VGT

Vanguard Information Technology ETF (VGT) is an exchange-traded fund that seeks to track the performance of an index composed of U.S. equities in the information technology sector, including hardware manufacturers, software developers, semiconductor producers, and tech services providers. The ETF is managed by Vanguard and trades under the ticker VGT on NYSE Arca.

Classified as a U.S. equity ETF with a sector focus, VGT aims to reflect, before fees and expenses, the combined price and income return of the stocks included in its benchmark index.

To achieve this objective, the fund employs a passive management strategy, maintaining a portfolio that seeks to replicate the composition and weighting of a representative technology sector index.

VGT’s benchmark includes technology companies listed in the United States, weighted by float-adjusted market capitalization, with periodic rebalancing to ensure the portfolio remains aligned with eligible technology-focused equities.

Diversification and sector exposure

VGT provides concentrated exposure to the information technology sector, with companies operating across areas such as:

• Software and technology services.

• Equipment and hardware.

• Semiconductors and components.

• Technology-related services.

Structure and costs

Shares of VGT are traded on the secondary market, while creation and redemption of shares are carried out by authorized participants, a mechanism that helps keep the ETF’s market price close to its net asset value (NAV).

The fund carries an expense ratio consistent with technology sector ETFs, typical of niche-focused funds with an innovation tilt, and does not charge a performance fee. VGT may make periodic income distributions, derived from dividends paid by companies in its portfolio. The ETF has a single share class and trades exclusively under the ticker VGT.

History and evolution of the ETF

The Vanguard Information Technology ETF was launched in 2004, amid growing investor interest in sector-specific exposures that capture structural growth in the information technology space within equity markets.

Since its inception, VGT has been used by institutional and individual investors seeking targeted exposure to the U.S. technology sector, combining potential capital appreciation with long-term innovation trends.

Between 2020 and 2024, the ETF reflected the strong performance and volatility of the technology sector, influenced by factors such as acceleration in digital adoption, innovation cycles in software and semiconductors, monetary policy adjustments, and shifts in risk appetite, while maintaining high liquidity and broad adoption in sector allocation strategies.