Do you want to become richer? 2 Top ETFs to Buy Right Now

Exchange-traded funds (ETFs) offer investors a simple way to take advantage of strong economic trends. There are two economic trends that have been dominating the headlines lately, and there are two ETFs that are particularly well-positioned to take advantage of these trends and provide their investors with growing returns. Let’s take a closer look at each.

1. This small-cap ETF can outsize your gains

With inflation falling, the Federal Reserve is sending strong signals that it is on the verge of cutting interest rates for the first time since the start of the COVID-19 pandemic in early 2020. A rate cut, which would reduce borrowing costs for businesses and consumers alike, could come as soon as September. Such a move would provide a strong stimulus to the economy and a likely corresponding stock market shock.

Smaller companies that rely heavily on borrowing to fuel their growth tend to benefit greatly from lower interest rates. Owners of small-cap stocks, in turn, could enjoy huge gains. If you want to position yourself to take advantage of a small business boom, consider investing in SPDR Portfolio S&P 600 Small Cap ETF (SPSM -0.60%) today.

The SPDR Portfolio S&P 600 Small Cap ETF gives you a simple way to quickly gain ownership stakes in several hundred businesses. The fund has positions in more than 600 stocks with a weighted average market value of $3.3 billion. Most of the stocks it holds are squarely in small-cap and micro-cap territories. It also holds several big winners that have successfully risen to mid-cap status.

Value investors will also appreciate that the shares held by the SPDR Portfolio S&P 600 Small Cap ETF are currently trading at an attractive price. With an average price-to-earnings (P/E) ratio of less than 16, this small-cap ETF trades at a considerable discount to many broad-market index funds, such as those that track S&P 500.

Better yet, the SPDR Portfolio S&P 600 Small Cap ETF is an ultra-low-cost fund. Its annual expense ratio of just 0.03% works out to just $0.30 per $1,000 invested annually. Thus, almost all of the ETF’s earnings will go to you rather than to the fund managers.

2. Here’s how you can take advantage of the AI ​​boom

Demand is growing for artificial intelligence (AI) and the game-changing innovations it enables. Artificial intelligence could boost the global economy by $15.7 trillion by 2030, according to consulting firm PwC. If you want to claim your share of the AI ​​gold rush, consider building a position in the WisdomTree Innovation and Artificial Intelligence Fund (WTAI 0.20%).

The ETF holds shares of 75 companies with some of the best AI technologies on the planet. Areas of interest include semiconductors, machine learning software, and high-performance computing infrastructure. Key end markets include drones, robotics and autonomous vehicles.

Here are the fund’s top five holdings and the percentages of its portfolio they comprise:

1. Nvidia3.2%
2. Meta platforms2.6%
3. Arm holds2.5%
4. Broadcom2.5%
5. Apple2.4%

All five are remarkable businesses. Combined with other large holdings such as Taiwan Semiconductor Manufacturing, Alphabetand Microsoftthese proven winners can add ballast to your portfolio. Meanwhile, smaller, fast-growing companies like drone maker AeroVironment and automation specialist Symbolic offers even more AI-powered growth potential.

Finally, the WisdomTree Artificial Intelligence and Innovation Fund has a modest expense ratio of 0.45%, which equates to about $4.50 per $1,000 invested annually. This well-constructed ETF thus gives you a simple and relatively cheap way to profit from the AI ​​boom.