Nvidia, Apple, Alphabet, Microsoft, and Amazon Now Make Up 30.8% of VOO and 49.2% of VUG. Here’s a Better Low-Cost Vanguard ETF to Buy Now. | The Motley Fool

Vanguard just updated its key holdings across major exchange-traded funds (ETFs) like the Vanguard S&P 500 ETF (VOO -0.79%) and Vanguard Morningstar Growth ETF (VUG -1.66%).

As of Sept. 30, the Vanguard S&P 500 ETF had a staggering 30.8% weighting in just five stocks — Nvidia (NVDA -2.38%), Apple (AAPL +0.46%), Alphabet (GOOG -2.17%) (GOOGL -2.15%), Microsoft (MSFT -1.24%), and Amazon (AMZN -3.46%). Those same five companies make up a mind-numbing 49.2% of the Vanguard Morningstar Growth ETF.

Concentration in just a handful of companies may be unappealing for investors who already own mega-cap growth stocks as individual stock holdings or through ETFs and index funds.

Here’s why the Vanguard Morningstar Total Stock Market ETF (VTI -0.74%) offers a superior alternative to the Vanguard S&P 500 ETF and Vanguard Morningstar Growth ETF for investors who still want low-cost exposure to a basket of stocks but with less concentration in a handful of names.

The Vanguard Morningstar Total Stock Market ETF holds 3,519 stocks

The Vanguard Morningstar Total Stock Market ETF is benchmarked to the Morningstar U.S. Total Market Index. The index holds 100% of investable U.S. equities — from mega caps like Nvidia and Apple all the way down to small-cap and micro-caps you’ve probably never heard of.

Despite holding roughly seven times as many stocks as the S&P 500 (^GSPC -0.84%), the Vanguard Morningstar Total Stock Market ETF is still heavily concentrated…