7 Promising ETFs Under $20

Most investors want to put their money in equities but may not be able to afford large stakes in valuable companies with higher-priced stocks. For them, low-priced stocks could be attractive as these will enable them to buy more shares instead of just a handful of higher-priced shares for the same amount. For example, an investor willing to spend $10,000 can either purchase at least 500 shares of a stock trading under $20 or only 100 shares of a stock trading at $100.

Additionally, stocks under $20 reap huge profits as an increase of as less as a dollar in share price adds 5% to the portfolio. This is in contrast to stocks priced at $100 or above, which see 1% or lower gains if shares move up by $1. Further, most of the low-priced stocks have high levels of liquidity, which give these stocks an added advantage. This means that cash can be converted quickly and investors could easily get their money out of the securities. In fact, trading in higher average daily volumes keeps the bid/ask spread tight and does not lead to extra cost for investors.

And guess what, market volatility has provided investors a great opportunity to tap some of these stocks from a long list. The preference is not only limited to the stock world but can be felt in the ETF space as well. In fact, there are only a handful of ETFs that currently trade below $20 out of nearly 2,000 funds, suggesting that choices are pretty worthy for investors who like to get a decent number of shares from their investment.

So, let us dig into some of the ETFs that are below $20, and have AUM of over $50 million and average daily volume of at least 50,000 shares. These low-priced ETFs could lead to huge gains in the coming months.

ETFMG Prime Junior Silver ETF (SILJ - Free Report) – Last Closing Price: $8.88

The product provides direct exposure to the silver mining exploration and production industry by tracking the Prime Junior Silver Miners & Explorers Index. Holding 30 stocks in its basket, the fund is heavily concentrated on the top four firms that make up for double-digit allocation each. Canadian firms take the largest share at 48%, while the United States and Mexico take 21% and 15% share, respectively. The fund has managed assets worth $51.1 million and trades in solid volume of around 56,000 shares a day. It charges 69 bps in annual fees.

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