ETF

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These exchange-traded funds are great options for putting away some money and leaving it there.

Exchange-traded funds (ETFs) hold assets such as stocks, commodities or bonds. The funds themselves are traded on stock exchanges. Huge amounts of money are invested in them worldwide. In 2017, there was $3.28 trillion invested in ETFs in the United States alone. Half of all the money invested in ETFs in the United States flowed into less than 1% of the 1,756 ETFs marketed in the United States.

Whether you have ETFs in your portfolio now or are considering a future investment, here are eight ETFs that have been identified as good prospects for long-term investing.

Vanguard Total Stock Market ETF

This fund does not invest in particular sectors or capitalization ranges, but in the entire U.S. stock market by tracking the CRSP U.S. Total Stock Market Index. It has $823 billion dollars under investment and an expense ratio of 0.03%. As of December 10, 2019, the ETF had a one-year return of 9% and was trading at $159.60 USD.

SPDR S&P 500 ETF

Like another ETF you’ll see shortly, this ETF tracks the S&P 500 index of mainly large-cap stock on U.S. stock exchanges. It has $262 billion under investment and an expense ratio of 0.09%. As of December 11, 2019, the ETF had a one-year return of 10.15% and was trading at $314.36 USD.

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iShares Core MSCI EAFE ETF

This ETF offers investment in stocks in developed markets in Europe, Asia and the Far East. It does not include stocks in U.S. or Canadian equities. It tracks the EAFE Index, which is the oldest international stock index. The EAFE Index represents 98% of non-North American equity markets worldwide and includes small-cap equities in proportion to the market. The ETF has $63 billion under investment. As of December 11, 2019, it had a one-year return of 0.15% and was trading at $64.54 USD.

Vanguard S&P 500 ETF

The Standard & Poors 500 index reflects the United States economy more generally than the Dow Jones industrial average. The Dow focuses on 30 industrial giants and Nasdaq’s technology and biotechnology stocks. This ETF has an expense ratio of only 0.04%, or $4 per year per $10,000 invested. As of October 2018, it had a one-year return of 17.9% and a dividend yield of 1.8%. As of December 10, 2019, it was trading at $288.02 USD.

Vanguard Russell 2000 ETF

This ETF tracks the popular Russell 2000 index of American small-cap stocks. The Russell 2000 is made up of the 2000 smallest equities that make up the Russell 3000 index. Its goal is to reduce risk by its diversification while giving opportunities to invest in small entities with growth potential. As of October 2018, this ETF had a one-year return of 15.2% and a dividend yield of 1.2%. As of December 10, 2019, it was trading at $130.75 USD.

In 2017, there was $3.28 trillion invested in ETFs in the United States alone. Half of all the money invested in ETFs in the United States flowed into less than 1% of the 1,756 ETFs marketed in the United States.

Vanguard Value ETF

This ETF tracks the CRSP U.S. Large-Cap Value Index, which itself screens for good companies with cheap stock prices based on the following factors: price-book; dividend yield; price-sales and forward price-earnings compared to historical P/E. It may not be sexy, but we’re talking best long-term options here. As of October 2018, this ETF had a one-year return of 13.6% and a dividend yield of 2.6%. As of December 11, 2019, it was trading at $117.79 USD.

Vanguard Health Care ETF

Increasing costs of healthcare have outpaced inflation for decades. That’s a crummy situation for consumers of healthcare, but warrants investing the healthcare sector as part of a portfolio. As of October 2018, this ETF had a one-year return of 20% and a dividend yield of 3%. As of December 10, 2019, it was trading at $186.98 USD.

Fidelity Quality Factor ETF

This ETF tracks the Fidelity U.S. Quality Factor IndexSM, an index that includes 125 stocks selected on the basis they would collectively outperform the market generally. The Fidelity Quality Factor ETF invests in stable and highly profitable U.S. companies and seeks to reduce risk and volatility. As of October 2018, the ETF had a one-year return of 17.7% and a dividend yield of 1.5%. As of December 11, 2019, it was trading at $38.88 USD.

A deeper dive – Related reading from the 101:

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