2017 could be a tough year for investors. (They’ve all been saying that for years, haven’t they?) However, with the bull market getting old and a new president coming into office things are sure to shake up a bit this year. Whether or not it’s good for the market is yet to be seen.
You shouldn’t be scared of the market though. There are some good funds out there to choose from. Subsequently, I’m a big fan of Vanguard mutual funds, and here’s my top three picks for 2017.
1- Vanguard 500 Index Fund (VFINX)
If you’re going to pick just one fund out of this group then I’d highly recommend that you choose this one. This fund is focused on the big name large caps in the US market. Apple, Microsoft, Amazon, and Facebook round out the top four holdings of the fund.
You’ll need $3,000 to make an initial investment into the fund. You also get a nice and small expense ratio of 0.14% which is the lowest of the three recommended here.
Having your money in this fund should keep you in relatively “safer” large cap stocks. If you don’t have a fund that concentrates on large caps then you should definitely consider this one. You should aim to have a fund like this one in your mutual fund portfolio.
2- Vanguard Balanced Index Fund (VBINX)
A balanced fund is exactly what it sounds like, balanced. The fund has holdings in both stocks and bonds with about 60% in stocks and 40% in bonds. This is a good fund to get into if you want to take on some risk but also want to put your money somewhere “less risky” too (with bonds).
Again, you’ll need a $3,000 initial investment to get into the fund. They also have a pretty good expense ratio (a lot of Vanguard funds do) at 0.19%
Vanguard has one of the best balanced funds out there in VBINX. If you’re looking for a fund in the balanced category then you should definitely give this one a look. They have a good track record, and their trailing returns are at around 10% over the past 5 years annualized.
3- Vanguard Health Care Fund (VGHCX)
With the Trump organization in the driver’s seat you may see a prop up to this healthcare fund. Trump wants to repeal Obamacare and give back some control to the businesses in the healthcare sector.
In any case, a healthcare sector focused fund is usually seen as a more defensive type fund. I wouldn’t completely call it defensive though in this environment. Still, if you’re looking for a good fund with a good track record in this sector you should consider this one.
You need $3,000 here once again to make an initial investment. The expense ratio is a little higher than the other two funds mentioned at 0.36%, but it’s smaller than other comparable funds in the healthcare sector.
This fund is in mostly large cap stocks with its top four holdings being Bristol Myers, Allergan, United Health, and Eli Lilly. The fund has an almost 19% trailing 5 year annualized return.