6 Best Growth ETFs to Buy Now

The best growth ETFs offer exposure to higher-risk, higher-reward stocks while lessening the risk of a single stock torpedoing your returns.

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Growth ETFs (exchange-traded funds) are as straightforward as they sound: They are portfolios of growth stocks. However, not all funds are created equal and investors must perform due diligence in order to find the best growth ETFs to meet their goals.

By definition, a growth stock is any company with an above-average growth profile. In other words, these are companies whose revenues and earnings are expanding faster than the market average. They also often pay little or no dividends (but not always, as you'll read later), opting instead to reinvest their cash flow in the business to maintain their growth.

This is why owning growth ETFs makes so much sense. By diversifying your growth-stock holdings through a fund, you're protecting your downside.

Funds like these are extremely cheap, efficient vehicles that allow you to invest in dozens, if not hundreds, of growth stocks without having to trade them all individually in your account. They also allow you to be tactical, investing in sectors and industries you think are best positioned to rise going forward.

Investors abandoned growth stocks in 2022 due to higher interest rates and the threat of a recession. However, this corner of the market came back with a vengeance in 2023 due in part to strength in The Magnificent 7, the group of tech and artificial intelligence (AI) stocks that include Nvidia (NVDA) and Microsoft (MSFT). 

Looking ahead, easing inflation and more normalized interest rates will likely "provide upside potential in earnings for growth stocks, particularly in the technology and communication services sectors," says Jeff Buchbinder, chief equity strategist at LPL Financial. This could keep the wind at growth's back.

With that in mind, here are six of the best growth ETFs to add to a core portfolio for the long haul. 

Data is as of April 15, 2024. Dividend yields represent the trailing 12-month yield, which is a standard measure for equity funds. 

Will Ashworth
Contributing Writer, Kiplinger.com

Will has written professionally for investment and finance publications in both the U.S. and Canada since 2004. A native of Toronto, Canada, his sole objective is to help people become better and more informed investors. Fascinated by how companies make money, he's a keen student of business history. Married and now living in Halifax, Nova Scotia, he's also got an interest in equity and debt crowdfunding.