Back to top

Image: Bigstock

Mega Cap ETF (XLG) Hits New 52-Week High

Read MoreHide Full Article

For investors seeking momentum, Guggenheim S&P 500 Top 50 ET (XLG - Free Report) is probably on radar now. The fund just hit a 52-week high, and is up roughly 23.3% from its 52-week low price of $130.63/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:

XLG in Focus    

This fund offers exposure to mega cap securities with key holdings in information technology. As such, it has significant concentration on the top two firms – Apple (AAPL - Free Report) and Microsoft (MSFT - Free Report) – with a combined 12.4% share while other firms hold less than 3.7% of assets. The product charges investors 20 basis points in fees (see: all the Large Cap ETFs here).

Why the Move?

The mega cap space of the broad U.S. stock market has been an area to watch lately given that the major bourses are again hovering around record levels. Trump’s policy for the financial sector acted as a major catalyst for the stock market after a slew of anti-trade policies. Further, encouraging earnings reports and upbeat job data also supported the rally. In particular, the Q4 earnings season is faring better than recent years, with earnings growth not only on track to reach the highest level in two years but total earnings set to hit a new quarterly record.
More Gains Ahead?

Currently, XLG has a Zacks ETF Rank of 3 or ‘Hold’ rating with a High risk outlook. Therefore, it is hard to get a handle on its future returns in 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.

Want key ETF info delivered straight to your inbox?

Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Apple Inc. (AAPL) - free report >>

Microsoft Corporation (MSFT) - free report >>

Invesco S&P 500 Top 50 ETF (XLG) - free report >>

Published in