These are the ASX ETFs I would buy if the market crashed tomorrow

You never know when the next market crash will happen but you can prepare for it.

| More on:
A stressed businessman sits next to his briefcase with his head in his hands, while the ASX boards behind him show shares crashing.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • In the event of a market crash, the iShares S&P 500 ETF offers a chance to invest in top U.S. companies like Microsoft and Visa at reduced valuations, historically rebounding well post-downturns.
  • The Vanguard Australian Shares ETF provides access to dominant Australian stocks such as Commonwealth Bank and BHP, presenting a rare opportunity to buy these key players at lower prices during a market decline.
  • For growth potential, the Betashares Global Cybersecurity ETF focuses on crucial cybersecurity industries, with companies like CrowdStrike and Fortinet potentially depreciating during crashes but offering strong recovery prospects as threats persist.

Market crashes are uncomfortable, but they are also where some of the best long-term opportunities are created.

History shows that share markets have always recovered from major downturns, even though it rarely feels that way at the time.

If the ASX and global markets were to suffer a sharp sell-off, I wouldn't be trying to pick the bottom or trade in and out. Instead, I would be looking to deploy capital into high-quality exchange-traded funds (ETFs) that offer diversification, resilience, and strong long-term growth potential.

These are the ASX ETFs I would be buying if markets fell sharply.

iShares S&P 500 ETF (ASX: IVV)

The first ASX ETF I would reach for is the iShares S&P 500 ETF. It provides exposure to 500 of the largest and most profitable stocks in the United States, many of which have proven their ability to survive and thrive through multiple market cycles.

Its holdings span industries such as technology, healthcare, consumer goods, and industrials. This includes names such as Microsoft (NASDAQ: MSFT), Johnson & Johnson (NYSE: JNJ), Costco Wholesale Corp (NASDAQ: COST), Visa Inc (NYSE: V), and Nvidia Corp (NASDAQ: NVDA).

A market crash often hits even the strongest businesses indiscriminately. Buying this fund during those periods has historically given patient investors exposure to world-class stocks at far more attractive valuations.

Vanguard Australian Shares ETF (ASX: VAS)

Closer to home, I would also be looking at the Vanguard Australian Shares ETF. This fund tracks the broader Australian share market and provides instant exposure to the country's 300 largest stocks.

Its portfolio includes Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP), CSL Ltd (ASX: CSL), Coles Group Ltd (ASX: COL), and Wesfarmers Ltd (ASX: WES). These businesses dominate their respective industries and play a central role in the Australian economy.

For long-term investors, a market crash can be an opportunity to buy into the Australian market at valuations that don't come around very often.

Betashares Global Cybersecurity ETF (ASX: HACK)

Finally, I would want some exposure to a long-term structural growth theme that is unlikely to disappear in a downturn.

The Betashares Global Cybersecurity ETF invests in stocks that are providing cybersecurity software and services. This includes Palo Alto Networks (NASDAQ: PANW), CrowdStrike Holdings (NASDAQ: CRWD), Fortinet (NASDAQ: FTNT), and Zscaler (NASDAQ: ZS).

As digital threats continue to rise, spending on cybersecurity remains a priority for governments and businesses regardless of economic conditions.

If the market crashed, high-growth thematic ETFs like HACK would likely be hit hard. But for investors with a long time horizon, that volatility could present an opportunity to buy into an essential industry at discounted prices.

Motley Fool contributor James Mickleboro has positions in CSL. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended BetaShares Global Cybersecurity ETF, CSL, Costco Wholesale, CrowdStrike, Fortinet, Microsoft, Nvidia, Visa, Wesfarmers, Zscaler, and iShares S&P 500 ETF. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended Johnson & Johnson and Palo Alto Networks and has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has recommended BHP Group, CSL, CrowdStrike, Microsoft, Nvidia, Visa, Wesfarmers, and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on ETFs

Young boy in business suit punches the air as he finishes ahead of another boy in a box car race.
ETFs

The ASX ETFs I think could beat the Australian share market over the next 5 years

If the goal is market outperformance, I think these growth-focused ETFs are worth considering.

Read more »

A woman stands at her desk looking at her phone with a panoramic view of the harbour bridge in the windows behind her.
ETFs

Why I would buy these ASX ETFs with $50,000

I’d allocate $50,000 to a mix of structural growth and high-quality global exposure.

Read more »

Woman looks amazed and shocked as she looks at her laptop.
ETFs

3 amazing ASX ETFs you need to know

Want to invest in the best? Check out these funds.

Read more »

Excited couple celebrating success while looking at smartphone.
ETFs

The ASX just got a new ETF that pays monthly dividends

This ETF will pay 12 dividends a year.

Read more »

strong woman overlooking city
ETFs

Why I think this Vanguard ETF is a strong buy in 2026

Global diversification matters more than ever if you’re investing for the next decade.

Read more »

ETF spelt out with a piggybank.
ETFs

How are these newly listed ASX ETFs performing?

Do you have any of these funds in your portfolio?

Read more »

ETF written in yellow with a yellow underline and the full word spelt out in white underneath.
ETFs

Why these ASX ETFs could be perfect for buy and hold investors

These funds could compound strongly over the next decade and beyond.

Read more »

A woman stands at her desk looking at her phone with a panoramic view of the harbour bridge in the windows behind her.
ETFs

Investment themes investors should be watching closely – Expert

Themes investors should be paying attention to.

Read more »