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Small-Cap Growth ETF (VTWG) Hits New 52-Week High

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For investors seeking momentum, Vanguard Russell 2000 Growth Index ETF (VTWG - Free Report) is probably on radar now. The fund just hit a 52-week high and is up more than 26% from its 52-week low price of $117.80/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:

VTWG in Focus

VTWG provides diversified exposure to a broad basket of 1202 small-cap stocks whose earnings are expected to grow at an above-average rate relative to the market. The fund has key holdings in healthcare, information technology, consumer discretionary and producer durables. It charges 20 basis points in annual fees (see: all the Small Cap ETFs here).

Why the Move?

The growth space of the small-cap segment has been an area to watch lately given the continued surge in the space amid a raft of political woes. This is because small-cap stocks, which are closely tied to the U.S. economy and do not have much exposure to the international market, are well insulated from the trade war fears, geopolitical tension, political instability and a strong dollar. All these are the most happening stories brewing in Wall Street at present. The pint-sized stocks are considered safe and better plays if any political issue creeps into the picture. In particular, growth stocks tend to outperform in a trending market (a market characterized by a prolonged uptrend).

More Gains Ahead?

Currently, VTWG has a Zacks ETF Rank #3 (Hold) with a High 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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