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Just been looking at the beaten-down growth stock landscape this year, and honestly, there's some interesting opportunities forming if you're thinking long-term.
So here's the thing - 2023 through 2025 was basically the AI and megacap growth show. But 2026? Completely different story. Tech and communications sectors are getting hit hard. Even the Magnificent Seven are all down - Nvidia, Alphabet, Apple, Microsoft, Amazon, Meta, Tesla, the whole crew. Which means growth stock ETFs are taking a beating too.
But that's exactly when you want to be looking at these. Three stand out to me right now.
First up is the Vanguard Growth ETF (VUG). This one's basically a foundational holding for anyone serious about growth stock exposure. The expense ratio is dirt cheap at 0.04% - like, almost free. It gives you a basket of 151 growth stocks, so you're not putting all your eggs in one place. Down 6.1% year to date, which actually makes it a pretty solid entry point if you believe in the long-term thesis.
Then there's the Vanguard Mega Cap Growth ETF (MGK) if you want something more concentrated. Only 60 holdings, but they're the absolute biggest growth stock names by market cap. Nearly 60% in the Magnificent Seven alone. Obviously, since those have been falling harder, this one's down a bit more than VUG. But the expense ratio is still basically free at 0.05%. If you specifically want the largest growth stocks, this is your play.
Now here's where it gets interesting - the iShares Expanded Tech Software Sector ETF (IGV). Down 21.7% year to date. That's brutal. Everyone's worried AI is going to kill the software-as-a-service model. And look, some of those concerns make sense - if AI can replace entire workflows, why would companies pay for subscriptions? But here's the thing - that doesn't mean the entire sector should crater. This is actually the kind of beaten-down opportunity that tends to set up the best recoveries. You're getting exposure to Microsoft, Palantir, Oracle, Salesforce at heavily discounted prices. The downside is the expense ratio is higher at 0.39%, but if you're betting on an industry-wide recovery, holding a basket is easier than picking individual names.
The bigger picture? When you see the broader market hovering near all-time highs while a huge chunk of growth stocks is getting destroyed, that's usually when the best long-term opportunities show up. These ETFs let you get exposure to that recovery without having to pick individual growth stock winners.