Three Growth ETFs to Consider for Long-Term Investment

If you're on the lookout for growth stock investments without the hassle of tracking multiple companies, you're not alone. A more straightforward strategy can be more rewarding in the long run. Here, we explore three growth exchange-traded funds (ETFs) that you might consider buying and holding indefinitely, especially if you have around $2,000 to invest right now.

Vanguard Information Technology ETF

Technology stocks have been at the forefront of market growth for nearly thirty years, and for good reason. Tech companies have pioneered critical developments like personal computers, mobile internet, and artificial intelligence. The technology sector shows no signs of slowing down, promising continued innovation far into the future.

The Vanguard Information Technology ETF (VGT) offers a versatile investment in the tech space. Unlike other tech-focused ETFs that track the Nasdaq-100 index, this fund draws from a broader array of large-, mid-, and small-cap tech companies, regardless of their stock exchange. So, while major names like Nvidia, Microsoft, and Apple are significant positions, the fund also includes robust non-Nasdaq companies such as Salesforce and Accenture.

iShares S&P 500 Growth ETF

For investors interested in growth stocks while retaining exposure to well-established companies, the iShares S&P 500 Growth ETF (IVW) is a compelling choice. This fund focuses exclusively on S&P 500 constituents categorized as growth companies. With around 200 stocks in its portfolio, it includes industry leaders like Meta Platforms, Alphabet, and Amazon.

Although top-heavy with high-value firms like Nvidia and Apple, the fund stands out because of its modified cap-weighting approach. This strategy helps balance the holdings more effectively, making the fund less volatile than those that are more focused on larger companies.

iShares Russell Mid-Cap Growth ETF

While large-cap stocks are often the focus, investing in mid-cap growth stocks can also yield favorable results. The iShares Russell Mid-Cap Growth ETF (IWP) focuses on mid-sized companies that have demonstrated strong growth potential.

Mid-cap stocks tend to outperform their large-cap counterparts over time due to their growth trajectory. They provide a sweet spot for investment; they have proven business models but still have ample room for growth. Companies like SoundHound AI and IonQ exemplify the exciting opportunities in this sector.

Instead of investing in individual stocks, utilizing the iShares Russell Mid-Cap Growth ETF allows for diversification within this category, which can help mitigate risks associated with stock volatility.

ETFs, Investment, Growth