Mid-cap growth stocks are generally defined as the stocks of companies with market capitalizations between $2 billion and $10 billion that are growing at faster-than-average rates. Growth stocks have the potential for high investment returns, but also tend to be relatively volatile, so exchange-traded funds, or ETFs, that track a mid-cap growth index can be smart ways to invest.

Why mid-cap growth stocks?

Large-cap growth stocks tend to have limited long-term potential, as compared with smaller companies, and the ETFs that track them tend to be less diversified because of the top-heavy nature of the large-cap market. For example, a certain Vanguard large-cap growth ETF tracks hundreds of companies, but 23% of the fund's assets are invested in the four largest holdings.

Money growing concept.

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On the other hand, small-cap growth ETFs tend to be rather diverse, but small-cap growth stocks tend to be more volatile than larger companies.

Mid-cap growth stocks can be a nice compromise. They tend to have strong long-term growth potential, and the ETFs that track them tend to be less top-heavy than large-cap ETFs, with lower volatility than small caps.

3 top mid-cap growth ETFs

If you're looking to invest in mid-cap growth stocks, here are ETFs that track three slightly different indexes that contain mid-sized companies that exhibit growth characteristics.

Fund Name

Total Assets

Expense Ratio

5-Year Average Total Return

Vanguard Mid-Cap Growth Index Fund ETF (NYSEMKT:VOT)

$10 billion

0.07%

14%

Vanguard S&P Mid-Cap 400 Growth ETF (NYSEMKT:IVOG)

$1 billion

0.20%

14.2%

iShares Russell Mid-Cap Growth ETF (NYSEMKT:IWP)

$8 billion

0.25%

14.3%

Data source: TD Ameritrade. Expense ratios and assets are current as of June 29, 2017, and returns are as of May 31, 2017.

1. Vanguard Mid-Cap Growth Index Fund ETF

The Vanguard Mid-Cap Growth Index Fund ETF tracks the CRSP US Mid Cap Growth Index. As of May 31, 2017, the fund owns 155 stocks, the largest of which make up just over 2% of the fund's total. Top holdings include well-known growth companies such as Electronic Arts, Fiserv, and Autodesk. The ETF's low 0.07% expense ratio means that you'll pay just $7 in annual fees for every $10,000 you have invested.

2. Vanguard S&P Mid-Cap 400 Growth Index Fund ETF

As the name suggests, the Vanguard S&P Mid-Cap 400 Growth Index Fund ETF tracks the growth stocks in the S&P Mid-Cap 400 index. This is a slightly broader group of companies than the CRSP index tracked by the first fund. The Vanguard S&P Mid-Cap 400 Growth Index Fund owns 243 individual stocks, and no company makes up more than 1.3% of the total assets. Since this is a different mid-cap index, there are different top holdings, which include Align Technology, Domino's Pizza, and MSCI, just to name a few.

3. iShares Russell Mid-Cap Growth ETF

The iShares Russell Mid-Cap Growth ETF tracks the stocks in the Russell Midcap Growth index, and is the broadest of the three with 425 different holdings. Just two stocks make up more than 1% of the fund's current holdings, and top stocks include Fiserv, Progressive Corp, and Zoetis, and the fund has high concentrations in the information technology and consumer discretionary sectors.

Matthew Frankel has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Align Technology. The Motley Fool recommends Electronic Arts. The Motley Fool has a disclosure policy.