The Schwab U.S. Large-Cap Growth ETF underperforms SPY and QQQ year-to-date amid a shift beyond megacap growth stocks.
The Schwab U.S. Large-Cap Growth ETF (SCHG) has returned 9% year-to-date, trailing the S&P 500’s 13% and the Nasdaq 100’s 19%. The fund’s decade-long outperformance, with a 445% return over ten years, has stalled as the 2026 rally expands beyond its concentrated growth holdings.
SCHG, which manages $61 billion, is heavily weighted in megacap stocks, with NVIDIA alone accounting for 11% of its portfolio. The fund’s top ten holdings represent 57% of its assets, leaving it vulnerable to sector rotations. While its long-term track record remains strong, its 2026 underperformance raises questions for investors relying on dollar-cost averaging.
For investors with shorter time horizons, the lag introduces sequence-of-returns risk, while long-term buyers may benefit from lower entry points. The shift highlights the challenges of concentrated growth strategies amid broader market gains.