Best Growth ETFs to Buy Right Now
Best Growth ETFs to Buy Right Now
So far in 2025, the U.S. stock market has been turbulent and unpredictable. It's fair to say the year-to-date performance of the S&P 500 has been disappointing, with the benchmark down 1.8% through March 4. There are, however, reasons for optimism and plenty of promising asset classes to invest in.
According to the Bureau of Labor Statistics, the U.S. unemployment rate was 4% in January. That's a solid number indicating a strong labor market which should mean relatively high consumer confidence as we approach the second quarter of the year. And it's not just consumers who are feeling good, business leaders are optimistic as well. The Conference Board's CEO Confidence index stands at 60 – that's the highest level in three years.
It may seem counterintuitive, but volatile periods and tough investing environments – like the one we're living through right now – are normal and expected features of equity investing. The market will go up and down, but historically, stocks have proven to be an excellent investment over the long run.
So what should you invest in when the market is choppy and unpredictable? One promising category is growth stocks. Growth stocks are shares in companies that, in terms of revenue and earnings, are demonstrably growing faster than their industry peers and the market as a whole. Growth stock investing is all about innovation, execution and momentum. That's in contrast to value stocks, which are considered undervalued and thought to be somewhat overlooked by Wall Street.
Exchange-traded funds, or ETFs, are one of the best ways to own growth stocks when the market is rocky. The stocks in ETF portfolios are professionally selected by top Wall Street asset managers, or are based on high-quality, credible growth stock indexes. ETFs can hold dozens or even hundreds of stocks, providing investors with the kind of diversification that's especially important today.
If you're one of the many investors who understands the potential and opportunity inherent in growth stocks, check out this timely list of seven of the best growth ETFs to buy now:
ETF
SPDR Portfolio S&P 500 Growth ETF (ticker: SPYG)
iShares Russell Mid-Cap Growth ETF (IWP)
Capital Group Global Growth Equity ETF (CGGO)
Vanguard Russell 1000 Growth Index Fund ETF Shares (VONG)
iShares S&P Small-Cap 600 Growth ETF (IJT)
Vanguard Growth Index Fund ETF Shares (VUG)
iShares Morningstar Growth ETF (ILCG)
According to the Bureau of Labor Statistics, the U.S. unemployment rate was 4% in January. That's a solid number indicating a strong labor market which should mean relatively high consumer confidence as we approach the second quarter of the year. And it's not just consumers who are feeling good, business leaders are optimistic as well. The Conference Board's CEO Confidence index stands at 60 – that's the highest level in three years.
It may seem counterintuitive, but volatile periods and tough investing environments – like the one we're living through right now – are normal and expected features of equity investing. The market will go up and down, but historically, stocks have proven to be an excellent investment over the long run.
So what should you invest in when the market is choppy and unpredictable? One promising category is growth stocks. Growth stocks are shares in companies that, in terms of revenue and earnings, are demonstrably growing faster than their industry peers and the market as a whole. Growth stock investing is all about innovation, execution and momentum. That's in contrast to value stocks, which are considered undervalued and thought to be somewhat overlooked by Wall Street.
Exchange-traded funds, or ETFs, are one of the best ways to own growth stocks when the market is rocky. The stocks in ETF portfolios are professionally selected by top Wall Street asset managers, or are based on high-quality, credible growth stock indexes. ETFs can hold dozens or even hundreds of stocks, providing investors with the kind of diversification that's especially important today.
If you're one of the many investors who understands the potential and opportunity inherent in growth stocks, check out this timely list of seven of the best growth ETFs to buy now:
ETF
SPDR Portfolio S&P 500 Growth ETF (ticker: SPYG)
iShares Russell Mid-Cap Growth ETF (IWP)
Capital Group Global Growth Equity ETF (CGGO)
Vanguard Russell 1000 Growth Index Fund ETF Shares (VONG)
iShares S&P Small-Cap 600 Growth ETF (IJT)
Vanguard Growth Index Fund ETF Shares (VUG)
iShares Morningstar Growth ETF (ILCG)
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Re: Best Growth ETFs to Buy Right Now
SPDR Portfolio S&P 500 Growth ETF (SPYG)
Most investors are familiar with the SPDR S&P 500 ETF Trust (SPY). With $627 billion in assets, it's one of the largest and most popular ETFs on the market. SPY, of course, tracks the S&P 500 index. SPYG is a $35 billion index fund that mirrors the growth-specific subset of that famous, large-cap index.
SPYG follows the S&P 500 Growth Index. That index, as its name implies, consists of S&P 500 stocks that display pronounced growth characteristics based on revenue growth, earnings and momentum.
SPYG is a low-cost fund with an expense ratio of just 0.04%. After those expenses are subtracted, the fund's performance should reasonably match its benchmark.
SPYG can be used as the core growth building block of a well-built, diversified portfolio. The fund has a current dividend yield of 0.6%.
Most investors are familiar with the SPDR S&P 500 ETF Trust (SPY). With $627 billion in assets, it's one of the largest and most popular ETFs on the market. SPY, of course, tracks the S&P 500 index. SPYG is a $35 billion index fund that mirrors the growth-specific subset of that famous, large-cap index.
SPYG follows the S&P 500 Growth Index. That index, as its name implies, consists of S&P 500 stocks that display pronounced growth characteristics based on revenue growth, earnings and momentum.
SPYG is a low-cost fund with an expense ratio of just 0.04%. After those expenses are subtracted, the fund's performance should reasonably match its benchmark.
SPYG can be used as the core growth building block of a well-built, diversified portfolio. The fund has a current dividend yield of 0.6%.
Re: Best Growth ETFs to Buy Right Now
iShares Russell Mid-Cap Growth ETF (IWP)
In the same way SPYG – the first fund on this list – is suitable as a core large-cap growth fund, this next ETF, IWP, was designed to be a core mid-cap growth holding.
IWP is a $18 billion fund in the BlackRock Inc. (BLK) iShares family of ETFs. IWP mirrors the Russell MidCap Growth Index. That benchmark was designed to track the performance of mid-capitalization companies exhibiting robust growth qualities.
The fund invests in stocks from the Russell MidCap Index that are expected to grow earnings and revenue faster than average and that have a high price-to-book ratio.
There are currently 288 holdings in the portfolio, but that number can go up or down depending on the fund's annual reconstitution and rebalancing, which takes place in June of each year.
Dividend income is not a major objective of IWP or most other growth-oriented funds. Still, this ETF has a current yield of 0.4%.
In the same way SPYG – the first fund on this list – is suitable as a core large-cap growth fund, this next ETF, IWP, was designed to be a core mid-cap growth holding.
IWP is a $18 billion fund in the BlackRock Inc. (BLK) iShares family of ETFs. IWP mirrors the Russell MidCap Growth Index. That benchmark was designed to track the performance of mid-capitalization companies exhibiting robust growth qualities.
The fund invests in stocks from the Russell MidCap Index that are expected to grow earnings and revenue faster than average and that have a high price-to-book ratio.
There are currently 288 holdings in the portfolio, but that number can go up or down depending on the fund's annual reconstitution and rebalancing, which takes place in June of each year.
Dividend income is not a major objective of IWP or most other growth-oriented funds. Still, this ETF has a current yield of 0.4%.
Re: Best Growth ETFs to Buy Right Now
Capital Group Global Growth Equity ETF (CGGO)
Growth investors who are willing to accept the increased volatility and risk of global investing may want to consider CGGO. This actively managed fund has net assets of about $5 billion and invests a significant portion of its assets – a minimum of 40% – in companies outside the U.S.
The fund invests in a wide range of international stocks. CGGO is not limited to large-cap stocks, but the portfolio managers do tend to favor large-caps over smaller companies. The majority of the fund's assets are invested in developed markets, but it will take positions in emerging-market stocks if they meet the fund's strict criteria for financial strength and growth prospects. CGGO generally maintains about 20% exposure to U.S. equities.
The fund is administered by Capital Group, which is an asset management subsidiary of Charles Schwab Corp. (SCHW). CGGO has an expense ratio of 0.47% and a current dividend yield of 1.1%.
Growth investors who are willing to accept the increased volatility and risk of global investing may want to consider CGGO. This actively managed fund has net assets of about $5 billion and invests a significant portion of its assets – a minimum of 40% – in companies outside the U.S.
The fund invests in a wide range of international stocks. CGGO is not limited to large-cap stocks, but the portfolio managers do tend to favor large-caps over smaller companies. The majority of the fund's assets are invested in developed markets, but it will take positions in emerging-market stocks if they meet the fund's strict criteria for financial strength and growth prospects. CGGO generally maintains about 20% exposure to U.S. equities.
The fund is administered by Capital Group, which is an asset management subsidiary of Charles Schwab Corp. (SCHW). CGGO has an expense ratio of 0.47% and a current dividend yield of 1.1%.
Re: Best Growth ETFs to Buy Right Now
Vanguard Russell 1000 Growth Index Fund ETF Shares (VONG)
VONG is a low-cost Vanguard index growth ETF with net assets of close to $38 billion. The fund is designed to match the performance of the Russell 1000 Growth Index after its expense ratio of 0.07% is subtracted.
The Russell 1000 Index contains the 1,000 largest publicly traded U.S. companies. This fund's benchmark – the Russell 1000 Growth Index – is made up of the roughly 400 stocks from within the Russell 1000 that exhibit strong growth stock characteristics.
VONG is considered a good representation of the universe of domestic, large-cap growth stocks. The fund is broadly diversified and offers a high potential for long-term capital appreciation.
The current dividend yield for VONG is 0.5%.
VONG is a low-cost Vanguard index growth ETF with net assets of close to $38 billion. The fund is designed to match the performance of the Russell 1000 Growth Index after its expense ratio of 0.07% is subtracted.
The Russell 1000 Index contains the 1,000 largest publicly traded U.S. companies. This fund's benchmark – the Russell 1000 Growth Index – is made up of the roughly 400 stocks from within the Russell 1000 that exhibit strong growth stock characteristics.
VONG is considered a good representation of the universe of domestic, large-cap growth stocks. The fund is broadly diversified and offers a high potential for long-term capital appreciation.
The current dividend yield for VONG is 0.5%.
Re: Best Growth ETFs to Buy Right Now
iShares S&P Small-Cap 600 Growth ETF (IJT)
A well-constructed portfolio of growth ETFs shouldn't neglect small-cap funds. IJT is a low-cost, tax-efficient index fund designed to provide exposure to domestic small-cap stocks with above-average earnings growth. Small-cap funds are usually not appropriate as core holdings, so IJT should complement and enhance a portfolio, not necessarily anchor one.
IJT is a $7 billion ETF that tracks the S&P SmallCap 600 Growth Index, which is a subset of the larger S&P SmallCap 600 Index. The fund's benchmark is made up of S&P SmallCap 600 stocks that demonstrate higher sales growth, strong earnings momentum and good market price performance. It identifies growth stocks by looking at three key factors: revenue growth, the ratio of earnings change to price, and share price momentum.
The fund is weighted using a float-adjusted market-cap methodology. This generally means bigger companies will have a bigger influence on overall fund performance, but adjustments are made based on the number of shares available to the investing public.
IJT has an expense ratio of 0.18% and a current yield of about 1%.
A well-constructed portfolio of growth ETFs shouldn't neglect small-cap funds. IJT is a low-cost, tax-efficient index fund designed to provide exposure to domestic small-cap stocks with above-average earnings growth. Small-cap funds are usually not appropriate as core holdings, so IJT should complement and enhance a portfolio, not necessarily anchor one.
IJT is a $7 billion ETF that tracks the S&P SmallCap 600 Growth Index, which is a subset of the larger S&P SmallCap 600 Index. The fund's benchmark is made up of S&P SmallCap 600 stocks that demonstrate higher sales growth, strong earnings momentum and good market price performance. It identifies growth stocks by looking at three key factors: revenue growth, the ratio of earnings change to price, and share price momentum.
The fund is weighted using a float-adjusted market-cap methodology. This generally means bigger companies will have a bigger influence on overall fund performance, but adjustments are made based on the number of shares available to the investing public.
IJT has an expense ratio of 0.18% and a current yield of about 1%.
Re: Best Growth ETFs to Buy Right Now
Vanguard Growth Index Fund ETF Shares (VUG)
VUG is a large index fund with net assets of $292 billion. The fund was designed to closely track the performance of the CRSP US Large Cap Growth Index. The portfolio includes 200 large-cap growth stocks and VUG is the only fund that offers investors exposure to all of the securities in the benchmark.
This is a passively managed, full-replication index fund. After the low expense ratio of 0.04% is accounted for, VUG should precisely match the returns of its benchmark.
VUG has been a solid performer. Based on net asset value (NAV), for the one-year period ending Feb. 28, the fund returned 19.9%. This fund is a convenient, low-cost way to gain access to 180 of the largest growth stocks in the U.S.
The current dividend yield for VUG is 0.5%.
VUG is a large index fund with net assets of $292 billion. The fund was designed to closely track the performance of the CRSP US Large Cap Growth Index. The portfolio includes 200 large-cap growth stocks and VUG is the only fund that offers investors exposure to all of the securities in the benchmark.
This is a passively managed, full-replication index fund. After the low expense ratio of 0.04% is accounted for, VUG should precisely match the returns of its benchmark.
VUG has been a solid performer. Based on net asset value (NAV), for the one-year period ending Feb. 28, the fund returned 19.9%. This fund is a convenient, low-cost way to gain access to 180 of the largest growth stocks in the U.S.
The current dividend yield for VUG is 0.5%.
Re: Best Growth ETFs to Buy Right Now
iShares Morningstar Growth ETF (ILCG)
The Morningstar Large-Mid Cap Broad Growth Index is a unique benchmark that includes both large-cap stocks and mid-cap stocks. ILCG is a $2.5 billion ETF that tracks that benchmark.
ILCG was designed to provide growth-oriented investors with exposure to a wide range of U.S. stocks that show above-average earnings and revenue growth compared to the broad market. There are 377 holdings in the fund, all of which meet the criteria to qualify as growth stocks.
This fund provides targeted access to a specific, high-growth category of domestic stocks. iShares recommends this fund to investors who need to tilt their portfolios toward growth.
The top sector in the fund is information technology, which represents about 41% of the fund's assets. Consumer discretionary comes in at a somewhat distant second at roughly 15%.
As with many of the prior growth ETFs, the fund is not especially focused on generating income, and has a modest dividend yield of 0.5%.
The Morningstar Large-Mid Cap Broad Growth Index is a unique benchmark that includes both large-cap stocks and mid-cap stocks. ILCG is a $2.5 billion ETF that tracks that benchmark.
ILCG was designed to provide growth-oriented investors with exposure to a wide range of U.S. stocks that show above-average earnings and revenue growth compared to the broad market. There are 377 holdings in the fund, all of which meet the criteria to qualify as growth stocks.
This fund provides targeted access to a specific, high-growth category of domestic stocks. iShares recommends this fund to investors who need to tilt their portfolios toward growth.
The top sector in the fund is information technology, which represents about 41% of the fund's assets. Consumer discretionary comes in at a somewhat distant second at roughly 15%.
As with many of the prior growth ETFs, the fund is not especially focused on generating income, and has a modest dividend yield of 0.5%.