GTEK outpaces VGT by excluding Mag 7 megacaps

Goldman Sachs Future Tech Leaders Equity ETF (GTEK) returned 48.9% year-to-date, according to fund performance data, compared with roughly 25% for Vanguard Information Technology ETF (VGT). GTEK posted about a 64% gain over the past 12 months. The fund charges a 75 basis point expense ratio and restricts holdings to companies with market capitalizations below $100 billion while excluding the largest tech names often concentrated in broad benchmarks.

GTEK uses an active, bottom-up stock-picking process to identify companies it views as potential leaders in disruptive and emerging technology areas. The portfolio has included sizable positions in smaller, high-growth names. Marvell Technology Group (MRVL) is one prominent holding and has risen about 164% year-to-date.

Goldman Sachs says the strategy concentrates conviction weightings on companies under the $100 billion market-cap threshold and excludes members of the largest technology clusters to limit overlap with common mega-cap exposures. The fund’s rules place a hard cap on investing in mega-cap firms.

Market data show the performance gap widened as several mid-cap and small-cap technology stocks rallied this year. Broad market-cap-weighted technology funds such as VGT hold large positions in a handful of very large firms, while GTEK’s active approach has higher concentration in smaller winners.

The fund’s construction involves trade-offs for investors. GTEK’s 75 basis point fee is higher than many passive tech ETFs, which generally have lower expense ratios. The active mandate permits the manager to limit exposure to the largest names and to increase weights in smaller, rapidly appreciating stocks.

For context, VGT typically holds the largest U.S. information-technology companies by market capitalization. Active strategies such as GTEK select individual stocks through analyst-driven research and may concentrate holdings in fewer names with higher growth potential. Year-to-date and one-year returns reflect recent performance and do not predict future results.