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2 ETFs For Investing In Robinhood's Most Popular Stocks

By Investing.com (Tezcan Gecgil/Investing.com )ETFsAug 18, 2020 04:40AM ET
www.investing.com/analysis/2-etfs-with-the-most-popular-robinhood-stocks-200534381
2 ETFs For Investing In Robinhood's Most Popular Stocks
By Investing.com (Tezcan Gecgil/Investing.com )   |  Aug 18, 2020 04:40AM ET
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Robinhood has gained widespread attention amid the coronavirus pandemic. Its popularity has soared with its target audience: millennials. The app aims to make trading more accessible with its commission-free, easy-to-use service.

Beyond the platform, Robinhood's daily 100 most popular stocks have attracted investors' attention as it provides a glimpse at what stocks are trending, at least for Robinhood users. The eclectic list includes everything from tech names, travel and leisure companies, electric vehicle stocks, oil giants, stocks under $10 and exchange-traded funds (ETFs).

For those looking for broad exposure to stocks favored by Robinhood users without the daily volatility of individual stocks, here are two ETFs are worth considering:

1. iShares Edge MSCI USA Quality Factor ETF

  • Current Price: $104.25
  • 52-Week Range: $68.20 - 105.05
  • Dividend Yield (TTM-Trailing Twelve Month): 1.6%
  • Expense Ratio: 0.15% per year, or $15 on a $10,000 investment

The iShares Edge MSCI USA Quality Factor ETF (NYSE:QUAL), invests in large- and mid-capitalization US stocks as identified by three fundamental variables: return on equity, earnings variability and debt-to-equity.

QUAL, which includes 125 holdings, tracks the investment results of the MSCI USA Sector Neutral Quality index.

The most important sectors by weighting are Information Technology (26.89%), Healthcare (14.42%), Consumer Discretionary (11.21%), Communication (11.11%) and Financials (9.85%).

QUAL's top five companies are all among the most-traded Robinhood shares, including Apple (NASDAQ:AAPL), Facebook (NASDAQ:FB), Coca-Cola (NYSE:KO), Nike (NYSE:NKE) and Microsoft (NASDAQ:MSFT). The top ten holdings make up about a third of net assets, which stand at around $19.3 billion.

Other stocks QUAL holds that are on Robinhood's list are Alphabet Class C (NASDAQ:GOOGL) and Class A (GOOG), Walt Disney Company (NYSE:DIS), Exxon Mobil (NYSE:XOM), Intel (NASDAQ:INTC), Johnson & Johnson (NYSE:JNJ), Pfizer (NYSE:PFE) and Visa (NYSE:V).

QUAL Weekly Chart
QUAL Weekly Chart

So far this year, QUAL is down about 3.3%. However, in February the fund hit an all-time high of $105.32, only to see a 52-week low in March. Yet since early spring, QUAL has gone up by over 50%.

While market participants are eyeing a new all-time high for the ETF, there will likely be some short-term profit-taking around the corner. Long-term investors may consider committing new capital to QUAL, especially if the price declines below $100 and toward the $95-level.

2. ERShares Entrepreneur 30 ETF (ENTR)

  • Current Price: $23.50
  • 52-Week Range: $14.00 - 23.72
  • Dividend Yield (TTM-Trailing Twelve Month): 0.73%
  • Expense Ratio: 0.49% per year, or $49 on a $10,000 investment

The ERShares Entrepreneur 30 ETF (NYSE:ENTR), holds shares in the 30 largest US companies by market cap that meet six standards, including low executive turnover, large stakes among key stakeholders, profitability, aligned executive compensation packages, minimum revenue and revenue growth and other company statistics.

ENTR's sector allocation by weighting is Technology (51.73%), Consumer Cyclicals (21.02%), Healthcare (16.46%), Financials (6.82%) and Industrials (3.98%).

The top ten holdings make up about half of the fund. ENTR's top five companies are Amazon.com (NASDAQ:AMZN), Alphabet Class A (GOOGL), Facebook, NVIDIA, (NASDAQ:NVDA) and Netflix (NASDAQ:NFLX), all of which are among the most-popular Robinhood shares.

Several other ETF holdings also on the Robinhood list include Square (NYSE:SQ), Tesla (NASDAQ:TSLA), Twitter (NYSE:TWTR) and Zoom Video Communications (NASDAQ:ZM).

ENTR Weekly Chart
ENTR Weekly Chart

Year-to-date, ENTR is up over 27%. And since March, the fund is up close to 67%. On Aug. 5, the fund hit an all-time high of $23.54. Long-term investors may consider buying the dips, especially if there is profit-taking that may push the price toward the $20 level.

Bottom Line

Today, we covered two ETFs providing exposure to a range of companies that are currently on Robinhood's most popular list.

In addition to individual shares, there are several exchange-traded funds that made Robinhood's top 100:

  • SPDR S&P 500 ETF (NYSE:SPY) (covered here)
  • Vanguard S&P 500 ETF (NYSE:VOO)
  • Direxion Daily S&P Oil & Gas Exp. & Prod. Bull 2X Shares (NYSE:GUSH)
  • Invesco S&P 500 High Div Low Volatility ETF (NYSE:SPHD)
  • ProShares Ultra Bloomberg Crude Oil (NYSE:UCO)
  • United States Oil Fund (NYSE:USO)

We plan to address many of these funds in the future.

2 ETFs For Investing In Robinhood's Most Popular Stocks
 

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2 ETFs For Investing In Robinhood's Most Popular Stocks

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Comments (11)
Gayathri Bhaskaran
Gayathri Bhaskaran Aug 24, 2020 11:35AM ET
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Interesting insights!
George Adosoglou
George Adosoglou Aug 23, 2020 11:49AM ET
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Great stuff!
Mary Lpeza
Mary Lpeza Aug 21, 2020 10:37PM ET
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Very interesting, thank you for sharing Tezcan
Jay Don
Jay Don Aug 20, 2020 7:32PM ET
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Great insights!
Alireza Dehghani
Alireza Dehghani Aug 20, 2020 11:01AM ET
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ETF
Jeshua Hamilton
Jeshua Hamilton Aug 19, 2020 10:46PM ET
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Just invest in TMFC
Daniel Morel
Daniel Morel Aug 19, 2020 10:46PM ET
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Even better and with a lower lateral volatility and better results is as simple QQQ / millenium are making their investing life as complicated as a lightly toasted seven grain toast with organically produced crushed avocados with micro beets flowers and a touch of unmolested south african honey!
Salman Kabani
Salman Kabani Aug 19, 2020 12:39AM ET
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Good ifno Tezcan. Thanks tor sharing
Yann Fournier
Yann Fournier Aug 18, 2020 1:24PM ET
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is the ETF called *****ho
Mohamed Sankoh
Mohamed Sankoh Aug 18, 2020 1:10PM ET
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stay in Africa Sierra Leone West coast of Africa
Will Power
Will Power Aug 18, 2020 11:58AM ET
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Yes, Jacob I agree. Just a little late in thess two ETF’s. I will wait for a pullback
Jacob Dayeh
Jacob Dayeh Aug 18, 2020 5:08AM ET
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Excellent choices on 2 stable and quality ETFs which invest in profitable stocks, solid earnings growth and fundamentals.
 
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