- Financial markets are currently in high-risk/high-reward trajectory, and ETFs offer one of the best ways to enrich a portfolio
- Tech stocks are still the most preferred, despite significant concerns about their valuation
- Diversification is at the core of maintaining a healthy balance, and that typically calls for blending multiple
The current market environment makes a strong case for focusing on diversification, cost efficiency, and exposure to resilient sectors. For 2026, several exchange-traded funds offer potential for returns while managing risk. Five ETFs warrant consideration for investors seeking broad market access or specific strategies.
Vanguard S&P 500 ETF (VOO)
Many strong portfolios begin with an investment in the largest U.S. companies, something the S&P 500 effectively represents. The Vanguard S&P 500 ETF (VOO) tracks this index, and it does so with an incredibly low 0.03% expense ratio. These low costs and the fund’s sheer scale make it an excellent way to get exposure to the broader market.
VOO has shown strong long-term returns, which speaks to the resilience of American businesses across many sectors. Over the last five decades, the S&P 500 has historically averaged nearly 10% annual returns, assuming dividends are reinvested. That’s a reasonable goal for building wealth over time.
Invesco NASDAQ 100 ETF (QQQM)
The Invesco NASDAQ 100 ETF (QQQM) provides focused exposure to prominent technology and growth companies for investors comfortable with increased volatility. With a 0.15% expense ratio, it includes companies involved in artificial intelligence, cloud computing, and consumer technology.
Recent dips in the tech sector could present good entry points, especially since the core growth from digital transformation remains robust. QQQM allows you to gain exposure to these trends without having to pick individual stocks. Do keep in mind, its performance can differ significantly from broader market indices when tech experiences its own ups and downs.
Roundhill Memory ETF (DRAM)
The investment focus within artificial intelligence is increasingly shifting towards foundational physical infrastructure rather than solely on software applications.
The Roundhill Memory ETF (DRAM), which launched to massive fanfare, has hauled in an incredible $12.73 billion in capital. This fund invests in companies making memory semiconductors and storage hardware, which are essential microchip components for intensive AI processing.
Vanguard Total International Stock ETF (VXUS)
The significant presence of mega-cap technology companies in U.S. stock indexes contributes to concentration risk within the domestic market. The Vanguard Total International Stock ETF (VXUS) offers broad exposure to developed and emerging markets globally, outside the United States.
Global geopolitical shifts and diverse monetary policies create opportunities in markets abroad. VXUS helps reduce U.S.-centric risks and allows investors to access global growth. It’s a good complement to domestic holdings, helping build a more diverse portfolio.
Schwab U.S. Dividend Equity ETF (SCHD)
Income-focused investors should pay attention to this fund. SCHD tracks the Dow Jones U.S. Dividend 100 Index, looking for companies that have paid dividends for 10 or more consecutive years. It then checks eligible stocks against four key metrics: cash flow-to-debt, return on equity, dividend yield, and its five-year dividend growth rate.
With a 3.46% dividend yield and a 0.06% expense ratio, SCHD focuses on value stocks, which tend to demonstrate more stability during uncertain periods. SCHD has outperformed broader value categories year-to-date in 2026, and it offers some protection from growth-stock volatility. This focus on steady payouts and strong financial health appeals to income investors and those preparing for a potentially slower economy.
SCHD offers a 3.46% dividend yield and selects only companies with at least 10 consecutive years of proven dividend payment history and growth.
Investors are utilizing international equity ETFs to diversify away from heavy concentration risks associated with mega-cap technology stocks in U.S. indexes
Yes, combining these five ETFs allows you to achieve meaningful diversification across market caps, growth styles, and income approaches for long-term success.