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The Simple Way to Buy Value Stocks

(In case the podcast isn't working, then you can listen here.)

Welcome to Episode #16 of the Value Investor Podcast

Every week, Zacks value stock strategist and the Editor of Zacks Value Investor portfolio service, Tracey Ryniec, talks about all things happening in the value stock universe, including her top stock picks.

After recently having a regional bank stock blow-up in her Value Investor portfolio, Tracey was too aware of the risks of buying individual stocks.

But if even a value investor can get burned buying stocks, how do you lessen the risk?

One way to do that, and still be in the value stock game, is by buying value stock ETFs.

Historically, the value stock indexes have outperformed the regular stock indexes. Value has even done better than growth. In the last 2 years, however, value has underperformed. That means there is a buying opportunity now.

Tracey believes you should have more than one ETF in a portfolio. While she likes small cap value, and invests herself in that sector, investors shouldn’t forget about the mid-caps. The large caps can also be a good way to lessen your portfolio volatility.

Here are Tracey’s favorite value ETFs:

1.      Vanguard Small Cap Value ETF (VBR): Tracey owns this ETF. She likes its low expense ratio and that its largest sector holdings is in financials.

2.     Guggenheim S&P Small Cap 600 Pure Value ETF (RZV): This ETF only owns 150 “pure” value stocks.

3.     Vanguard Mid-Cap Value ETF (VOE): It holds 210 companies and tracks the CRSP US midcap value index.

4.     iShares S&P Mid Cap 400 Value ETF (IJJ): Industrials are the largest sector and real estate is in the top five.

5.     Vanguard Large Cap ETF (VV): Holds 610 mostly domestic US companies. It yields 2%.

ETFs may seem like a boring way to invest, but for value investors, it can be a great way to get value exposure while lowering the risk of owning individual stocks.

Find out what else Tracey likes about value ETFs in this week’s podcast.

Want to Learn More About Small Cap Value Stocks?

Want more insights from Tracey?

Check out her weekly Value Investor service to receive more in-depth analysis on value companies and see which stocks she thinks are the best bargains now.

Click here to learn more>>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
VIPERS-LRG CAP (VV): ETF Research Reports
 
VIPERS-SC VALUE (VBR): ETF Research Reports
 
VANGD-MC VALUE (VOE): ETF Research Reports
 
GUGG-SP 600 PV (RZV): ETF Research Reports
 
ISHARS-SP MC VL (IJJ): ETF Research Reports
 
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Zacks Investment Research