The index funds do not perform in the same way as time goes on. Thus, the choice to buy matters significantly. Index funds let traders diversify their assets for their investment portfolios. Hence, the investor can make an investment spanning across different companies and industries instead of just assessing and investing in individual stocks.
For anyone seeking to make a long-term investment that grows considerable wealth over time, the index funds are the best options. Although investing money through an online stock broker is a great option, it never lets the investor gain access to multiple opportunities and potential that an index fund has.
Index funds have many tools and resources that come with considerably low fees providing exposure to every investor’s desired marketplace. Since some of the top index funds are buy-and-hold oriented, they are assured to serve as long-term investments. Here are some of the best index funds operating in the current market.
VanEck Vectors Preferred Securities ex Financials ETF (PFXF)
The Preferred Stock index fund features a low expense ratio of 4% with up to 5.4% yield and low volatility. That is a great combination. The Preferred Stocks take much preference over the normal stock dividends due to the dividends on them. They must also get paid before the common stock dividends are paid.
Preferred stocks are categorized as assets that are geared towards high income and demands which company usually pays all missed dividends in arrears before resuming the dividends to the common shares.
iShares Core S&P 500 ETF (IVV)
This large-capacity equity index incurs a fee of 0.04% that is easily accessible by its parent asset manager company known as BlackRock, Inc. This asset manager offers low-cost fees on its products like the Core-branded ETFs that comprise of the S&P 500-tracking iShares Core S&P 500 ETF.
On the other hand, IVV charges 7 basis points making it one of the cheapest recommendations that exist in the current market.
SPDR S&P Bank ETF (KBE)
This specific index fund operates with banking and industrial stocks. KBE has enjoyed a 25% growth due to the wide-spread notion that President Donald Trump will reduce Wall Street regulations. The KBE comprises of a focused collection of many banks that include national brands and the smaller names.
They are reported to incur an expense ratio of 0.35% and bank stocks have so far done quite well in 2019.
iShares Core S&P Mid-Cap ETF (IVV)
The performance delivered by this index fund is considerably high seeing that the IJH holds a 15-year record win over the IVV. The reason for this performance is that the mid-cap companies usually comprise of a stronger long-term growth potential compared to the large-cap companies.
They also have more financial stability with considerably more access to capital and managerial experience compared to the small-cap companies. They are known to incur an expense ratio of 0.07% which interestingly is a bit higher than that of the IVV.
Who are the Leading Traditional Brokers
These brokers can be chosen in the place of computerized systems like Robo Advisor. They offer a reliable platform where investors can make investment decisions with more control over their investments. Here are some of the top-rated online traditional brokers.
This broker is known to charge the lowest fees for an index fund or ETF hovering around a rate of 0.00%. That means that they do not charge any fee on funds. Even though they have a limited range of options to check out, they are all zero expense ratio index funds together with ETFs.
They charge a fee of 0.02% for ETF or index fund and get zero commission for each trade made with the Charles Schwab funds. They provide investors with more than 20 varieties of Schwab Index funds and ETFs.
This top-tier broker leads in low-cost index investing providing a wide range of funds. They charge a 0.04% fee for an index fund or ETF and also get a zero commission for trades executed with Vanguard funds.
These are automated financial advisers that go a long way in selecting the perfect investment for the traders and investors. They automatically create a portfolio that is entirely based on some factors such as the level of the expected returns and risk tolerance. The portfolio is also based on the time frame between when the money gets invested and when it is needed.
It is referred to as the oldest Robo Advisor in performance and existence. It has at least $13.5 billion worth of assets in its management. Betterment accounts attract an annual fee that ranges from 0.25% to 0.4%. The difference comes from the fact that there are standard and premium accounts.
This one is also a great Robo Advisor option available for the investors. It has more than $10 billion worth of assets in its management and most of its accounts charge a considerably low rate of 0.25% for yearly management fees. They primarily focus on building portfolios of low-cost ETFs.
Also, they offer direct indexing for their accounts through mimicking ETFs which is great for tax management purposes. Others include the Robo Advisor product from Charles Schwab, the Personal Capital Robo Advisor, M1 Finance, Ellevest, the Schwab Intelligent Portfolios, and many others.