This is the inaugural article of what I hope will prove to be a long-running series here on Seeking Alpha. I will begin this article with an introduction to the series, including the basis for my ETF selections as well as helpful common features readers will find in each article. Every investor desirous of developing an ETF-based portfolio does well to start by selecting a few core holdings.
This is the inaugural article of the "ETF Monkey Focus" series. It is my hope that this will prove to be a long-running series here on Seeking Alpha.
As my readers are well aware, I believe that low expenses and diversification form two "solid anchors" of a well-constructed portfolio. To satisfy that first anchor, as my starting point for this series I ran a screen to reveal all ETFs with an expense ratio below. I found ETFs that meet this first criteria.
Since they include both equity and fixed income and cross a wide variety of sectors and asset classes, an investor will be able to use the ETFs I feature to build a world-class portfolio that satisfies that second anchor; diversification.
SWTSX Fund Facts & Fees
These articles will be based on asset class or sector. In each article, I will likely write on somewhere between ETFs. Ultimately, I will not report on all ETFs. Some will either be too small, or too new, for me to present them as serious competitors in my comparative evaluations. Additionally, from time to time I may choose to at least mention a noteworthy competitor with an expense ratio greater than.
By the time I am done, however, I fully expect to have written on somewhere north of ETFs. I plan to include features that I hope will make these articles very useful tools for an investor as they begin their research. Here, briefly, are some of those features. First, each article will include an introductory table featuring key profile information for each ETF. As an aid to further research, if available, the name of each ETF, as well as the index it tracks, will actually be links to the provider's information sheet for that ETF or index.
SWTSX Schwab Total Stock Market Index ETF SWTSX Quote Price News
To the extent that some of the terms in the table might be unclear, I will attempt to include some definitions. Here is an example:. Here is a look at the information this introductory table will contain in the case of fixed income ETFs:. Additionally, in many of the articles on equity ETFs, I hope to include one additional table containing some form of high-level sector information that may help the investor understand each ETF at a big-picture level.
In the case of U. Total Market ETFs, I will feature just that, sectors. In the case of an international ETF, I may feature the breakdown by country. Well, that's it for the overview. Let's get started with our first evaluation, shall we? Such companies, while offering a higher level of risk than their larger brethren, also offer greater opportunities for growth. There are several worthy competitors in the marketplace. And, they may be even more worthy if your brokerage offers commission-free trading in these ETFs; particularly if one of your goals forex trading market share to invest regularly and in small increments.
In this article, we will briefly review five such ETFs. As will be schwab u.s. total stock market etf, I have selected three as the best of the group, with two runner-ups. The following ETFs are, in my opinion, your best choices in this asset class. In the forex meaning of pip table, you will find key high-level profile square root of trading days portfolio information.
The displayed percentages on the Schwab website only forex steam 8 review up to So, I used a "ballpark" number of 2.
Here is a brief overview of each of the ETFs, in alphabetical order by ticker symbol.
VTI Vanguard Total Stock Market ETF ETF VTI Quote Price News
In December,BlackRock NYSE: BLK made a couple of significant changes to deal with an increasingly competitive landscape. First, they dropped ITOT's expense ratio to an industry-leading.
However, Charles Schwab NYSE: SCHW immediately responded by dropping SCHB's stock market ratios explained ratio to.
As shown in the first table in the article, that is how things still stand as of this writing. At the same time, however, BlackRock made a second change I consider to be just as, if not more, important.
ETF Monkey Focus: Equity - U.S. Total Market ETFs | Seeking Alpha
This index was not as deep as those tracked by either SCHB or VTI. With 3, constituents, this index moves directly into competition with the index used for VTI. Due to its smaller size, at. However, this small difference would affect only the most active of traders.
For more on ITOT, feel free to consider this in-depth article I previously wrote for Seeking Alpha. As noted in the previous section, with an expense ratio of.
At the same time, it is not quite as broad or deep as stock exchange currency rates in pakistan VTI or ITOT in terms of complete market coverage.
SCHB tracks the Dow Jones U. Broad Stock Market Index. Basically, this index includes the largest 2, stocks in the U. The reason SCHB contains approximately less stocks than the index it tracks is that Schwab makes use of statistical sampling techniques to replicate the index. This technique is used when the ETF provider takes the view that the trading costs involved in attempting to purchase every security in the index would lead to a greater tracking error or divergence from the index than their actual practice of sampling the index.
Viewed from a critical standpoint, then, this ETF could be considered slightly less of a genuinely "total market" fund than either ITOT or VTI.
At the same time, its rock-bottom expense ratio combined with its substantial size and great tradeability make it a solid choice. VTI tracks essentially the entire investable U.
It does so by tracking the CRSP U. As you compared the various ETFs in the first table, likely the first thing that jumped out at you was VTI's size. As a result, while ITOT and SCHB now offer an even lower. The other thing you may have noted in the second table is that VTI contains a lower weighting in technology than the competition. For more on VTI, feel free to review a previous in-depth article I wrote for Seeking Alpha, in preparation for including it in The ETF Monkey Vanguard Core Portfolio.
In my research, I found 2 other ETFs meeting my criteria for inclusion in this article, namely an expense ratio of less than. Both of these ETFs track the Russell Index. In terms of total market coverage, this index falls somewhere in between the indexes tracked by ITOT and VTI and the index tracked by SCHB.
However, you will note that the two ETFs listed above have both a higher expense ratio and lower AUM than any of our 3 winners, leading to higher trading spreads. For these reasons, I believe you would be better off selecting either ITOT, SCHB or VTI as your core holding for this segment. ITOT data by YCharts.
In summary, while any of these five ETFs would do a nice job serving as a core holding in your portfolio, I believe you would be most benefited by selecting either ITOT, SCHB or VTI.
Lower expenses along with greater size and tradeability are a winning combination. It may come as no surprise that these are the 3 ETFs I selected for the three implementations of The ETF Monkey Model Portfolio.
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ETF investing, portfolio strategy, long-term horizon, Investing for Beginners. Summary This is the inaugural article of what I hope will prove to be a long-running series here on Seeking Alpha. In this article, I will evaluate 5 candidates, and select 3 winners and 2 runner-ups. Series Introduction - Overview and Common Features As my readers are well aware, I believe that low expenses and diversification form two "solid anchors" of a well-constructed portfolio.
Want to share your opinion on this article? Disagree with this article? To report a factual error in this article, click here. Follow ETF Monkey and get email alerts. Vanguard Total Stock Market ETF. SPDR Russell ETF. Vanguard Russell ETF.