Investing in growth stocks is a great long-term strategy. It can help you maximize your portfolio’s gains by investing in up-and-coming businesses with lots of room to grow. One exchange-traded fund (ETF) that focuses on growing businesses is the Capital Group Growth ETF (NYSE Arca:CGGR)
The Capital Group Growth ETF is heavily tilted towards U.S. stocks, which account for 89% of its portfolio. The ETF's top holdings are a blend of technology and consumer-focused companies. As of August 31, the fund's largest holdings included Meta Platforms (NASDAQ:META) at 7.7%, Tesla (NASDAQ:TSLA) at 5.5%, and Microsoft (NASDAQ:MSFT), accounting for 5.4% of the fund’s weight. These companies are leaders in their respective sectors, offering both growth and stability.
Although tech stocks are prevalent in the ETF, it is a well-balanced fund as technology companies only account for 18.8% of the total portfolio. Businesses involved in communication services make up 18.3% of the ETF’s holdings, followed by consumer discretionary stocks at 15.2%, healthcare at 14.6%, and industrials at 13.7%.
The ETF charges an expense ratio of 0.39%, which is relatively low, making it cost-effective for long-term investors. The fund also has a portfolio turnover rate of 33%, indicating a moderately active trading strategy, which ensures that the holdings aren’t stale.
For investors looking to capitalize on the growth potential of U.S. stocks while also having international exposure, the Capital Group Growth ETF offers a balanced and diversified portfolio. Its low expense ratio and experienced management team make it a suitable choice for those who are looking for capital appreciation over the long term. Year to date, the ETF has been a good buy as it has risen 23% in value.
