2 ETFs I'd Buy in Response to Goldman's 2026 Investment Forecast

Core Insights - Goldman Sachs forecasts a modest annual return of 6.5% for the S&P 500 over the next decade, prompting a consideration for a more active investment approach rather than a passive one [1] - Despite a long-term muted return outlook, Goldman Sachs anticipates 2026 to be a strong year for American stocks, projecting a target of 7,600 for the S&P 500, with potential for an 11% gain in the year [3] Investment Strategies - Investors are encouraged to explore opportunities outside the U.S. market and consider mid- and small-cap stocks for better returns [2] - The iShares Core S&P Small-Cap ETF is highlighted as a valuable option for gaining exposure to small-cap stocks, especially as the Fed lowers interest rates and M&A activity increases [5][6] - The Vanguard FTSE Developed Markets Index Fund ETF outperformed the S&P 500 with nearly 31% gains last year, suggesting international markets may offer attractive investment opportunities despite potential challenges in maintaining such performance [7][8] Valuation Considerations - The Vanguard FTSE Developed Markets Index Fund ETF has a trailing price-to-earnings (P/E) ratio of 17.1, which is appealing for value investors compared to the higher P/E ratios associated with the S&P 500 [9]