This Vanguard ETF’s 10.8% Energy Stake Is Why It’s Outperforming Inflation—Not Tech
The Vanguard Mid-Cap Value ETF (VOE) allocates 10.8% of its portfolio to the energy sector. Energy prices are a key driver of inflation, and the March Consumer Price Index rose to 3.3%, the highest level in nearly two years. Mid-cap value stocks have a historical reputation as inflation fighters due to their sector exposures and business models. VOE has outperformed both Vanguard’s large-cap and small-cap value ETFs year-to-date. VOE’s low 9% allocation to technology reduces its dependence on large-cap growth and tech sector performance. The ETF’s holdings are diversified across five sectors with double-digit weightings, and no single holding exceeds 2.43% of assets. VOE charges an annual expense ratio of 0.05%, or $5 per $10,000 invested. Investors in VOE gain exposure to established mid-cap companies with lower valuations than large caps and better earnings growth prospects, while paying minimal fees and avoiding concentrated tech risk.
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