3 Low-Risk ETFs That Smoke the S&P 500's Long-Term Gains

"Friday's market meltdown laid bare the vulnerabilities of the S&P 500. The index plunged 2.7%, erasing weekly gains amid President Trump's threat of massive new tariffs on Chinese imports. This sharp drop - its worst single-day loss since April - stemmed directly from the index's heavy reliance on a handful of tech giants. The top 10 stocks now command nearly 37% of the S&P 500's market capitalization, up from 27% during the 2000 dot-com peak."

"This concentration has fueled impressive returns , but also amplified risks. Year-to-date, the S&P 500 gained 12.5%, yet the Mag 7 contributed 42% of those gains. Their influence was even starker last year when the group drove nearly 70% of the index's 23% advance. This highlights how the S&P has morphed from the broad-based benchmark it was decades ago into a proxy for a few high-flying names."

"This shift makes the classic set-and-forget strategy of buying the S&P far riskier than before . Volatility spikes, like Friday's, can wipe out months of progress if those top holdings falter. Yet investors seeking steady, long-term compounding need not abandon passive approaches. By layering in quality controls - filters for profitability, low debt, and earnings stability, the three exchange-traded funds (ETFs) below deliver superior risk-adjusted returns. They outperform the S&P 500 over a decade while dialing down volatility, offering a smarter path to durable gains."

A steep market drop revealed the S&P 500's concentrated exposure to a small number of tech leaders, with the top 10 stocks now representing about 37% of the index and the Magnificent 7 accounting for roughly 35% of the weight. The concentration drove a disproportionate share of recent gains—42% year-to-date and nearly 70% last year—while increasing vulnerability to volatility that can erase broad index progress. Investors can retain passive exposure while reducing risk by using ETFs that apply quality filters for profitability, low debt, and earnings stability to improve risk-adjusted returns.

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