- While the market volatility has shaken many investors, daring contrarians have an opportunity to pick up some of the best ETFs (exchange-traded funds) at bargain prices.
- Invesco QQQ Trust(QQQ): Although tech has been one of the hardest-hit sectors, over the long run, the QQQ could be one of the best ETFs for a comeback.
- Vanguard Mid-Cap Growth Index Fund ETF (VOT): With mid-capitalization names providing a solid mixture between growth and stability, VOT is among the best ETFs in this environment.
- Renaissance IPO ETF (IPO): New listings are always risky but distributing the danger may be enticing for certain gamblers.
- ProShares Bitcoin Strategy ETF (BITO): Only an idea for the most daring of contrarians, BITO is on discount due to the cryptocurrency fallout.
Although the market volatility is worrying investors, it’s also fair to point out that some of the biggest gains can be made by zigging while others are zagging. Even better, you can spread out your risk through exchange-traded funds (ETFs) instead of picking individual stocks. In turn, ambiguous circumstances may favor the best ETFs for bargain hunters.
For one thing, putting your money into an individual company always ramps up the underlying risk profile. Despite electing a viable industry, for instance, you just never know what might happen with your specific idea. With the best ETFs, however, you can distribute your risk across a wide canvas, thus mitigating the potential that one bad apple could spoil the whole crate.
Another reason to focus your efforts on finding the best ETFs to buy is the overriding risk-off sentiment. With so many market segments awash in red ink, the chances of you finding just the right individual idea are slim. Instead, present economic dynamics suggest that you should go with sector funds, improving your odds for buying winners.
So, with all of that in mind, let’s dive in and take a closer look at these four best ETFs for investors
|QQQ||Invesco QQQ Trust||$284.16|
|VOT||Vanguard Mid-Cap Growth Index Fund ETF||$178.50|
|IPO||Renaissance IPO ETF||$28.36|
|BITO||ProShares Bitcoin Strategy ETF||$18.17|
Best ETFs to Buy Now: Invesco QQQ Trust (QQQ)
When digging through the bargain bin for the best ETFs, it’s important not to just focus on the price. Rather, you want to find funds that feature relatively robust trading volume. Otherwise, your money could end up going to feed zombie ETFs or funds that feature little interest and therefore low activity.
Never say never but you probably won’t have to worry about the Invesco QQQ Trust (NASDAQ:QQQ) joining the ranks of the undead. Featuring a volume level of nearly 91 million shares, QQQ is rarely if ever short on traders. More importantly, Invesco QQQ counts among its core holdings some of the world’s leading technology firms.
In the spirit of full disclosure, some of the companies are names that I’m a bit skeptical about. However, there are plenty of enterprises that, over the long run, should prove to be incredibly viable. Therefore, QQQ is one of the best ETFs to buy if you’re seeking a bargain.
Vanguard Mid-Cap Growth Index Fund ETF (VOT)
Typically, mid-capitalization stocks provide an attractive balance between proven stability and upside growth potential. It’s not always healthy to be fully on one side of the spectrum or the other, making the Vanguard Mid-Cap Growth Index Fund ETF (NYSEARCA:VOT) an appropriate choice for investors feeling things out.
Nevertheless, the broader market volatility has not been too kind to VOT stock. Year-to-date (YTD), the mid-cap ETF has declined by almost 30%, noticeably more than the benchmark SPDR S&P 500 ETF Trust (NYSEARCA:SPY), which has declined 18.1% during the same period. However, for the patient investor, once circumstances eventually normalize, the upside potential for VOT should be distinctly greater.
As the name of the ETF implies, VOT is well balanced. It features the heaviest exposure to tech, providing the growth potential. However, its significant ties to healthcare, financial services and energy offer the much-needed stability that’s so valuable at this juncture.
Best ETFs to Buy Now: Renaissance IPO ETF (IPO)
As one of the hardest-hit ETFs, the Renaissance IPO ETF (NYSEARCA:IPO) must come with a disclaimer: only place a wager on it with money you can afford to lose. Even then, it’s really a platform for true battle-hardened gamblers. As the name suggests, this fund focuses on companies that recently launched an initial public offering (IPO). And while this arena is compelling, it is also extraordinarily risky.
Nonetheless, if you happen to get the call correctly, buying a newly listed company when shares are offered in the secondary market — or better yet through a pre-IPO placement — could yield dramatic gains. At the same time, you must consider the opposite scenario: you could suffer extraordinary losses. As the debacle surrounding many special purpose acquisition companies (SPACs) have proven, IPOs can be dangerous.
Still, this market subsegment can provide exposure to groundbreaking businesses. Therefore, if you really like the idea of being a pioneer, the Renaissance IPO could be among the best ETFs to buy.
ProShares Bitcoin Strategy ETF (BITO)
Okay, so let’s get some disclosures out of the way. As a long-term concept, I’m a big believer in cryptocurrencies. I also have some Bitcoin (BTC-USD), which is the core focus of ProShares Bitcoin Strategy ETF (NYSEARCA:BITO). However, I’m simultaneously a proponent of reading the room and what the room tells me is that cryptos may be due for a serious correction.
Since this is the internet, I’m fully aware that some of you, perhaps most of you disagree with me. That’s fine. For those on the opposite side of the fence, you have BITO, which, per its underlying website, allows “investors an opportunity to gain exposure to bitcoin returns in a convenient, liquid and transparent way.”
Therefore, with so many concerns about cyberattacks and other nefarious activities impacting crypto-related ventures, BITO may be one of the best ETFs to buy if you simply want your Bitcoin without all the unnecessary — and sometimes disheartening — drama.
On the date of publication, Josh Enomoto held a LONG position in BTC. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.