Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you'd like to add some stocks to your portfolio that seem undervalued, the Vanguard Value ETF
ETFs often sport lower expense ratios than their mutual fund cousins. The value ETF's expense ratio -- its annual fee -- is a very low 0.10%. (Vanguard is known for low fees.) It recently sported a dividend yield near 2.6%, as well.
This ETF has actually not performed that well, underperforming the broad market over the past three and five years. It's the future that matters most, though, and one ray of hope is that according to Forbes, about 10% of the ETF's holdings have seen insider buying, which reflects management confidence. As with most investments, of course, we can't expect outstanding performances in every quarter or year. Investors with conviction need to wait for their holdings to deliver.
With a low turnover rate of 23%, this fund isn't frantically and frequently rejiggering its holdings, as many funds do.
What's in it?
More than a handful of big value companies had strong performances over the past year. Domestic tobacco giant Altria
Other companies didn't do as well last year, but could see their fortunes change in the coming years. Bank of America
The big picture
A well-chosen ETF can grant you instant diversification across any industry or group of companies -- and make investing in and profiting from it that much easier.
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Longtime Fool contributor Selena Maranjian, whom you can follow on Twitter, holds no position in any company mentioned. Click here to see her holdings and a short bio. The Motley Fool owns shares of Bank of America and Abbott Laboratories. The Motley Fool has a disclosure policy.
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