3 Of the Best Growth-Focused ETFs to Buy for 2023
We have now entered the final quarter of 2022-2023. This is now the time to look back on our finances and add elements to our portfolio. For those looking to add exposure to the markets, searching for growth-focused ETFs to buy may be a great way to go.
ETFs, or exchange-traded funds, provide diversified exposure to an index, sector, or trend at a very reasonable cost. These investment vehicles have become commonplace, mostly among passive investors. That said, many active investors may build a “base” that includes index ETFs and trade around the edges.
The cost and diversification advantages ETFs provide are certainly worthwhile. Even the most impressive investors of all time, including Warren Buffett, have touted the benefits of such funds. Low-cost diversification is hard to get, and these funds make investing a lot easier for those who want to avoid watching the markets closely.
That said, picking the best ETFs to buy is a challenging task. There are thousands of ETFs out there, each catering to a different investor profile. That said, the following three growth-focused ETFs are among the best in class. Thus, as we head into 2023, these are the index funds investors should dive into.
|VGT||Vanguard Information Technology ETF||$340.60|
|SPY||SPDR S&P 500 ETF||$399.59|
|SDIV||Global X SuperDividend ETF||$8.26|
Vanguard Information Technology ETF (VGT)
Technology remains one of the hottest sectors to invest in. Accordingly, for those looking for the best growth-focused ETFs to buy, the Vanguard Information Technology ETF (NYSEARCA:VGT) is among the best options in this sector.
As with the other growth-focused ETFs on this list, VGT offers exposure to a basket of the most prolific tech stocks at a reasonable price. This fund is available with an expense ratio of only 0.1%. Meaning that for every $10,000 invested, an investor will only pay $10 a year for exposure to this ETF.
With this bear market, tech stocks have been among the hardest hit. That said, for those thinking long-term, increasing exposure to this sector makes sense. That’s because as valuations have come down, the forward-looking upside looks more attractive.
The Vanguard Information Technology ETF holds a total of 367 stocks from the IT sector. While many may consider this ETF to be higher in risk profile than others, for those taking a more aggressive long-term approach, this can be one of the best buys in the market right now.
SPDR S&P 500 ETF (SPY)
On the list of most investors’ ETFs to buy, the SPDR S&P 500 ETF (NYSEARCA:SPY) is an ETF most investors have already heard of. This ETF, as the name suggests, follows the S&P 500 index. Now, every investor knows how popular and valuable the S&P 500 index is. It includes a combination of 500 stocks from the US’s most prominent companies (based on market valuation).
With this ETF, you get nothing but the best. Moreover, with this ETF, you can invest in all of the leading companies. As you know, the market is cyclical in nature. Currently, most investors are bearish. Accordingly, for those looking to take advantage of this bearish sentiment and buy when others are fearful, this may be the best way to do so.
Additionally, this ETF is among the best way for investors to battle market volatility over the long term. Higher market capitalization companies tend to be lower volatility (this year being an exception). Thus, this is a large-cap ETF worth considering for those with a sufficiently long investing horizon.
Global X SuperDividend ETF (SDIV)
There’s an ETF out there for every investor. However, those dividend-focused investors may need help traversing the overall list of ETFs to buy. That’s because most market-based ETFs focus more on sectors or overall indices than metrics, such as dividends.
That said, the Global X SuperDividend ETF (NYSEARCA:SDIV) is among the best options for growth investors looking to amplify returns via adding dividend exposure.
This fund comprises an equal-weighted portfolio of the 100 highest-yielding dividend stocks globally.
That sounds great, but doesn’t a higher dividend yield imply higher risk? Technically this is true. But this ETF combats these concerns by eliminating companies that have slashed their dividends. High-yielding (and consistently high-yielding stocks, for that matter) are included in this fund.
What I like about the SDIV is this ETF’s geographic diversification. Only 30% of the stocks in this ETF are based in the U.S. Thus, for investors with too much concentration here at home, this can help to diversify one’s overall portfolio further.
It’s also notable that this ETF is financials-heavy. Thus, for those who like bank stocks as a proxy for global growth, this is a great way to play this trend. For most investor types, this ETF fits in quite well as a core holding. It’s one I’m considering right now.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.
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