Have you been procrastinating about investing as stocks move opposite to your expectations? There is no crystal ball to predict how a stock will move. Those who make money in the stock market do not invest in stocks looking at the price. They look at the company’s fundamentals, the future growth opportunity, and the overall business and macro environment. You can rid yourself of this stock price prediction habit and have an assured way to earn money in the long term. Exchanged Traded Funds (ETFs) are a good way to invest in the overall trend, the buzzing sector, and economic growth.
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Three ETFs to buy and hold forever
Billionaire investor Warren Buffett said, “If you don’t find a way to make money while you sleep, you will work until you die.” One way to make money is to put money to work by staying invested in the stock market.
Investing in the market
The Horizons S&P/TSX 60 Index ETF (TSX: HXT) invests in large-cap stocks across Canada’s strongest sectors – financials, energy, materials, and industrials. Investing in someone’s strengths increases your upside potential. The HXT ETF has a management expense ratio of 0.08% and has generated an annual return of 13% in the last five years.
The TSX is currently in bearish momentum, creating an opportunity to buy the dip. Once the tariff concerns ease, the market will rally and so will the ETF. With this ETF, you can benefit from Canada’s economic growth.
Invest in the present with the XIT ETF
In this digital age, software stocks have come to offer lucrative investing opportunities as all enterprises, big and small, have adopted various software. Retailers are opening their online stores on Shopify to stay relevant. Exporters and importers are using Descartes Systems for seamless supply chain management. Banks and legal professionals are using Dye & Durham’s Unity platform for due diligence of property transactions.
The iShares S&P/TSX Capped Information Technology Index ETF (TSX: XIT) has holdings in all the above stocks and other tech stocks trading on the TSX. You can buy one unit of XIT ETF and get a share in its 20-plus holdings. No matter which trend picks up – crypto boom, hardware growth, or e-commerce – the XIT ETF will rally because it has holdings in the industry players.
The ETF has delivered a 20% average annual growth rate as software adoption has increased. For a management expense ratio of 0.60%, you can be assured of not missing out on the rally in Canadian technology stocks.
Invest in the future with the XQQ ETF
While Canadian technology stocks are good software stocks, they lack semiconductor stocks. Also, a limited number of stocks are riding the artificial intelligence (AI) wave. NASDAQ is the tech-heavy index that has surged by leaps and bounds over the last two decades.
The iShares NASDAQ 100 Index ETF (CAD-Hedged) (TSX: XQQ) can get you access to tech stocks listed on Nasdaq that are way ahead in the AI race. Nvidia and Broadcom are building the AI infrastructure with high-performance computing chips. Meta, Microsoft, and Amazon are bringing AI applications to individuals and enterprises. Tesla and Google are building autonomous cars. Apple is a pioneer in AI assistants.
These companies are shaping the future, and you can invest in them with the XQQ ETF. The ETF has 120-plus holdings. It replicates the weightage of the Nasdaq 100 Index. A company that outperforms the market will automatically have a higher weightage in the ETF. The ETF has delivered a 16% average annual return in the last 10 years.
