Want Strong, Cheap Growth In An ETF? Take A Look At This One (DSG)

Everybody wants growth in their portfolios. The problem is you have to pay up for growth, whether it be share price, P/E ratio, or PEG ratio. What if you could get growth, but not have to pay for it? SPDR Dow Jones Small Cap Growth DSG allows you to do just that, capture growth without having to pay for it. Looking at the prospectus for DSG, it reads: "The investment seeks to provide investment results that, before expenses, correspond generally to the total return of the Dow Jones U.S. Small Cap Growth Total Stock Market index. The fund uses a passive management strategy designed to track the total return performance of the float-adjusted Small Cap Growth index. The adviser seeks a correlation of 0.95 or better between the fund’s performance and the performance of the index. It is nondiversified." Small caps are generally seen as better investments in growth periods, as smaller investments in the companies can move shares much more than large caps. A small cap is usually any company with a market cap of $250 million to $1 billion. A million dollar investment in a company worth $500 million is going to move that company significantly more than a company worth $10 billion. This ETF allows you to play the companies that the ETF's manager feel are growing the strongest, all while you giving you exposure to different sectors. So how do you get the growth for free? The ETF's expense ratio is 0.26%, far lower than its competitor ETF's, which is at 0.43%. The ETF also sports a tiny yield, at 0.20%. If you reinvest the dividends back into the shares, your net cost is 6 basis points plus cost of the trade. If you think, the ETF will rise more than 6 basis points, which is little more than 1 cent, you're getting strong growth for free. Some of the top 10 holdings in this ETF are no slouch, with the likes of Aeropostale Inc ARO, Essex Property Trust Inc. ESS, and Jones Lang Lasalle Inc. JLL. The ETF includes some tech, some real estate, some retail and a variety of other sectors. It seems like a no brainer to me. If you want growth for free, take a look at adding shares of DSG. Who doesn't love free growth?