ETFs
Best mid-cap ETFs in June 2024
Many investors overlook mid-cap stocks, partly because they are not as financially stable as large-cap stocks and partly because they do not grow as quickly as small-cap stocks. But mid-cap stocks offer a mix of both: solid growth and financial stability. If you don’t want to have to invest in individual stocks, you can gain exposure to mid-cap stocks via an ETF.
What is a mid-cap ETF?
A mid-cap ETF is a exchange traded fund which invests in mid-market companies, where the total value of the company’s shares ranges from a few billion dollars to around $20 billion. Mid-cap ETFs are a great way to own companies that are growing quickly and have good financial stability without having to analyze individual stocks and pick winners.
Mid values include many companies you haven’t heard of as well as many you may use in your daily life. And the best mid-cap stocks will continue to grow, eventually becoming large-cap stocks and multiplying your initial investments many times over.
Mid-sized companies can be popular with investors for several reasons:
- Growth: Mid-sized companies are still small enough to deliver above-average growth, and sometimes well above average, as many mid-sized companies are becoming. large caps.
- Increase financial stability: Their increasing size comes with greater financial stability and greater resources, making mid-caps safer than small caps, but not as much as large caps or large-cap companies. mega-cap companies like Apple and Amazon.
- Defensive companies: Mid-sized businesses have typically grown to become large enough to be able to defend a business niche, thereby increasing their overall security.
- Less volatility: Because they’re safer, mid-caps tend to have less volatility than their smaller rivals, making them a bit better for risk-averse investors.
These are big positives for investors, but if you have no interest in investing yourself and don’t want to do the legwork of research and analysis, a good place to start is to buy an ETF mid-cap. (And here are the best small cap ETFs And best large cap ETFs based on their overall returns.)
The Best Performing Mid-Cap ETFs
Bankrate selected its best funds based on the following criteria:
- US funds that appear in ETF.com’s mid-cap filter
- Funds among the best performing over the last five years
- No inverse or leveraged ETFs
- Performance measured as of May 31, 2024 using the most recent figures from ETF.com.
Invesco S&P MidCap Quality ETF (XMHQ)
This passively managed fund is based on the S&P MidCap 400 Quality Index, which includes 80 stocks from the S&P MidCap 400 Index that perform well for quality companies.
- Performance since the start of 2024: 17.6 percent
- Historical performance (annual over 5 years): 18.7 percent
- Expense rate: 0.25 percent
Invesco S&P MidCap Momentum ETF (XMMO)
This passively managed fund is based on the S&P MidCap 400 Momentum Index, which includes 80 stocks from the S&P MidCap 400 Index with the highest momentum scores.
- Performance since the start of 2024: 26.3 percent
- Historical performance (annual over 5 years): 16.3 percent
- Expense rate: 0.34 percent
Invesco S&P MidCap 400 Income ETF (RWK)
This fund tracks the S&P 400 MidCap 400 Revenue-Weighted Index, which includes stocks from the S&P 400 MidCap Index reweighted based on company revenue.
- Performance since the start of 2024: 5.8 percent
- Historical performance (annual over 5 years): 15.8 percent
- Expense rate: 0.39 percent
Invesco S&P MidCap 400 GARP ETF (GRPM)
This passively managed fund tracks the S&P MidCap 400 GARP Index. The index – whose name GARP stands for growth at a reasonable price – includes stocks that offer good selection for consistent growth, a reasonable valuation, strong earnings power and solid financials.
- Performance since the start of 2024: 17.7 percent
- Historical performance (annual over 5 years): 15.0 percent
- Expense rate: 0.35 percent
Invesco S&P MidCap 400 Pure Value ETF (RFV)
This passively managed fund is based on the S&P MidCap 400 Pure Value Index, which includes stocks from the S&P MidCap 400 Index that perform well on value characteristics such as low price-to-book value , a low price-to-earnings ratio and a low price-to-sales ratio.
- Performance since the start of 2024: -2.8 percent
- Historical performance (annual over 5 years): 14.9 percent
- Expense rate: 0.35 percent
Franklin US Mid-Cap Multifactor Index ETF (FLQM)
This fund tracks the LibertyQ US Mid Cap Equity Index, which includes stocks based on company quality, value, momentum and low volatility. This fund targets stocks that have low downside potential and can provide attractive long-term risk-adjusted returns.
- Performance since the start of 2024: 6.1 percent
- Historical performance (annual over 5 years): 13.1 percent
- Expense rate: 0.30 percent
Invesco S&P MidCap Value with Momentum ETF (XMVM)
This passively managed fund tracks the S&P MidCap 400 High Momentum Value Index, which includes 80 stocks from the S&P MidCap 400 Index that score highest on value and momentum factors.
- Performance since the start of 2024: 3.6 percent
- Historical performance (annual over 5 years): 12.9 percent
- Expense rate: 0.39 percent
Conclusion
Mid-cap ETFs are an attractive way to invest in high-performing companies that combine growth and stability without the risks of purchasing individual stocks. While an ETF can help diversify the risk of purchasing a few individual stocks, it will not eliminate all of the risk of investing.
Editorial Disclaimer: All investors are advised to conduct their own independent research into investment strategies before making an investment decision. Furthermore, investors are advised that past performance of investment products is not a guarantee of future price appreciation.