How to build an ETF investment strategy—because you’ll need one when markets get wild, says advisor

Let’s talk ETFs—the investing world’s favorite starter pack. They’re cheap, flexible, and ridiculously popular. In fact, ETF assets crossed $13.74 trillion as of June 2025, according to Hightower Advisors. That’s up from $10 trillion just seven months earlier. If you're new to investing, this is probably where your money’s headed first. And that’s not a bad thing.

But here’s the catch: just because ETFs are easy to buy doesn’t mean they’re easy to get right.

Think of it like this. ETFs are like grocery store sushi. Convenient. Accessible. Feels smart. But eat it carelessly, and yeah—you could regret it. You still need some rules, some guardrails, and at least a bit of common sense. Otherwise, your portfolio ends up a mess of impulse buys and market hype. So if you’re buying ETFs just because your app made it one tap away, slow down. Let’s go through what actually matters.

An exchange-traded fund, or ETF, is basically a basket of stocks or bonds that tracks something bigger—like the S&P 500, tech stocks, or even clean energy companies. It’s similar to a mutual fund but way more flexible. The key difference? ETFs can be traded throughout the day, just like a stock. You don’t need to wait until the market closes to buy or sell.

That intraday flexibility makes ETFs feel modern, agile, and totally Gen Z–friendly. And they usually come with lower fees and better tax treatment compared to old-school mutual funds. What’s not to love?

Certified financial planner Gloria Garcia Cisneros puts it simply: “The best thing about the ETF is that it’s not like old school mutual funds.” Which makes sense—no load fees, no early redemption penalties, no waiting games. Just a clean, low-cost way to get exposure to a broad market or sector.

But again, that convenience can be dangerous if you’re not intentional. It’s like giving a teenager a sports car because it has a good fuel economy. Without a strategy, you’re still asking for chaos.

Let’s start with one of the biggest traps: trying to “buy the dip” or time your ETF purchases based on market news or vibes. It doesn’t work.

You might think buying ETFs when prices drop is smart. But unless you’re running full-time models and watching every economic signal like a hawk, chances are you’re just guessing. And even the pros don’t get it right all the time.

Lee Baker, a certified financial planner and president of Claris Financial Advisors, says it best: you need a plan that holds up “when things inevitably get a little crazy.” Because they always do. News breaks. Rates change. Markets drop for no reason. Without a strategy, your moves become reactive—and expensive.

There’s also the issue of trading at the wrong time of day. Most volatility happens right after markets open and right before they close. That’s when pricing spreads widen, algorithms battle it out, and things move fast. Baker recommends aiming for calmer hours—say, 10 a.m. to 2 p.m. Eastern Time. Prices tend to be more stable and you’re less likely to get caught in a wave of panic or hype.

But honestly, even choosing the time of day is less important than choosing not to chase the market at all. A recent study by Charles Schwab compared five fictional investor strategies, including one where the person timed the market perfectly. Surprisingly, that “perfect timer” didn’t do much better than the one who just invested consistently on a schedule—no timing, no guesswork.

That’s why dollar-cost averaging works. You invest a fixed amount at regular intervals, whether the market’s up or down. It smooths out the highs and lows, keeps your emotions in check, and helps you stay invested over time. Which, spoiler alert, is what actually builds wealth.

Now let’s talk about how you actually place your order. When you hit “buy” on an ETF, you’re probably placing what’s called a market order. That means the trade executes right away at the best available price. Sounds efficient, right? Not always.

If that ETF is moving fast—or if there’s a lot of volatility in the market—you could end up buying at a price that’s higher than expected. And if you're buying multiple shares, that difference matters. You’re basically telling the market, “Whatever it costs, I’ll take it.” Not the vibe.

A better way? Limit orders. A limit order lets you say, “I only want to buy this ETF if it drops to $50 or lower.” You’re setting a ceiling on what you’re willing to pay. It gives you more control, especially in markets that feel unpredictable.

Baker says limit orders are especially useful when buying multiple shares of a volatile ETF. They help cap your risk during wild swings. It’s like having price protection built in. But there’s a tradeoff. The price you set might not get hit—and the order might not execute at all. So if you’re being too picky, you could end up sitting on the sidelines while the market moves on.

Garcia Cisneros compares it to shopping for a bag that never goes on sale. “You might be waiting forever,” she says. “I would hate to see if they wait forever and don’t actually put any money to work.”

Bottom line: use limit orders when you care about price control. Use market orders when the ETF is super liquid and your timing is long-term anyway. Just don’t blindly click whatever your app defaults to.

A lot of people hesitate to start investing in ETFs because they feel like they’ve “missed the moment.” Maybe the S&P has already rallied. Maybe rates are about to drop and you’re unsure. Maybe TikTok says there’s a crash coming.

Here’s the truth: none of that matters as much as your timeline.

If you’re investing for the next 10, 20, or 30 years, short-term volatility is noise. Trying to time entries based on vibes or macro forecasts just distracts you from the main goal: putting money to work in a diversified, cost-efficient way.

ETFs are great for that. But they’re still tools—not shortcuts. You can build long-term wealth with ETFs. But only if you use them with intention. Set up a recurring investment schedule. Understand what your ETF holds. Use limit orders when things feel chaotic. And maybe chill on checking your app every five minutes. Because here’s what most investing apps don’t tell you: Compounding doesn’t care about perfect timing. It rewards consistency.

The most powerful ETF strategies aren’t flashy. They’re boring. And that’s exactly why they work. Pick a solid index ETF. Invest regularly. Automate what you can. Use smart order types when needed. Don’t check the news every hour. Don’t try to beat the system. Just stay in the game.

ETF investing isn’t about finding the hottest fund or catching the perfect dip. It’s about showing up, staying steady, and letting time do its thing. Because the real flex? Not how much you traded. It’s how long you stayed invested.

ETFs make investing easier—but they don’t make you smarter by default. That part’s still on you. Build your habits, not your hype. And remember: even the cleanest-looking investing app can’t protect you from poor decisions. But a plan can. So get one. And maybe don’t buy ETFs while you’re half-asleep on a Sunday night scroll. You deserve better than accidental wealth management.