What is the most common type of ETF?
Futures-based commodity ETFs: The most common type of commodity ETF, these funds buy futures, forwards, or swap contracts on the benchmark commodity. Equity-based commodity ETFs: These funds hold stocks of companies that are associated with the mining and production or transport of commodities.
| Ticker | Fund | AUM |
|---|---|---|
| SPY | SPDR S&P 500 ETF Trust | $363.23B |
| IVV | iShares Core S&P 500 ETF | $300.18B |
| VTI | Vanguard Total Stock Market ETF | $288.78B |
| VOO | Vanguard S&P 500 ETF | $286.59B |
- Equity ETFs. Equity ETFs track an index of equities. ...
- Bond/Fixed Income ETFs. It's important to diversify your portfolio2. ...
- Commodity ETFs3 ...
- Currency ETFs. ...
- Specialty ETFs. ...
- Factor ETFs. ...
- Sustainable ETFs.
Dividend ETFs
A dividend ETF is usually passively managed, meaning it mechanically tracks an index of dividend-paying firms. This kind of ETF is usually more stable than a total market ETF, and it may be attractive to those looking for investments that produce income, such as retirees.
| Symbol | Name | AUM |
|---|---|---|
| SPY | SPDR S&P 500 ETF Trust | $507,975,000.00 |
| IVV | iShares Core S&P 500 ETF | $435,169,000.00 |
| VOO | Vanguard S&P 500 ETF | $425,684,000.00 |
| VTI | Vanguard Total Stock Market ETF | $375,725,000.00 |
| ETF | Ticker | Assets Under Management (AUM) |
|---|---|---|
| Vanguard S&P 500 ETF | (NYSEMKT:VOO) | $435.2 billion |
| Invesco QQQ Trust | (NASDAQ:QQQ) | $259.6 billion |
| Vanguard Growth ETF | (NYSEMKT:VUG) | $118.8 billion |
| iShares Core S&P Small-Cap ETF | (NYSEMKT:IJR) | $79.8 billion |
In contrast, the riskiest ETF in the Morningstar database, ProShares Ultra VIX Short-term Futures Fund (UVXY), has a three-year standard deviation of 132.9. The fund, of course, doesn't invest in stocks. It invests in volatility itself, as measured by the so-called Fear Index: The short-term CBOE VIX index.
The largest Active Management ETF is the JPMorgan Equity Premium Income ETF JEPI with $32.56B in assets. In the last trailing year, the best-performing Active Management ETF was NVDL at 479.27%.
Experts agree that for most personal investors, a portfolio comprising 5 to 10 ETFs is perfect in terms of diversification.
- Source: Vanguard: Data current as of April 2, 2024. Data is intended for informational purposes only.
- Total Bond Market ETF (BND)
- Total International Bond ETF (BNDX)
- Total International Stock ETF (VXUS)
- Total Stock Market ETF (VTI)
What is the safest ETF to buy?
- Vanguard S&P 500 ETF (VOO -0.46%) ...
- Vanguard High Dividend Yield ETF (VYM -0.1%) ...
- Vanguard Real Estate ETF (VNQ -0.35%) ...
- iShares Core S&P Total U.S. Stock Market ETF (ITOT -0.5%) ...
- Consumer Staples Select Sector SPDR Fund (XLP 0.29%)
Market risk
The single biggest risk in ETFs is market risk. Like a mutual fund or a closed-end fund, ETFs are only an investment vehicle—a wrapper for their underlying investment. So if you buy an S&P 500 ETF and the S&P 500 goes down 50%, nothing about how cheap, tax efficient, or transparent an ETF is will help you.
| FUND(TICKER) | EXPENSE RATIO | 10-YEAR RETURN AS OF APRIL 1 |
|---|---|---|
| Vanguard Growth ETF (VUG) | 0.04% | 15.07% |
| iShares Russell 1000 Growth ETF (IWF) | 0.19% | 15.78% |
| iShares S&P 500 Growth ETF (IVW) | 0.18% | 14.34% |
| Schwab U.S. Large-Cap Growth ETF (SCHG) | 0.04% | 15.95% |
- SPY - $501.50 billion.
- IVV - $450.03 billion.
- VOO - $420.71 billion.
- VTi - $380.70 billion.
- QQQ - $258.64 billion4.
Company Act would allow investment companies to make investments in ETFs that exceed the 3% Limit, subject to the following conditions: (i) the acquiring fund does not exercise controlling influence over the ETF's management or policies, (ii) the acquiring fund may not redeem the shares acquired in reliance on the ...
| ETF | Price | % Change |
|---|---|---|
| XLU Utilities Select Sector SPDR Fund | $64.13 | 2.16% |
| GDX VanEck Gold Miners ETF | $33.55 | 1.56% |
| EDV Vanguard Extended Duration Treasury ETF | $70.07 | 1.45% |
| EFMSF WisdomTree Physical Gold | $223.66 | 1.40% |
| Symbol | ETF Name | 10y Chg 4-2-24 |
|---|---|---|
| XNTK | SPDR NYSE Technology ETF | 457% |
| QTEC | FT Nasdaq 100-Technology Sector ETF | 452% |
| QQQ | Invesco Nasdaq 100 Trust ETF | 452% |
| IGV | iShares Expanded Tech-Software Sector ETF | 425% |
Generally speaking, fewer than 10 ETFs are likely enough to diversify your portfolio, but this will vary depending on your financial goals, ranging from retirement savings to income generation. When building a portfolio of ETFs, it is crucial to consider your investment strategy, objectives, and risk tolerance.
Leveraged ETF prices tend to decay over time, and triple leverage will tend to decay at a faster rate than 2x leverage. As a result, they can tend toward zero.
What is the downside of ETFs?
For instance, some ETFs may come with fees, others might stray from the value of the underlying asset, ETFs are not always optimized for taxes, and of course — like any investment — ETFs also come with risk.
The one time it's okay to choose a single investment
That's because your investment gives you access to the broad stock market. Meanwhile, if you only invest in S&P 500 ETFs, you won't beat the broad market. Rather, you can expect your portfolio's performance to be in line with that of the broad market.
Vanguard S&P 500 ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VOO is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market.
In January 2024, the Securities and Exchange Commission (SEC) approved several spot Bitcoin exchange-traded funds (ETFs) for trading in a landmark ruling. The ETFs have been the most successful launch in history, amassing over $10 billion in net inflows since launch.
However, if you know that you'd like a bit more exposure to smaller and medium-sized companies or just want to invest in more stocks overall, VTI is your best bet. VOO, meanwhile, is the better option for investors who want to focus heavily on large cap companies.
