ETFs, or exchange-traded funds, are a popular investment choice for those looking to diversify their stock portfolio. Here are three top ETFs that can help you achieve a diversified portfolio:
1. The Vanguard Total Stock Market ETF (VTI) is a great option for investors looking for exposure to the entire U.S. stock market. This ETF tracks the performance of the CRSP US Total Market Index, which includes large, mid, small, and micro-cap stocks. With over 3,500 holdings, VTI provides broad diversification across various sectors and industries.
2. For investors seeking international exposure, the iShares MSCI EAFE ETF (EFA) is a good choice. This ETF tracks the performance of developed markets in Europe, Australasia, and the Far East. With holdings in companies from countries like Japan, the UK, and Germany, EFA offers diversification outside of the U.S. market.
3. The SPDR S&P Dividend ETF (SDY) is a solid option for investors looking for income and dividend growth. This ETF tracks the performance of high-yielding companies that have a history of consistently increasing their dividends. With holdings in sectors like consumer staples, utilities, and industrials, SDY provides exposure to stable and mature companies.
By investing in these top ETFs, investors can achieve a diversified stock portfolio that covers various markets, sectors, and investment styles. Consider adding one or more of these ETFs to your investment portfolio to help reduce risk and enhance returns.