In this article, we discuss 5 best mid-cap growth ETFs. If you want to read our discussion on the mid-cap ETF industry, you can check out the 10 Best Mid-Cap Growth ETFs.
5. iShares Russell Mid-Cap Growth ETF (NYSEARCA:IWP)
5-Year Price Performance: 37.7%
Total Net Assets as of September 21, 2023: $13.02 billion
Expense Ratio: 0.23%
Number of Holdings: 335
iShares Russell Mid-Cap Growth ETF (NYSEARCA:IWP) is designed to replicate the investment performance of an index composed of mid-capitalization US equities that exhibit growth characteristics. The fund tracks the Russell Midcap Growth Index, which includes mid-cap stocks with higher price-to-book ratios and forecasted growth values. The top 10 holdings of the ETF have a combined weightage of 13.61% of total assets. The top three holdings of the ETF are Apollo Global Management, Inc. (NYSE:APO), IDEXX Laboratories, Inc. (NASDAQ:IDXX), and Cheniere Energy, Inc. (NYSE:LNG).
Here’s what Baron Funds said about IDEXX Laboratories, Inc. (NASDAQ:IDXX) in its Q2 2023 investor letter:
“We have had some extraordinary winners over time. For instance, we bought DexCom, Inc. at a $950 million market cap in 2012, and it is now valued at $50 billion (the stock has appreciated 41% annually since the Fund’s initial purchase). TransDigm Group Incorporated has grown from $1.1 billion at purchase to $49 billion presently (and the stock has appreciated 29% annually since the Fund’s initial purchase 17 years ago). IDEXX Laboratories, Inc. (NASDAQ:IDXX) has gone from $2 billion at purchase to $42 billion over almost 15 years and the stock has appreciated 26% annually during that time frame. The Trade Desk is now valued at $38 billion and was $433 million when we first purchased shares over 6 years ago. The stock has appreciated almost 60% annually since our initial purchase. Pretty amazing. All four stocks have been solid performers this year, contributing nicely to the Fund’s returns.
Since we run a small-cap fund but want to hold on to these great investments as they continue to compound and perform, we reduce the positions sizes over the holding period so that the overall market capitalization of the Fund is palatable. For each of the four stocks mentioned above, we presently own 11% or less of our peak positions. We take the proceeds from the trimming of these positions to fund new small-cap investments, with the hopes of somehow replicating these results.”
4. Vanguard Mid-Cap Growth Index Fund (NYSEARCA:VOT)
5-Year Price Performance: 40.3%
Total Net Assets as of September 21, 2023: $21.42 billion
Expense Ratio: 0.07%
Number of Holdings: 161
Vanguard Mid-Cap Growth Index Fund (NYSEARCA:VOT) is an ETF with the second lowest management fee and the second highest net assets amongst all the best mid-cap growth ETFs on our list. The ETF tracks the CRSP US Mid Cap Growth Index. This index is composed of mid-cap US stocks that exhibit growth characteristics such as sales growth, earnings growth, and momentum. Amphenol Corporation (NYSE:APH), Motorola Solutions, Inc. (NYSE:MSI), TransDigm Group Incorporated (NYSE:TDG), and Arista Networks, Inc. (NYSE:ANET) are the top four holdings of the ETF.
3. Pacer Lunt MidCap Multi-Factor Alternator ETF (NYSEARCA:PAMC)
Performance since Inception: 49.8%
Total Net Assets as of September 21, 2023: $37.53 million
Expense Ratio: 0.60%
Number of Holdings: 133
Pacer Lunt MidCap Multi-Factor Alternator ETF (NYSEARCA:PAMC) is an actively managed mid-cap ETF that rotates between four investment factors – value, momentum, quality, and volatility. It alternates to a new factor every month. For September 2023, the ETF is in the high momentum and high-quality phase. It is one of the few broad-market ETFs that has the highest exposure to the industrial sector, with a weightage of 26.35%.
2. Invesco S&P MidCap Momentum ETF (NYSEARCA:XMMO)
5-Year Price Performance: 50.4%
Total Net Assets as of September 21, 2023: $1.15 billion
Expense Ratio: 0.34%
Number of Holdings: 91
Invesco S&P MidCap Momentum ETF (NYSEARCA:XMMO) is a passive mid-cap momentum ETF that was launched in March 2005. The ETF tracks an index of S&P Mid-cap 400 stocks with the highest momentum scores based on risk-adjusted trailing 12-month returns. The index is rebalanced bi-annually. Reliance Steel & Aluminum Co. (NYSE:RS), Hubbell Incorporated (NYSE:HUBB), Unum Group (NYSE:UNM), and Super Micro Computer, Inc. (NASDAQ:SMCI) are the top four holdings of the ETF.
1. iShares Morningstar Mid-Cap Growth ETF (NYSEARCA:IMCG)
5-Year Price Performance: 50.5%
Total Net Assets as of September 21, 2023: $1.62 billion
Expense Ratio: 0.06%
Number of Holdings: 311
iShares Morningstar Mid-Cap Growth ETF (NYSEARCA:IMCG) has the lowest management fee amongst all the ETFs on our list. The ETF launched in June 2004 makes quarterly distributions and offers a distribution yield of 0.87%. The passive mid-cap growth ETF is managed by the iShares division of BlackRock and tracks an index of mid-cap US stocks that exhibit growth characteristics as determined by Morningstar’s proprietary methodology. Stocks are screened for metrics like revenue and earnings growth. The top 10 holdings of the ETF have a combined weight of 9.91% of total assets. Workday, Inc. (NASDAQ:WDAY), Marvell Technology, Inc. (NASDAQ:MRVL), and TransDigm Group Incorporated (NYSE:TDG) are the top three holdings of the ETF.
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