So, you don’t want to spend a lot of time researching the 800-plus exchange traded funds (ETFs) out there. You’re busy and playing in the stock market isn’t your idea of fun times. You’d rather pick one that covers it all, then set it and forget it.
Matt Krantz at USA Today has some thoughts for investors who only want to buy one thing, despite wondering why the idea is so appealing in the first place:
- If this is what you’re going to do, don’t buy shares in just one company. Talk about putting allof your eggs into one basket! Many experts suggest that even six stocks isn’t enough to spread the risk around.
- Consider an ETF if you’re going to do this, in order to get the widest amount of exposure you possibly can.
To get the most bang for your buck, Krantz says, consider an ETF that holds a wide range of stocks. This gives you exposure to hundreds or even thousands of companies in just one investment. [Why these types of ETFs are the core of your portfolio.]
Vanguard Total Stock Market (NYSEArca: VTI) is one such fund. VTI owns the stocks of 3,900 companies that are small, medium size and large, in all sorts of industries. The annual fee for this ETF is a very reasonable 0.07%. Not only does this ETF give instant diversification, it can work as the one go-to investment for those of you who prefer the one-stop shop experience. [Why VTI is a basic building block for a portfolio.]
For more stories about VTI, visit our VTI category.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.