Our 8 best ETFs are selected for investors looking to grow their investment portfolio that can outperform the market. This growth investment portfolio is for investors with a longer time horizon. We will explore each of these 8 best ETFs. It is very important for investors to know their risk tolerance before investing in any of these ETFs.
Best ETFs Portfolio to Outperform the Market
1. Direxion TSLA Bull ETF – TSLL
TSLL ETF is a very unique ETF because it bets only on the performance of Tesla stock and its charismatic CEO Elon Musk.
The funds seek before fees and expenses, the 1.5X performance of Tesla stock.
If the stock goes up 10% on a given day, the TSLL ETF’s objective is to return 15%. The opposite will happen to the funds if the Tesla stock falls.
Tesla’s stock performance has been nothing short of spectacular over the past year. Investors have been betting big on Tesla’s future, and so far it has paid off.
There are a few factors. Firstly, Tesla is seen as a leader in the electric vehicle market, which is expected to grow rapidly in the coming years. Secondly, Tesla has been consistently profitable in recent quarters, giving investors confidence that it can continue to grow at a rapid pace.
Investing in a single leveraged stock is very risky but this leveraged ETF can be a good addition for people who are investing long-term and not concerned by the day-to-day tweets of the CEO Elon Musk which can occasionally drive negative headlines about the company.
2. Vanguard Total Stock Market Index Fund ETF-VTI
The Vanguard Total Stock Market Index Fund -VTI ETF is a good choice for investors who want to gain exposure to the total U.S. stock market in a low-cost and tax-efficient manner. Vanguard is the largest provider of index funds in the world.
S&P 500 SPY ETF returns compared to Total Market VTI ETF(2002-2021)
| YEAR | SPY | VTI |
| 2021 | 28.59% | 25.72% |
| 2020 | 18.40% | 20.95% |
| 2019 | 31.29% | 30.80% |
| 2018 | -4.45% | -5.13% |
| 2017 | 21.69% | 21.16% |
| 2016 | 11.80% | 12.68% |
| 2015 | 1.34% | 0.40% |
| 2014 | 13.53% | 12.56% |
| 2013 | 32.21% | 33.51% |
| 2012 | 15.84% | 16.41% |
| 2011 | 2.06% | 1.06% |
| 2010 | 14.93% | 17.26% |
| 2009 | 26.42% | 28.82% |
| 2008 | -36.97% | -36.97% |
| 2007 | 5.39% | 5.56% |
| 2006 | 15.39% | 15.66% |
| 2005 | 4.79% | 6.10% |
| 2004 | 10.75% | 12.57% |
| 2003 | 28.39% | 31.43% |
| 2002 | -22.12% | -20.94% |
3. Invesco Solar ETF- TAN
The Invesco Solar ETF (TAN) is a great way to invest in the growing solar industry. The ETF tracks the MAC Global Solar Energy Index, which includes companies that are involved in the manufacture, development, financing, and installation of solar energy products.
The solar industry is expected to grow significantly in the next few years. This is due to the increasing popularity of solar energy, the falling cost of solar panels, and the supportive policies of the United States government.
The TAN ETF has performed well in the past, and I believe it will continue to do so in the future.
The TAN ETF sector is made up of four different ETFs:
Technology
Allocation
Natural resources
Emerging markets
S&P 500 SPY ETF returns compared to Invesco Solar ETF- TAN (2009-2021)
| YEAR | SPY | TAN |
| 2021 | 28.59% | -24.69% |
| 2020 | 18.40% | 233.26% |
| 2019 | 31.29% | 65.65% |
| 2018 | -4.45% | -25.16% |
| 2017 | 21.69% | 54.22% |
| 2016 | 11.80% | -43.24% |
| 2015 | 1.34% | -9.37% |
| 2014 | 13.53% | -0.72% |
| 2013 | 32.21% | 129.94% |
| 2012 | 15.84% | -31.86% |
| 2011 | 2.06% | -63.28% |
| 2010 | 14.93% | -28.11% |
| 2009 | 26.42% | 21.27% |
4. ProShares UltraShort 20+ Year Treasury ETF- TBT
The ProShares UltraShort 20+ Year Treasury (TBT) is an exchange-traded fund (ETF) that seeks to provide investment results that correspond to twice (2x) the daily performance of the Barclays Capital 20+ Year U.S. Treasury Index. The TBT invests in ProShares Short 20+ Year Treasury ETF (TBF), which in turn invests in U.S. Treasury bonds with maturities greater than twenty years.
The TBT ETF is a great way to hedge against rising interest rates. When rates go up, the price of bonds falls, and vice versa. The TBT provides a way to bet against the bond market, and profit when bond prices go down.
The TBT is also a great way to diversify your portfolio. The fund provides exposure to a variety of different asset classes, including government bonds, corporate bonds, and mortgage-backed securities. This diversification can help reduce the overall risk of your portfolio.
If you’re looking for a way to hedge against rising interest rates, or to diversify your portfolio, the ProShares UltraShort 20+ Year Treasury (TBT) is a great option.
S&P 500 SPY ETF returns compared to ProShares UltraShort 20+ Year Treasury (TBT) (2009-2021)
| YEAR | SPY | TBT |
| 2021 | 28.59% | 3.16% |
| 2020 | 18.40% | -37.76% |
| 2019 | 31.29% | -23.80% |
| 2018 | -4.45% | 5.85% |
| 2017 | 21.69% | -16.82% |
| 2016 | 11.80% | -7.78% |
| 2015 | 1.34% | -5.42% |
| 2014 | 13.53% | -41.39% |
| 2013 | 32.21% | 26.55% |
| 2012 | 15.84% | -13.30% |
| 2011 | 2.06% | -50.91% |
| 2010 | 14.93% | -26.32% |
| 2009 | 26.42% | 33.55% |
5. ProShares Ultra QQQ ETF- QLD
The ProShares Ultra QQQ Trust is an exchange-traded fund that seeks daily investment results, before fees and expenses, that correspond to two times (2x) the daily performance of the NASDAQ-100 Index.
S&P 500 SPY ETF returns compared to ProShares Ultra QQQ Trust(QLD) (2007-2021)
| YEAR | SPY | QLD |
| 2021 | 28.59% | 54.32% |
| 2020 | 18.40% | 89.03% |
| 2019 | 31.29% | 82.06% |
| 2018 | -4.45% | -8.38% |
| 2017 | 21.69% | 70.54% |
| 2016 | 11.80% | 10.01% |
| 2015 | 1.34% | 14.74% |
| 2014 | 13.53% | 37.52% |
| 2013 | 32.21% | 81.83% |
| 2012 | 15.84% | 34.98% |
| 2011 | 2.06% | 0.14% |
| 2010 | 14.93% | 37.04% |
| 2009 | 26.42% | 119.08% |
| 2008 | -36.97% | -72.66% |
| 2007 | 5.39% | 28.68% |
6. AXS Short Innovation Daily ETF-SARK
The AXS Short Innovation Daily ETF (SARK) is an inverse ETF that tracks the Arkk Innovator’s Edge Index. The fund is designed to provide short exposure to companies that are leaders in innovation.
One of the reasons for SARK’s strong performance is its focus on shorting companies with high growth ambitions that are not yet profitable. Many of these companies are overvalued and have high levels of debt. By shorting these companies, SARK is able to generate strong returns when they fall.
7. Schwab U.S. Dividend Equity ETF-SCHD
The Schwab U.S. Dividend Equity ETF is an exchange-traded fund that seeks to track the performance of the Dow Jones U.S. Dividend 100 Index. This index is composed of 100 of the largest U.S. companies that have a history of paying dividends.
The Schwab U.S. Dividend Equity ETF is a dividend-focused exchange-traded fund that seeks to track the performance of the Dow Jones U.S. Dividend 100 Index. The fund invests in a portfolio of 100 large- and mid-capitalization stocks that have a history of paying dividends and are considered to be leaders in their respective sectors.
The ETF provides investors with exposure to a diversified mix of dividend-paying companies, including those in the industrials, consumer staples, healthcare, financials, and materials sectors. The fund has an expense ratio of 0.07%, which is relatively low for an ETF with this level of diversification.
For investors looking for dividend income and sector exposure, the Schwab U.S. Dividend Equity ETF may be worth considering as part of a well-rounded investment portfolio.
S&P 500 SPY ETF returns compared to Schwab U.S. Dividend Equity SCHD ETF (2012-2021)
| YEAR | SPY | SCHD |
| 2021 | 28.59% | 29.78% |
| 2020 | 18.40% | 15.11% |
| 2019 | 31.29% | 27.28% |
| 2018 | -4.45% | -5.46% |
| 2017 | 21.69% | 20.88% |
| 2016 | 11.80% | 16.25% |
| 2015 | 1.34% | -0.21% |
| 2014 | 13.53% | 11.66% |
| 2013 | 32.21% | 32.90% |
| 2012 | 15.84% | 11.40% |
8. iMGP DBi Managed Futures Strategy ETF-DBMF
The iMGP DBi Managed Futures Strategy ETF (DBMF) seeks to provide long-term capital growth by investing in a portfolio of exchange-traded futures contracts and other derivatives.
The index includes a range of futures contracts on different asset classes, including commodities, currencies, interest rates, and equity indexes.
The fund is managed by Deutsche Bank AG’s Global Markets Group.
Growth Portfolio Allocation Strategies
Dollar Cost Averaging Investment: Dollar-cost averaging is an investing technique that can help to smooth out the effects of market volatility and reduce your overall risk.
The basic idea is to spread your investment into equal parts and invest those parts over a period of time.
There are a few things to keep in mind when using dollar cost averaging.
First, it’s important to start with a comfortable amount that you can afford to invest each month.
Second, you need to be disciplined about investing the same amount each month, even when the market is volatile.
Dollar-cost averaging can help to reduce your overall risk, but it can’t completely eliminate it.
Monthly automated investing: It’s no secret that many people are intimidated by the stock market. The constant ups and downs can be difficult to stomach, and the thought of investing can be enough to make some people run for the hills.
The beauty of monthly automated investing is that it takes the emotion out of investing. Monthly automated investing is a great way to invest without having to worry about it every day. You can set it up and forget about it, knowing that your money is working for you.
Best brokerage for the Portfolio Allocation
The goal here is to set up a passive portfolio. We need a brokerage that can allow automatic investing of all ETFs selected. Robinhood does not allow automatic investing for leveraged ETFs such as QLD and TBT. The best brokerage that can satisfy our portfolio requirement with little management will be M1 Finance.
Investment Objectives
When it comes to investing, having goals is crucial. Having goals gives you focus and direction, and tells you what you need to research in order to get to where you want to be. This could involve contacting a financial planner for advice or taking matters into your own hands and finding out which types of investments are most likely to suit your needs. Without goals, it’s less likely that you’ll take these steps.
Setting investment goals also provides you with a challenge. Be sure to set goals that are realistic, so that you can then work towards meeting that challenge. Additionally, setting goals allows you to monitor your progress and make any necessary adjustments along the way.
Timing the Market
When it comes to the stock market, timing is everything. If you buy ETFs when they’re low and sell when they’re high, you can make a lot of money. But if you don’t time the market correctly, you could lose everything.
There are a few different ways to time the market. You can use technical analysis, which looks at past price movements to predict future prices. Or you can use fundamental analysis, which looks at company financials to determine whether a stock is undervalued or overvalued.
But the reality is that very few people can do it consistently. In fact, most people who try to time the market end up losing money.
The stock market is a complex system that is constantly changing. It is very difficult to predict exactly when stocks will go up or down.
Even professional investors who spend all day analyzing the market can’t always get it right.
The bottom line is that trying to time the stock market is a risky proposition. It is far better to invest for the long term and let the market take care of itself.
Risk Tolerance
The past performance of ETFs selected is not always indicative of future investment results.
It’s no secret that different people have different tolerance levels when it comes to risk. Some people are perfectly happy to invest in high-risk, high-reward ventures, while others prefer to play it safe and keep their money in more conservative investments.
So, how do you know which category you fall into? It’s actually not that difficult. Simply ask yourself how much money you would be comfortable losing if your stocks and funds ran into a period of difficulty lasting a couple of years.
In addition, you should consider how much time you have to invest and bounce back from any rough spots. If you’re young and have a long time horizon, you can afford to take more risks. On the other hand, if you’re older and closer to retirement, you’ll probably want to be more conservative.
Finally, think about what other assets you have that could provide you with some security. If you have a well-paid job and a comfortable lifestyle, you can afford to take more risks with your investments. However, if you’re relying solely on your investment portfolio for your income, you’ll need to be more careful.
Once you’ve considered all of these factors, you should have a good idea of your own risk tolerance. From there, you can start to look at different investment options and find the ones that best suit your needs.
Key Takeaways
There are many ways to invest money. Investment involves risk and past performance of an ETF is not indicative of future results. ETFs selected can overall achieve portfolio diversification and outperform the market. This is a long-term portfolio strategy.
We will let you know how we are doing with this portfolio using dollar cost averaging and automated investing. I am pretty sure you can achieve your investment goals. So take action today and start investing!
