Value stocks are slipping as investors return to the growth style. Investors can also quickly capture broad growth segments of the market through targeted ETF strategies.
Value stock ETFs are experiencing block selling that fueled a surge in trading volumes, report Carolina Wilson and Dani Burger for Bloomberg.
For instance, the Vanguard Value ETF (NYSEArca: VTV) saw $424 million in trades Tuesday, or almost triple its average daily volume over the past year. The iShares MSCI USA Value Factor ETF (NYSEArca: VLUE) also experienced $274 million worth of shares exchanging hands yesterday, more than double the average daily turnover in the past year.
“With the yield curve flattening, signaling lower growth, managers are shifting once again to the uber growth names, like the FANG play” Dave Lutz, head of ETFs at JonesTrading Institutional Services, told Bloomberg, referring to the fast rising tech stocks Facebook Inc., Amazon.com Inc., Netflix Inc. and Google parent Alphabet Inc.
10 Growth-Related ETFs Ideas
Investors may target more cyclical U.S. stocks through growth-oriented ETFs. For instance, the PowerShares QQQ (NasdaqGM: QQQ) tracks the Nasdaq-100 and includes a heavy tilt toward the tech sector, along with a large position in consumer cyclicals.
Investors can also target growth-specific index ETFs, like the iShares Russell 1000 Growth ETF (NYSEArca: IWF) and Vanguard Growth ETF (NYSEArca: VUG). IWF takes growth picks from the large-cap universe of Russell 1000 stocks. VUG selects picks from the largest 85th percentile of the U.S. stocks. The ETFs overweight tech and discretionary names as well.
Investors can also capture mid cap growth stocks through the iShares Russell Mid-Cap Growth ETF (NYSEArca: IWP), Vanguard Mid-Cap Growth (NYSEArca: VOT), iShares S&P Mid-Cap 400 Growth ETF (NYSEArca: IJK) and Guggenheim S&P Midcap 400 Pure Growth ETF (NYSEArca: RFG). These funds also include heavy positions in consumer discretionary, industrials and technology sectors.
Lastly, for smaller company exposure with a growth style tilt, the iShares Russell 2000 Growth ETF (NYSEArca: IWO), Vanguard Small-Cap Growth ETF (NYSEArca: VBK) and iShares S&P Small-Cap 600 Growth ETF (NYSEArca: IJT) focus on the small-capitalization growth asset class category.
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