Market Milestones: The Ultimate ETFs for 2025

We’re just three weeks away from the end of 2024, and what a year it’s been! The market has soared to record-breaking highs, with many of the top stocks smashing all-time highs daily. Fundamentals, valuations, and caution seem to have been thrown to the wind as this bull market rages on. With 2025 almost upon us—and shaping up to be another strong year, at least in the first half—we’ve compiled a list of ETFs to watch for the coming year.

MAGS: Magnificent Seven ETF
It’s no secret that the Magnificent Seven—Apple, Nvidia, Microsoft, Amazon, Google, Meta, and Tesla—have been powering the market higher for years now. MAGS, which holds an equal weighting of these stocks, has been a top performer, and is up about 75% in 2024.

As AI investments accelerate and dominate the tech landscape, these names are primed to keep climbing into 2025 and beyond. MAGS, with its 0.29% expense ratio, mid-double-digit price, and monthly options, offers a straightforward and cost-effective way to gain exposure to this marvelous—nay, magnificent—group of companies.

On a pullback to $50–$45, near the daily long-term moving averages, MAGS could present a strong opportunity for another 30% move higher. As long as it holds above $42, there’s no need to worry about a larger correction. However, if it breaks below $42, volatility could spike, and protective puts would likely be needed.

TOPT: Top 20 U.S. Stocks ETF
If MAGS feels too concentrated, TOPT might be worth considering. This ETF, launched by BlackRock, includes the top 20 U.S. companies by market cap. While it is market cap weighted and therefore still heavily weights giants like Apple, Nvidia, and Microsoft, it also offers exposure to diversified names such as JPMorgan, Eli Lilly, Visa, ExxonMobil, Costco, and Home Depot.

TOPT may offer slightly more resilience during market pullbacks compared to MAGS, thanks to its broader holdings. On a pullback, this ETF could be an excellent trade for 2025 as it balances high-growth tech with more stable blue-chip stocks. 

SMH: Semiconductor ETF
As big tech pours more capital into AI, the semiconductor sector is poised to continue booming. Some of the biggest winners in 2025 are likely to come from this space, with Nvidia standing out once again. Nvidia has been a top performer for the past two years, and a three-peat performance doesn’t seem out of the question. SMH offers broad exposure to the semiconductor sector, featuring 26 holdings. Nvidia leads the pack with a 22.6% weighting, followed by Taiwan Semiconductor at 13.4% and Broadcom at 8.3%.

If SMH revisits the $200 region, it could present an excellent buying opportunity heading into 2025. However, with fundamental strength driven by Nvidia, Broadcom, and the sector overall, a breakout from the current triangle formation might be more likely. In that case, a move to $270 could be the next overhead target as we enter the new year.

IBIT: Bitcoin ETF
Of course I can’t go a full newsletter these days without mentioning Bitcoin! IBIT has become the most successful ETF launch in history, devouring record-breaking inflows throughout 2024. All signs point to another strong year for Bitcoin in 2025, and IBIT is positioned to further boost Bitcoins momentum and capitalize on its gains.

The ETF’s options are excellent for option sellers since it’s such a volatile asset, which adds to its appeal. It’s not the premium beast that MSTR is, but don’t let me get off on that tangent. If Bitcoin retests the $85,000 region, that could offer a fantastic risk/reward setup for a run to $120,000–$140,000. A retest of $85,000 in Bitcoin would correspond to IBIT revisiting about $48. Of course, Bitcoin might leave everyone in the dust and keep climbing higher—so avoid FOMO and keep position sizes small when adding on breakouts.

ETHA: Ethereum ETF
If crypto has a bullish 2025, or at least a strong first half, ETHA should perform well. Historically, Ethereum tends to outperform Bitcoin later in bull market cycles, and this cycle may follow the same pattern. While Bitcoin is already 45% above its all-time high, Ethereum is still 25% below its peak, leaving significant room for upside if it wants to catch up. A 30%-40% move from current levels seems reasonable, and the risk/reward becomes even more attractive if ETH dips slightly lower.

If ETHUSD pulls back to the $3,400–$3,000 range, the risk/reward setup for 2025 would be excellent. That said, the chances of another low before the next leg higher appear to be diminishing.

Keep these ETFs on your radar as we enter 2025. With the market’s bullish momentum likely continuing into the new year after some kind of pullback, these picks could make for some exciting trades.