There are at least five ETFs that I’d want to buy with $10,000 right now.
Confidence is returning to investors with the worst stage of COVID-19 seemingly over. Australia is in such a good healthcare position that it seems the economy may be able to bounce back quicker than expected. That’s why ASX bank share prices are jumping this week, particularly with less people getting jobkeeper than expected.
With that in mind, here are five ETFs I’d buy with $10,000 right now:
1: BetaShares Australia 200 ETF (ASX: A200)
Why I’d invest in this ETF: It is the cheapest way to invest in the ASX 200 with an annual management fee of just 0.07%. If you’re going to invest in an index product then you may as well go for the cheapest one.
If Australia’s economy is going to do better than expected, then being invested in Australia’s 200 biggest shares could be a good idea. The biggest positions are shares like CSL (ASX: CSL), CBA (ASX: CBA) and BHP (ASX: BHP).
2: Australian EX-20 Portfolio Diversifier ETF (ASX: EX20)
Why I’d invest in this ETF: Australia is one of the least diversified major share markets in the world. There’s a big focus on financial and resource businesses. There are tech shares on the ASX, but they’re too small to make a difference. So this ETF gives the potential of investing in ASX shares outside of the ASX 20.
It’s invested in shares like Fortescue Metals (ASX: FMG), Brambles (ASX: BXB), Sonic Healthcare (ASX: SHL) and Fisher & Paykel Healthcare (ASX: FPH). These are the types of businesses that are likely to make stronger returns over the longer term.
3: Vanguard FTSE Asia ex Japan Shares Index ETF (ASX: VAE)
Why I’d invest in this ETF: When you look at the overall economic picture of the world, it’s several Asian countries that appear to have COVID-19 under control the most.
Places like South Korea, Taiwan, South Korea and China. These are also economies which are growing strongly with excellent businesses listed on their stock exchanges. Companies like Alibaba, Tencent, Taiwan Semiconductor Manufacturing and Samsung.
Asia is a good place to be invested in with a part of your portfolio in my opinion.
4: Betashares FTSE 100 ETF (ASX: F100)
Why I’d invest in this ETF: In some ways the UK share market is similar to the Australian share market. Both stock exchanges even have Rio Tinto (ASX: RIO) and BHP listed on them.
However, the UK share market has more global businesses that I think make better investments than say ASX banks. I believe the UK shares offer better diversification with shares like Astrazeneca, GlaxoSmithKline, Unilever, Reckitt Benckiser, National Grid and so on.
5: iShares S&P 500 ETF (ASX: IVV)
Why I’d invest in this ETF: Warren Buffett says that people would be well served to invest in a S&P 500 ETF. That covers the biggest 500 businesses listed in the US. Shares like Microsoft, Amazon, Facebook, Alphabet and Apple are all part of the S&P 500. Then there’s stocks like Berkshire Hathaway, Visa, Mastercard and Netflix that also form part of the index.
It’s not just an American index though. Many of the holdings earn profit from across the world. It’s a high quality global index. And it also has the cheapest management fee on this list.
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Disclosure: At the time of writing, Jaz doesn’t own shares in any of the businesses mentioned.
