When looking for the best exchange-traded funds to buy now, you have to pick a strategy. Are you looking for quick gains, no matter the risk? Or are you taking a long-term approach with the hope that major trends in technology pay off in several years instead of several weeks?
The following seven flavors of exchange-traded funds, or ETFs, all have something different to offer investors right now. You should take a hard look at your personal investing goals and risk tolerance first, but once you decide what you’re after then there’s likely to be something on this list that fits your portfolio.
| ETF | YTD total performance as of March 2 market close (includes dividends) |
| ProShares Bitcoin Strategy ETF (ticker: BITO) | 41.3% |
| Vanguard Short-Term Corporate Bond ETF (VCSH) | 0.15% |
| ARK Innovation ETF (ARKK) | 25.4% |
| ARK Next Generation Internet ETF (ARKW) | 29.9% |
| VanEck Semiconductor ETF (SMH) | 19.1% |
| Global X MSCI Greece ETF (GREK) | 22.1% |
| WisdomTree Europe Hedged Equity Fund (HEDJ) | 16.2% |
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Best Aggressive ETF: ProShares Bitcoin Strategy ETF (BITO)
A host of crypto-related assets have surged in the beginning months of 2023, thanks to a rebound in Bitcoin and other cryptocurrencies. After bottoming at less than $16,000 around Thanksgiving, Bitcoin has surged about 50% in short order. If you’re not interested in playing cryptocurrencies directly, however, the ProShares Bitcoin Strategy ETF is one of the best-established funds in the space, with about $800 million in assets. BITO can be bought and sold through a brokerage account, eliminating the need for a cryptocurrency exchange account or wallet, and it is tied to regulated Bitcoin futures, trading on the CME exchange.
If you’re bullish on Bitcoin, you should consider this as one of the top ETFs to buy now. There are other crypto related funds out there, including the Valkyrie Bitcoin Miners ETF (WGMI), the VanEck Digital Assets Mining ETF (DAM) and the Bitwise Crypto Industry Innovators ETF (BITQ). But there’s only about $60 million in total assets between the three of these funds, so they are not nearly as established or liquid in their trading volume. Furthermore, they hold publicly traded companies that mine Bitcoin or are related in other ways to digital assets, so it’s not as pure of a play on crypto.
Given the volatility of the last few years, it should go without saying that Bitcoin is a risky asset — and all of these are risky funds as a result.
Best Safe ETF: Vanguard Short-Term Corporate Bond ETF (VCSH)
If diving headfirst into crypto isn’t appealing, consider the Vanguard Short-Term Corporate Bond ETF. This is a diversified bond ETF with an average duration of just 2.7 years across its portfolio of nearly 2,400 bonds. Furthermore, these are investment-grade loans to firms such as aerospace giant Boeing Corp. (BA) and financial giant JPMorgan Chase & Co. (JPM). With no “junk” in the holdings and a very short time horizon, investors can have confidence in the stability of these assets no matter what happens.
Despite the short duration, an inverted yield curve actually means short-dated bonds are yielding more than longer ones at present — adding up to a 30-day yield that tops 5%. That’s more than three times the dividend you’ll find in the S&P 500, and it’s higher than the 4% or so offered by 10-year U.S. Treasury bonds.
The fund is huge, with $40 billion under assets, and it is also dirt cheap at 0.04% in annual expenses, or $4 on every $10,000 invested. If you want to steer clear of the stock market and hide out in short-term, conservative bonds, then consider VCSH your safety net.
[READ 5 of the Best Stocks to Buy Right Now]
ARK Innovation ETF (ARKK)
The iconic ARK Innovation ETF run by guru Kathie Wood made a lot of headlines in past years thanks to its outperformance, but the fund really took it on the chin in 2022. Some of its “risk on” investments have finally stabilized in recent months, however, and ARKK is starting to get some of its luster back with gains of more than 25% since Jan. 1. Top holdings include familiar disruptors such as electric vehicle leader Tesla Inc. (TSLA) and telework platform Zoom Video Communications Inc. (ZM). There’s risk here, but if things go well there’s also the potential for outperformance.
ARK Next Generation Internet ETF (ARKW)
Another popular ARK fund, the $1 billion ARK Next Generation Internet ETF is one of the top-performing funds this year — but with a more focused approach. This includes digital and internet businesses such as mobile payments company Block Inc. (SQ), streaming media icon Roku Inc. (ROKU) and other growth-oriented companies. These are important players in emerging technologies, and investors seem to be coming around to the long-term prospect of these firms despite recent volatility. Shares are up about 30% so far this year.
VanEck Semiconductor ETF (SMH)
Another high-tech trend to watch is the stabilization of the chipmaking industry after a few rough years. The $7 billion VanEck Semiconductor ETF reflects the health of the industry, with gains of more than 19% this year thanks to strong performance from companies such as Nvidia Corp. (NVDA) and Taiwan Semiconductor Manufacturing Co. Ltd. (TSM). During the pandemic, supply chain disruptions upended operations, and some firms overcorrected to create a glut of chips and weak pricing power. Then, trade disputes muddied the waters even further. But based on the last few months, it appears things have stabilized for many chipmakers, and SMH offers a way to ride this trend.
Global X MSCI Greece ETF (GREK)
Looking at geography instead of sectors, the Global X MSCI Greece ETF is the top-performing, country-specific fund this year, with more than 22% gains year to date. It’s modest but established, with about $200 million in assets, and its top holdings are all Greek firms such as local bank Eurobank Ergasias Services Holdings SA (EGFEY) and industrial conglomerate Mytilineos SA (MYTHY). You may not have heard of some of these stocks, and you may not follow Greece’s economy closely, but with a 2022 growth rate of almost 6%, this region is looking up.
WisdomTree Europe Hedged Equity Fund (HEDJ)
A bit more vanilla, but still a good tactical opportunity, is the WisdomTree Europe Hedged Equity Fund. This ETF provides exposure to the European equity market while hedging exposure to fluctuations between the U.S. dollar and the euro. That means you get exposure to big-name European companies such as automaker Stellantis NV (STLA), pharmaceutical maker Sanofi SA (SNY) and luxury goods company LVMH Moet Hennessy Louis Vuitton SE (LVMHY). With this fund, you don’t have to worry that exchange rates will eat away at any hard-fought gains, as Europe looks to a brighter future after a troubled 2022. The $1 billion fund is up more than 16% this year.
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7 Best ETFs to Buy Now originally appeared on usnews.com
Update 03/03/23: This story was previously published at an earlier date and has been updated with new information.
