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Profit Without Panic: 7 ETFs to Diversify Your Portfolio - 4 of 7

 
 

#4 - Vanguard Financials ETF (NYSEARCA:VFH)

The Vanguard Financials ETF (NYSEARCA: VFH) is one of the top financial ETFs to consider. The fund tracks the Morgan Stanley Capital International (MSCI) Investable Market Financials Index. This provides exposure to large- mid- and small-cap companies in the financial sector. 

The fund has over 25% (26.1%) exposure to bank stocks. But you also get nearly equal exposure (approximately 20%) to insurance, capital markets, and diversified financial services companies. The fund’s top two holdings are JPMorgan Chase & Co. (NYSE: JPM) and Berkshire-Hathaway (NYSE: BRK.B).  

But why single out financial stocks? Like bank stocks, financial ETFs don’t deliver market-beating returns, but they still offer higher returns than you can get from bonds or cash. And they tend to deliver returns that keep your portfolio ahead of inflation. That’s played out in the last three years, with the fund delivering a total return of over 40%. This performance includes an annual dividend with a yield of 1.9%. The fund has a net expense ratio of 0.10%. 



About Vanguard Financials ETF

Vanguard Financials ETF (the Fund) is an exchange-traded share class of Vanguard Financials Index Fund. The Fund employs a passive management or indexing investment approach designed to track the performance of the Morgan Stanley Capital International (MSCI) US Investable Market Financials Index, an index of stocks of large, medium and small United States companies in the financials sector, as classified under the Global Industry Classification Standard (GICS). More
Current Price
$125.01
Consensus Rating
Moderate Buy
Ratings Breakdown
0 Buy Ratings, 17 Hold Ratings, 0 Sell Ratings.
Consensus Price Target
$125.01 (0.0% Downside)