Expert Analysis on Top ETFs Stocks Performance
Oil was up Friday morning in Asia and was set to end the week with gains of more than 2%. Hence, there are increasing signs of tight supply over the next few months. These are due to soaring gas and coal prices which are encouraging a switch to oil products.
Today, the ASX 200 also reported some gains. The index added 37.20 points or 0.51% to $7,348.90 extending gains of 0.8% in the previous session. This was fuelled by easing long term bond yields boosted technology stocks, whilst investors proved optimistic on re-opening trades as NSW moves toward further easing of restrictions.
Best ASX ETFs Stocks For Your Next Investment
As the broad market makes up lost ground, it might be time to consider these three ETFs to get exposure with the upcoming bull run:
SPDR S&P 500 ETF (NYSEARCA: SPY)
The SPY is the most popular ETF in the world. It is an exchange-traded fund that holds all companies that make up the S&P 500. So, while you are holding the SPY in your portfolio, you are getting exposure to 500 of the most popular stocks on the planet.
Since the SPY owns all the stocks in the S&P 500, its holdings are an open book. And SPY gives greater weight to stocks with bigger market values. Therefore, you can know what its top holdings are at any time.
It is important to note that the SPY weights stocks based on the value of stock available to trade. This means that it is dominated by the largest companies. Hence, just the 15 most valuable stocks in SPY stock account for roughly a third of its value. And now two companies claim more than 5% of the total index.
The top three stocks are comprised in the ETF is Apple with 6.2%, Microsoft with 5.8%, and Amazon with 4.2%.
The SPY has performed quite well despite the recent volatility. The index has gained more than 18% year-to-date and is trading at US$442.5 per share.
BetaShares Nasdaq 100 ETF (ASX: NDQ)
Another option for investors interested in diversifying their portfolio could be the BetaShares NDQ ETF. This hugely popular ETF tracks the performance of the NASDAQ 100 Index before fees and expenses.
This famous index comprises 100 of the largest non-financial companies listed on the NASDAQ stock exchange. This means you’ll be owning a slice of some of the biggest tech companies the world has to offer. Hence, these include Google’s parent Alphabet, Amazon, Apple, Facebook, Microsoft, and Netflix to name a few.
It is worth noting that this area of the market is underrepresented in the Australian share market. Considering this, the NDQ ETF could help balance out a portfolio that is heavily weighted to financial and mining companies.
Over the last five years, the BetaShares NASDAQ 100 ETF has also smashed the market. So far, this ETF has generated a return of around 17.3% year-to-date.
iShares Core S&P/ASX 200 ETF (ASX: IOZ)
And finally, this ASX 200 ETF gives people the ability to invest in the Australian broad market, which effectively represents most of the ASX share market.
It can be tricky knowing where to start investing in the ASX share market. There are literally thousands of different potential investments to choose from. Hence, you might go for one of the biggest businesses in Australia such as CBA, BHP, or Telstra for instance.
What about smaller businesses with more growth potential? For example, Adore, Pushpay or even Temple & Webster.
The solution for you to get exposed to the broad market without worrying about how to pick any individual shares would be to consider the IOZ ETF. This ETF allows you to invest in lots of businesses at once.
The IOZ ETF aims to track the ASX 200. Accordingly, the largest ASX businesses are obviously the biggest positions. For example, CBA is 8.8% of the ETF allocation, while CSL is 6.9%, BHP 5.4%, Westpac 4.5%, NAB 4.4%, and ANZ 3.8%. Those are the five biggest positions. It goes all the way down to the smallest of the 200 shares of the ASX.
The ability to get that much diversification in one investment is very useful. Investors do not have to worry about how much of each investment to own. The ETF automatically does it. In short, this ETF will offer you the returns of the ASX 200 index, less the management fee.
It is worth noting, that the IOZ ETF fees are absolutely low. In fact, it is the lowest fee when it comes to investing in ASX 200 shares. The annual management fee is 0.07% of the fund value per year. That is extremely low. To put it in context, a typical fund manager may charge 1% of the investment each year.