The mid-term election outcome has sparked a rally in the stock market. Democrats won the House of Representatives as expected while the Republicans maintained control of the Senate. This has resulted in a split Congress with a Republican president.

In fact, both the Dow Jones and the S&P 500 logged in the biggest post-midterms gain since 1982. The trend is likely to continue as a gridlock is good for stocks. A divided government will keep the rates in check resulting in higher prices for stocks. Additionally, the outcome eased fears of a big change in policy that could hurt corporate profitability.

According to data from LPL Financial, stocks usually see a 15.7% gain in the year after mid-term election that produce a split Congress under a Republican president. Not only do stocks usually see that longer runway of growth after such an outcome but it tends to start with a quick bounce.

Given the historical bullish trend post mid-term election, nothing seems a better strategy than growth. This is especially true, as growth stocks refer to high-quality stocks that are likely to witness revenue and earnings increase at a faster rate than the industry average. These stocks harness their momentum in earnings to create a positive bias in the market, resulting in rocketing share prices. As such, growth stocks tend to outperform during an uptrend.

However, it is worth noting that these funds offer exposure to stocks with growth characteristics that have comparatively higher P/B, P/S and P/E ratios and exhibit a higher degree of volatility when compared to value stocks.

Given this, we have highlighted five growth ETFs and stocks that have a solid Zacks Rank #1 (Strong Buy) or #2 (Buy), suggesting their outperformance in the months ahead.

ETFs to Buy

These ETFs are popular in the growth space, making them extremely liquid.

iShares Russell 1000 Growth ETF (IWF - Free Report)

This ETF follows the Russell 1000 Growth Index and holds 545 stocks in its basket.

Zacks ETF Rank: #1
AUM: $42.2 billion
Expense Ratio: 0.20%
Average Daily Volume: 1.7 million shares

Vanguard Growth ETF (VUG - Free Report)

This fund tracks the CRSP US Large Cap Growth Index, holding 318 stocks in its basket.

Zacks ETF Rank: #1
AUM: $36.1 billion
Expense Ratio: 0.05%
Average Daily Volume: 709,000 shares

iShares Russell 2000 Growth ETF (IWO - Free Report)

This fund offers exposure to the small cap segment of the broader market by tracking the Russell 2000 Growth Index. It holds a large basket of 1,244 stocks.

Zacks ETF Rank: #2
AUM: $9.7 billion
Expense Ratio: 0.24%
Average Daily Volume: 1 million shares

SPDR Portfolio S&P 500 Growth ETF (SPYG - Free Report)
 
This product follows the S&P 500 Growth Index, holding 300 stocks in its basket.

Zacks ETF Rank: #1
AUM: $3.5 billion
Expense Ratio: 0.04%
Average Daily Volume: 1.3 million shares

Vanguard Mega Cap Growth ETF (MGK - Free Report)

This ETF offers diversified exposure to the largest growth stocks in the U.S. market by tracking the CRSP US Mega Cap Growth Index.

Zacks ETF Rank: #2
AUM: $4 billion
Expense Ratio: 0.07%
Average Daily Volume: 143,000 shares

Stocks to Buy

Here, in addition to a solid Zacks Rank, we have used several other criteria like a Growth Score of A, positive earnings estimate revision for this year, double-digit estimated earnings growth for this year, and a solid Zacks Industry Rank.

Cummins Inc. (CMI - Free Report)

This global power leader is a corporation of complementary business units that design, manufacture, distribute and service diesel and natural gas engines and related technologies, including fuel systems, controls, air handling, filtration, emissions solutions and electrical power generation systems.

Zacks Rank: #2
Market Cap: $23.56 Billion
This Year Estimated Earnings Growth: 29.38%
Zacks Industry Rank: Top 1%

CF Industries Holdings Inc. (CF - Free Report)

It is the global leader in transforming natural gas into nitrogen products.

Zacks Rank: #1
Market Cap: $12.36 Billion
This Year Estimated Earnings Growth: 724%
Zacks Industry Rank: Top 5%

Hess Corporation (HES - Free Report)

It is a global exploration and production company that develops, produces, purchases, transports and sells crude oil and natural gas.

Zacks Rank: #1
Market Cap: $18.25 Billion
This Year Estimated Earnings Growth: 100.65%
Zacks Industry Rank: Top 13%

PayPal Holdings Inc. (PYPL - Free Report)

This technology platform company offers online payment solution, which allows customers to pay and get paid, withdraw funds to their bank accounts and hold balances in their PayPal accounts in various currencies.

Zacks Rank: #2
Market Cap: $103.97 Billion
This Year Estimated Earnings Growth: 25.79%
Zacks Industry Rank: Top 20%

Ross Stores Inc. (ROST - Free Report)

It is a leading provider of healthcare in home with a vision of becoming the premiere solution for patients.

Zacks Rank: #1
Market Cap: $38.36 Billion
This Year Estimated Earnings Growth: 24.25%
Zacks Industry Rank: Top 30%