Want to Start Investing? Here Are 3 ETFs to Buy Now

If you want to get started investing, here’s an easy way to put your money to work with three of the best Canadian ETFs to buy now.

Daniel Da Costa

Author Bio

Daniel joined The Motley Fool Canada in 2019 and brings experience in banking, investing, and financial analysis. Growing up as the son of a proprietary stock trader and educator, he developed an early interest in financial markets and a passion for helping Canadians improve their financial well-being. His work spans investment research, economic analysis, and econometric modelling, with a focus on understanding the broader forces that influence businesses, markets, and the economy. As an investor, Daniel looks for high-quality businesses with long-term growth potential, reliable income, and attractive valuations. Outside of finance, Daniel enjoys spending time with his family, playing hockey, running, and sailing.

Areas of Expertise

Investment research, economic analysis, econometric modelling, banking, financial analysis, business fundamentals, long-term investing, dividend investing, and company valuation.

Favorite Investment Quote

"It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price." — Warren Buffett

Published March 20, 2022 1:03 pm EDT

If you’re looking to start investing, deciding which stocks to buy first can be a tough task. In addition to the fact that there are hundreds of stocks to buy, there are plenty of high-quality companies to consider, all in different industries and with operations in different geographies. It can be a lot to keep track of, so instead, you may want to consider finding exchange-traded funds (ETFs) to buy now.

ETFs offer several advantages. It’s one of the main reasons why there are so many different ETFs to choose from. One of the most significant advantages that ETFs offer is instant diversification, which is why they are perfect for when you want to start investing.

Rather than only investing in one or two stocks when you first begin to invest money, you can buy an ETF that offers exposure to several different stocks.

So if you’re looking to start investing or just want to find top ETFs to buy now, here are three to consider today.

exchange traded funds — Image source: Getty Images

Index funds are some of the best ETFs to buy if you want to start investing

Because there are so many different ETFs to consider, there are funds of all types. You can buy an ETF that’s purely growth stocks, for example, or you can buy an ETF that only offers exposure to a single industry.

But one of the best types of ETFs to consider first is one offering exposure to an index fund. That’s why the iShares S&P/TSX 60 Index ETF(TSX: XIU) is one of the largest and most popular ETFs in Canada and one of the best to buy now.

An index fund like the XIU is a great way to gain exposure to an entire country’s economy. It offers exposure to 60 of the largest Canadian stocks from the main market sectors. This is why it’s one of the best ETFs to buy now, especially if you’re just starting to invest. Not only do you gain exposure to some of the highest quality stocks in Canada, but also a significant amount of diversification.

But while the XIU is one of the top ETFs to buy, it only offers exposure to Canadian companies. So you’ll also want to consider funds such as the iShares Core S&P 500 Index ETF (CAD-Hedged)(TSX: XSP), a Canadian investment offering exposure to the U.S. market.

This way, your capital will be diversified even more, and you gain exposure to some of the largest companies in the world.

In this market environment, a low-volatility ETF can help protect your capital

In addition to index ETFs, buying a low volatility ETF could be an excellent idea in this market environment, especially if you’re looking to shore up your portfolio.

That’s why you may want to consider the BMO Low Volatility Canadian Equity ETF (TSX: ZLB). As its name suggests, the ZLB offers investors exposure to several of the safest Canadian stocks you can buy.

These are companies with tremendous operations. But they’re also stocks that won’t be as negatively impacted if the entire market is selling off.

And considering that higher risk growth stocks have been the worst performers lately, an ETF like the ZLB, which also provides a yield of 2.4%, is one of the best ETFs to buy now.