A portfolio that survives every crash consists of a few building blocks that move differently. How to weight stocks, bonds, gold and cash, which split fits which age and how often to rebalance.
In short
- The split between risky and safe decides more than 90 percent of the result, not the fund selection.
- Rule of thumb: equity share equals 100 minus age, adjusted for nerves and horizon.
- Building blocks: world ETF, savings account or short bonds, five to ten percent gold, optionally property.
- Return to the target allocation once a year, not at every price swing.
What diversification means
Not all eggs in one basket: whoever puts everything in one share depends on one company; whoever puts everything in German shares depends on one country; whoever puts everything in shares depends on one asset class. Spreading lowers risk without lowering expected return, because the building blocks do not move at the same time. In 2022 stocks and bonds fell together, gold held. In 2008 stocks fell, government bonds rose. Nobody knows what holds next time, so you hold everything.
The one decision
Studies show that the split between the risky part (stocks, property, gold) and the safe part (savings account, fixed-term deposit, short-dated bonds of top quality) explains around 90 percent of volatility and result. Which ETF you pick is secondary. The rule of thumb of 100 minus age gives a 35-year-old 65 percent stocks. Whoever cannot stand a 50 percent crash takes less; whoever has 30 years and does not look takes more.
The building blocks
Risky: a world ETF on the MSCI World or FTSE All-World, optionally with emerging markets and small caps. That is 1,500 to 4,000 companies from 20 to 50 countries. Nobody needs more equity funds. Safe: savings account, fixed-term ladder or an ETF on short-dated euro government bonds. Gold: five to ten percent as a stabiliser, physical or as an ETC. Property: the home you live in does not count as an investment; a let flat is a lump you should choose consciously.
What does not belong in
Individual shares as the core, sector and theme ETFs, active funds with two percent fees, certificates, closed funds, cryptocurrencies above five percent, foreign currency accounts, life insurance with a capital component. All of it may exist as an addition if you understand it, but it does not make the portfolio safer.
Rebalancing
After a good equity year the share sits at 72 instead of 65 percent. Once a year, on a fixed date, you sell the surplus and top up the safe part, or you direct new contributions there. That forces you to sell dear and buy cheap. More frequent shuffling costs tax and fees and brings nothing.
An example
€100,000, 40 years old, medium risk appetite: €60,000 world ETF, €30,000 savings and fixed-term accounts, €8,000 gold, €2,000 play money for individual shares or crypto. Expected long-term return around 5 percent after inflation, largest expected drawdown around 30 percent. Whoever finds that boring has understood the goal.
Frequently asked questions
Is a single ETF enough?
For the equity part, yes. An FTSE All-World contains developed and emerging markets. Together with a savings account that is a complete portfolio.
How many ETFs are too many?
More than four or five. Whoever holds ten ETFs usually owns the same companies several times and has lost the overview.
Should I buy bonds?
For the safe part, savings and fixed-term accounts are just as good in 2026 and simpler. Long-dated bond ETFs swing strongly and do not belong in the safe part.
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