When it comes to investing in listed funds (ETFs), investors have many choices. You can follow the latest artificial intelligence companies with an AI ETF, or even immerse your toe in cryptocurrencies with a Bitcoin Etf.
But if you want an efficient and reliable way S&P 500 (Snpindex: ^GSPC)the Vanguard S&P 500 ETF (Nysemkt: flight) Is one of the best places to place your money. You not only spread your money over the 500 largest listed companies in the US, but you also pay minimum costs and you can get started with this Vanguard ETF with just $ 1.
Here are a few reasons why it is now a sensible decision to place $ 100 in the Vanguard S&P 500 ETF and to hold it for the long term.
Vanguard is known for its cheap funds, and the Vanguard S&P 500 ETF is no exception. You pay a cost ratio of only 0.03%, which means that for every $ 1,000 you have invested, you only pay $ 0.30 in management costs.
Spending less on costs is a fantastic way to maximize your profit. Many actively managed funds charge much more and may not even earn better profit in the long term. In fact, the latter Morningstar Data shows that the most passively managed funds perform actively than actively managed funds for more than ten years.
As the name suggests, Vanguard’s S&P 500 ETF follows the S&P 500. You will be invested in 500 of the largest listed companies. This reduces the pressure of finding the hottest shares to buy or looking for the next big trend to invest.
Instead, you will benefit from the long -term potential of the S&P 500. Since 1957, the S&P 500 has a historical annual return of 10.1% (not adapted for inflation). There is no guarantee that it will keep track of that trend, but with such a large mix of companies within the index there is a good chance that your investment will grow over time, because it will benefit from the growth of so many companies.
This is one of the biggest calls of an S&P 500 ETF, because you get the benefits of investing your money without having to commit substantial time and energy to find individual shares.
One of the most difficult things about investing is to spread your money over different companies and opportunities. This helps to protect your investments in case a company never reaches its full potential or a long -term trend.
You don’t have to worry about that with the S&P 500 ETF from Vanguard. Since your money is diversified in many companies, the ETF will probably also be doing if the economy and the market in general are doing well.
