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Finding the right exchange-traded fund isn't easy.
ETFs, mutual funds that trade throughout the day like a stock, can be a convenient investing tool. But there are thousands to choose from. More than 150 new ETFs appeared in 2018 alone. To help you, we pared this vast universe down to a more manageable set of choices, our Money 50 list of recommended exchange-traded funds.
What follows is our list of recommended ETFs, broken out into three groupings: "building-block ETFs" for the core of your portfolio, offering you broad exposure to stocks and bonds; "custom ETFs" to help you tilt toward specific strategies, such as value or dividend investing; and "one-decision ETFs," which are single funds offering you exposure to both equities and fixed income.
(You can find our list of 50 recommended traditional mutual funds here.)
These exchange-traded funds expose you to broad swaths of the stock and bond markets, and should be used to construct the core part of your port-folio that you’ll hold for years. Because you’re simply seeking basic exposure, low-cost index funds are your best bet here.
Don’t want to put together a portfolio on your own? Then use one of these professionally managed ETFs that hold a diversified mix of stocks and bonds.
Supplement your core holdings with these funds to diversify more broadly and to tilt toward certain types of stocks and bonds.
NOTES: ¹Net prospectus expense ratios were used. ²Total return figures are as of Oct. 31. ³Five-year returns are annualized. N.A.: Not available or not applicable.
SOURCES: Lipper, Morningstar, and fund companies