Exchange-traded funds (ETFs) are great for managing risk exposure and are especially useful for reducing the risk of financial loss when markets are unpredictable.
Where Can I Buy ETFs in June 2021?
eToro is one of the world's leading multi-asset trading platforms offering some of the lowest commission and fee rates in the industry. It's social copy trading features make it a great choice for those getting started.
Financial company driven by technology and offering all-in-one self-directed investment platform that provides excellent user experience.
Which ETFs to Buy in June 2021?
Here is our list of the top ten ETFs to buy this month.
1. Invesco S&P SmallCap 600 Pure Growth ETF (NYSE:RZG)
Issued by Invesco in 2006, the RZG growth ETF tracks US small-cap stocks that exhibit high-growth characteristics. It has about $141.5 million in assets under management, has an expense ratio of just 0.35%, and currently pays dividends at a yield of 0.31%.
This ETF gained 68.67% in the 12 months to 10th June 2021 and is up 16.57% this year. There is room for an upward movement in the second half of the year if it is to maintain the current 12-month return.
2. Invesco NASDAQ Internet ETF (NASDAQ:PNQI)
The PNQI ETF was issued by Invesco in June 2008 to follow the NASDAQ index, and it tracks the most liquid internet business stocks. PNQI now has more than $1 billion in assets under management, an expense ratio of 0.60%, and a 0.00% dividend yield at the time of writing.
This ETF gained 48.26% in the 12 months ending 10th June 2021 and is up just 7.70% this year, which again leaves room to run for the next seven months to maintain the current 12-month return.
3. Invesco Dynamic Semiconductors ETF (NYSE:PSI)
PSI is another ETF issued by Invesco (in June 2005) to track the dynamic semiconductors index. PSI now has $606 million in assets under management, is offered at an expense ratio of 0.57%, and has a low dividend yield of 0.16% at the time of writing.
PSI is one of the best growth ETFs to buy now. It gained 81.27% in the 12 months ending 10th June 2021 but is up just 18.17% this year, so it has a lot of room to run to maintain the current 12-month return through December.
4. iShares Expanded Tech Sector ETF (NYSE:IGM)
The IGM ETF was issued by Blackrock in March 2001 to track US large-cap tech companies that exhibit characteristics of high growth and sharp price swings. Therefore, IGM offers huge potential for capital gains at high risk. It is offered at a low expense ratio of just 0.46%, has more than $3.3 billion in assets under management at the time of writing, and trades at a dividend yield of 0.25%.
The IGM price gained 46.84% in the 12 months ending 10th June 2021 but this year is up only 12.45%, making it one of the top ETFs to watch now.
5. Technology Select Sector SPDR Fund (NYSE:XLK)
The XLK ETF was issued by State Street under the SPDR brand in December 1998, to give investors exposure to several US large-cap technology stocks. The dividend yield of 0.79% as of 10th June 2021 makes this one best dividend-paying growth ETFs, and its expense ratio is just 0.12%. It is also one of the biggest ETFs in terms of its $40 billion assets under management.
XLK gained 43.80% in the 12 months ending 10th June 2021, and up 10.30% so far this year, leaving a lot of room to match the trailing twelve months figures.
6. First Trust Small Cap Growth AlphaDEX Fund (NASDAQ:FYC)
Issued by First Trust in April 2011, the FYC ETF tracks a special class of US high-growth small-cap stocks. FYC currently pays dividends at a yield of just 0.10% but it compensates with a high return to cover the low dividend yield, and its expense ratio is 0.71%.
This ETF gained 83.11% in the 12 months ending 10th June 2021, making it one of the best-performing ETFs. Since it is up only 18.19% so far this year, more upward movement is possible in the second half of the year.
7. First Trust NASDAQ-100-Technology Sector Index Fund (NASDAQ:QTEC)
QTEC is another First Trust ETF issued to track the US technology sector. This ETF focuses broadly on NASDAQ-100 stocks from several industries in the technology sector. It was issued in 2006 and is available at an expense ratio of 0.57%. QTEC currently has about $3.38 billion assets under management. It is another growth ETF that pays dividends, albeit at a paltry yield of 0.30%.
QTEC shares gained 46.48% in the 12 months ending 10th June 2021. This year, the ETF is up 7.03%, again leaving a lot of room to run.
8. iShares Expanded Tech-Software Sector ETF (BATS:IGV)
The IGV ETF was issued by Blackrock in 2001 to track US large-cap stocks offering different types of software. The ETF focuses on the software segment of the technology sector. IGV has $4.95 billion in assets under management. It is offered at an expense ratio of 0.46% and pays dividends at a paltry yield of 0.03%, but growth ETFs are not known for healthy dividend payments.
IGV gained 41.81% in the 12 months ending 10th June 2021 but this year is up only 6.79%.
9. Vanguard Healthcare ETF (NYSE:VHT)
Vanguard Healthcare ETF was issued by Vanguard in 2004 to track the US healthcare sector. VHT is a growth ETF, which exhibits low volatility. It pays dividends at a relatively high yield of 1.21% and offered at an expense ratio of 0.10%, making it one of the most cost-effective ETFs to buy. It currently has about $14.56 billion in assets under management.
This ETF gained 32.43% in the 12 months ending 10th June 2021 and this year is up 10.19%. VHT’s annual return is still exciting compared to the other growth ETFs discussed here, and it’s one of the best EFTs to buy if you are looking for a low-risk growth ETF.
10. Fidelity MSCI Healthcare Index ETF (NYSE:FHLC)
Issued by Fidelity in October 2013, the FHLC ETF tracks over 400 US companies operating in the healthcare sector. It has an attractive expense ratio of just 0.08%, $2.62 billion in assets under management, and an attractive dividend yield of 1.28% based on the closing share price on 10th June.
FHLC gained 32.32% in the 12 months ending 10th June 2021, and this year it is up 10.21%. FHLC is one of the most popular growth ETFs in the market.
Why Buy ETFs in June 2021?
ETFs typically track several companies with similar characteristics but this doesn’t mean they are not well diversified. ETFs can minimize exposure to risks attached to individual companies, and some of them offer great returns. June could be a good time to look at some ETFs to help balance your portfolio as we move to the second half of the year.
The Bottom Line
There are two main classes of ETFs: value ETFs and growth ETFs. The ETFs presented in this article are predominantly growth ETFs that have delivered high returns in the last 12 months. The companies they track choose to reinvest earnings rather than pay dividends, resulting in high returns at the slight expense of low dividend payouts.