For investors seeking momentum, Vanguard Consumer Discretionary ETF (VCR - Free Report) is probably on radar. The fund just hit a 52-week high and is up 107.3% from its 52-week low price of $118.99/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
VCR in Focus
This product targets the consumer discretionary segment of the broad stock market. It has key holdings in Internet & direct marketing retail, home improvement retail, and restaurants. The ETF charges 10 basis points in annual fees (see: all the Consumer Discretionary ETFs here).
Why the Move?
The consumer discretionary sector has been an area to watch lately given the improving economic conditions and progress in developing a coronavirus treatment or vaccine. The latest bouts of data indicate that the American economy is recovering and consumer spending, which accounts for more than two-thirds of the U.S. economic activity, is picking up. The cyclical sectors like consumer discretionary are tied to economic activities and when growth improves, these perform well.
More Gains Ahead?
Currently, VCR has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.
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