I got a question the other day about what to look for when investing in ETFs. Here are a few things I take into consideration:
Fund Objective: Understanding the main objective of the fund is a great place to start when researching ETFs. This can typically be found on the fund's website.
Expense Ratio: This is how much you pay in fees as a holder of the fund. Something like $DGRW has a 0.28% expense ratio, which in my opinion, is high, especially when compared to something like $SCHD or $VYM (+0,44 %).
Holdings: It's a good idea to take a look at the top holdings of the fund because, in essence, you want to know what you're buying.
Returns: While past performance doesn't tell you anything about how a fund will do in the future, looking at the long-term returns can help you get a sense for how it has historically performed in different market environments.
What are some things you look for when analyzing ETFs? Let me know in the comments below! 👇