Most investors are fully aware that the market is trading at or near an all-time high with many stocks trading at historically very-large valuation levels. Some of these investors are Nervous Nellies in the face of recent hot inflation rates (see my
Vanguard's VOOV Value ETF Is For Nervous Nellies (And For You Too)
Summary
- Many investors are quite nervous about the market's current high valuation level in the face of inflation and potential interest rate increases by the Federal Reserve.
- For those Nervous Nellies looking for "value", the cost-efficient and well diversified Vanguard S&P500 Value ETF may be just the ticket.
- That's because VOOV currently trades at a P/E=18.8x and a price-to-book of 2.7x, both of which are at a significant discount to that of the S&P500 and Nasdaq-100 indexes.
Michael Fitzsimmons is a retired electronics engineer and avid investor. He advises investors to construct a well-diversified portfolio built on a core foundation of a high-quality low-cost S&P500 fund. For investors who can tolerate short-term risks, he advises an over-weight position in the technology sector, which he believes is still in the early stages of a long-term secular bull-market. For dividend income, and as a 4th generation oil & gas man, Fitzsimmons suggests investors consider a position in large O&G companies that provide strong dividend income and dividend growth. Fitzsimmons' articles on portfolio management recommend a top-down capital allocation approach that is aligned with each individual investor's personal situation (i.e. age, retired/working, risk tolerance, income, net worth, goals, etc) and might include allocations into investment categories such as the S&P500, technology, dividend income, sector ETFs, growth, speculative growth, gold, and cash.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of XOM either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
I am an electronics engineer, not a CFA. The information and data presented in this article were obtained from company documents and/or sources believed to be reliable, but have not been independently verified. Therefore, the author cannot guarantee their accuracy. Please do your own research and contact a qualified investment advisor. I am not responsible for the investment decisions you make.
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