- (1:00) – Are You Better Off Buying Index Funds vs. Individual Stocks?
- (7:20) – Breaking Down The Performance of Index ETFs: Which One Is Right For You?
- (17:10) – Episode Roundup: AMZN, AAPL, CMG, LULU, W, VOO, QQQ, QQQM
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Welcome to Episode #290 of the Zacks Market Edge Podcast.
Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life.
This week, Tracey is going to solo to talk about investing in the basic stock index ETFs.
Many investors get frustrated by their lack of investing choices in their 401ks, where there are usually basic stock index funds and ETFs. For some, investing in individual stocks are the only way to build wealth quickly.
But can you get rich off of owning the basic stock index ETFs?
Are You Beating the S&P 500?
Over the last year, the S&P 500 has hit new highs and has gained 32%.
That’s a pretty hefty return, for any investment. Are you sure your favorite growth stocks are out performing it?
Amazon
AMZN
is up just 5.4% over the last year, even though it soared during the initial months of the pandemic.
Even mighty
Chipotle
CMG
, which has busted out to new all-time highs this year, is up “just” 31% in the last year.
Similarly, one of the hottest retailers on the Street,
Lululemon
LULU
has gained “only” 28.9% over the last year.
Other hot stocks have certainly outperformed, including Tesla and Shopify, but it may not be as easy to “beat” the index as you think, especially when the index is seeing big gains.
The S&P 500 and the Nasdaq-100 ETFs: Boring?
Investing in the S&P 500 may seem “boring” but during bull markets it can be anything but.
The
Vanguard S&P 500 ETF
VOO
has a 10-year annualized return of 16.5%. $10,000 invested in Sep 2011 was $46,426 by Sep 2021.
But the
INVESCO QQQ ETF
QQQ
, which tracks the Nasdaq 100, is even hotter. This “boring” index ETF has a 10-year annualized return of 21.25%.
$10,000 invested in Sep 2011 in the QQQ was $66,107 by Sep 2021.
What else do you need to know about using the stock index ETFs to grow your wealth?
Tune into this podcast to find out.
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