Best ETFs for a 3-Fund Portfolio

The Bogleheads 3-Fund Portfolio is a simple investment strategy using three ETFs to capture the entire global stock and bond markets, offering diversification, low costs, and easy rebalancing.

It was popularized by the Bogleheads community, followers of Vanguard founder John Bogle.

1) US Total Stock Market, 2) International Stock Market, 3) US Total Bond Market.

The top pick is VTI (Vanguard Total Stock Market ETF).

VTI covers the entire U.S. equity market, including small-, mid-, and large-cap stocks.

VTI is priced at approximately $323.76.

VTI has a very low expense ratio of 0.03%.

VTI offers a yield of around 1.32%.

It provides the broadest U.S. stock diversification in a single ETF.

The runner-up is VXUS (Vanguard Total International Stock ETF).

VXUS invests in developed and emerging markets outside the U.S., covering over 8,500 stocks across 49 countries.

VXUS is priced at approximately $77.48.

VXUS has an expense ratio of 0.07%.

VXUS offers a yield of approximately 2.95%.

The bond component is BND (Vanguard Total Bond Market ETF).

BND provides broad exposure to U.S. investment-grade bonds, including government, corporate, and mortgage-backed securities.

BND is priced at approximately $73.58.

BND has a very low expense ratio of 0.03%.

BND offers a yield of about 4.25%.

It requires minimal rebalancing and uses broad market ETFs, reducing costs and complexity.

All three ETFs are managed by Vanguard.

VTI provides U.S. equity exposure, VXUS provides international equity exposure, and BND adds stability and income through bonds.

Yes, its simplicity, diversification, and low costs make it ideal for beginner investors.

By combining U.S. stocks, international stocks, and U.S. bonds, it captures almost the entire global financial market.

It offers medium overall risk, with stocks providing growth and bonds providing stability and income.