For investors seeking momentum, Vanguard S&P Mid-Cap 400 ETF (IVOO - Free Report) is probably on the radar now. The fund just hit a 52-week high and is up nearly 18.9% from its 52-week low price of $113.66/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.
IVOO in Focus
The fund follows the performance of the S&P MidCap 400 Index. The fund holds 400 stocks in total. Abiomed, Broadridge Financial Solutions, and Teleflex are the top three stocks of the fund. Information Technology (17.10%), Financials (17%) and Consumer Discretionary (12.20%) are the top three sectors of the fund. The product charges 15 bps in fees (see all mid-cap ETFs here).
Why the Move?
While large companies are normally known for stability and the smaller ones for growth, mid-caps offer the best of both the worlds, allowing growth and stability in portfolios simultaneously.
Large caps have wider foreign exposure and thus currently bear trade war risks. On the other hand, after a nice rally in recent months, small-cap stocks (which are more domestically focused) appear a bit overvalued. Against this backdrop, tapping mid-cap ETFs like IVOO appears intriguing.
More Gains Ahead?
The fund has a Zacks ETF Rank #2 (Buy). It seems that the fund will perform decently in the near term given a positive weighted alpha of 15.30.
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