Look to Momentum ETFs to Carry Investors Through 2019

When momentum picks up in the markets, it can be difficult to stop and for investors who are keen on the idea that the momentum can continue through the rest of 2019 can look to momentum-focused ETFs.

However, it’s not a matter of simply sticking your hand into a grab bag of equities and blindly accepting what’s available. It will still require a strategic bent when picking potential winners.

“More and more it seems like the companies that we cover on Wall Street are starting to agree that while the future is still bright for the U.S. economy, it may be one of stock market gains that are much lower than the norm has been over the past 10 years,” wrote Lee Jackson in 24/7 Wall St. “When that is the case, then investing strategies often shift from indexing to a more disciplined stock-picking routine, and that’s when investors need solid growth ideas.”

Investment banking firm Jefferies is looking at specific equities that are focused on momentum, which can become part of an investor’s aggressive growth portfolio.

“Jefferies highlights the firm’s top growth stocks to buy each week, and this week is no exception. The firm’s analysts have been reviewing third-quarter results, and they are very positive going forward on some of the biggest and most powerful technology and momentum giants,” Jackson noted.

Technology has been a prime playground for investors looking to add growth and momentum factors to their portfolios. Jefferies recommends tech giants like Amazon and Tesla.

As such, here are a few ETFs investors can look to:

  1. Technology Select Sector SPDR ETF (NYSEArca: XLK): tries to reflect the performance of the Technology Select Sector Index, which is comprised of technology and telecom sector of the S&P 500. The ETF includes companies from technology hardware, storage, and peripherals; software; diversified telecommunication services; communications equipment; semiconductors and semiconductor equipment; internet software and services; IT services; electronic equipment, instruments and components; and wireless telecommunication services.
  2. Fidelity MSCI Information Technology Index ETF (FTEC): tries to reflect the performance of the Nasdaq-100 Technology Sector Index, which consists of companies in the Nasdaq-100 Index classified as technology according to the Industry Classification Benchmark. QTEC currently holds 34 components and more-or-less equally weights its holdings.
  3. iShares U.S. Technology ETF (NYSEArca: IYW): reflects the performance of the Dow Jones U.S. Information Technology Index, which includes all tech sector picks in the Dow Jones U.S. Index. Due to the Dow Jones’ classification of information tech names, healthcare technology stocks may be included while payment technology stocks are excluded.

For more market trends, visit ETF Trends.