Avantis US Mid Cap Equity ETF

AVMC

Market cap $245M

Midcaps, especially those with a growth factor skew, are having a strong 2025 so far. Given this, investors may want to consider tilting towards exposure to midcap equities.

AVMC is led by five portfolio managers at Avantis Investors. Their investment objective is to outperform a benchmark like the Russell MidCap Index by emphasizing quality and value. Maintaining adequate diversification is also crucial. With 500+ securities and only about 7% allocated to the top ten, AVMC is designed to replace popular core funds like IWR and IJH. I have AVMC ranked #18/52 overall in the mid-cap blend category for February, primarily due to its solid quality features and attractive value ratios like its 16.99x forward P/E.

The S&P 500 has had an incredible run over the last two years. From the start of 2023 through the end of 2024, the benchmark stock index produced a total return of 58%.

The market narrative has moved on from the election to the season's latest rate cut. Now, with the year in its final stages and investors looking to reshuffle portfolios, surprising equity segments may be rising into view.

Trying to add some more ETF exposure before the year is through? Now may be the time as the yield curve returned to normal earlier this week for the first time in more than two years.

Rate cuts are coming – the question is, when? Many market watchers are expecting at least one cut this Fall as the U.S. inflation rate has cooled.

With some investors concerned with being overweight in large-cap equities, midcap investing can work as a great alternative. As the name would suggest, midcaps can provide the “best of both worlds” between small and large-cap equities.

Is now the time for midcap investing? The signs are starting to appear.

Companies situated in the middle of the market capitalization range could be on the cusp of breaking out. In midcap companies, investors could get exposure to the market's next big thing.

Small cap companies can offer investors more performance in the throes of a market rally. But the more risk averse may not want to add the extra volatility to their portfolios.