How Many ETFs Should You Really Own? (European investor)

Jul 2, 2026

Read: ~6m · You save: 6 min

How Many ETFs Should You Really Own? (European investor)

Is 22 ETFs too many? Real case studies show how one, two, six, or even zero ETFs can be right, depending on your age, goals, taxes and country.

A friend recently asked the author to review his exchange-traded fund (ETF) portfolio. The author has 19 years of professional investment experience on Wall Street and in Europe. He states that he had never seen a portfolio like it. The friend held 22 ETFs, including active and passive funds, large-cap and small-cap funds, and several funds with overlapping regions and strategies. The author states that the portfolio appeared designed to maximize fees for the private banker who recommended it.

The author argues that most European investors do not need 22 ETFs. The appropriate number depends on the individual. The number of funds required depends on factors such as age, financial goals, risk tolerance, and tax situation. The author presents six case studies of students in his investing program, followed by his own portfolio.

Key Factors That Determine the Number of ETFs

The case studies show four main considerations:

Risk capacity: Whether the investor can afford to hold a high share of stocks through a severe market decline without selling.
Goals and time horizon: Whether the investor needs income, capital growth, or capital preservation, and over what period.
Control preferences: Whether the investor wants a single fund or prefers to build and manage a multi-fund allocation.
Tax situation: Local tax rules affect the choice of fund structure, distribution policy, and fund type.

Case Study 1: One ETF (Jose)

Profile: Jose is 30 years old, a software developer from Spain living in Berlin. He is single, financially ambitious, and starting to invest from zero.

Risk capacity: Jose is employed by a government agency with full unemployment protection and excellent health care. He also has family support. If the market fell 40% and stayed down for years, he would not need to sell his investments to cover living costs. The author states that this allows Jose to hold 100% of his portfolio in stocks.

Approach: Jose wants a simple, passive, buy-and-hold strategy. He holds one ETF.

Diversification: A single global ETF can be sufficiently diversified. Jose chose VWCE, the Vanguard FTSE All-World Accumulating ETF. It holds almost 4,000 stocks in developed and emerging markets. Problems at a single company or in a single region should not significantly affect the portfolio. The author also notes that ETF assets are held separately from the fund provider's assets. If Vanguard became insolvent, the investor's holdings would remain separate.

Distribution policy: Jose does not hold the accumulating version. Accumulating ETFs retain dividends received from stocks within the fund. Jose lives in Germany, where each year he can receive 1,000 euros of investment income tax-free. For this reason, he holds the distributing version of VWCE, which pays a portion of dividends each year.

Case Study 2: Two ETFs (Mary)

Profile: Mary is 55 years old and lives in Ireland. She spent three decades in a corporate job and has saved 300,000 euros. She plans to invest this capital and add to it over the next 10 years until retirement.

Strategy: Mary is cautious. She selected a 60/40 portfolio, with 60% in global stocks and 40% in high-quality bonds. The author states that this type of allocation can work both before and during retirement, and that bonds can protect the portfolio during difficult periods.

Options: Investors can buy a pre-packaged fund that combines stocks and bonds in a single product. Mary preferred more control, so she selected one stock ETF and one bond ETF.

Stock component: Mary prioritizes socially responsible investing. She selected a global stock fund from Xtrackers that screens stocks based on social responsibility criteria.

Bond component: Mary wanted a bond ETF to stabilize the portfolio. It needed to meet three criteria:

Hold investment-grade bonds, which carry low credit risk.
Denominate holdings in euros, which removes unnecessary currency risk.
Serve as a portfolio stabilizer.

Mary selected the iShares Core Euro Corporate Bond ETF.

Case Study 3: Zero ETFs in Stock Index Products (Olga)

Profile: Olga is 40 years old and owns a successful marketing agency. She is a risk-taker and is willing to invest 100% of her savings in stocks. She intends to invest in developed-world stocks.

Geopolitical concern: Olga is concerned about geopolitical tensions between America and Europe, which she associates with Donald Trump. She wants less exposure to the United States and more exposure to Europe. Her target is a home bias in which 30% of her portfolio is invested in Europe and the remainder is spread across global markets.

Allocation calculation: Using two stock funds achieves this most cleanly: a developed-world fund and a European fund. The global fund already includes European companies, so the European fund only needs to adjust the total. The author's training calculation shows that an 83% allocation to a developed-world fund and a 17% allocation to a European fund produces an overall European exposure of 30%.

Proposed ETFs:

83% in IEUNL, the iShares Core MSCI World ETF
17% in IEUNK, the iShares Core MSCI Europe ETF

Tax constraint: Olga is originally from Lithuania and now lives in Spain, where she plans to remain. Under a special Spanish rule, index mutual funds allow investors to move money between funds without paying capital gains tax. ETFs do not receive this treatment. Like many Spanish tax residents, Olga does not hold ETFs. She selected two index mutual funds instead, through the fund platform MyInvestor.

Case Study 4: Six ETFs (Charles)

Profile: Charles is 50 years old. He is a former entrepreneur who sold his companies and now holds about 11 million euros in investments. He is fully retired and pursues his hobbies.

Strategy: Charles uses a typical 60/40 retirement portfolio of stocks and bonds.

Custody structure: Charles divides his portfolio across three brokerages:

Interactive Brokers, Ireland
Saxo, Denmark
Julius Baer, Switzerland

Julius Baer is a private bank with high fees. Charles values its reputation for customer service and confidentiality.

Replication and provider diversification: At each brokerage, Charles holds the same 60/40 allocation. At each one, he buys ETFs from a different fund provider. This adds an additional layer of diversification. The stock portion includes VWCE, IUSQ, and SPYY. The bond portion includes three separate bond ETFs.

Rationale: The author states that six ETFs would be excessive for most beginning investors. Charles's approach is designed so that his portfolio is protected regardless of the outcome at any brokerage, fund provider, or individual fund. Charles works with an accountant and a tax adviser, which the author states makes the added complexity worthwhile.

Case Study 5: Four Components, Four to Five ETFs (Bruno)

Profile: Bruno is 35 years old and originally from Argentina. He lives in Switzerland and works in private equity. He enjoys research and takes a hands-on approach to his money.

Allocation:

Component	Share of Portfolio	Purpose
All-world stock fund	70%	Broad global diversification across large-, mid-, and small-cap companies
Gold ETF	10%	Diversification, as gold and stocks tend to move at different times
REIT ETF	10%	Exposure to real estate, which is large in the global economy but underrepresented in the stock market
Clean energy ETF	10%	Sector bet

Rationale for each component:

All-world fund: Most global ETFs hold only large- and mid-cap companies. Adding small caps provides additional diversification.
Gold: The author states that gold is expected to underperform stocks over the long term. In the short and intermediate term, however, small allocations can improve diversification.
REIT ETF: REITs invest in real estate investment trusts. Real estate is a major part of the global economy and is underrepresented in the stock market.
Clean energy: Bruno allocates 10% to a sector bet. The author states that sector bets generally do not work out well for most investors. Bruno believes in his ability to make good choices.

ETF count: Building this portfolio normally requires four to five ETFs. The number depends on whether one ETF can cover all company sizes or whether two funds are needed.

Domicile: Because Bruno lives in Switzerland, he can access US-domiciled ETFs as well as European ETFs. The funds he uses reflect this option.

The Author's Portfolio

The author's portfolio varies over time:

Temporary: On some days the portfolio may hold as many as 10 ETFs, including overlapping funds. This occurs because the author buys and sells funds in YouTube videos, webinars, and workshops that demonstrate these transactions for students.
Long-term: The core holding is a simple all-world portfolio covering large-, mid-, and small-cap stocks.
Structure: The author holds this portfolio across multiple brokerages in different countries to protect his family's wealth. At each brokerage, he often buys a different version of the same ETF from a different provider.
Count: The author holds five major ETFs.

Summary of Case Studies

Investor	Age	Location	Strategy	Number of ETFs or Funds
Jose	30	Germany (from Spain)	100% global stocks	1 ETF (distributing VWCE)
Mary	55	Ireland	60/40 stocks and bonds	2 ETFs
Olga	40	Spain (from Lithuania)	Developed world stocks with 30% European exposure	0 ETFs; 2 index mutual funds
Charles	50	Retired; three brokerages	60/40 stocks and bonds, split across three brokerages	6 ETFs
Bruno	35	Switzerland (from Argentina)	70% all-world, 10% gold, 10% REIT, 10% clean energy	4 to 5 ETFs
Author	n/a	Multiple countries	Long-term all-world portfolio	5 major ETFs (up to 10 at times)

Conclusion

The number of ETFs an investor needs depends on individual circumstances, not on a fixed rule. A single global ETF can provide broad diversification for an investor who can hold stocks through market declines. Investors with specific goals, tax constraints, or custody preferences may require several funds. The author states that he does not give individual investment recommendations. He presents the case studies to show how students applied a decision framework that considers each investor's age, goals, risk capacity, and tax situation.

Introduction: Why 22 ETFs Is Too Many

The presenter reviews a friend's portfolio of 22 ETFs, which he considers excessive and likely built to generate fees. He promises case studies showing how many ETFs different investors actually need.

A friend asked the presenter to review his portfolio of 22 different ETFs, including active and passive, large and small cap, with many overlapping regions and strategies.
The presenter has 19 years of professional investment experience on Wall Street and in Europe.
He says the portfolio appeared built to maximize fees for the private banker who recommended it.
The answer to how many ETFs are needed depends on the individual investor.

Case 1: Jose – One Global ETF

Jose, a 30-year-old software developer from Spain living in Berlin, uses a single global ETF because his stable employment lets him take maximum risk. He buys the distributing version of VWCE for tax reasons.

Jose is 30, a software developer from Spain now living in Berlin, single, and starting to invest from zero.
He works for a government agency with full unemployment protection, excellent health care and a supportive family, so he has a high risk tolerance.
He puts 100% of his portfolio into stocks and wants a simple, passive, set-it-and-forget-it approach.
He chooses VWCE, the Vanguard FTSE All-World Accumulating ETF, which invests in almost 4,000 stocks in developed and emerging markets.
The presenter says the ETF structure keeps fund assets held separately, so they stay safe even if the provider Vanguard went bankrupt.
Germany gives a 1,000 euro tax-free allowance for investment income, so Jose buys the distributing version to receive some dividends each year.

Case 2: Mary – Two ETFs (60/40)

Mary, 55 and living in Ireland, runs a 60/40 stock-bond portfolio with two ETFs for control. She picks a socially responsible global stock ETF and a euro-denominated investment-grade corporate bond ETF.

Mary is 55, lives in Ireland, and has saved about 300,000 euros over three decades at a corporate job.
She plans to invest and add to her savings over the next 10 years until retirement.
She is cautious and chooses a 60/40 portfolio: 60% global stocks and 40% high-quality bonds.
The presenter notes that pre-packaged mixes exist, but Mary wants more control, so she uses one stock ETF and one bond ETF.
On the stock side she chooses an Xtrackers global stock fund that filters for social responsibility characteristics.
On the bond side she chooses the iShares Core Euro Corporate Bond ETF, which holds investment-grade bonds with low credit risk and is denominated in euros to avoid currency risk.

Case 3: Olga – Zero ETFs (Index Mutual Funds in Spain)

Olga, 40, owns a marketing agency and wants a home bias toward Europe. Because she lives in Spain, where index mutual funds can be switched without capital gains tax and ETFs cannot, she uses zero ETFs and buys index mutual funds on MyInvestor.

Olga is 40, owns a successful marketing agency, and is willing to put 100% of her savings into stocks.
She is concerned about geopolitical tensions between America and Europe and wants a home bias with about 30% in Europe.
The presenter describes a plan of 83% in a developed world fund and 17% in a European fund, using IEUNL (iShares Core MSCI World) and IEUNK (iShares Core MSCI Europe).
Olga is originally from Lithuania but lives in Spain and plans to stay there.
Spanish rules let index mutual funds be switched between funds without capital gains tax, which does not apply to ETFs.
Olga therefore avoids ETFs and chooses two index mutual funds on the MyInvestor platform, making zero ETFs the right answer for her.

Case 4: Charles – Six ETFs Across Three Brokerages

Charles, 50 and fully retired with about 11 million euros, runs a 60/40 portfolio split across three brokerages with six ETFs. The layered setup adds protection against broker or provider failure.

Charles is a former entrepreneur, 50 years old, fully retired, with about 11 million euros invested.
He uses a typical 60/40 stock-bond retirement portfolio.
He splits his assets among Interactive Brokers in Ireland, Saxo in Denmark, and Julius Baer in Switzerland.
Julius Baer is a private bank and is expensive, but Charles values its reputation for customer service and confidentiality.
He reproduces the same 60/40 structure at each brokerage, buying from a different fund provider each time for extra diversification.
Stock ETFs include VWCE, IUSQ, and SPYY; bond ETFs are three funds the presenter mentions, bringing the total to six.
Charles works with a good accountant and tax adviser, which makes the added complexity worthwhile for him.

Case 5: Bruno – Four Components with Sector Bets

Bruno, 35, works in private equity, lives in Switzerland, and holds four components: a global all-cap fund, gold, a REIT ETF, and a clean energy sector ETF. He uses US-domiciled ETFs as well as European ones.

Bruno is 35, from Argentina, lives in Switzerland, and works in private equity.
He takes a hands-on approach and wants to be maximally diversified.
70% goes into an all-world fund tracking large, mid, and small cap companies, adding small caps that most global ETFs exclude.
10% goes into a gold ETF, since gold can diversify a portfolio in the short to intermediate term even though it is expected to underperform stocks long term.
10% goes into a REIT ETF to represent real estate, which is large in the global economy but underrepresented in the stock market.
10% goes into a clean energy ETF as a deliberate sector bet, which he accepts is risky for most people.
Building this would normally take four to five ETFs; because Bruno lives in Switzerland he can use US-domiciled ETFs as well as European ones.

The Presenter's Own Portfolio

The presenter's own portfolio is a simple all-world, multi-cap, long-term holding spread across several brokerages and countries, and at times it looks cluttered because of his teaching work.

The presenter's ETF count varies: at some points he may have as many as 10 ETFs, which can look like overlapping funds.
The clutter comes from YouTube videos, webinars and workshops where he demonstrates buying and selling funds for students.
Long term, he holds a simple all-world portfolio covering large, mid, and small-cap stocks.
He holds this across multiple brokerages in different countries to protect his family's wealth.
At each brokerage he often buys a different version of the same ETF from a different provider.
He has five major ETFs in his own portfolio.