There’s still time to top up ISAs, using up any remaining allowances – Hal Cook, Senior Investment Analyst at Hargreaves Lansdown shares three ETF ideas to consider.
With tax year end upon us, it’s the time of year to review investment portfolios and ensure best use has been made of any potential tax allowances. There is still time to rebalance portfolios too.
As always, a diversified portfolio is important. Recent events have highlighted this more than usual and act as a reminder that we never know what’s around the corner.
It’s the unknown risks that hit markets hardest and cause the most disruption. Diversification of investments is the best way to protect against these events in future.
If investors are looking for ETFs to use within their ISA, the following can be used to help provide a broad and diversified portfolio.
Vanguard FTSE All-World ETF
- Broad global exposure across developed and emerging markets in a single investment
- Low-cost, passive approach tracking the FTSE All-World Index
- Could act as a core long-term growth building block within a diversified portfolio
We favour this as a core building block to an investment portfolio, providing investments in stock markets all over the world, diversification that is welcome in all portfolios.
Vanguard Global Aggregate Bond ETF
- Exposure to global investment-grade government and corporate bonds
- Invests across thousands of bonds worldwide, providing plenty of diversification in a single bond investment
- Designed to provide ballast alongside equity or potentially higher-risk investments
We favour this as a core building block to an investment portfolio, providing investments in bond markets all over the world.
Fixed income is particularly welcome for clients who are approaching or in retirement to add diversification to equity portfolios.
iShares UK Dividend ETF
- The UK stock market tends to pay a higher income than other regions in the world
- Invests in some of the larger UK dividend payers
- Aims to track the performance of the FTSE UK Dividend+ Index
We think this is a good option for investors looking for income, or who want to reinvest dividends to boost total returns.
The UK has natural biases to old economy, quality and value biased sectors.
Past performance is not a reliable guide to future returns. You may not get back the amount originally invested, and tax rules can change over time. The writer’s views are their own and do not constitute financial advice.
This information should not be relied upon by retail clients or investment professionals. Reference to any particular investment does not constitute a recommendation to buy or sell the investment.
Main image: ETF, markus-winkler-cAGGyg2a_tc-unsplash
