It has been a year that the investment community will remember for a long time. In addition to dealing with the unprecedented coronovirus disease 2019 (COVID-19) epidemic, Wall Street and investors have faced the slowest bear market downturn of all time and the fastest rally from a bear market to a new high in history. Actually, CBOE Volatility Index, Which expects volatility in measurement S&P 500 (SNPINDEX: ^ SPX) The options reached their highest level in March in the next 30 days.
Short-term volatility can be exceptionally scary, but it historically opens the door for long-term investors to buy large companies at substantial discounts.
Of course, not every investor has the stomach to buy individual stocks, or the time required for research. This is where exchange traded funds (ETFs) come in. An ETF is a security that usually holds a basket of shares with a fixed focus. For example, if you want to invest in large-cap stocks, consumer staples, or the Brazilian economy, there are ETFs that satisfy those desires.
Given the diversification and breadth that often accompany ETF owners, they can buy smart if the stock market crashes. That should come near – remember that Nasdaq composite It recently fell 10% in three trading sessions – investors should consider buying these top tier ETFs.
Vanguard S&P 500 ETF
Although this is about as far from new as you can get, Vanguard S&P 500 ETF (NYSEMKT: Voo) In the long term the patient is going to work for investors.
As its name implies, it attempts to closely show the performance of the ETF benchmark S&P 500. This only happens with a net expense ratio of 0.03%. For just a fraction of your investment, you can get instant diversification from 500 companies that include broad-based indices.
But why keep an eye on the S&P 500? The simple answer is that you will never go wrong, as long as time is on your side. The S&P 500 has undergone 38 improvements of at least 10% since the 1950s, and it eventually puts each of these firmly in the rear mirror. As operating income expands over time, we should expect major S&P 500-like US indices to gain value.
Best of all, Mohra and S&P 500 ETFs are currently yielding around 1.9%, meaning that these payments will more than offset the micro-management expenses associated with this ETF.
Vanek Vectors Gold Miners ETF
If hedging is your thing during a market downturn, consider putting your money to work Vanek Vectors Gold Miners ETF (NYSEMKT: GDX).
In my 21 years of investing in the stock market, I have never seen so many catalysts in gold and gold stocks. We have seen a decline in global bond yields. The Federal Reserve had to assure domestic financial markets that it would keep its benchmark federal funds rate at a record-low level for years to come. The central bank is rapidly expanding the money supply as it exposes unlimited quantitative easing in markets. All of these factors have a weak US dollar and a very high gold price.
As a gold mining stock, many have spent the last five years reducing their net debt, expanding their most efficient or highest-ore-grade mines, and reducing all their costs. In many instances, gold mining stocks have a cash operating margin of $ 1,000 an ounce or more. You can rightly say that there is a golden age on the industry.
Buying the VanEck Vector Gold Minors ETF will put you at risk for the biggest players producing bright yellow metal, and the 0.53% expense ratio associated with ETFs is almost completely offset by the current 0.52% annual yield.
Global X Cloud Computing ETF
Although high-growth stocks often throttle during a stock market crash, investors would be prudent not to ignore growth trends during a recession. That’s why Global X Cloud Computing ETF (NASDAQ: Fundamental Plan) During an accident can be very attractive.
It is no secret that the coronavirus epidemic has completely eradicated the traditional office, allowing many employees to work remotely. This means more emphasis on shared data outside the workplace. But the thing to realize here is that this trend was going well before the outbreak of COVID-19. Cloud stocks across the division were growing by double-digit percentages; Now they are growing even faster.
For investors who lack the ability to really dig into the technical gaps between cloud companies, but still who want access to this exceptionally high-growth space, the Global X Cloud Computing ETF is the right solution. You will pay a high net expense ratio of 0.68%, but you will receive more than three dozen of the hottest cloud-based businesses on the planet, including Zoom video communication, Shopify, Twilio, And salesforce.com, to name a few.
Leg Mason Low Volatility High Dividend ETF
Finally, investors who want to avoid as much volatility as possible, but still should consider buying when exposed to stocks Leg Mason Low Volatility High Dividend ETF (NASDAQ: LVHD). That huge mouthful simply means that the fund buys mature, time-tested companies that pay a below-average yield.
Although the Leg Mason Low Volatility High Dividend ETFs have weakened the broader market in 2020, it is important to understand how powerful a dividend dividend can be. A 2013 report Bank of america/ Merrill Lynch observed that public companies initiated and increased dividends between 1972 and 2012 and delivered annualized annualized returns of 9.5%. By comparison, stocks that did not pay dividends generated an average annual return of only 1.6% over this 40-year period. Overall, dividend shares performed nearly 19 times better than non-dividend shares between 1972 and 2012.
By the end of July, the Leg Mason Low Volatility High Dividend ETF had almost half of its money invested in a trio of utilities, real estate and consumer staples, with 52% of assets invested in companies with a minimum market cap. $ 25 billion. These can be boring businesses, but it is okay to have boring ideas that provide many essential goods or services.
With the Leg Mason Low Volatility High Dividend ETF, you can expect an annual net expense ratio of 0.27%, but a current yield of over 3%.