"The VanEck Retail ETF tracks the MVIS US Listed Retail 25 Index and gives you exposure to the 25 largest and most liquid retail stocks in the U.S. The ETF is passive and can add significant ballast to your portfolio in case of an AI downturn. It does have as its biggest holding with a 20.36% weight, but almost all other holdings are uninvolved in AI."
"Even CEOs of certain AI companies themselves are quite confused, with Google's CEO talking about "elements of irrationality". However, instead of panicking and selling all your tech stocks, the smarter idea would be to hedge. If you are uncomfortable with how expensive tech stocks are today, you can hold off on buying and start slowly rotating gains into defensive ETFs."
"RTH has seen lower drawdowns during recessions compared to the S&P 500. Plus, it declines less abruptly and can cushion your portfolio. This is thanks to how retail businesses act during downturns. They tend to adapt quickly, with value-oriented retailers seeing increased foot traffic. RTH has a small 0.70% dividend yield. The expense ratio is 0.35%, or $35 per $10,000."
Certain AI stocks have been undergoing a sharp correction as Wall Street sentiment cools. Hope remains for a recovery, but growing insecurity suggests the rally may have become a bubble and could face a Dot-Com–like drawdown. CEOs have flagged "elements of irrationality," and a defensive approach is recommended instead of panicked selling. Investors can hedge by holding off new buys and slowly rotating gains into defensive ETFs. The VanEck Retail ETF (RTH) offers exposure to 25 large retail names, provides ballast with lower recession drawdowns, and carries a 0.70% dividend and 0.35% expense ratio. The Vanguard Consumer Staples ETF (VDC) tracks the MSCI US IMI Consumer Staples 25/50 for broad staples exposure.
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