The L.A. Lakers Delivered a 1-Year Return of 25%. These ETFs Have Done Even Better.

Would you rather own the Los Angeles Lakers or a diversified stock ETF? One of the NBA's most iconic franchises is being sold to new owners for $12.5 billion. About a year ago, the Lakers sold for $10 billion. That means the soon-to-be-former owner of the L.A. Lakers achieved a 25% one-year return while owning the team.

Earning a 25% return from one year of owning the L.A. Lakers is an impressive return on investment (ROI). But some of the best stock exchange-traded funds (ETFs) have done even better. Let's look at three diversified stock ETFs that have recently beaten the L.A. Lakers (as investments, not in basketball).

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1. Invesco Nasdaq 100 ETF: 26% annual return

Many investors might believe that tech stocks are the best place to put their money. The tech-heavy Nasdaq-100 has outperformed the broader S&P 500 (SNPINDEX: ^GSPC) 88% of the time during the past 10 years. But tech stocks can also beat the L.A. Lakers.

In the past year, shares of the Invesco Nasdaq 100 ETF (NASDAQ: QQQM) have gained about 26%. That's works out to 1.1% better performance than owning the Lakers.

This tech ETF owns 104 stocks and tracks the performance of the tech-heavy Nasdaq-100. It is almost identical to the popular "Qs" ETF, but with a lower expense ratio (0.15%). The top holdings in the fund are major tech names like Nvidia, Apple, Alphabet, Microsoft, and Amazon.

If you want to invest in the future of the artificial intelligence (AI) boom and the U.S. tech economy, this growth ETF could be a good buy today. And it might just keep beating the Lakers.

2. Schwab U.S. Dividend Equity ETF: 30% annual return

The Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) is a fund focused on financially strong, consistently profitable companies expected to pay high dividends. This dividend ETF owns 103 stocks and is paying a 30-day SEC yield of 3.2%. That strong dividend yield is a big reason this Schwab ETF ranks as one of the best dividend index funds.

In the past year, this Schwab fund has delivered a return of a bit more than 30%. That's 5.1% higher than the ROI of owning the L.A. Lakers.

Because it focuses on well-established companies and blue chip stocks that pay high dividends, this Schwab ETF is not tech-heavy. It offers a different mix of stocks than a Nasdaq-100 ETF. The top holdings in this Schwab fund include healthcare stocks like Abbott Laboratories and Amgen, pharmaceutical stocks like Merck, and household name stocks like Coca-Cola and Home Depot.

If you want to own a mix of solid, well-known, profitable companies that pay great dividends, this fund could be worth considering.

3. Vanguard International High Dividend Yield ETF: 35% annual return

What if you wanted to diversify your investments beyond U.S. stocks? Good news: International ETFs can beat the Lakers, too. The Vanguard International High Dividend Yield ETF (NASDAQ: VYMI) has delivered a one-year return (by net asset value) of almost 35%. That's a roughly 10% higher ROI than owning the Lakers.

This ETF is more broadly diversified than the Schwab fund. It owns 1,565 international stocks from dozens of countries. Instead of major tech names, this dividend ETF's top 10 stock holdings are mostly banks from Canada, Japan, and the U.K.; Swiss pharma companies like Novartis; consumer household goods maker Nestlé; and Netherlands-based international energy major Shell PLC. Those kinds of financially strong, steadily profitable companies have helped this fund pay an impressive trailing-12-month dividend yield of 3.5%.

If you want to diversify away from the tech-heavy U.S. stock market, the Vanguard International High Dividend Yield ETF can deliver. And it's outperformed the Nasdaq-100 and the L.A. Lakers for the past year.

Why buy stocks (instead of the L.A. Lakers)?

Most people reading this will never have enough money to buy an NBA team, and that's OK. Buying stocks can be a better investment than owning a pro sports team -- even the Lakers.

You don't have to be a billionaire to earn a strong return on your investments. Buying diversified stock ETFs can be a winning strategy for long-term investors at all wealth and income levels.

Ben Gran has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Abbott Laboratories, Alphabet, Amazon, Amgen, Apple, Home Depot, Merck, Microsoft, and Nvidia. The Motley Fool recommends Nestlé. The Motley Fool has a disclosure policy.