Robinhood traders have a status for getting high-growth stocks. Certainly, a few of the hottest stocks on the platform match that description, together with Virgin Galactic Holdings, Penn Nationwide Gaming, and Tesla.
Nevertheless, no fewer than seven exchange-traded funds, or ETFs, seem in Robinhood’s present High 100 record. Whereas thousands and thousands of Robinhood traders are actually attempting to get in on the bottom flooring of the subsequent large factor, many are additionally creating good, low-maintenance, long-term funding portfolios with the magic of index funds.
In case you’re in search of some investments that would produce wonderful long-term returns whereas nonetheless permitting you to sleep soundly at evening, listed below are three wonderful ETFs.
Some of the thrilling tech traits
The best way we pay for items and companies has radically reworked over the previous decade or so, and can probably proceed to take action. Monetary know-how consists of cost processing corporations like Sq. and PayPal, monetary software program corporations like Intuit and Invoice.com, and firms that make it simpler and more cost effective to borrow cash like LendingTree, simply to call a couple of.
As an alternative of attempting to select winners within the house, it may be a greater thought to easily understand that “a rising tide lifts all ships” and spend money on all of the fintech leaders. The International X FinTech ETF (NASDAQ:FINX) does simply that. Its portfolio incorporates 33 of probably the most compelling fintech stocks, together with the 5 corporations talked about within the final paragraph, in addition to a few of the most fun internationally listed fintech leaders that may not be accessible by way of Robinhood.
With a 0.68% expense ratio, the International X FinTech ETF is not low-cost, however it is not too steep of a price to pay for an all-in-one portfolio that would profit from one of the vital thrilling development markets of this technology.
Get wealthy slowly with dividends
With rates of interest close to document lows, discovering investments that pay an honest yield and not using a ton of threat might be difficult. Vanguard Excessive Dividend Yield ETF (NYSEMKT:VYM) is one among a uncommon few.
This fund invests in a various portfolio of greater than 400 stocks that pay above-average dividends. High holdings embrace Johnson & Johnson, Procter & Gamble, and JPMorgan Chase. These stocks are strong funding selections on their very own, however it could possibly be an excellent higher thought to personal all of those excessive yielders as a part of an ETF.
The Vanguard Excessive Dividend Yield ETF has a dividend yield of about 4.3% as of this writing and has a rock-bottom 0.06% expense ratio. This is not simply an revenue play; over the previous decade, the fund has generated complete returns averaging over 11% per yr.
Market-beating complete returns with comparatively low volatility
One sector notably absent from Robinhood’s High 100 record — each in stock and ETF kind — is actual property. There are a couple of good causes Robinhood traders may wish to change that. First, actual property stocks are typically much less risky than the remainder of the market and may diversify a stock portfolio.
Second, actual property stocks are typically wonderful dividend payers. The Vanguard Actual Property ETF (NYSEMKT:VNQ) pays 3.5% as of this writing and invests in a portfolio of 181 actual property funding trusts, or REITs.
Lastly, whereas many traders consider actual property as a boring and low-return funding, that is an entire false impression. Actually, over the previous 20 years, actual property funding trusts have produced higher complete returns than the S&P 500.
It is also worth mentioning that many dividend-focused ETFs, just like the Vanguard Excessive Dividend ETF talked about earlier, particularly exclude actual property stocks, so each could possibly be wonderful additions to your long-term funding technique.