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- Exchange Traded Fund (ETF) has gained popularity as it offers several features that can make it ideal for investors.
- ETFs make it possible for investors with low investment amount to build a diversified portfolio and earn passive income.
Investors use various kinds of strategies and invest across different asset classes to achieve their goals and generate high returns. Exchange-Traded Fund (ETF) is one such asset class that has gained popularity, as it offers a number of features that can make it ideal for investors. ETFs are a low-cost means to gain exposure to the stock market as it tracks a share index, such as the FTSE 100, while others may track a definite sector or asset type – such as gold.
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ETFs make it possible for investors with low investment amount to build a diversified portfolio and earn passive income. These funds offer exposure to a wide range of global financial markets while charging much less than actively managed funds. ETFs also offer liquidity and real-time settlement as they can be easily bought and sold on a stock exchange same as stocks.
Let us look at the three best ETFs in the UK that you may consider investing in in April.
You may consider the Vanguard S&P 500 UCITS ETF if you want to gain exposure to 500 stocks listed on the S&P 500 index with low risk. The fund tracks the performance of the biggest companies listed on the US stock exchange and invests in all constituent securities of the index in the same proportion. The S&P 500 index is one of the best indicators of the performance of the US stock market as per experts and market observers.
The S&P 500 UCITS ETF ongoing charge is 0.07%, with a minimum one-off payment of £500 and a monthly direct debit of £100. With total assets of US$32.1 billion as of 7 April 2022, the ETF has high levels of liquidity, with an impressive average return of 10.5% through to 2021.
The fund invests across various sectors including IT, Healthcare, Consumer Discretionary, Financials, Communication Services, Industrial, Consumer Staples, Energy, Material, Real Estate, and Utilities. Its’s top three holdings include Apple Inc, Microsoft Corp, and Amazon.
iShare Core FTSE 100 ETF offers exposure to the 100 largest UK listed companies. In the last one year, the fund has delivered a return of 16.01%, as compared to the 16.04% return given by FTSE 100 Index. Since its inception, it has given a return of 4.25% as compared to the 4.55% return given by its benchmark. The fund’s total expense ratio is 0.07%.
The fund invests across various sectors, including financials, consumer staples, healthcare, materials, energy, industrials, consumer discretionary, communication, utilities, real estate, and IT. Whereas its top three holdings include Shell Plc, AstraZeneca Plc, and HSBC Holdings Plc.
Invesco EQQQ NASDAQ 100 USITS ETF aims to provide investors with the net total return performance of the NASDAQ 100 Index, which includes 100 of the largest US and international non-financial securities. Its management fee is 0.30%.
The fund invests in a range of sectors including IT, Communication Services, Consumer Discretionary, Healthcare, Consumer Staples, Industrials, and Utilities. Whereas its top three investments, include Apple Inc, Microsoft, and Amazon.
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