How to Invest in ETFs in 2022 - Cabot Wealth Network

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  • Kate, that is exciting news that you going to have an ETF advisory. I ditched stock picking in 2018 and only focus on a handful of ETS and the results is mind-blowing. I adopted a model that I used to calculated the upside potential for stocks, to work on ETSs. The output is surprisingly accurate and it helped me to tactically switch between ETFs. This way my portfolio grew by 3.7x over the past two years without taking unnecessary risks.

  • Ronald: If your objective is medium- to long-term capital appreciation along with income, it’s important to first understand what return you need. That determines the mix of assets. You’ve got a heavy concentration in various tech sub-industries, which adds risk. Any over-weighting in a specific industry has the potential to do that. I’d be concerned that your portfolio is too risky, particularly if these are your retirement investments. If it’s in a taxable account, not earmarked for a specific objective, it’s still important to understand why all the holdings are there.

    Carefully look at each ETF, understand the sector or industry, then notice what’s missing. I see a lot of duplication when it comes to domestic stocks as well. The important part now is to understand what these holdings are, and what they are designed to accomplish in your portfolio. Each ETF should have a job, and not just be something you purchased because it’s done well in the past, or because you believe it has potential.

  • Ronald R.

    I own: LIT, QQQ, SMH, BLCN, XLF, FTEC, FHLC, VGT, VFH, IJT, IJR, IUSV, IWM, IWD, IWR, IWS, and IVV. I own these with no “rhyme or reason”. Any advice would be appreciated. It seems the only advantage is they trade like stocks. The capital gains from mutual funds creeps up as an unplanned tax obligation.

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