Identical Tech Exposure, Lower Cost or Greater Liquidity? VGT vs. FTEC

By Eric Trie – Mar 26, 2026 at 12:34PM ESTKey PointsFTEC matches VGT on sector and top holdings, but charges a slightly lower expense ratioBoth ETFs delivered nearly identical 1-year and 5-year returns, with minimal differences in risk and drawdownVGT boasts much larger assets under management and greater trading liquidity compared to FTECVanguard Information Technology ETF (NYSEMKT:VGT) and Fidelity MSCI Information Technology Index ETF (NYSEMKT:FTEC) both target U.S. technology stocks with similar sector allocations and top holdings, but VGT commands far greater assets under management and higher daily trading volume, while FTEC edges out with a marginally lower expense ratio.Both VGT and FTEC are passively managed funds focused on the U.S. information technology sector, offering exposure to major players like Nvidia, Apple, and Microsoft. This comparison looks at their costs, performance, risk, and portfolio details to help investors assess which may better fit their needs.Snapshot (cost & size)MetricVGTFTECIssuerVanguardFidelityExpense ratio0.09%0.08%1-yr return (as of 2026-03-24)23.7%24.1%Dividend yield0.42%0.44%Beta1.321.31AUM$126.5 billion$15.96 billionBeta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months.FTEC is slightly more affordable, charging a 0.08% expense ratio versus VGT’s 0.09%, but VGT delivers a marginally higher dividend yield at 0.5% compared to FTEC’s 0.4%.Performance & risk comparisonMetricVGTFTECMax drawdown (5 y)-35.07%-34.95%Growth of $1,000 over 5 years$2,035$2,057What's insideFTEC tracks the MSCI USA IMI Information Technology 25/50 Index, holding 294 stocks across the technology sector. Its largest positions are Nvidia Corp (NVDA 3.68%) at 18.25%, Apple Inc (AAPL +0.59%) at 15.41%, and Microsoft Corp (MSFT 1.29%) at 10.07%. The fund launched in October 2013 and, like VGT, is nearly 98% weighted to technology, with small allocations to industrials and financial services. There are no leverage, currency hedging, or ESG quirks.VGT is similarly concentrated: 98% in technology, with top holdings in NVIDIA Corp (NVDA 3.68%), Apple Inc (AAPL +0.59%), and Microsoft Corp (MSFT 1.29%), though it owns slightly more companies at 310. Both funds provide broad, cap-weighted exposure to U.S. tech giants, with minimal sector or holdings differences.For more guidance on ETF investing, check out the full guide at this link.What this means for investorsWhen two ETFs hold nearly identical technology stocks in similar weights ,the real difference is how they are managed, not what they invest in. That is the case with the Vanguard Information Technology ETF and the Fidelity MSCI Information Technology Index ETF.Both funds are dominated by the same group of mega-cap companies, with Nvidia, Apple, and Microsoft accounting for a substantial portion of returns. Their broader holdings are also closely aligned, which keeps performance differences minimal over time. The main distinctions are cost and scale. FTEC charges a slightly lower fee, while VGT’s larger size and heavier trading volume can support tighter spreads and smoother execution.For investors, the choice is less about different technology exposure, but about finding the most efficient way to invest in it. A lower expense ratio can benefit long-term holders, while greater liquidity may matter more for larger positions or frequent trading. In practice, both funds deliver nearly the same portfolio, so the decision comes down to whether cost or trading efficiency carries more weight for you.Read NextMar 4, 2026 •By Katie BrockmanCHAT Takes a Big Swing on AI, While FTEC Provides Diversified Tech Exposure. Which Is the Stronger ETF Right Now?Mar 26, 2026 •By Neil PatelHow to Start Investing in the Stock Market Today With $10,000Mar 26, 2026 •By Stefon WaltersFrom 1980 to Today: What Past Recessions Tell Us About Future Downturns in the Stock MarketMar 26, 2026 •By Josh Kohn-LindquistVanguard (VGT) vs. Roundhill Investments (CHAT): Which Technology ETF Reigns Supreme?Mar 26, 2026 •By Jake LerchConsumer Staples Stocks: IYK Offers Broader Holdings While PBJ Focuses on FoodMar 26, 2026 •By Eric TrieTreasury Safety or Higher Yield From Corporate Bonds? VGSH vs. VCSHAbout the AuthorEric Trie is a Motley Fool contributing stock analyst covering technology and semiconductors, healthcare, financial services, and consumer sectors. Previously, he worked in investment analysis and financial writing. He holds a B.A. in Philosophy from Rutgers University. Eric lives in New York City and is an avid sports fan.CMFIdeaMachineStocks MentionedFidelity Covington Trust - Fidelity Msci Information Technology Index ETFNYSEMKT: FTEC$208.23(-2.54%)-$5.42Vanguard Information Technology ETFNYSEMKT: VGT$698.67(-2.48%)-$17.79*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.