This ETF Is a Great Option for Value Investors
Value investing has been rising in popularity amid the current bear market. And one exchange-traded fund that risk-averse investors should consider loading up on right now is the Vanguard Value Index Fund (NYSE Arca: VTV). In the past 12 months, the fund is down less than 9%, which is a bit better than the S&P 500's fall of 10%. Historically, it has underperformed the S&P but with investors pulling away from growth stocks, it may be a much better fund to target right now.
What's attractive about the ETF is that it has a miniscule expense ratio of 0.04%. Its yield is above average at 2.5%, and the fund is incredibly diverse; there are more than 340 stocks in the ETF. And at a median market cap of over $116 billion, these are established, relatively low-risk stocks for investors to be hanging on to. The value-oriented fund averages a price-to-earnings multiple of 15.8.
The three largest sectors within the fund are financials (20%), followed by health care (19%), and industrials (14%). And at 3.1%, the top holding, Berkshire Hathaway (NYSE:BRK.B), doesn't make up a huge part of the fund. Other big-name stocks in the ETF include oil and gas giant Exxon Mobil (NYSE:XOM), and health insurer UnitedHealth Group (NYSE:UNH).
The fund is a suitable option for long-term investors who are willing to buy and hold. However, at a tumultuous time in the markets when investors are looking for safety, this can also be a great place to temporarily park your money for the remainder of this year.
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