Best Exchange Traded Funds for 2014

Find best exchange traded funds for 2014. The top ETF funds are PIMCO Total Return Exchange-Traded Fund, Schwab US Dividend Equity ETF, Vanguard Total World Stock ETF, etc.

Top ETF Funds

Best Exchange Traded Funds for 2014 | Top ETF FundsIn 2013, investor who invests in stock funds has seen a huge return. Investing in bond funds has seen a challenging performance in 2013. Investing in exchange traded funds is easy and popular because of its low cost. In 2014, I still think we need to diversify our assets in bond fund. Whether it is an up year or a down year, bond fund can provide a buffer through income.

For 2014, I also simplify my best ETFs list. You will find 4 funds to invest. It consists of 3 main funds for core investment and 1 fund for alternative asset. You will find 2 bond ETF funds and 2 stock ETF funds. If you invest in brokerage or retirement account, please check the fund review below. You may find the expense fee, fund’s return, holdings, yield, etc. If you want to find best mutual fund, you can check my previous article as well.

The 4 best exchange traded funds for 2014 are:
  • Schwab Large-Cap Core (SCHX)
  • Vanguard FTSE All-World ex-US ETF (VEU)
  • PIMCO Total Return Exchange-Traded Fund (BOND)
  • Vanguard Emerging Markets Government Bond ETF (VWOB)
Updated on 12/31/2013

Best Stock ETF

Schwab Large-Cap ETFThe first best ETF for 2014 is Schwab Large-Cap ETF. Listed in NYSE Arca, this exchange traded fund uses its assets to purchase companies listed in the Dow Jones U.S. Large-Cap Total Stock Market Index made up of approximately the largest 750 U.S. stocks. This index exchange traded fund has a low expense fee of 0.04%. Its dividend yield is 1.80%.

Introduced in 2010, this best ETF fund has returned 34.29% over the past 1 year, and 15.85% over the past 3 year. In 2013, it managed to return 28.82%. Morningstar has ranked this top ETF with 4 stars rating. US News also ranked it as top 5 ETF in large cap category.

The top 3 stocks in its portfolio are Apple Inc, Exxon Mobil Corporation, and Google Inc. The top 2 sectors are technology, and financial services.

To diversify your asset allocation, investing internationally is important. For the past 2 years, international stock has been performing great as well. You may invest in Vanguard FTSE All-World ex-US ETF. This top exchange traded fund is investing in companies located in developed and emerging non-U.S. stock markets around the world. Its expense fee is only 0.12%.

In 2013, this international stock ETF has a year-to-date return of 12.53%. The 5 year average return is 12.63%. Ranked with 3 stars rating, it also has total net assets of $11.5 billion. The top 5 stocks in its portfolio are Nestle SA, HSBC Holdings Plc, Roche Holding AG, Novartis AG, and Vodafone Group Plc.

Another alternative of top international stock ETF is Schwab International Equity ETF (SCHF). This ETF has expense fee of 0.09% only.

Fixed Income ETF

As of now, you might notice most bond fund performed rather poorly in 2013. PIMCO Total Return Exchange-Traded Fund (BOND) has managed to achieve -0.56% return in 2013. This bond exchange traded fund is managed by Bill Gross. The current share price is $104.56. The fund’s yield is 2.39%. This intermediate term bond ETF has an annual expense fee of 0.55%.

While the performance is not great, it still managed to perform better than its peers. It is in top 8% among its category. Bill Gross also managed another popular mutual fund including PIMCO Total Return Fund (PTTRX). The top 2 bond sectors are Agency MBS Pass-Through, and U.S. Treasury.

Vanguard Emerging Markets Government Bond ETFThe above 3 best ETFs should be used as core asset allocation. For 2014, I also include one dark house to become best ETF. The ETF fund is Vanguard Emerging Markets Government Bond ETF. I would recommend about 5-10% of asset to be allocated in this bond ETF. Its expense ratio fee is 0.35% per year.

This Vanguard fund invests mainly in emerging market government bonds. The index benchmark is Barclays USD Emerging Markets Government RIC Capped Index. This bond fund has an average duration of 6.4 years. Its SEC yield is currently 4.80%. As new ETF, it hasn’t had any long term history performance. The top 5 countries in its portfolio are Russia, Brazil, Mexico, Turkey, and United Arab Emirates.

Where can you buy these ETFs?

Since these best exchange traded funds are traded like stock, you can buy through your brokerage. You may need to pay for the trading commissions. Another alternative is buying it through brokerages which provide free ETF for trading such as Charles Schwab, TD Ameritrade, Fidelity, Vanguard, Merrill Edge, etc.


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