How to navigate the ETF market amid volatility and position yourself for long-term growth
ETF investing is under pressure. After a strong bull run driven by tech and growth stocks, signs of a potential correction are becoming more visible. If you're building long-term wealth through ETFs—or just starting your journey—this is the time to pay attention. In this article, we’ll break down current market signals, explore high-performing and undervalued ETFs, and share strategies to help you navigate turbulent times with confidence.
Why are ETFs falling?
Since mid-2024, warnings have been circulating that ETFs—particularly those concentrated in tech—might be overvalued. In early 2025, this concern appears to be playing out. A combination of geopolitical tension, valuation concerns, inflation trends, and speculative excess in markets like crypto are leading to increased volatility.
The S&P 500’s price-to-earnings (P/E) ratio has climbed near 30—double the historical average of 15. Adjusted for inflation (Shiller P/E), it's nearing levels seen before the dot-com crash. Meanwhile, the VanEck Semiconductor ETF (SMH), heavily weighted in Nvidia, has a P/E over 40. For long-term investors, this is a red flag.
It’s Not a Time to Panic—It’s a Time to Prepare
Markets move in cycles. No one can predict the exact top or bottom, but we can assess probabilities. When hype is high and valuations stretch far beyond fundamentals, a correction becomes more likely.
That’s why now is the time to:
- Rebalance your portfolio and take profits from overvalued ETFs
- Build up cash to buy during dips
- Focus on fundamentals—not just momentum
Key Strategy: Opportunistic ETF Investing
As a long-term investor, you don’t need to time the market perfectly. But you can prepare by identifying ETFs with strong fundamentals that are now entering more attractive price ranges.
Here are some ETF investing ideas for 2025:
1. Invesco QQQ ETF (QQQ) – Tech Titans on Sale?
The QQQ tracks the Nasdaq-100, home to giants like Apple, Microsoft, Nvidia, Meta, and Alphabet. It’s one of the best-performing ETFs of the past decade and incredibly efficient with a 0.2% expense ratio.
However, with a current P/E around 40, it’s expensive. The recent 7–8% drop in early 2025 may be just the beginning. Historically, QQQ has seen drawdowns of 30–40% during corrections. If this happens again, it could become a golden buying opportunity.
Strategy: Wait patiently. Build cash, and gradually increase exposure if QQQ dips further. Few active managers outperform QQQ over 10+ years.
2. KraneShares China Internet ETF (KWEB) – Contrarian Value Play
This ETF gives exposure to Chinese internet giants like Alibaba, Tencent, JD.com, and Baidu. After a brutal 2022, KWEB dropped as much as 80% from its highs. But many of these companies have bounced back, and their valuations remain low.
With a P/E well below U.S. tech peers, this ETF offers a kind of “cheap QQQ.” China still holds massive economic potential, especially in tech and infrastructure.
Strategy: Dollar-cost average during dips. Current allocation ~10%, with room to grow.
3. Global X MSCI Argentina ETF (ARGT) – Macro-Driven Growth
Argentina's market surged in 2024, with ARGT doubling at its peak. Holdings like MercadoLibre (MELI), Pampa Energia, and Grupo Financiero Galicia have seen explosive gains.
However, technical indicators now show a declining trend. Momentum is fading, and a pullback is likely.
Strategy: Monitor for a deeper correction. This is a speculative ETF with higher volatility—but also strong upside if macro reforms continue.
4. Global X Defense ETF – Geopolitical Hedge
Increased military spending across Europe and the U.S. has given defense-related ETFs strong upward momentum. The VanEck Defense ETF and Global X Defense ETF have benefited from rising global tension.
Despite a solid return on equity (~16%) and P/E around 21, these ETFs are less compelling for long-term investors who avoid defense-related industries.
Strategy: Momentum investors may consider short- to mid-term exposure. Long-term investors should weigh personal values.
5. Global X MSCI Greece ETF (GREK) – Slow & Steady Value
With a P/E under 8 and a price-to-book of 1, this ETF is among the few remaining true value plays in today’s market. Its focus is primarily on Greek financial institutions.
Strategy: Ideal for conservative investors looking to balance high-growth positions. Modest volatility, long-term potential.
6. Uranium ETFs (URA, URNM) – High-Risk, High-Reward Energy Play
ETFs focused on uranium mining and production have corrected sharply—down as much as 40%—after gaining attention in 2023–2024 due to energy demand from data centers and AI infrastructure.
Strategy: For speculative investors only. Small allocations (<5%) could pay off big, but risk is high.
Final Thoughts: Position Yourself, Don’t Predict
ETF investing isn’t about having a crystal ball. It’s about positioning yourself to take advantage of market cycles. In 2025, volatility may increase—but that creates opportunities.
Build your watchlist. Set price targets. Stay disciplined. Keep cash ready for strategic entries. Whether it’s buying QQQ after a dip, increasing KWEB exposure, or diversifying into value ETFs like GREK, the path to financial freedom through ETFs is still alive and well.
Free Resource: Download our free ETF investing guide with 3 ready-to-use ETF portfolios.
Let us know—what ETFs are you watching in 2025? Drop a comment on the video above and join the conversation.
