An intelligent portfolio, designed for optimal performance

Built on Nobel Prize-winning research.

The Betterment portfolio is a globally diversified mix of stock and bond index funds, chosen to help provide optimal returns at every level of risk. Read more about our selection methodology.

Smarter than your average portfolio.

  • Lower Costs

    Higher expected take-home returns over time with expense ratios well below the industry average.

  • Tax-Efficient

    Automatically get the benefits of features like Tax Loss Harvesting, once only available to the wealthiest investors.

  • Better Investment Selection

    As an independent financial advisor, we are not compensated to recommend specific investments.

Benefit from broad diversification in proven asset classes.

When you deposit money, we'll seamlessly and instantly invest every dollar in thousands of companies. See a complete list of these stock ETFs and bond ETFs.


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US Total Stock Market

US Total Stock Market contains broad exposure to the historically strong long-term growth of the US economy.

US Large-Cap Value Stocks

US Large-Cap Value stocks overlap with the US Total Stock Market, but are included to tilt the portfolio toward large size companies with low price-to-earnings ratios.

US Mid-Cap Value Stocks

US Mid-Cap Value stocks overlap with the US Total Stock Market, but are included to tilt the portfolio towards medium size companies with low price-to-earnings ratios.

US Small-Cap Value Stocks

US Small-Cap Value stocks overlap with the US Total Stock Market, but are included to tilt the portfolio towards small size companies with low price-to-earnings ratios.

International Developed Stocks

Developed Markets stocks provide exposure to a diverse set of companies from international developed economies including the UK, Europe, Japan, and others.

Emerging Market Stocks

Emerging Markets provide higher return potential and diversification, however it comes with higher risk compared to US or International Developed stocks.


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Short-Term Treasuries

This extremely low-risk asset class is a cash alternative that generates nominal benefit through interest payments, and de-risks the portfolio at safer allocations.

Inflation Protected Bonds

This allocation serves to insulate a part of the portfolio from the depreciating effects of inflation while also having historically low correlation with other asset classes.

US High Quality or Municipal Bonds

For fixed income with slightly higher risk and returns than US Treasuries, taxable accounts use Municipals and IRA and 401(k) accounts use US High Quality bonds.

US Corporate Bonds

Corporate bonds generally offer attractive yields and opportunity for capital appreciation to compensate investors for default risk.

International Bonds

International Bonds have high credit quality and provide interest rate diversification for a bond portfolio, resulting in higher risk-adjusted returns.

Emerging Markets Bonds

Emerging Markets Bonds are dollar-denominated bonds issued by governments with economies that are rapidly growing and industrializing.

An optimal allocation tailored to you.

With Betterment, choosing the right portfolio is easy, no matter your level of experience. We'll recommend an allocation for each of your goals, to help you reach them faster.

Historically better results.

We don't try to beat the market, but by lowering costs and minimizing taxes, we optimize your portfolio for the best-expected investor returns possible. Betterment would have outperformed the average private client investor in almost all periods over the last decade.

Global diversification, maximum efficiency.

Betterment portfolios benefit from growth in developed and emerging markets, meaning you're less exposed to the economy of any one country. Read more.

Frequently Asked Questions

  • What is an ETF?

    An exchange-traded fund (ETF) is a security that tracks an index, a commodity or a basket of assets just like an index fund, but trades like a stock on an exchange. Betterment uses ETFs in both our stock and bond portfolios because of the liquidity, diversification, and low management fees they offer. Read more.

  • Will my Betterment portfolio beat the market?

    Betterment is a strong believer in passive investing. The majority of the evidence shows that active management, whether by individual investors or fund managers, can cause more harm than good in net-of-fee returns. We therefore invest in low-cost, passive investments which seek to match the market's performance. Read more.

  • Will a taxable portfolio be different from a non-taxable portfolio?

    Yes—We distinguish between taxable and retirement accounts when allocating bonds for additional optimization. Taxable accounts generally hold federally tax-exempt municipal bonds, providing portfolios more favorable after-tax return. Tax advantaged retirement accounts generally maintain exposure to U.S. investment-grade bonds.

  • Will my Betterment portfolio be globally diversified?

    Yes—By using the world's markets as its baseline, the Betterment portfolio diversifies risk on a number of levels including currency, interest rates, credit risk, monetary policy, and economic growth country by country. As economic circumstances may drag down one nation, global diversification helps decrease the risk that one geographic area alone will drag down your portfolio. Read more.

  • Can my Betterment portfolio decrease in value?

    Yes—Far from unusual, downturns are a normal part of even the highest returning investments. Investors often worry and react with panic in response to market drops, even if they are invested properly for their long-term goals, but interim losses are to be expected even during the best investment periods. Read more.

  • Where can I learn more about the Betterment portfolio and investing strategy?

    You can read more about the Betterment portfolio, investment strategy, ETFs, taxes and more at our Resource Center.

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