Exchange-traded funds (ETFs) can be fantastic investments for many people, especially those looking for a simple, no-hassle option.
An ETF is a basket of securities bundled together into a single investment. When you invest in one, you’re actually investing in dozens, hundreds, or even thousands of stocks at once. This not only makes building a diversified portfolio a breeze, but it also helps take the guesswork out of what to buy.
Not all ETFs are created equal, however, and some are better investments than others. These three would be great additions to most portfolios as we head into 2024.
1. iShares Core S&P 500 ETF
S&P 500 ETFs, in general, are incredibly consistent. In fact, analysts at Crestmont Research examined the index’s long-term performance and found that for every single 20-year period in history, the index ended with positive total returns. So if you had invested in an S&P 500 ETF or index fund at any point (or bought that same portfolio yourself, back before ETFs existed) and simply held it for 20 years, you would have made money.
While the S&P 500 naturally experiences fluctuations and even steep declines in the short term, it has a long track record of recovering from downturns. If you’re feeling nervous about the market or simply want an investment that can stand the test of time, an S&P 500 ETF is a safe bet.
In addition, the iShares Core S&P 500 ETF has a rock-bottom expense ratio of just 0.03%. This is far lower than many other ETFs, and the difference could save you thousands of dollars in fees over time.
2. Invesco QQQ Trust
Invesco QQQ Trust (QQQ 0.41%) is a growth ETF containing primarily tech stocks. It tracks the Nasdaq-100 index, which is composed of the 100 largest non-financial companies listed on the Nasdaq.
This fund was launched in 1999, making it one of the older ETFs in existence. It also has a history of beating the broader market. Over the past 10 years, the Invesco QQQ Trust has averaged a total rate of return of over…
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