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Ask HN: What are your favorite index ETFs for Investing?
There are many people that recommend the straight forward full-index ETFs such as Vanguard's VOO for the S&P 500. I have also run across QQQ (Nasdaq / Tech heavy) and XLG (Curated set of S&P 500).
What index style ETFs have you uncovered in your research that you might recommend?
Has anyone had any success or warnings with some of the more exotic leveraged holding ETFs?
- iamtherealjohn 2y agoI have been investing for 5 years and I would say my favorites were: TQQQ & SQQQ to make short to medium term trades. Otherwise, I stick with the classic QQQ for long term holdings and have some fun with the VIX when I want to gamble a bit more.
- gmays 2y agoThese days a Nasdaq ETF is likely the best bet (it's what I use in my IRA) since it has been conistently outperforming the S&P 500. I'd be cautious with the more exotic leveraged ETF. Instead, for my non-investment accounts I've been mostly holding the Mag 7 since last year (after rotating out of pandemic stocks following the rebound). I shared my results over the last couple of years on by blog where I document my thinking for future reference/improvement (https://gmays.com/2-year-follow-up-on-buying-the-dip-on-pandemic-stocks/ https://gmays.com/2-year-follow-up-on-buying-the-dip-on-pand...). My current IRR from that portfolio is 83.70% over the last couple years for context.
- Tempest1981 2y agoComparison charts: https://portfolioslab.com/tools/stock-comparison/SPY/QQQ https://portfolioslab.com/tools/stock-comparison/SPY/QQQ
- commandersaki 2y agoLove QQQ and the Australian version NDQ.
- lastofus 2y agoQQQ has done great the last decade, but that's no guarantee it will outperform the next decade. Make sure you understand what you are getting yourself into by overweighting in the tech sector, and that it's a plan you can stick with during the hard times.
- harryquach 2y agoVTSAX and chill
- LUmBULtERA 2y agoSecond this… or VTI is the ETF equivalent. It’s all I do now.
- hirvi74 2y agoNo VXUS/VTIAX? I am looking to debate its merits in one's portfolio, since it's such a hotly contested topic in some communities e.g., Bogleheads. I try to maintain some arbitrary split between the two, but I do not have a ton of faith in Int. overtaking the US market anytime soon, but I am often wrong about most things, so that's why I ignore my gut feelings.
- harryquach 2y agoI am bullish on the US long term. Other developed countries have a population problem which is going to start causing issues. Sub 1.0 birth rates are a catastrophe for capitalism. The US has enough immigration to keep the population somewhat level.
- LUmBULtERA 2y agoThey're fine. I just don't for two reasons: (1) VTI/VTSAX is already internationally exposed (and has a slightly smaller expense ratio), and (2) I like to keep things as simple as possible, particularly if there are no huge benefits. These two points have lead me to just settle on VTSAX/VTI. It may be slightly suboptimal. I don't know.
- ternaus 2y agoThe same, read a few books, all recommended more or less the same. => while was working full time and had income I've sold all stock that got from the employee and put into VTSAX. Living from these money for the past few years in the Bay Area.
- NiekvdMaas 2y ago50% VOO 25% VWCE 25% bonds That's the way I've been doing it since years.
- JLCarveth 2y agoI am Canadian so I invest in XEQT, a globally-diverse index fund from Blackrock.
- godzillafarts 2y agoVTI for the majority of post-tax investments, VUG for a smaller percent that I'm more aggressive with.
- time0ut 2y agoI keep it simple: VT (tax advantaged) VTI+VXUS (regular brokerage) BND (a bit)
- toomuchtodo 2y ago70/30 VTI VXUS?
- quickthrowman 2y agoVTI in my IRA, FXAIX (S&P 500) in my 401k.
- ilrwbwrkhv 2y agoI earn $4m profits per year through my software business. I put all of it in VTI.
- joshbochu 2y agoCould you please share a bit more on your business and how you got started?
- ilrwbwrkhv 2y agoI build, host, manage custom software for mid sized businesses. I got started by following YC startup school videos. The first one I did was creating an app for a high society maid service in the UK.
- joshbochu 2y ago> I build, host, manage custom software for mid sized businesses. Is this more of a consultancy?
- ilrwbwrkhv 2y agoNo I just build and sell custom software.
- roncesvalles 2y agoHow many employees do you have, or is it all yourself?
- nasdaq-txn 2y agoMain positions are FSKAX (Total US) and FXAIX (S&P 500). SOXX (Semiconductors) is the only sector specific ETF I have(~10% of my portfolio).
- ksherlock 2y agoQQQM is QQQ with a lower fee (.15% vs .20%). For historical reasons QQQ has more mindshare and more volume. Stick to QQQM unless you're day trading.
- reducesuffering 2y agoVEA and VWO are also good for low-expense international diversification. More aggressively, VIOV and VBR target "Small Cap" "Value", stocks, 1 - 2% of the total market that are smaller companies with more low-growth prospects. There is academic research to suggest that there may be some higher-risk but even-more-high-reward for these type of stocks that is consistently underpriced by the so-called "efficient market hypothesis." This is a backtest from 1972 where $10k in Total Market (~VTI) and Small Cap Value stocks were bought and Small Cap Value ended with $7.5m against Total Market $2m, while retaining better Sharpe and Sortino ratios. https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&sl=5dJJwCSbkLnsppH7nER6iK https://www.portfoliovisualizer.com/backtest-asset-class-all... That is only for those who could commit long term with conviction of their research and understanding, as there are periods of 10-15 years you could underperform Total Market: https://www.portfoliovisualizer.com/backtest-portfolio?s=y&sl=7gWf90vn9BV8UptaiJZlMI https://www.portfoliovisualizer.com/backtest-portfolio?s=y&s...
- atombender 2y agoI would throw in Avantis Small Cap Value (AVUV) as a contender. Avantis' funds are index-like in that they pick stocks by screening the universe of market-cap-weighted stocks using factor-based screens, rather than active management. Their algorithms use profitability, volatility, size, and value as factors, and mix in the momentum factor (basically, stocks that go in one direction tend to move that way for a bit) to time trades. The international counterpart is AVDV, and they have a whole range of funds for emerging markets and so on. Avantis was founded by ex-Dimensional (DFA) people and their methodology is similar to that of the famous high-end mutual funds run by DFA. (Of course, DFA also has ETFs now.)
- reducesuffering 2y agoAVUV may perform similarly, but it is actively managed to the whims of Avantis' decisions and does not track an index. Thus it is also a 0.25% expense ratio compared to VBR and VIOV at 0.07% and 0.15% respectively. Avantis: "this fund is an actively managed ETF that does not seek to replicate the performance of a specified index."
- hirvi74 2y agoVTI and VXUS. Nothing more and nothing less, like the good Lord intended.
- medmunds 2y agoYep, and mix in some BND and BNDX as you get older. Bogleheads ftw.
- aagha 2y agoWhy?! The 5-year and 10-year for both under-perform QQQ & SPY
- refurb 2y ago"Past performance does not guarantee future performance". This is a basic tenant of Boglehead. Chasing returns usually means you "buy high, sell low".
- mooreds 2y agoThank you. The whole point of index investing is to be boring.
- ralala 2y agoI’m sticking with iShares MSCI World SRI + a small amount stock picks
- robot 2y agoFCNTX
- commandersaki 2y agoFCNTX has given me about 450% growth since 2011. Pretty stable & steady, but these days I think I’d just go with QQQ.
- till2 2y agoFTSE all-world
- anonfordays 2y agoSCHB if you're on Charles Schwab. It's a broad US market ETF.
- wintorez 2y agoSCHG
- greatpostman 2y agoTQQQ
- helltone 2y agoWhat bank/app do you use to invest (I'm in UK)?
- trod123 2y agocaprock, I would not recommend investing in the stock market at all, and standard disclaimer, this is not financial advice; you are responsible for your own due dilligence... yada... that said. The stock market no longer meets the requirements to be considered an investment, using Benjamin Graham's definitions. While it seems like it has no where to go up, this is an illusion, and most of the smart money has diversified or left the stock market completely. Rule number one of investing is, don't lose your principal. The market has for almost 3 years now, been approaching irrational exuberance indicating it may be at the top of an everything bubble. There is no visibility on the leverage, and updates to the valuation of an ETF more likely than not will not follow even the underlying portfolio valuation. For a perfect example, thanks to the YTM loophole in reporting, the main ETF that follows bonds didn't see a severe correction (to the downward valuation) while interest rates were going up despite the fact that the underlying of the fund lost 1/3rd of its value almost overnight using standard financial math valuation for bonds in changing interest rates. The higher interest rates being offered by the Fed dropped the price of all existing, for the underlying, and at the time it was roughly 99% US 30Y bonds iirc at 1.5%. The ETF traded at 115 per share. 2 years later in a 4.5% available bond, it had only dropped to 108/share. Despite book value of the underlying having lost significant value, they claim its updated daily based on market conditions, but they follow the YTM loophole to avoid marking to market the underlying; along similar dirty lines as the Libor rate scandals. Additionally, there is no visibility, or for that matter safeguard against someone crashing your investment and stealing your money through options. Many of the entities involved are tangentially related to middlemen who have the exclusion for creating synthetic shares (out of nothing). I'm sure you've seen some of the GME stuff that's been going on over the years, the functional component is options, that may be pushed out in perpetuity. The fact that the underlying aggregate is shorted more than the shares in existence, should cause a short squeeze normally. That would normally cause the price to go up in a short squeeze, but when you can create synthetic shares into existence that doesn't happen and they capture the profit both ways, while tamping down the squeeze. Any big player can utilize PFOF, and yield farming to steal your money. Invest in something tangible, with cashflow, where you've done the research. There are just too many ways for you to lose everything from bad actors in the stock market, and the SEC is helpless to go after the people involved since its a systemic problem at the top, it is a captive system, where putting you money into it is volunteering for it to be stolen; with the hope that you'll make some money, and the fear that you'll miss out.
- HenryBemis 2y agoSOXX, QCLN, FXI, VOOG, IQQQ.DE, VOO, VGT, VXUS, VONG, IHI, XLY, FIW.US, INDA I wanted to diversify so I got plenty of US, some India and China, , Silicon, Water, Clean Energy.
- mkbkn 2y agoFor Indian stock markets, Nifty 200 Momentum 30 and Nifty Midcap150 Momentum 50 index funds are the best.
- GabeHamington 2y ago[flagged]