Exchange Traded Funds (ETFs) have truly revolutionized the concept of diversification, and they have fundamentally changed the way people invest. Investors can now seek-out different markets, sectors, regions, and/or asset classes that interest you.
ETFs for investing are like apps for your phone. Do you want to invest in only green energy companies? There’s an ETF for that. Are you looking for an ETF that invests in only Israeli stocks? There’s an ETF for that. Do you want an ETF that targets global real estate? There’s an ETF for that too.
The categories and ETF options are so expansive that there are currently more than 1,700 available to choose from, and the number keeps rising. The ETFs can be narrowly focused on a particular region, commodity, style, or can be expansive like investing in an entire market, like the S&P 500. In fact, for many investors, simply buying an S&P 500 ETF (ticker: SPY) and calling it a day is all they’ll ever need.
ETFs can give new investors a benefit because they are generally cost effective (low annual fee) and represent a category, which means investors can obtain instant diversification (assuming you invest in a broad market or multiple categories).
That being said, for new investors or those building a portfolio from scratch, choosing from the extensive menu of ETFs can be somewhat daunting. A good place to start is by answering some questions that inform who you are as an investor:
Those questions are all good primers for narrowing your options and figuring out which ETF(s) could make sense for your situation.
Next would be to search and filter the ETFs. Using the iShares website is helpful to poke around on all the options, and Vanguard and Schwab also offer good selections of ETFs. TD Ameritrade also has a tool that allows you to search for and filter ETFs by different criteria, like performance, sector, fund family, market cap, ratings, portfolio holdings, and so on. They also have more than 300 ETFs that you can trade commission-free.
Want to Use Algorithms to Get Investment Ideas? Tickeron has Artificial Intelligence for That
Want to invest and/or diversify your portfolio but unsure where to start? Artificial Intelligence can help! Tickeron has developed user-friendly Artificial Intelligence tools to help new and experienced investors generate investment ideas. Tickeron’s A.I. is capable of evaluating a portfolio and providing a “Diversification Score,” to tell the user how well-diversified their portfolio is. It can also generate investment ideas for a user’s 401(k) plan – even if you’re just getting started! The A.I. will give you ideas based on your risk tolerance, investment objectives, and the investment options available.
Tickeron’s new financial website is available to beginners, intermediate investors, and even experts and advisors. Explore tickeron.com today.