Four Blue Chip ETFs To Consider Now

With U.S. stocks holding up better than their international peers and small caps still being viewed as a tad risky, this is shaping up to be an ideal time to continue sticking with boring but beautiful blue chip stocks. And sure, it has been said this is a stock picker's environment, but for the indecisive among us, ETFs can alleviate the burden of researching hundreds of individual stocks. Beyond not having to engage in extra hours of research, there are more advantages to ETFs focusing on blue chips. Typically, these funds have low expense ratios. Buy one from Vanguard or Schwab and you can trade it commission free. And of course, you'll likely be familiar with most of, it not all the ETF's holdings. With that, let's examine four blue chip ETFs that merit investors' attention right now. Vanguard Dividend Appreciation ETF VIG: The Vanguad Dividend Appreciation ETF is one of the standards by which blue chip ETFs are measured. With $9.7 billion in assets under management, VIG is not an unknown ETF by any stretch and with an expense ratio of just 0.18%, it's also one of the cheaper options in this genre. Nine of VIG's top-10 holdings are Dow components with ConocoPhillips COP being the exception. Vanguard Value ETF VTV: To be clear, you probably don't need to own VIG and the Vanguard Value ETF at the same time, but if you want higher exposure to financials, VTV is your better option. Home to 409 stocks, VTV's expense ratio is even lower than VIG's at 0.12% and its AUM is far larger at $14.6 billion. Again, nine of this ETF's top-10 holdings are Dow stocks with Wells Fargo WFC being the standout. We lean in favor of VIG due to less weight to bank stocks. iShares MSCI USA Minimum Volatility Index Fund USMV; USMV is new on the scene having made its debut less than a month ago. Home to 127 stocks, this new ETF fits with the low-cost theme of blue chip ETFs as it has an expense ratio of just 0.15%. Most of USMV's roster can be considered blue chip while all of it is supposedly low volatility. USMV spreads its holdings out nicely as no stock receives a weight of more than 1.72% and just three Dow stocks are found among the new ETF's top-10 holdings. Rydex Russell Top 50 XLG: This is a mega-cap and blue chip ETF rolled into one. The 50 stocks XLG holds represent about 40% of the total market value of ALL U.S. stocks. Think Exxon Mobil XOM, Apple AAPL and related fare. Those two stocks account for over 13% of XLG's weight. The ETF has an expense ratio of 0.2%. Bull case: U.S. large-caps continue to outperform. Dividend increases and stock buybacks continue at their current solid paces. Bear case: Global equity markets collapse and the only thing that works is Treasuries.