5 Index ETFs to Buy With $1,000 and Hold Forever

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It’s common for investors to hesitate when the stock market is doing very well, like it is now. People often worry about buying at the peak, just before prices drop. However, markets actually reach new highs fairly often, and historically, stocks have generally increased in value over time. Trying to time the market perfectly can lead to missed opportunities.

A recent study by J.P. Morgan revealed that if you miss out on just the ten best days of market gains over a 20-year period, your overall returns could be cut in half. Interestingly, these best days often follow significant market declines, but investors frequently hesitate to buy during those drops, fearing further losses. This highlights the benefit of dollar-cost averaging – investing a fixed amount of money at regular intervals, regardless of market conditions. This strategy eliminates the need to try and time the market and allows your investments to grow steadily over time.

Here are five ETFs where you can start investing with $1,000 right away, and continue adding to your investment over time.

1. Vanguard S&P 500 ETF

If I had to choose just one investment to hold for the next 30 years, I’d pick the Vanguard S&P 500 ETF (VOO). It mirrors the performance of the S&P 500, instantly diversifying your investment across roughly 500 of America’s largest and most important companies. Because the S&P 500 focuses on the biggest companies, it allows successful businesses to drive returns. This is a key reason why the ETF has performed so well over time – it naturally favors the best performers.

For the last ten years, this ETF has delivered an average annual return of 14.6%, which is a very strong performance. Plus, with an expense ratio of just 0.03%, it’s one of the most affordable options available.

As an equity researcher, if I had to pick just *one* investment for someone looking to build wealth steadily over time, it would be the Vanguard S&P 500 ETF. It’s perfect for dollar-cost averaging – meaning you invest a fixed amount regularly, regardless of market fluctuations – and essentially runs on autopilot once you set it up.

2. Vanguard Growth ETF

I’m looking to add some growth potential to my portfolio, and the Vanguard Growth ETF (VUG) seems like a solid option. It focuses on larger companies that are expanding at a faster rate than average, and it’s heavily weighted towards tech giants. In fact, Nvidia, Microsoft, and Apple alone represent over a third of the ETF’s investments.

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The fund’s performance is heavily influenced by its top ten investments, which make up over 60% of its total holdings – meaning it’s focused on a relatively small number of fast-growing companies. These growth stocks have driven market gains for the last ten years, and this fund has benefited, achieving an average yearly return of 17.1% over the past decade.

Artificial intelligence is poised to be a major technological advancement, and the Vanguard Growth ETF offers a convenient way to invest in many of the leading companies driving this innovation.

3. Invesco QQQ Trust

The Invesco QQQ Trust (QQQ) is another ETF worth looking at. It mirrors the performance of the Nasdaq-100 index, which is largely made up of technology and consumer companies. Over 60% of the fund is invested in technology, and almost 19% in consumer discretionary stocks – many of which, like Amazon, are essentially tech companies.

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Over the past decade, the Invesco QQQ Trust has consistently delivered strong returns, averaging 19.4% per year. Notably, it has outperformed the S&P 500 in over 87% of the last 10 years, consistently beating it on a year-over-year basis.

Although this fund has a slightly higher fee of 0.2%, its strong performance makes it a leading choice for investors.

4. Schwab U.S. Dividend Equity ETF

I’ve been watching the market closely, and while growth stocks have been getting a lot of attention lately, I think it’s smart to not overlook value stocks – they definitely have the potential to shine too. If I were looking to add some solid, dividend-paying value stocks to my portfolio, the Schwab U.S. Dividend Equity ETF (SCHD) would be a great place to start.

This ETF invests in companies that are financially healthy and consistently pay increasing dividends. Currently, it offers a yield of about 3.8%. Importantly, the underlying index regularly checks to ensure these dividend payments are sustainable, making them more reliable compared to many other ETFs focused on high yields.

Over the last ten years, this ETF has consistently earned returns of 10% or more each year, all while keeping its fees incredibly low at just 0.06%. This is a strong result, especially considering growth stocks have generally performed well during this time.

5. Vanguard International High Dividend Yield ETF

Many investment portfolios focus mainly on U.S. stocks. However, including some international investments can help reduce risk and potentially improve returns. The Vanguard International High Dividend Yield ETF (VYMI) is a good choice if you want to diversify your portfolio with international stocks that pay high dividends.

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This ETF invests in companies outside the U.S. that offer high dividend yields. It’s spread across Europe, Asia-Pacific, and developing countries, and its largest holdings include well-known companies like Nestlé, Roche Holding, Toyota Motor, and Shell. This combination provides a diversified global investment with a regular income payout.

This fund has performed exceptionally well this year, increasing by almost 28% since January 1st through September 10th. Over the past five years, it has averaged a 14.2% annual return. While its 0.17% fee is a bit higher than some U.S.-focused funds, it’s quite fair for an international investment.

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2025-09-16 11:58