4 Heavily Trending ETFs on Reddit That Are Rated 'Strong Buy' in the POWR Ratings

The meme stock frenzy dominated the market this year, spelling gloom for several short-selling institutions. Well-known meme stocks GameStop Corp. (GME) and AMC Entertainment Holdings, Inc. (AMC) are up 683.9% and 1,055.7% in price, respectively, year-to-date, representing retail investors’ power.

According to a report by The Verge, there were more than 366 million posts on Reddit, 2.3 billion comments, and nearly 46 billion upvotes. While all the securities trending on the most popular meme platform, Reddit, do not possess fundamental strength, some are popular for valid business reasons.

Quality ETFs SPDR S&P 500 ETF Trust (SPY), Vanguard Index Funds - Vanguard Total Stock Market ETF (VTI), Vanguard S&P 500 ETF (VOO), and Invesco QQQ Trust (QQQ) are heavily trending on Reddit. Also, they have an overall A (Strong Buy) rating in our proprietary POWR Ratings system. So, it could be wise to bet on them now.

SPDR S&P 500 ETF Trust (SPY)

One of the largest and most heavily traded ETFs globally, SPY provides exposure to one of the most well-known equity benchmarks, the S&P 500. The fund includes large-cap U.S. stocks and has become extremely popular with active traders. It is ranked #1 on Reddit.

With $437.73 billion in assets under management (AUM), SPY’s top holdings include Apple Inc. (AAPL), with a 7.03% weighting in the fund, followed by Microsoft Corporation (MSFT) at 6.43%, and Amazon.com, Inc. (AMZN) at 3.74%. It currently has 507 holdings in total. Over the past month, the ETF’s net inflows were $9.07 billion. In addition, its 0.09% expense ratio compares favorably to the 0.37% category average.

SPY pays an $5.66 annual dividend, which yields 1.22% at the prevailing share price. Its four-year dividend yield stands at 1.69%. Its dividends have increased at a 4.1% CAGR over the past three years and 5.1% over the past five years. Over the past year, the fund has gained 27.1%.

It is no surprise that SPY has an overall A rating, which equates to Strong Buy in our proprietary POWR Rating system. In addition, it has an A grade for Trade and Buy & Hold and a B grade for Peer.

SPY is ranked #1 of 272 ETFs in the Large Cap Blend ETFs group. Click here to see all the SPY ratings.

Vanguard Index Funds - Vanguard Total Stock Market ETF (VTI)

VTI offers broad exposure to the U.S. equity market, investing in thousands of securities. In addition to its  vast base of holdings and balance of exposure, VTI is one of the cheapest products available in the market. It is ranked #42 on Reddit.

MSFT has a 5.24% weighting in the fund as its top holding, followed by AAPL at 4.95% and AMZN at 3.05%. VTI has $294.07 billion in AUM. It has 4086 holdings in total. Its net inflows came in at $5.71 billion over the past month. Its 0.03% expense ratio is lower than the 0.37% category average.

VTI pays a $2.85 dividend annually, yielding 1.21% at the current price. Its four-year average dividend yield stood at 1.66%. Its dividends have increased at a 3.7% CAGR over the past three years and 6.6% over the past five years. The fund has gained 24.2% over the past year.

VTI’s strong fundamentals are reflected in its POWR Ratings. It has an overall A rating, which translates to a Strong Buy in our proprietary rating system.

It has an A grade for Trade and Buy & Hold grade. Again, VTI is ranked #3 in the Large Cap Blend ETFs group. To see VTI’s rating for Peer grade, click here.

Vanguard S&P 500 ETF (VOO)

VOO tracks the S&P 500 Index, one of the most famous benchmarks globally and one that follows some of the largest U.S. companies. Given its focus on the growth and value stocks of large-cap companies, it is one of the safest ETFs in the equity world. It is ranked #31 on Reddit.

The fund has $272.30 billion in AUM. Its top holdings include MSFT with a 6.35% weighting, AAPL at 6%, and AMZN with 3.75%. In addition, it has 512 holdings in total. Its net inflows came in at $4.48 billion over the past three months. Its 0.03% expense ratio compares favorably to the 0.37% category average.

VOO pays an $5.29 annual dividend, which yields 1.24% at the prevailing share price. Its average four-year dividend yield stands at 1.75%. In addition, its dividends have increased at a 4.5% CAGR over the past three years. Over the past year, the fund has gained 27.2%.

VOO’s POWR Ratings reflect solid prospects. It has an overall A rating, equating to a Strong Buy in our proprietary rating system. In addition, it has an A for Trade and Buy & Hold grade and a B grade for Peer. VOO is ranked #4 in the Large Cap Blend ETFs group. Click here to see all VOO’s ratings.

Invesco QQQ Trust (QQQ)

QQQ offers exposure to one of the world’s most widely-followed equity benchmarks, the NASDAQ, and has become one of the most popular exchange-traded products. The fund invests in companies that operate across energy, real estate, health care, information technology, and utility sectors. It is ranked #11 on Reddit.

AAPL has a 12.48% weighting in the fund as its top holding, followed by MSFT at 10.95% and AMZN at 7.38%. QQQ has $209.90 billion in AUM. It has 103 total holdings. In addition, its net inflows were $2.07 billion over the past month. The fund’s 0.20% expense ratio is lower than the 0.37% category average.

QQQ pays a $1.77 dividend annually, yielding 0.46% at the current price. Its four-year average dividend yield stands at 0.69%. In addition, its dividends have increased at a 10.4% CAGR over the past three years. The fund has gained 27.7% over the past year.

QQQ’s strong fundamentals are reflected in its POWR ratings. It has an overall rating of A. It is also rated A for Trade, Buy & Hold, and a B for Peer grade. Click here to get all the QQQ ratings. It is ranked #1 of 58 ETFs in the Large Cap Growth ETFs group.

SPY shares were trading at $461.72 per share on Wednesday morning, down $1.64 (-0.35%). Year-to-date, SPY has gained 24.70%, versus a % rise in the benchmark S&P 500 index during the same period.

Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries.

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