ETF Snapshot: Strategies for Wealthy Investors

Next week is the annual Las Vegas MoneyShow, and one of the workshops I’ll be teaching this year is specifically aimed at the needs of high-net-worth investors. In my opinion, the three best strategies for wealth investors involve growth funds, total return funds and tax-efficient/tax-free funds. Let’s take a quick look at each.

Growth Oriented:
Investors using this strategy are focused on capital appreciation during the next 1-3 Years. Income generation is not a priority, and some market volatility is acceptable. Investors should be aware of the potential for drawdowns and have the staying power to withstand short-term price fluctuations.

Total Return Oriented:
This strategy is focused on income generation, while also participating in capital appreciation opportunities. Volatility and drawdowns will generally be manageable; however, capital appreciation may not be as robust. The tradeoff here is the strong income and high yields inherent in these funds.

Tax-Free Income Oriented:
This strategy best suits investors with high federal and/or state tax burdens. These tax-efficient vehicles generate tax-free income on a state or federal level, depending on the security. Risks include interest rate volatility and municipality defaults.

To see which funds made my top 10 list of favorite ETFs for wealthy investors, just check out the ETF Snapshot today!

NOTE: Fabian Wealth Strategies is a Securities and Exchange Commission-registered investment adviser, and is not affiliated with Eagle Financial Publications.