New to Investing? Take a Look at These Funds
When you're just starting to invest, it's easy to get overwhelmed by the sheer number of options. Instead of rushing in and buying something you don't understand, purchasing an exchange-traded fund (ETF) is an excellent first move. ETFs are similar to mutual funds, except they trade like a stock.
There are thousands of these ETFs, each centered around a different theme. Some good ones to start with are the Vanguard Total Stock Market ETF (NYSEMKT: VTI), the Vanguard S&P 500 ETF (NYSEMKT: VOO), and the Vanguard Russell 2000 ETF (NASDAQ: VTWO). These are basic but important in every investor's portfolio. Here's why all investors (even experienced ones) should consider these three ETFs.
The Total Stock Market ETF centers around all stocks traded in the U.S. This includes small and micro-cap stocks that the Vanguard 500 (which tracks the S&P 500) misses. As a result, the index has captured the rise of companies like Amazon, Netflix, and Tesla, where the S&P 500 didn't. However, capturing these rises doesn't always mean outperformance.
Source Fool.com
