As
markets
remain
volatile
amid
economic
uncertainty,
many
investors
are
taking
a
long-term
view
and
looking
to
exchange-traded
funds
(ETFs)
to
position
their
portfolios.
CNBC
Pro
asked
several
finance
experts
for
their
top
ETF
picks
to
buy
and
hold
this
year.
Vanguard
Total
World
Stock
ETF
The
Vanguard
Total
World
Stock
ETF
(VT)
should
be
the
core
holding
for
any
long-term
investor,
according
to
Vahan
Janjigian,
chief
investment
officer
at
Greenwich
Wealth
Managemen
t.
“It
is
basically
a
world
global
index
ETF
that
gives
you
tremendous
diversification
at
a
very
low
cost,”
he
said.
“If
you’re
a
relatively
new
investor
in
your
20s
just
getting
started
…
I
think
this
is
a
great
ETF
to
go
into.
You
can
hold
it
for
the
long
term.”
Janjigian,
whose
firm
manages
more
than
$2
billion
in
client
assets,
also
suggested
buying
into
the
ETF
through
a
dollar-cost
averaging
strategy.
This
means,
for
instance,
investing
every
month
rather
than
allocating
a
lump-sum
one-off.
“Put
in
the
same
amount
of
money
every
single
month
and
forget
about
it.”
Janjigian
prefers
the
total
world
stock
ETF
over
an
S
&
P
500
fund
to
achieve
a
diversified
portfolio,
noting
the
S
&
P
500
is
“very
heavily
weighted
toward
large-cap
stocks”.
The
top
10
stocks
in
the
U.S.
benchmark
comprise
nearly
a
third
of
the
index.
“You’re
not
really
that
diversified
because
of
the
market
cap
weighting,”
he
added.
VT
1Y
line
However,
Ursula
Marchioni,
head
of
markets
and
portfolio
solutions
for
Europe,
the
Middle
East
and
Asia
at
BlackRock, believes
broad
global
indexes
are
unlikely to
rise
in
unison
in
the
near
term.
Instead,
she
suggested
a
more
fluid
allocation
approach
would
benefit
investors.
“Granularity
is
becoming
increasingly
important
in
this
new
investment
regime
–
we
don’t
envisage
a
macro
backdrop
which
is
conducive
to
gains
being
made
across
all
markets,”
she
said.
Marchioni
favors
a
“quality
core”
of
investments
through
sectors
like
healthcare
and
technology,
combined
with
cyclical
exposure
in
financials
and
energy.
Marchioni
also
added
that
she
will
likely
revisit
her
allocation
choices
frequently,
“especially
in
a
year
with
increased
geopolitical
drivers.”
SPDR
MSCI
USA
Value
ETF
For
investors
concerned
over
the
rising
valuation
multiples
in
tech
and
seeking
a
value
tilt,
Ian
Rees,
co-head
of
multi-manager
funds
at
Premier
Miton
Investors
,
favors
the
SPDR
MSCI
USA
Value
ETF
(UVAL-GB).
“With
high
growth
U.S.
stocks,
driven
by
the
surge
in
technology
and
AI
names,
in
the
ascendancy,
the
value
style
of
investing
in
this
market
has
been
out
of
favour
for
some
years
now,”
Rees
noted.
However,
“over
the
long
term,
following
the
value
discipline
of
buying
cheap
companies
has
been
proven
to
be
an
effective
way
of
compounding
wealth,
although
it
struggles
during
market
bubbles
or
narrow
market
leadership,”
he
added.
Rees
believes
the
current
backdrop
provides
“an
excellent
entry
point”
into
the
value
strategy.
The
MSCI
USA
Value
index,
accessible
to
U.S.
and
Europe-based
investors,
has
run
up
14%
this
year,
outperforming
the
S
&
P
500.
Investors
in
this
ETF
have
typically
made
7.8%
in
annual
compounded
gains
over
the
past
5-years.
Invesco
Nasdaq
Biotech
ETF
For
investors
wanting
exposure
to
growth
stocks,
Rees
likes
the
Invesco
Nasdaq
Biotech
ET
F
(SBIO-GB)
in
the
biotech
space.
“Biotechnology
stocks
have
seen
a
sharp
de-rating
in
the
last
few
years,
resulting
in
valuations
looking
quite
low
when
judged
in
a
historical
context,”
he
said.
However,
the
long-term
trends
of
aging
demographics
and
more
personalized
medicine
are
keeping
the
growth
story
intact,
according
to
Rees.
“This
is
creating
a
wave
of
investment
opportunity
which
has
generated
a
lot
of
positive
comment
from
biotech
managers,”
he
added.
Invesco
Nasdaq
Biotech
ETF,
traded
on
U.S.
and
European
exchanges,
is
down
by
1.5%
this
month
and
is
flat
for
the
year.
L
&
G
Clean
Water
ETF
Rees,
whose
firm
manages
more
than
$12.6
billion
in
assets,
also
highlighted
the
L
&
G
Clean
Water
ETF
(GLUG-GB)
for
investors
keen
on
an
environmental
play.
The
ETF
provides
exposure
to
companies
involved
in
clean
water
solutions
amid
growing
global
water
scarcity
concerns.
“With
many
of
the
valuations
within
the
index
still
broadly
in-line
with
that
of
the
World
index,
this
is
another
growth
area
which
does
not
require
investors
to
pay
nose-bleed
valuations,”
he
said.
The
ETF,
trading
with
the
ticker
GLUG
on
the
London
Stock
Exchange,
has
gained
nearly
3.5%
this
year.
The
fund’s
$415
million
is
invested
across
53
stocks
in
the
Solactive
Clean
Water
Index.
Vanguard
FTSE
250
ETF
Finally,
Rees
sees
an
opportunity
in
the
unfashionable
U.K.
market
through
the
Vanguard
FTSE
250
ETF
(VMID-GB),
which
tracks
mid-cap
U.K.
companies.
“The
perception
of
the
U.K.
being
the
sick
economy
of
Europe
drives
a
lot
of
negative
sentiment,
however
the
improving
business
confidence
U.K.
macro
data
of
recent
months
showing
the
U.K.
economy
outperforming
our
European
neighbors,
is
much
overlooked,”
Rees
said.
The
$2
billion
Vanguard
ETF,
also
accessible
to
Germany-based
investors
(VMID-DE),
is
relatively
flat
for
the
year.
It’s
returned
3.45%
annually
over
the
past
five
years.
However,
it
also
distributes
dividends
with
a
yield
of
3.3%.
“While
the
U.K.
market
overall
offers
a
lot
of
valuation
appeal,
of
most
attraction
to
us
is
the
UK
mid-market
space
covered
by
the
FTSE
250
Index,”
he
added.
