Blue HavenRetirement planning

3 low cost ETF’s we’re buying right now

By April 21, 2019 No Comments

In an earlier blog post, we answered the question of what is an ETF and also explained why they are so popular. Today, we’re sharing 3 of our favorite low-cost ETF’s we’re buying right now and why.

3 ETFs we’re buying right now

SPDR Portfolio Total Stock Market ETF (SPTM, $34.84)

What it is: This ETF tracks the performance of the total US stock market. Think of the performance of the NASDAQ, Dow Jones Industrial Average, Russell 2000, and S&P500 all being grouped into one. Therefore, if the total US stock market returns 10% for the year, so too will this ETF. Conversely, if the total US stock market declines 10% for the year, then this ETF will decline 10% for the year also.

Why we like it: Studies show that in trying to beat the market most investors fail miserably and end up underperforming. SPTM ensures that we will achieve the market rate of return. That is very appealing considering the total US market has gone up 10% annually the last 5 years. In the last 10 years, the annual return jumps to 17%.

Exposure to Amazon at a fraction of the price

Schwab US Large-Cap Growth ETF (SCHG, $77.72)

What it is: This ETF owns the largest and fastest growing companies in the world such as Apple (AAPL), Amazon (AMZN), Microsoft (MSFT), and over 400 other fast growing companies. While a majority of the stocks are in the tech sector, the ETF owns shares in other fast-growing industries like biotechnology and aerospace.

Why we like it: Some of the best stocks in the world like Amazon (AMZN) and Boeing (BA) are in this ETF. We can buy 25 shares in SCHG for the same amount it would cost to buy one share in AMZN. SCHG gives us a great way to invest in some of our favorite stocks at an affordable price.

Be a contrarian, consider emerging markets

SPDR Portfolio Emerging Markets ETF (SPEM, $35.62)

What it is: This ETF owns stocks in emerging markets like China, India, Brazil, South Africa, and other lesser developed countries. These markets are considered higher risk than developed markets like the US and Europe. In SPEM you will find some of the largest non-US companies in the world like Alibaba and Tencent.

Why we like it: SPEM offers a convenient way to gain exposure to up and coming markets. While these markets are riskier than their US counterpart, they also offer potentially greater rewards. Investors have not embraced emerging markets. This means there is room for investor sentiment to improve towards the space. If it does, those who were willing to take the risk early on stand to benefit.

Happy to review your own ETF choices

These are just 3 ETF’s we like right now out of over 1000 choices. When it comes to choosing the right ETF for you, it’s important to understand what you’re buying, and why. If you think you’ve found a good ETF to buy, we recommend running it through an ETF scanner website like ETF.COM where you can learn more about what the fund owns and the risks involved. Contact us If you’d like us to review a particular ETF or other investment for you. Just give us a call or fill out our and we’ll reach out to you.


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