Speaker 1: Now, what’s an ETF extensible exchange traded funds and has two main components to it. First, it is a marketable security. This just means it can be bought or sold at a public stock exchange. This means you can quickly convert an ATM into cash.
The second component of an ETF is that attracts an index fund or any group of exits. So it is a way of buying into whatever index or group of assets you think will do well in the future. The main positives of an ETF are that it is generally extremely low cost. And second, that helps dramatically diversify your risk. The main negative, while you can pick one single stock that you know will do well, you have to pick a group of assets. So there is arguably less potential for really high returns. I’m going to start with two pretty safe, solid ETFs and then get into a more exciting speculatory if they actually has potential for dramatic returns before I get started. If you want to see regular quality videos on investing and personal finance and this is the channel to be subscribed to. So the first ETF that I’m going to recommend is a pretty darn sight one I cooked up with ETFs. Guys, is that generally speaking, you want to go with the ones that have a low expense ratio? That’s the one thing you can get right right off the bat. You don’t want massive expense ratios eating into your returns.
So my first recommendation is a Vanguard S&P five hundred eighty Vanguard as the second largest provider of ETFs in the world and has over four point five trillion dollars in assets under management. Now, this ETF pretty much identically tracks the S&P 500 index, and the best thing about it is its price. You pay next to nothing with an expense ratio of zero point zero four percent. The main thing you need to know about this fund is you’re pretty much going to get the same returns as the overall United States market. The US markets does. Well, the S&P 500 index fund will also do well. But my guess is that most of the investors are looking to beat the market by next recommended ETF as one that has years of history to prove it beats the market that is PE S&P 600 SmallCap ETF say hit three times. So first of all, it’s Paideia as a company that just fails in ETFs and is a subsidiary of S&P Global and S&P 600 small cap ETF that STPI operates is one that tracks small cap stocks and the United States. The expense ratio is higher than the previous year at zero point fifteen percent before this high expense, you’ve got potential higher returns over twenty years ahead, a return of six hundred twenty seven point nine per cent, whereas the S&P five hundred had a good return, but only of three hundred fifty two point four percent. So if you invested in the 600, your investment would have grown by six times the amount in the S&P 500, a solid three and a half times. Obviously this investment will be more volatile, but over the long run you should get above average market returns. OK, so these first two ETFs were solid, stable and as a sensible investor, you’d want to invest most of your portfolio in an ETF like these before you look for those speculatory investments. My next year has the potential for massive returns, but also the potential for loss as well.
Only invest once you have solid amounts and stable stocks or eight years. So my third ETF is Horizons Marijuana Life Sciences Index. So this ETF focused mainly on medicinal marijuana and the stocks have to have a market cap of over seventy five million Canadian dollars to get in the ETF. It’s got a strong exposure to the Canadian marijuana industry as well as a little bit towards the US and Great Britain. So if you look at the companies that can be seen as holding the main well known marijuana stocks, this is a fun investment and it offers the potential for dramatic returns. But obviously you need the marijuana industry to flourish. So those are my three year 2018, the first two being pretty darn safe ones and the last one more exciting with great ups and downs to offense, a personal finance and investing.
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