Exchange traded funds (ETFs) continue to grow in popularity with investors and it isn’t hard to see why. Never has it been so easy for investors to gain access to groups of shares from all corners of the world.
But given how many ETFs there are to choose from, it can be hard to decide which ones to add to a portfolio. To narrow things down, I have picked out two highly rated and popular ETFs to get better acquainted with. They are as follows:
BetaShares NASDAQ 100 ETF (ASX: NDQ)
The BetaShares NASDAQ 100 ETF aims to track the performance of the NASDAQ-100 Index before fees and expenses. This index comprises 100 of the largest non-financial companies listed on the NASDAQ market, and includes many companies that are at the forefront of the new economy.
BetaShares notes that this area of the market is underrepresented on the Australian share market. As a result, the ETF may benefit local investors that often have a large allocation to financials and mining companies and little exposure to technology.
Among the companies you’ll be buying a slice of are global giants such as Amazon, Apple, Facebook, Microsoft and Tesla. And given their positive long term growth prospects, this bodes well for the BetaShares NASDAQ 100 ETF’s performance over the coming years.
Over the last five years the ETF has generated a return of 23.6% per annum for investors.
Vanguard MSCI Index International Shares ETF (ASX: VGS)
Another ETF to look at is the Vanguard MSCI Index International Shares ETF. This ETF provides investors with exposure to 1,507 of the world’s largest listed companies from major developed countries.
Vanguard notes that the ETF offers low-cost access to a broadly diversified range of securities that allows investors to participate in the long-term growth potential of international economies outside Australia. The fund manager believes this makes it suitable for buy and hold investors seeking long-term capital growth, some income, and international diversification.
Among the companies included in the fund are giant such as Apple, Johnson & Johnson, JP Morgan, Nestle, Procter & Gamble, and Visa.
The Vanguard MSCI Index International Shares ETF has generated a total return of almost 14% per annum over the last five years.