Investors looking to expand their investment portfolios should at least consider Blue-Chip ETFs. The immediate attraction to Blue-Chip exchange-traded funds is the fact that the index tracks shares of financially stable, and established publicly traded companies. Most offer consistent returns and are tracked through a blue-chip index with emphasis on the performance of these stocks daily. The transparency promotes confidence and the risk is less than direct investing funds in individual stocks. This strategy also allows a variety of purchases in blue-chip stocks through the ETF for a broad approach to diversification, which lowers overall risk. We consulted with several notable sources to learn which blue-chip ETFs have shown the most positive performance over the past year. While some have taken a downwards turn, others have shown great promise. This invites a closer look and consideration at the blue-chip ETF investment strategy. Here are five blue-chip recommendations you can't go wrong with.
5. iShares MSCI USA Value Factor ETF (VLUE)
According to Bloomberg, iShares SCI USA Value Factor ETF offers some of the largest and best-known companies in the United States in its holdings. This inspires confidence for investors. Among them are AT&T, Citigroup, International Machines Corp., and others. Black Rock issues the notes for the fund. The current statistics show the 3-month return at 4.74%, the 3-year return at 2.15%, and the 5-year return at 6.67%. The inception date for VLUE is April 18, 2013. The current total assets are $194.648 million with a dividend indicated gross yield of 2.47% a current management fee of 0.15% and an expense ratio of 0.15%. Holdings also include the Intel Corporation, Micron Technology Inc., FedEx Corporation, General Motors Co., Target Corporation, Pzifer Inc., and the Ford Motor Co.
4. iShares Russell 1000 Value ETF (IWD)
The iShares Russell1000 is an ETF worth considering in 2020 as it has taken in a high amount of cash, according to iShares. The total net assets of the fund are valued at $37,423,198,784. the inception date is May 22, 2000, and the fund has reached the two-decade mark. It's listed on the NYSE Arca in the Equity asset class. The fund receives exposure through the Benchmark Index Russell 1000 Value Index. Options are available and as of Oct 16, 2020, 303,900,000 shares were outstanding. The number of holdings as of October 15, 2020, was 842. The PE ratio is 16.07 with a PB ratio of 2.03 with an Equity Beta 3 year of 1.02.
3. SPDR S&P 500 ETF SPY
The SPR S&P 500 ETF tracks the premier American blue-chip index, the Standard & Poor's 500. This fund is comprised of 500 blue-chip stocks. The selection for inclusion includes liquidity, size, and financial viability. This is among the largest ETFs established in the year 1993. The assets since that time have amounted to $190 billion. The holdings include Apple, Exon Mobil Corporation, Microsoft Corporation, and others. For every $10,000 invested the expenses are $9.45, according to US News.
2. PowerShares QQQ ETF QQQ
US News also recommends QQQ as a lopsided tech EFT in the blue-chip category that is worthy of consideration. It's more of a hybrid fund that offers a bit of diversity, which can lead to greater stability to the investment. The Nasdaq 100 is tracked by the QQQ ETF, comprised of 100 of Nasdaq's larges companies. Among them are Amazon.com, Microsoft, and Apple in the 60% tech holdings. Holdings in healthcare are at 11 percent with 20 percent in consumer discretionary and other sectors thrown in.
1. Vanguard Dividend Appreciation ETF (VIG)
Kiplinger recommends the Vanguard Dividend Appreciation ETF as one of the top choices. Th market value of the ETF is $25.3 billion with a dividend yield of 2.0 percent. The expenses are 0.8 percent. The Vanguard Dividend Appreciation ETF is comprised of 185 different stocks. Each meets the criteria for increasing regular payouts on an annual basis for the preceding 10 years. A decade of positive growth distinguishes these companies and their willingness to distribute payouts is a sign that they bear the best interests of investors in mind. The operations of each company are strong enough to do so. These facts inspire confidence in the fund. The yield to cost is another attractive feature of this ETF because, in four years, the increase in dividend payments has gone up 31 percent more. The portfolio of VIG's fund is distributed among multiple sectors of the market. A concentration of 32 percent of VIG's holdings areas in the industrial sector.
Fifteen percent of the holdings are in the health care arena. Health care has recently shown an increase in positive growth in some sectors of the market. Some of the top holdings include Johnson & Johnson, PepsiCo, and Microsoft. Our choice for the highest recommendation falls in line with Kiplinger's assessment.
We offer five blue-chip ETFs that you really can't go wrong when investing. Each provides a stable investing strategy that has recently shown an increase in yield. If you're looking for an investment strategy, This indirect method of investment is among the most appealing. Investing in exchange-traded funds is safer than a direct investment in stocks. The broad portfolios of these funds provide better protection if one sector shows negative performance. Blue-chip companies achieve their status in this elite grouping because of their longevity and positive performance for a minimum of ten years. They are among the most well-recognized and stable operating companies in the United States. From an analyst's point of view, blue-chip EFTs are the way to go for 2020. While any investment represents a risk, there is less volatility with the ETF strategy. Consider speaking with your financial advisor about which blue-chip ETF is the right choice for your investment portfolio.
Written by Allen Lee
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