You’ve probably heard of the S&P 500. It’s the celebrity of the investing world. But if you’re tucking money away in a Vanguard growth fund, you aren’t actually tracking the S&P. You’re likely hitched to the CRSP Large Cap Growth Index.
Most people don't even realize there's a difference. Honestly, it’s kinda weird how much power this specific index has over trillions of dollars without being a household name.
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The multi-factor machine
The Center for Research in Security Prices (CRSP) doesn't just pick "big companies that go up." They’re based out of the University of Chicago Booth School of Business, and they take a very academic, almost obsessive approach to defining what "growth" actually looks like.
While some indexes just look at how fast sales are rising, the CRSP Large Cap Growth Index uses six different factors to grade a stock. They look at:
- Future long-term EPS (Earnings Per Share) growth.
- Future short-term EPS growth.
- Three-year historical growth in earnings.
- Three-year historical growth in sales.
- Current investment-to-assets ratio.
- Return on assets (ROA).
It’s that last one—ROA—that makes things interesting. By including profitability metrics, the index tries to weed out the "junk" growth companies that burn cash but never make a dime.
Why this index is basically the tech sector's shadow
If you look at the sector weights as of early 2026, it’s pretty lopsided. Technology usually eats up more than 50% of the pie.
Think about the "Magnificent Seven." Companies like NVIDIA, Apple, and Microsoft don't just sit in this index; they dominate it. In fact, the top ten holdings often account for over 60% of the entire index's value.
Is that a bad thing? Not necessarily. But it means that when you buy into a fund tracking the CRSP Large Cap Growth Index, you aren't getting a "diversified" slice of the whole economy. You’re making a massive bet on Silicon Valley and high-end consumer discretionary brands like Amazon and Tesla.
The "Packeting" trick you've never heard of
Here is where CRSP gets really nerdy. Most indexes have a "hard" cutoff. If a stock falls from the 500th spot to the 501st, it's out. Boom. Deleted.
This causes a problem: every fund manager has to sell that stock at the exact same time, which drives the price down and costs investors money in "transaction drag."
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CRSP uses something called packeting. Basically, they allow a stock to be split between two indexes—say, half in Large Cap and half in Mid Cap—during a transition. It’s a slow-motion move that keeps the market from freaking out. It’s subtle, but it’s one reason why Vanguard funds tend to have such low internal costs. They aren't constantly churning the portfolio just because a stock’s market cap ticked down by a few million dollars.
CRSP vs. S&P 500 Growth: The showdown
People often ask me, "Does it really matter which growth index I track?"
The short answer: Sorta.
The S&P 500 Growth Index is much more restrictive. It only pulls from the 500 companies in the main S&P 500. CRSP, however, defines "Large Cap" as the top 85% of the total US market. This means the CRSP Large Cap Growth Index often includes a handful of companies that S&P would consider "Mid Cap."
Because of this slightly broader reach, the CRSP version can sometimes capture those "rising stars" a bit earlier than an S&P-based fund would.
Real performance in the 2025-2026 cycle
Looking back at the data from the end of 2025, the index put up some wild numbers. While the broader market was steady, this growth index saw returns of around 19.4% for the year, largely fueled by the continued AI hardware boom.
But there’s a catch.
Volatility is the price of admission here. Because the index is so heavy on tech, it swings like a pendulum. When interest rates look like they might stay higher for longer, these growth stocks get hit much harder than a boring "Value" index full of banks and oil companies.
Actionable insights for your portfolio
If you’re looking to use the CRSP Large Cap Growth Index as a building block for your wealth, don't just go in blind.
Check your overlap. If you own a "Total Stock Market" fund and then add a Growth fund (like VUG), you are doubling down on the same top ten stocks. You aren't diversifying; you're concentrating.
Mind the valuation. With a Price-to-Earnings (P/E) ratio often hovering around 39x or 40x, you are paying a premium. This isn't a "buy low" strategy. This is a "buy high and hope it goes higher" strategy.
Set your timeline. This index is a terrible place for money you need in two years. It's built for the 10-year horizon where the compounding power of companies like Eli Lilly or Broadcom can actually overcome the inevitable 20% market corrections.
Diversify the "Growth" itself. Consider pairing this with an international growth fund or a small-cap value fund to balance out the extreme tech-heavy nature of the US large-cap space.
Your next move should be to pull up your brokerage statement. Look for the "Top Holdings" section of your largest equity fund. If you see NVIDIA and Apple making up more than 15% of your total net worth, you’re already a major participant in the CRSP growth ecosystem—whether you realized it or not.