Published

  • (1:30) - Ted Weschler And His Homerun IRA
  • (7:30) - What Kind Of Investments Was He Making?
  • (13:25) - Lessons To Learn From Ted Weschler
  • (17:45) - Top Stock & ETF Picks For Your Roth IRA
  •                 Podcast@Zacks.com

In this episode of ETF Spotlight, I speak with Tracey Ryniec, Zacks Senior Equity Strategist,

about investing lessons from Ted Weschlers $264 Million Roth IRA.

Roth IRAs owned by ultra-wealthy Americans have been in spotlight after ProPublica obtained more than 15 years of tax return data on them.  The largest one belonging to PayPal PYPL founder Peter Thiel had over $5 billion in assets as of 2019. Thiel used the account to buy founder’s shares in PayPal, and also shares in Palantir PLTR and Facebook FB when they were still private companies.

Unlike Thiel, Warren Buffett’s deputy Ted Weschler built his retirement wealth through publicly traded investments and strategies available to all investors. His investing journey provides some good lessons for other investors. These lessons include: start young, buy stocks, stay invested, maintain a diversified portfolio, and capture the power of compounding.

IRAs allow investors to buy individual stocks, bonds, ETFs or mutual funds.  ETFs are excellent tools for retirement investors since they provide an easy way to build a diversified portfolio at a low cost.

Tracey recommends owning high quality stocks like Apple AAPL, Amazon AMZN and Nvidia NVDA, and ETFs in retirement accounts. The Invesco QQQ ETF QQQ and its cheaper version Invesco NASDAQ 100 ETF QQQM hold many highly innovative companies. Apple, Microsoft MSFT, Amazon and Alphabet GOOG are the top holdings in these funds.

Investors should also consider low-cost ETFs like  the Vanguard S&P 500 ETF VOO and iShares Core S&P Total U.S. Stock Market ETF ITOT for broad market exposure.

Further, dividend paying ETFs are better placed in an IRA as income is sheltered from taxes. The Vanguard Dividend Appreciation ETF VIG and the iShares Core High Dividend Growth DGRO, which hold companies that have a record of increasing dividends over time, are worth a look.

Tune in to the podcast to learn more.

Make sure to be on the lookout for the next edition of the ETF Spotlight and remember to subscribe! If you have any comments or questions, please email podcast@zacks.com.

(In full disclosure, Neena owns shares of VIG in the ETF Investor Portfolio.)

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Alphabet Inc. (GOOG): Free Stock Analysis Report

Amazon.com, Inc. (AMZN): Free Stock Analysis Report

Apple Inc. (AAPL): Free Stock Analysis Report

Microsoft Corporation (MSFT): Free Stock Analysis Report

NVIDIA Corporation (NVDA): Free Stock Analysis Report

Invesco QQQ (QQQ): ETF Research Reports

Facebook, Inc. (FB): Free Stock Analysis Report

PayPal Holdings, Inc. (PYPL): Free Stock Analysis Report

Vanguard Dividend Appreciation ETF (VIG): ETF Research Reports

Vanguard S&P 500 ETF (VOO): ETF Research Reports

iShares Core Dividend Growth ETF (DGRO): ETF Research Reports

iShares Core S&P Total U.S. Stock Market ETF (ITOT): ETF Research Reports

Palantir Technologies Inc. (PLTR): Free Stock Analysis Report

Invesco NASDAQ 100 ETF (QQQM): ETF Research Reports

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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