Growth ETFs
A growth ETF follows an index that selects stocks based on the growth rate of each stock. Some growth ETFs will also weight their holdings based on each stock's growth rate, rather than weighting their holdings using market capitalization.
The concept of a "growth ETF" is a little confusing because during the 1990s and early 2000s, when ETFs were first taking off, the investment community tried to classify all stocks into "value" stocks and "growth" stocks. So during the early days of the ETF industry, if you wanted to outperform the market, you had to buy an ETF that was labeled as either a "value ETF" or a "growth ETF". Each of the major index providers (MSCI, Russell, FTSE, and S&P) had their own way of classifying every stock as either a "growth" or a "value" stock.
Fast forward to today. Today, with the new terminology of "smart beta" and "factor investing", the concept of every stock being a "value" stock or a "growth" stock is somewhat outdated. Many of the old "growth" ETFs would actually be labeled today as a "multi-factor" ETF, because if you read the fine print about what the old "growth indexes" were doing, they were looking at numerous factors like quality, momentum, and volatility.
Because the tricky part about understanding growth ETFs is understanding what they define as "growth", let's run through some examples.
IVW, the iShares S&P 500 Growth ETF, one of the oldest growth ETFs, tracks the S&P 500 Growth Index, which measures growth using three factors: sales growth, the ratio of earnings change to price, and momentum. The selected stocks (around 300) are weighted using market capitalization.
VUG, the Vanguard Growth ETF, another one of the oldest growth ETFs, tracks the performance of the CRSP U.S. Large Cap Growth Index. CRSP classifies growth securities using the following factors: future long-term growth in earnings per share (EPS), future short-term growth in EPS, 3-year historical growth in EPS, 3-year historical growth in sales per share, current investment-to-assets ratio, and return on assets.
RPG, the S&P 500 Pure Growth ETF, tracks the S&P 500 Pure Growth Index. Similar to the S&P 500 Growth Index, the S&P 500 Pure Growth Index selects growth stocks using three factors: sales growth, the ratio of earnings change to price, and momentum. But only stocks with the highest growth characteristics are included in the index (about 115 stocks), and the stocks are weighted in the index based on their style score.
Growth ETFs are tricky to analyze and categorize in the context of factor investing because many growth ETFs are actually multi-factor ETFs, but they aren't labeled as "multi-factor" ETFs.
VUG, for example, uses several earnings related criteria, including return on assets, that factor research has labeled as the "quality" factor. VUG also screens for "current investment-to-assets ratio", which factor research has labeled as the "investment factor". So VUG is a multi-factor ETF using the quality, growth and investment factors, but it was launched before "smart beta" was invented as a marketing idea.
IVW and RPG are similarly tricky to analyze in terms of factor investing. They both screen on "price momentum", which is a well known factor. They also screen using the "ratio of earnings change to price", which presumably is a way to screen for profitable companies, which would be the "quality" factor, and also maybe a way to screen on value.
There are a large number of growth ETFs, as shown in this table:
| Name | Symbol | Last price | Currency | AUM | Expense ratio, % | Inception date |
|---|---|---|---|---|---|---|
| iShares Russell 1000 Growth ETF | ARCX:IWF | 122.75 | USD | May 26, 2000 | ||
| iShares S&P 500 Growth ETF | ARCX:IVW | 140.02 | USD | May 26, 2000 | ||
| Vanguard Growth ETF | XNYS:VUG | 271.31 | USD | Jan 26, 2004 | ||
| iShares Russell Midcap Growth ETF | ARCX:IWP | 140.91 | USD | Aug 02, 2001 | ||
| iShares Core S&P U.S. Growth ETF | XNAS:IUSG | 191.23 | USD | Jul 28, 2000 | ||
| iShares S&P SmallCap 600 Growth ETF | XNAS:IJT | 171.06 | USD | Jul 28, 2000 | ||
| iShares Russell Top 200 Growth ETF | ARCX:IWY | 287.20 | USD | Sep 28, 2009 | ||
| Nuveen ESG Large-Cap Growth ETF | BATS:NULG | 114.27 | USD | Dec 22, 2016 | ||
| Nuveen ESG Mid-Cap Growth ETF | BATS:NUMG | 48.04 | USD | Dec 20, 2016 | ||
| Pacer US Cash Cows Growth ETF | ARCX:BUL | 64.93 | USD | May 06, 2019 | ||
| Motley Fool Small-Cap Growth ETF | BATS:TMFS | 36.13 | USD | Nov 05, 2018 | ||
| Schwab U.S. Large-Cap Growth ETF | ARCX:SCHG | 35.78 | USD | Jan 04, 2010 | ||
| SoFi Next 500 ETF | ARCX:SFYX | 17.17 | USD | Apr 11, 2019 | ||
| Vanguard Mid-Cap Growth ETF | ARCX:VOT | 303.06 | USD | Aug 17, 2006 | ||
| Vanguard Small-Cap Growth ETF | ARCX:VBK | 351.84 | USD | Jan 26, 2004 | ||
| iShares Russell 2000 Growth ETF | ARCX:IWO | 378.91 | USD | Jul 28, 2000 | ||
| iShares S&P Mid-Cap 400 Growth ETF | ARCX:IJK | 113.70 | USD | Jul 28, 2000 | ||
| SPDR S&P 600 Small Cap Growth ETF (based on S&P SmallCap 600 Growth Index --symbol CGK) | ARCX:SLYG | 114.13 | USD | Sep 25, 2000 | ||
| SPDR Series Trust SPDR Portfolio S&P 500 Growth ETF | ARCX:SPYG | 121.25 | USD | Sep 25, 2000 | ||
| Invesco Large Cap Growth ETF | XNYS:PWB | 102.59 | USD | Mar 03, 2005 | ||
| SPDR S&P 400 Mid Cap Growth ETF (based on S&P MidCap 400 Growth Index--symbol: MUV) | ARCX:MDYG | 108.46 | USD | Nov 08, 2005 | ||
| Invesco S&P Midcap 400 Pure Growth ETF | XNYS:RFG | 49.15 | USD | Mar 01, 2006 | ||
| iShares Morningstar Large-Cap Growth ETF | ARCX:ILCG | 115.17 | USD | Jul 13, 2004 | ||
| iShares Morningstar Mid-Cap Growth ETF | ARCX:IMCG | 97.38 | USD | Jul 13, 2004 | ||
| iShares Morningstar Small-Cap Growth ETF | ARCX:ISCG | 64.10 | USD | Jul 13, 2004 | ||
| iShares MSCI EAFE Growth ETF | BATS:EFG | 125.02 | USD | Aug 05, 2005 | ||
| First Trust Large Cap Growth AlphaDEX Fund | XNAS:FTC | 177.85 | USD | May 11, 2007 | ||
| First Trust Multi Cap Growth AlphaDEX Fund | XNAS:FAD | 185.35 | USD | May 11, 2007 | ||
| Vanguard Mega Cap Growth ETF | ARCX:MGK | 90.12 | USD | Dec 17, 2007 | ||
| VanEck India Growth Leaders ETF | ARCX:GLIN | 45.92 | USD | Aug 25, 2010 | ||
| Vanguard S&P 500 Growth ETF | ARCX:VOOG | 84.17 | USD | Sep 07, 2010 | ||
| Vanguard S&P Mid-Cap 400 Growth ETF | ARCX:IVOG | 141.63 | USD | Sep 07, 2010 | ||
| Vanguard S&P Small-Cap 600 Growth ETF | ARCX:VIOG | 147.05 | USD | Sep 07, 2010 | ||
| Vanguard Russell 1000 Growth ETF | XNAS:VONG | 126.38 | USD | Sep 20, 2010 | ||
| Vanguard Russell 2000 Growth ETF | XNAS:VTWG | 276.72 | USD | Sep 20, 2010 | ||
| First Trust Mid Cap Growth AlphaDEX Fund | XNAS:FNY | 103.00 | USD | Apr 20, 2011 | ||
| First Trust Small Cap Growth AlphaDEX Fund | XNAS:FYC | 120.52 | USD | Apr 20, 2011 | ||
| Janus Henderson Small/Mid Cap Growth Alpha ETF | XNAS:JSMD | 93.22 | USD | Feb 25, 2016 | ||
| Janus Henderson Small Cap Growth Alpha ETF | XNAS:JSML | 88.86 | USD | Feb 25, 2016 | ||
| American Century U.S. Quality Growth ETF | ARCX:QGRO | 118.88 | USD | Sep 12, 2018 | ||
| Invesco S&P Smallcap 600 Pure Growth ETF | ARCX:RZG | 67.36 | USD | Mar 01, 2006 | ||
| Invesco S&P 500 Pure Growth ETF | ARCX:RPG | 57.11 | USD | Mar 01, 2006 | ||
| ClearBridge Large Cap Growth ESG ETF | XNAS:LRGE | 88.83 | USD | May 31, 2017 | ||
| iShares MSCI USA Quality GARP ETF | BATS:GARP | 83.81 | USD | |||
| Advisors Series Trust Logan Capital Broad Innovative Growth ETF | ARCX:LCLG | 70.59 | USD | Aug 08, 2022 | ||
| Alger Mid Cap 40 ETF | ARCX:FRTY | 22.87 | USD | Mar 02, 2021 | ||
| Alger 35 ETF | ARCX:ATFV | 39.68 | USD | May 04, 2021 | ||
| The Alger ETF Trust Alger Weatherbie Enduring Growth ETF | ARCX:AWEG | 22.55 | USD | Mar 07, 2023 | ||
| EA Series Trust Strive 1000 Dividend Growth ETF | XNYS:STXD | 40.38 | USD | Nov 11, 2022 | ||
| EA Series Trust Strive 1000 Growth ETF | XNYS:STXG | 56.48 | USD | Nov 11, 2022 | ||
| AOT Growth and Innovation ETF | XNAS:AOTG | 65.04 | USD | Jun 29, 2022 | ||
| American Century Sustainable Growth ETF | ARCX:ACGR | 70.07 | USD | Jan 21, 2020 | ||
| American Century Mid Cap Growth Impact ETF | ARCX:MID | 69.86 | USD | Jul 27, 2020 | ||
| American Century Focused Dynamic Growth ETF | ARCX:FDG | 133.36 | USD | Apr 02, 2020 | ||
| Capital Group Growth ETF | ARCX:CGGR | 46.99 | USD | Feb 24, 2022 | ||
| Capital Group Global Growth Equity ETF | ARCX:CGGO | 40.42 | USD | Feb 24, 2022 | ||
| DBX ETF Trust Xtrackers S&P 500 Growth ESG ETF | BATS:SNPG | 59.57 | USD | Nov 11, 2022 | ||
| ETF Series Solutions LHA Market State Tactical Q ETF | BATS:MSTQ | 38.81 | USD | Mar 16, 2022 | ||
| Fidelity Fundamental Large Cap Growth ETF | BATS:FFLG | 33.06 | USD | Feb 04, 2021 | ||
| Fidelity Blue Chip Growth ETF | BATS:FBCG | 61.81 | USD | Jun 05, 2020 | ||
| First Trust Growth Strength ETF | XNAS:FTGS | 39.48 | USD | Oct 26, 2022 | ||
| First Trust Multi-Manager Large Growth ETF | ARCX:AFGR | 37.33 | USD | Jul 22, 2020 | ||
| First Trust Multi-Manager Small Cap Opportunities ETF | ARCX:MMSC | 28.03 | USD | Oct 14, 2021 | ||
| Hartford Large Cap Growth ETF | BATS:HFGO | 29.40 | USD | Nov 10, 2021 | ||
| NYLI Winslow Focused Large Cap Growth ETF | ARCX:IWFG | 54.53 | USD | Jun 23, 2022 | ||
| NYLI Winslow Large Cap Growth ETF | ARCX:IWLG | 56.41 | USD | Jun 23, 2022 | ||
| iShares Trust iShares ESG Aware MSCI USA Growth ETF | BATS:EGUS | 58.63 | USD | Feb 03, 2023 | ||
| JPMorgan International Growth ETF | ARCX:JIG | 85.39 | USD | Jun 01, 2020 | ||
| J.P. Morgan Exchange-Traded Fund Trust JPMorgan Active Growth ETF | ARCX:JGRO | 94.24 | USD | Aug 09, 2022 | ||
| Sterling Capital Focus Equity ETF | ARCX:LCG | 33.08 | USD | Aug 27, 2020 | ||
| Nuveen Winslow Large-Cap Growth ESG ETF | ARCX:NWLG | 29.35 | USD | Aug 05, 2021 | ||
| PGIM ETF Trust PGIM Jennison Focused Growth ETF | ARCX:PJFG | 118.05 | USD | Dec 14, 2022 | ||
| Pacer US Large Cap Cash Cows Growth Leaders ETF | XNAS:COWG | 40.02 | USD | Dec 30, 2022 | ||
| Putnam Focused Large Cap Growth ETF | ARCX:PGRO | 47.01 | USD | May 26, 2021 | ||
| Motley Fool Mid-Cap Growth ETF | BATS:TMFM | 23.47 | USD | Dec 13, 2021 | ||
| Motley Fool Global Opportunities ETF | BATS:TMFG | 31.68 | USD | Dec 13, 2021 | ||
| T. Rowe Price Blue Chip Growth ETF | ARCX:TCHP | 50.74 | USD | Aug 05, 2020 | ||
| T. Rowe Price Growth Stock ETF | ARCX:TGRW | 47.38 | USD | Aug 05, 2020 | ||
| ETRACS 2x Leveraged US Growth Factor TR ETN | ARCX:IWFL | 61.44 | USD | Feb 08, 2021 | ||
| WisdomTree Trust WisdomTree U.S. Quality Growth Fund | ARCX:QGRW | 67.67 | USD | Dec 22, 2022 | ||
| Gabelli Growth Innovators ETF | ARCX:GGRW | 37.55 | USD | Feb 19, 2021 | ||
| Harbor ETF Trust Harbor Long-Term Growers ETF | XNYS:WINN | 33.71 | USD | Feb 03, 2022 | ||
| Pacer US Small Cap Cash Cows Growth Leaders ETF | XNAS:CAFG | 33.32 | USD | May 02, 2023 | ||
| Natixis ETF Trust II Natixis Loomis Sayles Focused Growth ETF | ARCX:LSGR | 45.57 | USD | Jun 29, 2023 | ||
| T. Rowe Price Exchange-Traded Funds, Inc. T. Rowe Price Growth ETF | ARCX:TGRT | 46.45 | USD | Jun 16, 2023 | ||
| Level Four Large Cap Growth Active ETF | XNAS:LGRO | 47.58 | USD | Aug 22, 2023 | ||
| Litman Gregory Funds Trust Polen Capital Global Growth ETF | ARCX:PCGG | 11.57 | USD | Aug 30, 2023 | ||
| Professionally Managed Portfolios Congress Large Cap Growth ETF | ARCX:CAML | 40.73 | USD | Aug 21, 2023 | ||
| Professionally Managed Portfolios Congress SMid Growth ETF | ARCX:CSMD | 34.42 | USD | Aug 21, 2023 | ||
| Brookstone Growth Stock ETF | BATS:BAMG | 44.58 | USD | Sep 27, 2023 | ||
| Foundations Dynamic Growth ETF | BATS:FDGR | 14.17 | USD | Oct 16, 2023 | ||
| The Advisors Inner Circle Fund II CastleArk Large Growth ETF | ARCX:CARK | 47.99 | USD | Dec 07, 2023 | ||
| Fidelity Covington Trust Fidelity Enhanced Large Cap Growth ETF | ARCX:FELG | 44.08 | USD | Nov 20, 2023 | ||
| Franklin Templeton ETF Trust Franklin Focused Growth ETF | BATS:FFOG | 49.41 | USD | Nov 06, 2023 | ||
| Goldman Sachs ETF Trust Goldman Sachs MarketBeta Russell 1000 Growth Equity ETF | ARCX:GGUS | 66.84 | USD | Nov 30, 2023 | ||
| Tidal Trust II CoreValues Alpha Greater China Growth ETF | ARCX:CGRO | 22.16 | USD | Oct 02, 2023 | ||
| First Trust Exchange-Traded Fund VIII FT Raymond James Multicap Growth Equity ETF | ARCX:RJMG | 27.59 | USD | Jan 18, 2024 | ||
| Litman Gregory Funds Trust Polen Capital China Growth ETF | ARCX:PCCE | 12.55 | USD | |||
| Litman Gregory Funds Trust Polen Capital International Growth ETF | ARCX:PCIG | 9.27 | USD | |||
| WisdomTree U.S. SmallCap Quality Growth Fund | XNAS:QSML | 35.04 | USD | |||
| WisdomTree U.S. MidCap Quality Growth Fund | XNAS:QMID | 30.65 | USD | |||
| Pacer Funds Trust Pacer Developed Markets Cash Cows Growth Leaders ETF | ARCX:EAFG | 25.99 | USD | Mar 22, 2024 | ||
| VanEck ETF Trust VanEck Morningstar Wide Moat Growth ETF | BATS:MGRO | 30.90 | USD | |||
| The Alger ETF Trust Alger Concentrated Equity ETF | ARCX:CNEQ | 39.66 | USD | Apr 05, 2024 | ||
| iShares Large Cap Growth Active ETF | XNAS:BGRO | 43.17 | USD | |||
| Macquarie ETF Trust Macquarie Focused Large Growth ETF | ARCX:LRGG | 30.19 | USD | |||
| Federated Hermes ETF Trust Federated Hermes MDT Large Cap Growth ETF | ARCX:FLCG | 35.06 | USD | Jul 31, 2024 | ||
| Trust for Professional Managers Jensen Quality Growth ETF | ARCX:JGRW | 28.60 | USD | |||
| ETF Series Solutions AAM Sawgrass US Large Cap Quality Growth ETF | ARCX:SAWG | 24.45 | USD | Jul 31, 2024 | ||
| ETF Series Solutions AAM Sawgrass US Small Cap Quality Growth ETF | ARCX:SAWS | 23.51 | USD | Jul 31, 2024 | ||
| SoFi Select 500 ETF | ARCX:SFY | 152.36 | USD |