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How many ETFs should an individual hold? And how do we know the overlap between ETFs?
Investing strategy
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Lalita Channgoo
Asked on 16 January 2024
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Great question Lolita, one that has been asked by many (maybe all) of us!
How many ETFs is enough… It’s a personal question and there is no right or wrong answer, it really comes down to balancing what you want to get exposure to, then checking you’re not complicating things buying the same companies across multiple ETFs.
It’s a common one, so we have some great resources that can help! I’ve linked some things below, hope this helps.
How many is too many… https://pearler.com/explore/learn/blog/how-ma...
A past Exchange thread on this very topic… https://pearler.com/explore/ask/exchange/how-...
How to choose… https://pearler.com/explore/learn/blog/how-to...
Our compare tool can be used to look at ETFs side by side https://pearler.com/explore/invest/au-shares/...
Ultimately though, you can just click through our invest page and you’ll quickly see which ETFs cover similar indexes (have similar companies. For example, in our top 10, VAS and A200 both cover ASX large companies, then VGS, IVV, VTS all cover large international companies, and finally ETHI, VESG are international ESG ETFs and may exclude similar companies. And a simple google of each etf + “factsheet” will take you to each fund’s summary sheet and there you can browse the top holdings, for many of the ETFs mentioned above, you’ll see the same companies in the top holdings, respectively.
This is a topic that has caused many an investor to spend lots of time searching for the right answer, one approach is to start with the one you most want to invest in, then add additional ones that give you something different as you
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