Exchange-traded funds (ETFs) remain an attractive investment option for portfolio diversification in the new year, offering exposure to diverse asset classes and sectors, suitable for all investor experience levels. Several ETFs show strong potential for returns and risk mitigation in January 2025.

A leading choice this month is the Vanguard Total Stock Market ETF (NYSEARCA:VTI). This ETF provides broad U.S. equity market coverage across all market capitalizations. Its low fees and diversification make it a core portfolio asset.

The iShares MSCI Emerging Markets ETF (NYSEARCA:EEM) is another noteworthy ETF. Capitalizing on the rapid growth of emerging markets, it offers exposure to companies in countries like China, India, and Brazil, appealing to investors seeking high-growth potential with geographical diversification.

For income-focused investors, the Schwab U.S. Dividend Equity ETF (NYSEARCA:SCHD) is a strong contender. SCHD concentrates on high-quality U.S. companies with a consistent dividend history, making it suitable for investors prioritizing steady income streams alongside capital growth.

In short, January 2025 offers promising ETF investment opportunities. The Vanguard Total Stock Market ETF offers broad U.S. market access, the iShares MSCI Emerging Markets ETF provides access to thriving international markets, and the Schwab U.S. Dividend Equity ETF caters to income-seeking investors. These ETFs can enhance portfolio diversification and boost potential returns.

Footnotes:

• The Vanguard Total Stock Market ETF offers exposure to the entire U.S. equity market.
• The iShares MSCI Emerging Markets ETF provides access to companies in rapidly growing economies.
• The Schwab U.S. Dividend Equity ETF focuses on high-quality companies with a proven record of dividend payments.