ETFs Run The Show

Quote

“I’m not obsessed with money, I’m obsessed with freedom.” - Some guy probably

ETFs Run The Show

As you know, ETFs are a staple of my portfolio.

In fact, I made it my first post on the new threads app this week. Go ahead and shoot me a follow over there if you want to join the madness.

To stick with the theme, I figured it was time to reveal my five largest ETF holdings (for email readers only of course).

A quick background. These percentages/holdings are only across my traditional brokerage and Roth IRA account. These totals do not include employer-sponsored plans like my 401k, HSA, or employee stock purchase plan.

VOO/VTI

The dynamic duo of the ETF world.

As you might know, these are about 86% similar by weight, which is why I am counting them as one holding. (Here’s the link to the ETF overlap tool that I use)

In the future, I’ll likely consolidate these into VOO to have more control over small/mid-cap exposure through VXF and VB. The biggest mistake with VOO and VTI is debating which to hold in your portfolio. Pick one and start, if history repeats itself the difference in return won’t be much.

Percentage of portfolio: 32%

QQQ

This ETF has grown to be one of my favorites. QQQ’s high growth aligns with my goals of putting an “investing emphasis” on capital appreciation while I’m young. Ideally, I’d like to own 100 shares of QQQ in the future to sell covered calls on and generate extra cash.

If you don’t see yourself selling options, consider QQQM as it is equivalent to QQQ but has a cheaper expense ratio.

Percentage of portfolio: 18%

VUG

Similar to QQQ, VUG is the main “growth” holding in my Roth IRA. My reasoning behind choosing VUG in my Roth is that its expense ratio is significantly cheaper when compared to QQQ.

VUG is also less exposed to tech and offers more holdings spread across health, finance, and real estate. It’s slightly more diversified, which I see as a positive for a position I plan to hold till I’m 60 years old.

Percentage of portfolio: 8%

VB

When there isn’t enough love to go around small caps are often the first ones to get left in the dust. Today though, they hold the number four spot on my list.

VB is Vanguard’s small-cap ETF fund. In a perfect world, I would like small caps to have more exposure in my portfolio. Given the market turn-down over the last year, I did neglect my small-cap investing and poured extra cash into QQQ (paying off so far).

While VB’s performance hasn’t been the best compared to some of the other ETFs on this list, I still believe it’s a good idea to have small-cap exposure. Who knows what the next 10 years might hold?

Percentage of portfolio: 5%

VNQ

Real estate without the 4 am calls and water line breaks. For starters, VNQ holds REITs aka real estate investment trusts which are companies that own office buildings, malls, hotels, and other property.

It’s only averaged about 7% annually since 2004 but it also has a healthy dividend yield of 4.2% for the income lovers out there. Similar to small caps, having some exposure to real estate is something I like in a long-term portfolio.

Percentage of portfolio: 4%

Conclusion

I’ll be the first to say it.

Watching grass grow is usually more exciting than watching my portfolio. That’s exactly how I like it though as I’ve had my time slinging options and penny stocks (background story here).

Now, I value a passive approach and let these ETFs work on autopilot while I do cool things like write this email, shank golf drives, or hit the gym.

As always, this isn’t a post to convince you to buy these funds. This piece is simply to show how I invest to help you develop a plan for yourself. Thanks for reading.

Let’s keep ETF’n. ~ Cade

Cade's Picks

The Showdown: ETFs vs Individual Stocks - Shameless plug. Here is a recent post defending my claim that ETFs are better than individual stocks.

What’s it like to run 200 fireworks stores? - Cool AMA by Michael Girdley (owner of Alamo fireworks) on Twitter discussing what it takes to operate one of the largest fireworks businesses in America.

Best Memes

Threads is our chance to ditch the ugly train.

Honestly, one of my biggest complaints about threads is having so much random content in my feed.

Nothing in this email is intended to serve as financial advice. Do your own research. Thanks for reading, if you have any questions, comments, suggestions, etc. about the email don’t hesitate to send me a reply.