When it comes to generating solid returns, investors often turn to Exchange-Traded Funds (ETFs) that offer diversified portfolios. These funds, managed by experts, track benchmarks, potentially leading to increased returns for shareholders. While investors should be mindful of expense ratios associated with ETFs, many top ETFs manage to keep these costs low, typically below 0.20%. However, there are funds with expense ratios that can range closer to 1%. Conducting a thorough review of an ETF’s holdings and past performance can provide insights into its future performance. Here are three top ETFs to consider investing in for the month of April, serving as a solid foundation for your investment research.
Vanguard Growth Index Fund ETF (VUG)
Source: C H A L N / Shutterstock.com
The Vanguard Growth Index Fund ETF (NYSEARCA:VUG) boasts over 200 holdings, heavily concentrated in the tech sector, representing more than half of the fund’s total assets. Consumer Discretionary accounts for 20% of the portfolio, leaving limited space for other sectors. The fund’s Top 10 holdings feature the Magnificent Seven, with Microsoft (NASDAQ:MSFT) taking the top spot at 12.84% of assets. VUG has exhibited steady returns for long-term investors with a 38% increase over the past year and 115% growth over the past five years.
Vanguard is renowned for its low expense ratios, and VUG is no exception, boasting a mere 0.04% expense ratio paired with a 0.46% 30-day SEC yield. Prioritizing domestic growth stocks with sizable market caps, this large growth fund puts investors in a favorable position.
Invesco QQQ Trust Series 1 (QQQ)
Source: whiteMocca / Shutterstock
The Invesco QQQ Trust Series 1 (NASDAQ:QQQ) tracks the Nasdaq 100 and champions Magnificent Seven stocks within its Top 10 holdings. Boasting a 39% upsurge over the past year and a remarkable 141% growth over the past five years, QQQ has significantly outperformed the S&P 500 since its launch in 1999, especially considering the harsh impact of the dotcom bubble burst when the fund plummeted by over 80% from peak to trough.
With a competitive 0.20% expense ratio, QQQ offers income-boosting covered call options for interested investors. Besides the Magnificent Seven, Broadcom (NASDAQ:AVGO) and Costco (NASDAQ:COST) also grace the list of top 10 holdings, while the tech sector dominates over half the fund’s total assets.
iShares Semiconductor ETF (SOXX)
Source: Shutterstock
The iShares Semiconductor ETF (NASDAQ:SOXX) offers exposure to the dynamic semiconductor industry. Top holdings include Nvidia (NASDAQ:NVDA), Broadcom, and Advanced Micro Devices (NASDAQ:AMD), collectively accounting for over 23% of the fund’s total assets.
Despite a slightly higher 0.35% expense ratio, SOXX has delivered impressive returns, surging by 55% over the past year and an outstanding 243% increase over the last five years. With an annualized return rate of 24.47% over the past decade, the fund’s performance stands out. While the fund excels in the semiconductor industry, prudent investors may consider diversifying their portfolio to mitigate risks.
On the date of publication, Marc Guberti held a long position in VUG. The views expressed in this article are solely those of the author, following the InvestorPlace.com Publishing Guidelines.
