If you’ve spent more than ten minutes reading about investing online, you’ve probably seen two opposite camps shouting at each other.
On one side:
“Just buy one ETF and forget about it.”
On the other:
“You need multiple ETFs to be properly diversified.”
Both sides sound very sure of themselves. And as usual in investing, the truth is a bit less dramatic — and far more practical.
So let’s answer the real question: do you actually need more than one ETF to build a solid long-term portfolio?
The Case for a Single ETF
Let’s start with the option that makes finance influencers nervous: keeping things simple.
Simplicity Beats Complexity (Most of the Time)
A single, well-chosen ETF can already give you exposure to thousands of companies across multiple countries and sectors. That’s not “lazy investing”. That’s efficiency.
One ETF means:
- One position to track
- One contribution decision
- One rebalancing question (or none at all)
Less friction. Less second-guessing. Fewer chances to overthink a perfectly good plan.
And yes, overthinking is one of the most expensive habits in investing.
Lower Costs, Fewer Mistakes
Every extra ETF adds:
- Another expense ratio
- Another decision point
- Another temptation to “optimize” something that didn’t need fixing
For long-term investors, costs compound quietly — just like returns. Keeping things simple often means keeping more of your money working for you.
Who Is One ETF Actually For?
A single ETF approach makes sense if:
- You’re starting out
- You want a hands-off strategy
- You invest consistently over time
- You value peace of mind over financial gymnastics
If that sounds boring… good. Boring is underrated in investing.
If you want to understand this approach better, start with the basics in our ETF Investing section and see how it fits into long-term Portfolio Building.
The Case for Multiple ETFs
Now let’s talk about when more than one ETF actually makes sense — because sometimes, it does.
Customization and Control
Multiple ETFs allow you to:
- Separate equities and bonds
- Adjust geographic exposure
- Tilt toward specific factors or regions
This is useful if you know why you’re doing it.
That last part matters more than most people think.
Risk Management (Done Properly)
Adding a bond ETF, for example, isn’t about chasing returns. It’s about smoothing volatility and staying invested when markets get uncomfortable — which they eventually will.
Multiple ETFs can help you build a more resilient portfolio, as long as each ETF has a clear role.
The Hidden Trap: Overlap and Overconfidence
Here’s where many investors go wrong.
They add ETFs that:
- Hold the same underlying stocks
- Don’t materially change risk or return
- Exist mainly because “more ETFs feels smarter”
It isn’t.
More ETFs don’t automatically mean more diversification. Sometimes they just mean more complexity with no real benefit.
One ETF vs Multiple ETFs: The Real Answer
There is no universal winner. But there is a winning mindset.
- One ETF works exceptionally well for most long-term investors
- Multiple ETFs work well when used intentionally
- Complexity without purpose is a liability, not a strategy
If your portfolio requires a spreadsheet to understand, that’s usually a warning sign.
A Simple Decision Framework
Use this as a practical guide:
| Your Goal | Strategy |
|---|---|
| Maximum simplicity, minimal effort | 1 broad ETF |
| Slight customization and risk control | 2–3 ETFs |
| Advanced allocation with discipline | Multiple ETFs (with a plan) |
Notice what’s missing?
There’s no prize for owning “the perfect number” of ETFs.
Final Thoughts
Investing isn’t about proving how sophisticated you are. It’s about building a system you can stick with — through boredom, volatility, and the occasional market panic.
If one ETF helps you stay consistent, that’s a win.
If multiple ETFs help you manage risk and sleep better at night, that’s also a win.
Just don’t confuse complexity with progress.
This article is for educational purposes only and does not constitute financial advice.
