The Vanguard Morningstar Growth ETF (VUG) hit a record of $92.64 on Oct. 6 but has since fallen about 6% to roughly $87, while the S&P 500 is down less than 3% over the same period. The fund is up about 7% in 2026 versus about 11% for the index, and if the gap holds through December, it would be the first year since 2022 that it trails the S&P 500 on price alone. The fund holds a large share of its assets in its top 10 stocks, many of them tech companies, and several, including Tesla (down about 17%), are lagging this year. Rising interest rates also weigh on growth stocks, since their value depends on profits expected far in the future. The author notes the fund has beaten the S&P 500 in 16 of 21 years from 2005 to 2025, but says he would not rely on 2027 to erase this year's gap.
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