Getting started with your investment portfolio is an awesome experience.
But it can be a little overwhelming. There are hundreds of products, from multiple providers and all with slightly different features.
Today we’re going to introduce three ETFs suitable for a beginner’s portfolio, and why you might consider purchasing them.
NDQ ETF tracks a basket of the world’s best growth companies including Apple, Tesla and Google.
Over the years, NASDAQ has built a reputation as the go-to exchange for companies at the forefront of innovation.
Subsequently, it’s an exchange most investors want exposure to when starting a portfolio.
The fund has returned a whopping 27.78% per annum for the past five years. Had you invested $10,000 in 2016, it would now be worth $34,065.
One benefit of the ETF is that it saves investors the hassle of completing a W-8 BEN form, which is a tax form required if you hold the companies directly.
For a 0.48% management fee per annum ($4.80 for every $1,000 invested), this ETF is on the top of my list for new investors.
VAS tracks the 300 biggest public companies in Australia including the likes of Commonwealth Bank, Afterpay and Woolworths.
It’s very similar to the ASX 200, however, VAS includes the 100 next biggest companies (201-300) to form the ASX 300.
I like VAS over other Australian index products as it provides exposure to the smaller end of the market, where up and coming businesses exist.
Over the past ten years, VAs has returned 10.06% per annum. If you invested $10,000 in 2011, it would now be worth $26,079.
With a 0.10% management fee per annum ($1.00 for every $1,000 invested), this ETF is great for investors wanting diversified local exposure.
VGS is effectively the inverse of VAS.
Instead of tracking the biggest Australian companies, VGS tracks the biggest companies in the world minus Australia.
It holds over 1,500 companies from developed markets including Japan, the United Kingdom, Canada, France and the United States.
Notable holdings include Nestle, Facebook and Amazon.
The ETF has returned 15.96% over the past five years. A $10,000 investment in 2016 would be worth $20,967 today.
For just a 0.18% management fee per annum ($1.80 for every $1,000 invested), VGS is a great way to gain low-cost international exposure.
All three ETF’s provide a different type of geographic exposure while remaining diversified across companies.
As a result, one or all three would be a great fit for any new portfolio.
If you’re looking to learn more about ETFs, consider taking our free Beginner’s ETF Investing Course.
It takes less than an hour to complete and is a great entry point to learn more about the world of ETFs and investing.