ETF funds are one of the most popular ways for investors to build diversified portfolios. Similar to mutual funds, ETF funds contain dozens or hundreds of securities, allowing investors to buy shares in one entity to gain exposure to a wide range of investments.
Best Public ETF
The best public ETF for investors is the Vanguard Total Stock Market ETF. This fund seeks to replicate the returns of the U.S. stock market at a cost of just 0.03%. With no minimum investment, the fund provides instant exposure to large, mid, and small-cap companies. As of December 2021, the fund holds 4,139 stocks, with top holdings including Apple, Microsoft, Alphabet, and Amazon.
Best No-Fee ETF
The SoFi Select 500 ETF is one of the best relatively new ETFs with a unique feature: the fund’s investment advisor has reduced management fees until at least June 2022. The fund operates very similarly to the S&P 500 index fund, holding stocks in about 500 of the largest companies in the United States. The fund adjusts the weight of these companies somewhat, as it invests in companies that appear poised for growth rather than weighting its holdings based on market capitalization.
Best ETF for Active Traders
The SPDR S&P 500 ETF is one of the most traded ETFs in the world. This fund tracks the U.S. S&P 500 index, which includes 500 of the largest companies in the country. The S&P is considered one of the most-used indicators for measuring the overall performance of the stock market.
If you want to day trade based on the overall market performance, you can use the SPY fund. It tracks the S&P’s performance in real-time and is very liquid, with nearly 30 million shares traded daily as of February 11, 2022.
Best ETF for Small-Cap Companies
Small-cap companies are those with a market capitalization between $250 million and $2 billion. The iShares Core S&P Small-Cap ETF is one of the best ETFs if you want to invest in a diversified portfolio of small-cap companies.
The fund is large with over $74 billion under management, and it’s inexpensive to invest in. As of February 11, 2022, its portfolio includes 676 holdings. Such diversification may help defend against the volatility that small-cap stocks may face.
Best ETF for Large-Cap Companies
The Vanguard Mega Cap ETF invests in some of the largest companies in the United States, focusing on companies that make up approximately 70% of the country’s market capitalization.
This fund typically holds stocks of large companies with a long history. Large-cap companies are considered more stable than small-cap ones and generally provide more consistent dividends and returns. However, those companies may experience volatility, which investors should be prepared to accept before investing.
As of December 31, 2021, the top holdings of this fund include Apple Inc., Microsoft Corp., Alphabet Inc., and Amazon.com Inc.
Best ETF for Dividends
Dividends are one of the most popular ways for investors to
Source: https://www.thebalancemoney.com/best-etfs-4173857
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