Do you know the thrill of finding undervalued, affordable stocks with huge upside potential? Value exchange-traded funds (ETFs) can save you a lot of time and money. Value ETFs hold assets in a basket of companies with low price-to-earnings (P/E) ratios and a proven track record of stable price movements. These ETFs can provide your stock portfolio with low-risk investments that offer sustainable long-term gains.
A look at the best value ETFs
- Utility Sector SPDR Fund
- Vanguard Utilities ETF
- ProShares Ultra Utilities ETF
Value ETFs Biggest Gainers and Biggest Losers
Take a look at the value ETFs with the most profits and losses.
Here’s a look at the stock quotes of value ETFs before the opening of trading sessions on the major exchanges.
Secondary Market Value ETFs
You can trade value ETFs at these price levels after the close of trading sessions on the exchange.
Why invest in Value ETFs?
Here are 3 top reasons why you should consider investing in value ETFs.
- Value ETFs have low expense ratios. Cost can play a vital role in your decision to invest. These ETFs are designed to appeal to investors who want to earn more profit at a lower price. These ETFs are passively managed and an expense ratio corresponds to the annual cost of operations.
A low spend rate of 0.1% means you’ll spend $10 for every $10,000 you invest. For example, you can buy shares of Vanguard Energy ETF (NYSEARCA: VDE) at a low expense ratio of 0.10% – $100. With these ETFs, you have the option of buying cheaper stocks such as the Fidelity MSCI Energy Index ETF (NYSEARCA: FENY) at a lower expense ratio – 0.08% – or $80.
- Value ETFs can generate more long-term gains. Besides the low cost of stocks, these ETFs can offer a financially stable return on investment. These ETFs can bring considerable benefits to your portfolio if you decide to buy and hold stocks. A diversified portfolio of small, mid and mega cap stocks to include in your set of these ETFs. This diversified set of securities offsets the risk of long-term volatility.
- Value ETFs have good dividend yields. Most ETFs pay dividends to shareholders on a monthly or quarterly basis. Taking the time to invest in these ETFs can become a second source of income for you. Combined with the security of long-term returns, these ETFs can help you plan for retirement and even cover regular expenses without forcing you to dip into your savings.
3 Value ETFs by AUM
Whether you are a beginner or an experienced trader, these ETFs offer something for every type of investor. From low-cost stocks to instant diversification, these ETFs can reduce the risk of losses and improve your earnings over time.
You should assess key factors such as expense ratios, price-to-earnings (P/E) ratios, index performance, return histories, liquidity and assets under management (AUM) before investing. Considering these criteria, you can view these ETFs to invest in.
1. SPDR Utilities Sector Fund (NYSEARCA: XLU)
Launched in 1998, the SPDR Utilities Select Sector fund tracks the Utilities Select Sector Index. It exposes you to domestic stocks in the US utilities sector known for its low volatility and high dividend yields.
Utilities Select Sector SPDR Fund has an expense ratio of 0.13% and a P/E ratio of 19.58. With this ETF investment, you can earn an annual dividend yield of 3.42%. Utilities Select Sector SPDR Fund has a 3 year return of 19.52% and a 5 year return of 49.49%. It has a total AUM of over $11 billion with an average monthly trading volume of 17 million shares.
2. Vanguard Utilities ETF (NYSEARCA: VPU)
Vanguard Utilities ETF holds assets in more than 50 companies in the US utilities sector. It mirrors the MSCI US Investable Market Utilities 25/50 Index and has a low expense ratio of 0.10%.
This value ETF has a 3-year yield of 18.94% and a 5-year yield of 49.72%. You can earn an annual dividend yield of 3.16% by investing in this ETF. It has a P/E ratio of 24.8 with a total AUM of $3.7 billion. Vanguard Utilities ETF trades over 200,000 stocks per month.
3. ProShares Ultra Utilities ETF (NYSEARCA: UPW)
The ProShares Ultra Utilities ETF has been in the market since 2007. It matches the Dow Jones US Utilities Index with a 200% return.
ETF stock has low liquidity with less than 5,000 shares traded each month. It has an expense ratio of 0.95% and a total AUM of $13.6 million. ProShares Ultra Utilities ETF has an annual dividend yield of 1.73% and a P/E ratio of 17.84. It has a 3-year return of 6.9% and a 5-year return of 56.63%.
Best Online Brokers for Value ETFs
You can browse thousands of leading ETFs on the stock exchange with an online broker. Most online brokers allow you to trade ETFs commission-free. Benzinga has selected the best online brokers to help you get started.
1. Commercial Station
You can experience the full suite of intuitive trading technologies, online brokerage services, and trading education with TradeStation.
This platform allows you to explore vast markets to trade stocks, ETFs, futures, options, or cryptos with competitive pricing models.
At TradeStation, you can start investing with advanced trading tools and data to help you with your trading strategy.
You can also share your knowledge with a thriving community while unlocking new trading skills.
2. First class
Firstrade’s Android and iPhone apps allow you to seize all trading opportunities, wherever you are. Access trading trends and tactics from comprehensive research and reports provided by Morningstar, Briefing.com, Zacks and Benzinga.
This online trading platform is fully customizable and allows you to manage your account seamlessly across all your digital devices.
Firstrade is equipped with an advanced filter that allows you to filter stocks based on P/E ratios, profitability, market capitalization, industry sectors and more.
3. TD Ameritrade
TD Ameritrade is an online brokerage that helps you build and manage your financial portfolio. Its 40+ years of industry-leading experience can help you successfully trade stocks, ETFs, options, futures, mutual funds, currencies and bonds on its platform .
TD Ameritrade gives you access to your trading account on the web and on mobile. It is integrated with the thinkorswim platform which offers elite-level trading tools for performing stock analysis and testing investment strategies. You can also check the latest financial news from Yahoo! Fund in a customizable dock on TD Ameritrade.
Are value ETFs right for your portfolio?
Value ETFs can make you a shareholder of many promising stocks for a marginal fee. Their potential for long-term gains coupled with stable performance in the stock market can make these ETFs a lucrative investment opportunity for you.
Are value ETFs a good investment?
Since value ETFs are made up of stable companies, they can be a good investment.
Are value ETFs short-term or long-term investments?
Value ETFs are considered a long-term investment.
Which value ETFs should I invest in?
See the list of ETFs recommended by Benzinga in the list above.