The world of exchange traded funds (ETFs) is a difficult one to navigate. Add in specific strategies like value investing which have under-performed the broader market for the better part of a decade, and picking ETFs suddenly becomes more tricky.
For those investors who, like myself, believe in slow and steady methodologies that have been proven to work over long periods of time, staying the course and investing in such companies in an active way (by picking stocks) or by investing in a passive vehicle like ETFs that provide exposure to such securities, should remain the top priority for those looking to build wealth in a steady way over the long-term.
One such ETF which provides passive investors with access to a range of high quality value oriented assets is Vanguard Value ETF (NYSE:VTV). This ETF is a highly diversified ETF which is also weighted by market capitalization, making this fund more representative of larger indices and allowing for lower turnover rates and therefore a very low expense ratio.
Because this is both a value ETF as well as a market capitalization-weighted ETF, the fund holds a higher percentage of large companies with slower growth rates than others on the Dow or S&P 500. This means investors can expect slower rates of growth over time (as priced in via low valuation multiples), but also a relatively low risk profile, as these are the corporate behemoths that very rarely ever go out of business.
Invest wisely, my friends.
