Here Are 3 Top ETFs I'd Buy Right Now

Source The Motley Fool

The stock market has been rather turbulent in 2025, and although the S&P 500 is no longer in correction territory, there are still some excellent investment opportunities to be found.

In fact, there are some ETFs that look highly attractive for long-term investors right now. Here are three in particular I've bought for my own portfolio recently, and that I plan to continue buying for the foreseeable future.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

A beaten-down AI ETF

The Ark Autonomous Technology & Robotics ETF (NYSEMKT: ARKQ) is down by about 17% from its 52-week high and looks like an interesting long-term opportunity. I added it to my portfolio recently, as I had been looking to increase my AI exposure, but there were two problems.

First, AI stocks really aren't my area of expertise. I'm a value investor at heart, and my core competencies are things like banks and real estate. Second, most other AI ETFs looked almost identical and focused on the massive technology stocks.

On the other hand, this is an actively managed ETF, overseen by tech investor Cathie Wood, that owns about three dozen stocks, with some smaller and outside-the-box AI plays among its largest holdings. The largest position, Tesla, is certainly a household name, but other top stocks, including Kratos Defense & Security, Teradyne, and Archer Aviation, are not. In short, this ETF focuses on high-potential names that could be big winners of the AI boom, not just the same megacap tech stocks you'll find in other tech ETFs.

My favorite ETF of all for 2025

At the beginning of 2025, small cap stocks, as defined by the Russell 2000 benchmark index, were trading at their lowest price-to-book valuation relative to their large-cap counterparts in more than 25 years. And with the S&P 500 outperforming the Russell 2000 so far in 2025, the gap has widened even further.

In a nutshell, I believe the gap will narrow considerably, and that's especially true if we get a falling-rate environment over the next few years, as experts predict. Lower interest rates can disproportionately favor small-cap stocks for a few reasons. For one thing, small caps tend to rely on borrowed money more than large caps do, and lower interest rates obviously help in this area. Plus, as rates fall, money starts flowing out of "guaranteed" return assets such as CDs and Treasuries, which can be a big lift for smaller, more speculative companies.

For these and a few other reasons, the Vanguard Russell 2000 ETF (NASDAQ: VTWO) is my No. 1 ETF pick to buy in 2025, and in full disclosure, it's the one on this list I've put the most of my own money into.

Still a bargain near its 52-week high

I added the Vanguard International High Dividend Yield ETF (NASDAQ: VYMI) to my portfolio in 2024, and it has been one of the better-performing investments I own, up about 10% so far in 2025.

However, even with shares near a 52-week high, this 4.4%-yielding ETF could still be worth a closer look, especially if you're looking for international diversification in your portfolio.

As the name suggests, this ETF tracks an index of international stocks with above-average dividend yields. There are just under 1,500 stocks in the index, which is weighted, so larger companies make up a larger percentage of the fund. Although it's an international index fund, that simply means that its components are based outside of the United States. Many have large U.S. operations are household names to American investors, such as Nestle, Toyota, and Shell, all of which are among the top 10 holdings.

The fund has a low 0.17% expense ratio, and even though it has performed well recently, it still looks rather cheap. For one thing, the average P/E ratio of its component stocks is about 12, and the average stock trades for 1.4 times book value. The U.S.-based Vanguard counterpart ETF, the Vanguard High Dividend Yield ETF (NYSEMKT: VYM) has an average P/E and P/B of 19.8 and 2.9, respectively.

Great entry points for long-term investors

To be clear, I have no idea what these three ETFs will do over the coming weeks or months. But from a long-term perspective, it looks like an attractive time to buy all three of these. I own all three in my portfolio already, and for very different reasons, and I plan to add more shares of each incrementally for as long as these valuations remain.

Don’t miss this second chance at a potentially lucrative opportunity

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Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

Continue »

*Stock Advisor returns as of March 24, 2025

Matt Frankel has positions in Ark ETF Trust-Ark Autonomous Technology & Robotics ETF, Vanguard International High Dividend Yield ETF, and Vanguard Russell 2000 ETF. The Motley Fool has positions in and recommends Tesla and Vanguard Whitehall Funds-Vanguard High Dividend Yield ETF. The Motley Fool recommends Nestlé and Teradyne. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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