Exchange-traded funds (ETFs) remain a key vehicle for investors seeking capital growth, even as markets grapple with macroeconomic uncertainty tied to the continuing conflict in the Middle East.
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This article highlights three ETFs rated Outperform by TipRanks’ AI analyst that investors can consider adding to their portfolios. The funds, which carry significant upside potential, include:
- Vanguard Information Technology ETF (VGT)
- iShares Expanded Tech Sector ETF (IGM)
- Avantis U.S. Equity ETF (AVUS)
Each of these ETFs is projected to deliver a return of at least 11%. The snapshot below highlights what makes each fund stand out from the crowd.
- Vanguard Information Technology ETF (VGT) — As the name suggests, this ETF is focused on the U.S. technology industry and seeks to provide investors with exposure to companies active in high-growth fields such as artificial intelligence and cloud computing. However, the fund’s primary focus on the tech sector means that macroeconomic updates that shake the sector can similarly affect the fund’s performance. The ETF AI analyst currently has an $826 price target on VGT, suggesting about 16% growth potential. The fund’s strength comes from the contributions of key portfolio holdings such as Apple (AAPL) and Microsoft (MSFT).
- iShares Expanded Tech Sector ETF (IGM) — IGM tracks the S&P North American Expanded Technology Sector Index, a benchmark of the performance of U.S. and Canadian technology-related stocks. However, the fund primarily holds stakes in large U.S. tech and internet companies and select communication services businesses. The ETF AI analyst currently has a $139 price target on IGM, suggesting about 14% upside. The fund’s current Outperform rating largely reflects the strong performance of key holdings such as Apple, Microsoft, and Alphabet (GOOGL).
- Avantis U.S. Equity ETF (AVUS) — Unlike the two funds highlighted earlier, AVUS seeks to provide investors with exposure to the entire U.S. stock market. It achieves this by scattering its investment across a broad range of sectors and companies, from industry heavyweights to small but fast-growing establishments. The ETF AI analyst currently has a price target of $124 on AVUS, indicating about 11% upside. The fund’s current Outperform rating is thanks to portfolio leaders Microsoft and Alphabet.