Best Growth ETFs Right Now

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Contributor, Benzinga
Updated: April 8, 2020

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A growth ETF is a broad category of funds that include stocks from companies with the greatest capacity for quick growth and profit increases. If you’re looking to add a boost to your portfolio, investing in a growth ETF can be an excellent way to take advantage of market volatility. But which growth ETFs are worth your investment?

Today, we’ll take a look at a few of the best growth ETFs right now. We’ll also introduce you to some of our favorite brokers to help you get started investing online. 

Growth ETFs Biggest Gainers and Losers

Which growth ETFs show the highest volatility? These are the top-moving growth ETFs on the market today. 

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Premarket Growth ETFs

Prefer to do your trading in the premarket? These growth ETFs are making movements before the official market opening bell. 

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Aftermarket Growth ETFs

The aftermarket hours can also be one of the best times to invest. These growth ETFs are some ETFs to consider in today’s aftermarket trading session. 

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Why Invest in Growth ETFs?

With so many investment choices available, why should you invest in growth ETFs? Let’s take a look at some of the biggest benefits that come with investing in this asset class.

  • Growth ETFs have the potential for high returns. One of the key features of growth ETFs is that they have the high potential for returns. When a fund manager puts together a growth ETF, he or she only selects stocks that have high return potential. While every growth ETF won’t always skyrocket in price, growth ETFs have a much higher potential for profit when compared to value ETFs.
  • Growth ETFs are much safer than investing in individual stocks. If you have the risk tolerance to invest in growth ETFs over value ETFs or total market index funds, why not invest in individual companies or penny stocks? Growth ETFs can provide you with the volatility necessary to see large price increases without the risk of investing in individual stocks.

    When you invest in a growth ETF, you invest in a basket of companies instead of 1 individual corporation. If you purchase stock of an individual company and that company goes bankrupt, you could lose 100% of your initial investment. However, when you invest in a growth ETF, you split your investments between many companies. If a company has a poor season or goes bankrupt, you won’t lose all of the money you’ve invested.
  • Growth ETFs can amplify returns during a bull market. A bull market is a type of market trend during which prices of stocks and ETFs are rising or expected to rise. During a bull market, you might see a small increase in price if you invest in value ETFs or index funds. Growth ETFs, on the other hand, tend to see huge price increases during a bull market. If you think that prices are set to rise soon, investing in growth ETFs can be a better value for your dollar. 

3 Growth ETFs by AUM

Ready to add a growth ETF to your portfolio? Let’s take a look at the 3 largest growth ETFs by assets under management (AUM).   

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1. Invesco QQQ (QQQ)

The Invesco QQQ is one of the world’s most widely purchased growth ETFs on the market with over $79,000 million assets under management (AUM). The QQQ ETF aims to track the NASDAQ 100 index, which means that the ETF is heavily invested in the technology sectors. You’ll probably recognize most of the fund’s included assets — major holdings include the Microsoft Corporation (MSFT), Apple (AAPL), Amazon (AMZN), Facebook (FB) and Alphabet, the company that owns Google.

The Invesco QQQ contains relatively few stocks when compared to other growth-oriented ETFs, with about 1/3 of its total assets held in its 3 largest investments and only 100 stocks included in total. This can make the ETF especially volatile and is primarily held by short-term traders looking to capitalize on quick market movements. However, QQQ also has an exceptionally low expense ratio at 0.20%, and has a history dating back to 1999. This can make it an equally appealing candidate for long-term traders looking to add tech sector exposure to their portfolio. 

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2. iShares Russell 1000 Growth ETF (IWF)

The iShares Russell 1000 Growth ETF tracks the Russell 1000 Growth Index, which offers exposure to large-cap companies with a high potential for growth. Most of the fund’s holdings are similar to QQQ, with major investments in the Microsoft Corporation, Apple, Amazon and Facebook. IWF currently has over $41,000 million in AUM.

Unlike QQQ, IWF includes a little over 600 stocks in its composition and offers a greater level of diversification. Though the fund is still heavily weighted toward technology and the tech sector, industrials, energy and consumer goods also receive a good amount of representation. Major nontech holdings include Visa, UnitedHealth Group, Mastercard and Cisco. This can make IWF a safer long-term hold than more concentrated funds like QQQ.  

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3. Vanguard Growth ETF (VUG)

The Vanguard Growth ETF tracks the MSCI U.S. Prime Market Growth Index, which is another index fund focused on tracking the prices of growth-oriented companies. VUG currently holds a little over $39,500 million AUM and is heavily oriented toward the tech and consumer goods sectors. Some of the fund’s largest holdings are in the Microsoft Corporation, Apple and Amazon. The fund’s largest non-tech holdings are in Visa, Mastercard, Home Depot and the McDonald’s Corporation.

VUG currently contains a little over 400 individual stocks in its fund, which can make it an appealing choice for long-term investors. Another appealing benefit of VUG is its rock-bottom expense ratio. Like most choices from Vanguard, the Vanguard Growth ETF focuses on low expenses — and at just 0.04%, it’s an appealing choice for both bargain hunters and long-term investors. 

Best Online Brokers for Growth ETFs

Before you can invest in a growth ETF, you need to open a brokerage account. Thankfully, there are plenty of online brokers offering quick signups — let’s take a look at a few of our favorites.   

Self Direct Investment by JP Morgan
Best For
  • Chase Customers
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1. You Invest by J.P. Morgan

Chase You Invest by J.P. Morgan means you can easily research, trade and manage your investments from your mobile device. You Invest provides online tools to search for investments, track companies and rollover your assets.

Only U.S. clients are able to open a You Invest account but it takes, on average, just a day to open and you’re able to apply fully online. Equipped with portfolio reports and pie charts, the mobile app is simple and user-friendly. The app is available for both iOS and Android devices.

With Chase You Invest you’ll have access to roughly 5,000 stock exchanges. There are plenty of research and educational tools provided on the app. Overall, we recommend the Chase You Invest platform for stock trading because it’s easy to open and fund an account. It’s also reliable thanks to its strong parent company, J.P. Morgan. 

TradeStation – Online Broker – ONL-TRA-INVE-2737
Best For
  • Futures Trading
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2. TradeStation

TradeStation is an advanced trading platform for active traders. TradeStation offers a comprehensive set of trading tools, indicators and screeners you can use to find your next great investment. Its mobile app is impressive and mirrors full capabilities of the desktop platform for traders on the go.

TradeStation also offers a wide range of tradable securities beyond ETFs. From stocks and mutual funds to futures contracts and cryptocurrencies, TradeStation is a one-stop shop for all types of traders. If you’ve traded before and want a single platform for all of your trading needs, TradeStation is an excellent candidate.  

Firstrade
Best For
  • Mobile Investing
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3. Firstrade

If you’re a very new trader, TradeStation’s comprehensive platform can quickly become overwhelming. If this is your situation, you might want to consider opening an account with Firstrade.

Firstrade is a simple and easy-to-master platform that’s perfect for beginners. Though the platform doesn’t offer as many charting tools and indicators as some competitors, its simple layout can be a welcome change of pace for new investors. In addition to a great mobile app and intuitive desktop platform, Firstrade also offers a wide range of beginner-oriented investment classes and courses. If you’ve ever wanted to learn more about investing your money but you weren’t sure where to start, Firstrade can be an amazing first step. 

TD Ameritrade
Best For
  • Options Trading
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4. TD Ameritrade

With over 4 decades on the market, TD Ameritrade is 1 of the longest-standing discount brokers available. The broker effortlessly combines professional-grade stock and ETF charting tools with rock bottom prices on its award-winning thinkorswim platform. With $0 commissions and no maintenance fees, TD Ameritrade is a great choice for both casual investing and saving for retirement.

TD Ameritrade also offers easy onboarding and a range of instruction courses and videos you can use to learn more about investing and the platform’s many tools. There are plenty of research reports and news articles available on TD Ameritrade’s platform as well. If you’re looking for a low-cost yet powerful trading platform, TD Ameritrade might be right for you. 

Enhancing Your Portfolio with Growth ETFs

Growth ETFs can be an excellent complement to any investing portfolio. However, it’s important to remember that growth ETFs can be exceptionally volatile — and they shouldn’t make up the majority of your portfolio. Invest in a strong foundation of value ETFs and index funds before you start investing in growth ETFs to protect your financial future.