has Performed, Year by Year

VUG, Vanguard’s large-cap growth ETF, launched in January 2004 and has returned about 12.0% a year since, including reinvested dividends. That turned $10,000 into roughly $131,100 by early November 2026, more than 13 times the original investment.

Its record is one of the longest of any growth ETF. VUG has lived through the 2008 financial crisis, the long bull market that followed, the 2020 COVID crash, the 2022 bear market and the AI boom, and it beat the S&P 500 in 15 of its 21 full calendar years and in every rolling 10-year period since launch.

This guide tells VUG’s story year by year. It covers how the fund was built and how its index has changed, what happened in every calendar year since 2004, how far it fell in each major decline and how long it took to recover, and how it compared with the S&P 500, SCHG and QQQ.

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VUG at a Glance

All return figures in this guide are total returns, meaning they include dividends reinvested, unless stated otherwise. Past performance does not guarantee future results.

VUG Returns by Year

Over its 21 full calendar years, VUG finished higher in 18 and lower in three: 2008, 2018 and 2022. Two of those losses were severe, and both came when the market as a whole was falling.

VUG Returns Over 1, 3, 5, 10, 15 and 20 Years

The 3- to 20-year figures use full calendar years, so they will differ slightly from trailing figures quoted on fund pages, which change every day. VUG is one of the few growth ETFs old enough to have a 20-year record, and that record includes the 2008 crash.

Including 2026 changes the 10-year picture slightly. From the start of 2017 to November 2, 2026, almost 10 years, $10,000 grew to about $48,700 in VUG, against about $39,200 in the S&P 500.

Average Return vs Annualized Return

VUG’s simple average return across its 21 full calendar years was about 15.0%. Its annualized return over the same years, the rate it actually compounded at, was lower, at about 12.6%.

The gap comes from volatility. A 38% loss, like VUG’s in 2008, needs a gain of more than 60% just to get back to even, so big swings pull the compounded return below the simple average.

How Often VUG Had a Big Year

VUG gained more than 30% in six of its 21 full years. The S&P 500 did that only twice over the same period, in 2013 and 2019.

Its middle year, or median, was a gain of about 17.0%. But VUG’s returns ranged from a loss of 38.0% to a gain of 46.8%, and its typical year-to-year swing was about 22 percentage points, against about 17 for the S&P 500.

The Fund and the Index Behind It

VUG holds the largest US companies with the strongest growth characteristics, such as fast growth in earnings, sales and assets, and high valuations relative to earnings and book value. Holdings are weighted by company size, with no cap on any single stock, so the biggest growth companies dominate.

At the end of September 2026, NVIDIA made up about 13.5% of VUG, Apple about 12.5% and Microsoft about 9.7%. The top 10 holdings, including Alphabet, Broadcom, Amazon, Meta, AMD and Tesla, made up about 63% of the fund.

That concentration explains VUG’s history. When the largest technology companies rise, VUG rises faster than the market, and when they fall, it falls harder.

A Fund With Three Indexes

VUG is the ETF share class of the Vanguard Growth Index Fund, a mutual fund that dates back to 1992. When the ETF shares launched in January 2004, the fund tracked an MSCI growth index.

In 2013, Vanguard moved VUG and many of its other index funds to indexes run by the Center for Research in Security Prices (CRSP), largely to cut licensing costs. VUG tracked the CRSP US Large Cap Growth Index for the next 13 years.

In February 2026, Morningstar bought CRSP, and the CRSP indexes took the Morningstar name. On July 29, 2026, the fund was renamed the Vanguard Morningstar Growth ETF, but its ticker, its costs and the way its index picks stocks did not change.

The Launch: January 2004

VUG launched on January 26, 2004, as Vanguard expanded its range of low-cost ETFs, which it then called VIPERs. Investors could now buy Vanguard’s growth index fund on the stock exchange like a single share.

The timing was unusual. Growth stocks had only just begun to recover from the dot-com crash of 2000 to 2002, when many technology companies lost most of their value, and investors were still wary of them.

VUG gained about 5.0% in its first 11 months to the end of 2004. The leaders of that era were energy, industrial and financial companies, not the technology giants that dominate the fund today.

2005: A Slow Start

VUG returned about 5.0% in 2005, slightly ahead of the S&P 500’s 4.8%. The Federal Reserve kept raising interest rates, and oil prices climbed after Hurricane Katrina.

Growth stocks were still out of favor. Value companies, especially in energy and finance, did most of the work in the market.

By the end of 2005, an investor’s $10,000 from launch had grown to about $11,000.

2006: Value Stays in Front

2006 was one of VUG’s weaker years relative to the market. It returned about 9.2%, against the S&P 500’s 15.9%.

Banks, energy companies and other value stocks led again, helped by a booming housing market and strong commodity prices. VUG held relatively little of any of them.

By the end of 2006, the original $10,000 had grown to about $12,000.

2007: Growth Takes the Lead

2007 marked a turning point. As cracks appeared in the US housing market and subprime lending, bank stocks started to fall, and growth companies took over market leadership.

VUG returned about 12.5%, well ahead of the S&P 500’s 5.2%. Companies such as Apple and Google, both growing fast, were among its strongest holdings.

VUG’s price peaked on October 31, 2007. It would not see that level again for almost four years.

2008: The Financial Crisis

2008 was VUG’s worst year. As the housing crash turned into a global financial crisis, Lehman Brothers collapsed in September, credit markets froze, and stocks of every kind plunged.

VUG lost about 38.0%, slightly more than the S&P 500’s 36.8% but less than the Nasdaq-100’s 41.7%. Growth companies offered no shelter, and the fund’s $10,000 from launch fell to about $8,400, below its starting value.

From its October 2007 peak to its low on March 9, 2009, VUG’s price fell about 51.4%, its deepest decline to date. The US economy was in a deep recession.

2009: The Rebound

VUG’s low came on March 9, 2009. From there, a powerful recovery began, driven by government support for the banking system, near-zero interest rates and the Federal Reserve’s bond buying.

VUG returned about 39.0% for 2009, well ahead of the S&P 500’s 26.4%. Technology and consumer companies led the recovery.

By the end of 2009, the original $10,000 had climbed back to about $11,700. The new bull market would last almost 11 years.

2010: Climbing Back

VUG returned about 17.2% in 2010, ahead of the S&P 500’s 15.1%. The May 2010 flash crash and Europe’s debt crisis caused a scare, but cheap money kept stocks rising.

Apple, by now a leading holding, grew rapidly on the success of the iPhone and the launch of the iPad. Growth companies benefited from a recovering economy and very low interest rates.

By the end of 2010, an investor’s $10,000 from launch had grown to about $13,700.

2011: The Debt Crisis Year

VUG returned about 1.8% in 2011, almost level with the S&P 500’s 1.9%. VUG’s price finally regained its 2007 peak on July 7, 2011, about two years and four months after the low.

Within weeks, it was falling again. The United States lost its AAA credit rating in August, Europe’s debt crisis spread, and from July to early October VUG’s price fell about 18.7%.

The recovery came quickly. VUG regained its July peak by early February 2012, about four months after the low.

2012: Back in Front

VUG returned about 17.0% in 2012, slightly ahead of the S&P 500’s 16.0%. Apple became the world’s most valuable company and was a major driver of the fund’s gains.

The year ended with worries about the fiscal cliff, a set of tax rises and spending cuts due on January 1, 2013. A last-minute deal calmed markets.

By the end of 2012, the original $10,000 had grown to about $16,300.

2013: A Banner Year and a New Index

2013 was an outstanding year for almost every US stock fund. VUG returned about 32.5%, just ahead of the S&P 500’s 32.3%, as the Federal Reserve’s bond buying kept interest rates low.

It was also the year VUG switched to its CRSP index. The move changed some of the fund’s holdings at the edges, but it remained a large-cap growth fund weighted by company size.

By the end of 2013, an investor’s $10,000 from launch had grown to about $21,600, more than double its starting value.

2014: Steady Gains

VUG returned about 13.6% in 2014, almost level with the S&P 500’s 13.5%. The Federal Reserve wound down its bond buying, and oil prices began to collapse in the second half of the year.

VUG held very little in energy, so the oil crash barely touched it. Technology and healthcare companies led its gains.

By the end of 2014, the original $10,000 had grown to about $24,500.

2015: Narrow Leadership

VUG returned about 3.2% in 2015, ahead of the S&P 500’s 1.2%. The broad market was nearly flat, held up by a small group of large internet companies.

In August, China’s surprise currency devaluation triggered a sharp global sell-off. From July 2015 to February 2016, VUG’s price fell about 16.2%.

Its growth holdings, including Amazon, Alphabet and Facebook, were among the few big winners of the year. That narrow leadership kept VUG ahead of the market.

2016: Value Takes Over

2016 was one of VUG’s weaker years relative to the market. It returned about 6.3%, against the S&P 500’s 12.0%.

After oil prices hit bottom in February, energy, industrial and financial stocks rebounded. The surprise result of the US presidential election in November sparked a rally in banks and value stocks, areas where VUG held little.

VUG regained its July 2015 peak in July 2016, about five months after the low. FRC’s guide to growth stocks vs value stocks explains why the two styles take turns leading.

2017: Calm and Strong

2017 was one of the calmest years in market history, with steady gains and very few pullbacks. VUG returned about 27.7%, well ahead of the S&P 500’s 21.7%.

Large technology companies such as Apple, Amazon, Microsoft and Alphabet led the market. The corporate tax cuts passed in December 2017 added to optimism about company profits.

By the end of 2017, an investor’s $10,000 from launch had grown to about $34,400.

2018: A Late-Year Sell-Off

2018 started strong, but a larger decline came in the fourth quarter, driven by rising interest rates, trade tensions with China and fears of a slowing economy. From late September to Christmas Eve, VUG’s price fell about 22.7%.

Even so, VUG finished the year down only about 3.3%, a smaller loss than the S&P 500’s 4.6%, thanks to its gains earlier in the year. It regained its September peak in late April 2019.

2019: A Powerful Rebound

When the Federal Reserve paused its rate rises in early 2019 and then cut rates three times, markets rebounded strongly. VUG returned about 37.0%, ahead of the S&P 500’s 31.2%.

Lower interest rates make the future profits of fast-growing companies more valuable today, which tends to favor growth stocks. Apple and Microsoft both had exceptional years.

By the end of 2019, the original $10,000 had grown to about $45,500.

2020: The COVID Crash and a Record Rally

In early 2020, the spread of COVID-19 triggered the fastest market crash in history. From February 19 to March 23, VUG’s price fell about 31.8%.

The recovery was remarkable. As people worked, shopped and streamed from home, technology companies thrived, and VUG regained its February peak by June 9, less than three months after the low.

VUG returned about 40.3% for 2020, more than double the S&P 500’s 18.3%. It was VUG’s widest lead over the market in any year since launch.

2021: Neck and Neck

2021 was a strong year for almost everything. VUG returned about 27.4%, slightly behind the S&P 500’s 28.7%, as economies reopened and value stocks joined the rally.

By the end of 2021, an investor’s $10,000 from launch had grown to about $81,300. However, inflation was rising fast, and VUG’s price had peaked on November 19.

2022: The Inflation Bear Market

As inflation hit 40-year highs in 2022, the Federal Reserve raised interest rates at the fastest pace in decades. Rising rates hit growth stocks hardest, because they reduce the value of profits expected far in the future.

VUG lost about 33.2% for the year, against 18.2% for the S&P 500. From its November 2021 peak to its low on December 28, 2022, its price fell about 36.0%, its second-deepest decline after 2008.

The original $10,000 fell from about $81,300 to about $54,400. VUG’s price did not regain its 2021 peak until late January 2024, more than two years after the decline began.

2023: The AI Boom

2023 was dominated by artificial intelligence. Excitement about AI drove huge gains in a small group of giant technology companies, and VUG held large stakes in almost all of them.

VUG returned about 46.8%, its best calendar year, almost double the S&P 500’s 26.2%. NVIDIA, Microsoft, Apple, Meta and Amazon led the way.

By the end of 2023, an investor’s $10,000 from launch had recovered to about $79,800, close to its 2021 level.

2024: Another Strong Year

VUG returned about 32.7% in 2024, well ahead of the S&P 500’s 24.9%. The AI rally continued, and NVIDIA grew into one of the largest companies in the world.

By the end of 2024, the original $10,000 had passed $105,000. It was the first time the investment had been worth more than 10 times its starting value.

2025: The Tariff Shock

In early 2025, worries about AI spending and sweeping US tariff announcements triggered a sharp sell-off. From mid-December 2024 to April 8, 2025, VUG’s price fell about 23.0%.

The recovery was quick. VUG regained its December peak by late June 2025, less than three months after the low, as tariff fears eased and technology company profits held up.

VUG returned about 19.4% for 2025, ahead of the S&P 500’s 17.7%. By the end of the year, the original $10,000 had grown to about $126,500.

2026: A Split, a New Name and a Rotation

2026 has been a difficult year for VUG relative to the market. At the start of March, war between the United States and Iran sent oil prices above $100 a barrel, and investors moved towards energy, healthcare and defensive companies.

From its late October 2025 peak to March 30, 2026, VUG’s price fell about 16.7%, but it recovered by early May. On April 21, the fund carried out a 6-for-1 share split, turning each share into six, and in July it took its new Morningstar name.

VUG reached a new high on October 6, 2026, then slipped again. By November 2, it was up only about 3.7% for the year, against about 11.2% for the S&P 500, and about 9% below its October peak.

Every Major Fall at a Glance

These figures are measured on share price alone. Including reinvested dividends, the declines were slightly smaller, such as about 50.7% in 2007 to 2009, and the recoveries came slightly sooner.

VUG has fallen more than 15% eight times since 2004. In every case so far, it eventually recovered and went on to new highs, but after 2008, investors had to wait more than three and a half years from the 2007 peak.

On a total-return basis, VUG’s 2022 decline was about 35.6%, from November 19, 2021, to November 3, 2022. Its price kept drifting lower until late December, which is why the price-only fall in the table is slightly deeper.

VUG Recovered From 2008 Faster Than the S&P 500

VUG’s price regained its October 2007 peak in July 2011, about three years and eight months after that peak. The S&P 500, measured by SPY including dividends, did not regain its own 2007 peak until August 2012, more than a year later.

The reason is that growth companies led the recovery. While banks and other financial companies, a large part of the S&P 500, took years to repair their balance sheets, technology and consumer companies such as Apple, Google and Amazon kept growing their profits.

So although VUG fell slightly more than the market in 2008, an investor in VUG got back to break-even well before an investor in the S&P 500. FRC’s SPY performance history covers the S&P 500’s recovery in detail.

What If You Bought at the Worst Time?

Even an investor who bought VUG at the start of 2008, just before its worst year, had turned $10,000 into almost $97,000 by November 2026, about 13.2% a year to the end of 2025. That was well ahead of the same money in the S&P 500.

The 2022 example is a warning. An investor who bought VUG at the start of 2022 was still slightly behind the S&P 500 almost five years later, because VUG’s 2022 loss was so deep and 2026 has favored other parts of the market.

How VUG Compared With the S&P 500

From 2005 to November 2, 2026, $10,000 grew to about $124,900 in VUG, against about $92,600 in the S&P 500. VUG’s lead was built mainly in 2009, 2020 and 2023, three years when growth companies far outran the rest of the market.

FRC’s VOO performance history tells the S&P 500’s side of the same story, year by year.

Rolling Returns Against the S&P 500

VUG beat the S&P 500 in all 12 rolling 10-year periods from 2005 to 2025, including those shown above. Even the decade from 2007 to 2016, which started near the top of the market and included the whole financial crisis, returned about 8.4% a year.

Over shorter periods, the record was almost as strong. VUG beat the S&P 500 in 16 of the 17 rolling five-year periods from 2005 to 2025, missing only 2012 to 2016, and its weakest five-year stretch, 2005 to 2009, still finished slightly positive at about 2.1% a year.

How VUG Behaved in Up and Down Markets

This is VUG’s trade-off in numbers. In the S&P 500’s strong years, VUG gained about 7 percentage points more on average, while in its down years, VUG lost about 5 points more, almost entirely because of 2022.

In 2008, VUG lost only slightly more than the market, and in 2018 it actually lost less. The heavy losses came when rising interest rates, rather than a recession, drove the decline.

VUG vs SCHG and QQQ

VUG’s closest rival is SCHG, Schwab’s large-cap growth ETF. From 2010 to 2025, the years both funds were running, VUG returned about 16.1% a year and SCHG about 16.5%, turning $10,000 into about $108,400 and $115,400.

The two funds have traded the lead. VUG finished ahead of SCHG in six of those 16 years, including 2019, 2020 and 2025, while SCHG led in years such as 2023 and 2024, when its larger weights in a few AI leaders paid off. The two funds share most of their largest holdings, which is why their returns usually move closely together, and both charge only a few dollars a year per $10,000 invested.

QQQ, which tracks the Nasdaq-100, has been stronger than both. It beat VUG in 17 of the 21 years from 2005 to 2025, and over the 10 years from 2016 to 2025, it returned about 19.5% a year against VUG’s 17.4%, though at a higher cost of 0.20% a year. FRC’s SCHG performance history and QQQ performance history tell those funds’ stories year by year.

What the Declines Taught VUG Investors

The first lesson is that a growth fund can fall by half. VUG’s price dropped about 51% from 2007 to 2009, and an investor who bought at the 2007 peak waited more than three and a half years to break even.

The second is that concentration cuts both ways. With NVIDIA, Apple and Microsoft making up more than a third of the fund, VUG’s fortunes now depend heavily on a handful of companies.

The third is that patience was rewarded. Investors who held through 2008 saw VUG gain 39% in 2009, and those who held through 2022 saw it gain about 47% in 2023 and 33% in 2024.

Costs, Dividends and Taxes

VUG charges an expense ratio of 0.03%, or $3 a year for every $10,000 invested. That makes it one of the cheapest growth funds in the world.

Its dividend yield is very low, about 0.4%, because growth companies tend to reinvest their profits rather than pay them out. Almost all of VUG’s return comes from rising share prices.

That low yield makes VUG tax-efficient in a regular brokerage account, because most of the return is not taxed until shares are sold. FRC’s guides to how to choose tax-efficient ETFs and how to minimize capital gains tax explain the details.

VUG Questions Investors Ask

What is VUG’s average 10-year return? Over the 10 calendar years from 2016 to 2025, VUG returned about 17.4% a year, turning $10,000 into about $49,900. Its weakest rolling 10-year period, 2007 to 2016, returned about 8.4% a year.

What is VUG’s 20-year return? From 2006 to 2025, VUG returned about 13.0% a year, turning $10,000 into about $114,700, against about 10.9% a year for the S&P 500.

Did VUG change its name? Yes. On July 29, 2026, the Vanguard Growth ETF became the Vanguard Morningstar Growth ETF, after Morningstar bought CRSP, the company behind its index. The ticker, costs and strategy stayed the same.

Did VUG split its shares? Yes. On April 21, 2026, VUG carried out a 6-for-1 split, so each share became six. The split did not change the value of anyone’s investment, but it made individual shares cheaper to buy.

Has VUG outperformed the S&P 500? Over most periods, yes. It beat the S&P 500 in 15 of its 21 full calendar years, 14 of the last 20, and in every rolling 10-year period since launch, but it trailed in 2006, 2008, 2011, 2016, 2021, 2022 and so far in 2026.

How long did VUG take to recover after 2008? Its price regained its October 2007 peak in July 2011, about two years and four months after the March 2009 low. The S&P 500, including dividends, took until August 2012.

Why is VUG not performing well in 2026? Because the market has rotated away from the largest technology companies, which make up most of VUG, towards energy, healthcare and dividend stocks, helped by higher oil prices after the US–Iran war began in March. VUG has trailed the S&P 500 in similar rotations before, such as 2006, 2016 and 2022, and gone on to lead again, though there is no guarantee that pattern will repeat.

How has VUG performed in the past year? In the 12 months to November 2, 2026, VUG returned about 1.5%, and it was up about 3.7% for 2026 so far, as investors rotated towards energy, healthcare and dividend stocks.

Is VUG better than SCHG? Their records are very close. From 2010 to 2025, SCHG returned about 16.5% a year and VUG about 16.1%, and each has led in different years.

Is Your Money Safe in VUG?

VUG is a regulated investment company overseen by the SEC, with its holdings kept by an independent custodian and separate from Vanguard’s own assets. FRC’s guide to Is Vanguard Safe? explains how Vanguard is structured and regulated.

When you hold VUG at a SIPC member brokerage, your account is protected up to $500,000, including $250,000 in cash, if the brokerage fails and assets are missing. This protection does not cover market losses, such as VUG’s fall of about half from 2007 to 2009.

What VUG’s History Does Not Tell You

VUG’s best years came during a long period of low interest rates and extraordinary growth for a few technology giants. Future returns may look very different.

Its concentration has also grown. The VUG of 2026, with about 63% of its money in 10 companies, carries far more single-company risk than the VUG of 2004.

VUG launched after the dot-com crash, so its record does not include a period like 2000 to 2002, when growth stocks lost most of their value. FRC’s QQQ history shows how badly growth stocks can fall in such a period.

Keep Learning

VUG’s 22-year record shows that a low-cost growth index fund can beat the market over long periods, while falling harder in some bear markets and depending heavily on a few giant companies. The investors who did best were usually those who understood what the fund owned and held it through every cycle.

The FRC dictionary is more than a dictionary. It is a library of explainer videos, written explanations and on-page quizzes, so you can open any term, such as diversification or the S&P 500, and go deeper whenever something is unclear.

FRC’s programs and memberships are open to everyone. FRC’s Investing for Beginners guide and its guide to dollar-cost averaging vs lump sum are natural next steps.

Your Next Step

Since January 2004, VUG has returned about 12.0% a year and turned $10,000 into about $131,100. It beat the S&P 500 in 15 of 21 full years and every rolling 10-year period, fell about half in the financial crisis, and has lagged in 2026 as the market rotated away from technology.

Use that history to set realistic expectations. A growth fund can deliver exceptional long-term returns, but it can also fall a third or more in a bad year, so choose it for what it owns and hold it with a long-term view.