Building an investment portfolio is a personal experience: What suits one investor may be ill-fitting for another. Factors such as risk tolerance and time horizon influence how an investor constructs a portfolio, as do things like the amount of money involved, the types of financial accounts at hand, and the investor’s level of experience and interest.
Yet, most investors would probably agree that they own certain funds they’d call “core” holdings: Those mutual funds or exchange-traded funds they expect to do most of the heavy lifting when it comes to reaching their goals.
But what types of mutual funds and ETFs are good “core” funds?
The answer depends, in part, on your time horizon. For goals less than a year away, cash is the best core holding, says Morningstar Portfolio Strategist Amy Arnott. For goals that are, say, two to six years away, she recommends a high-quality bond fund with a short to intermediate maturity.
For longer-term goals—those a decade or longer out—Arnott says most investors should be looking to stock funds. “Typically, if you’re investing for a goal that’s at least 10 years away, you really want to be focusing on growth,” she adds.
Morningstar research recommends three types of stock mutual funds and ETFs as the best core portfolio holdings.
What Are the Best Investments for the Core of a Portfolio?
The best types of mutual funds and ETFs for the core of a long-term portfolio cluster are in three Morningstar Categories: US large blend, foreign large blend, and global large blend.
Why? Because the mutual funds and ETFs in these categories provide a broad representation of the overall stock market, either in the United States or globally, says Arnott. As a result, these categories have a narrower dispersion of returns than other equity categories—and therefore generate more predictable results. That’s just what investors want from their core holdings.
However, some mutual funds and ETFs in these groups are more representative of their categories than others. For instance, some funds may land in one of Morningstar’s blend categories that aren’t all that broad-based (concentrated active strategies, for instance). Funds that are unlike their categories in some way are typically less likely to be suitable core holdings for most investors, by our definition.
How To Find the Best Stock Funds for the Core of a Long-Term Portfolio in 2025
To compile our list of the best stock funds for the core of a long-term portfolio, mutual funds and ETFs had to meet the following criteria:
- The best long-term core stock funds have at least one share class that earns our highest Morningstar Medalist Rating of Gold, which is 100% analyst-driven. We expect such funds to outperform over a full market cycle.
- These recommended mutual funds and ETFs land in the US large-blend, foreign large-blend, or global large-stock-blend categories.
- The best funds for the core of a long-term portfolio are good representatives of their categories, with three-year R-squareds equal to or above the category average and three-year tracking error numbers equal to or below the category average.
20 Recommended Stock Mutual Funds for the Core of an Investment Portfolio
These mutual funds met our criteria for the best long-term core stock funds as of June 2025.
- American Funds International Growth and Income IGFFX
- DFA US Large Company DFUSX
- Fidelity 500 Index FXAIX
- Fidelity Total International Index FTIHX
- Fidelity Total Market Index FSKAX
- iShares S&P 500 Index BSPGX
- Parnassus Core Equity PRILX
- Schwab Total Stock Market Index SWTSX
- Schwab S&P 500 Index SWPPX
- State Street Equity 500 Index SSEYX
- State Street Global All Cap Equity ex-US Index SSGVX
- Vanguard 500 Index VFIAX
- Vanguard FTSE All-World ex-US Index VFWAX
- Vanguard Institutional Total Stock Market Index VITNX
- Vanguard Large Cap Index/ETF VLCAX
- Vanguard Russell 1000 Index VRNIX
- Vanguard Tax-Managed Capital Appreciation VTCLX
- Vanguard Total International Stock Index VGTSX
- Vanguard Total Stock Market Index VITSX
- Vanguard Total World Stock Index VTWAX
Given our emphasis on highly rated funds that behave like the categories in which they fall, it’s no surprise that most of the funds on our list of the best stock mutual funds for the core of a long-term portfolio are broad-based, low-cost index funds.
The list of recommended mutual funds also includes a mix of strategies that focus exclusively on US stocks, exclusively on non-US stocks, and on both US and non-US stocks. Non-US stocks don’t always provide US-based investors with added diversification, but they have proved their mettle in particular climates. “If you already have exposure to US large-cap stocks, international stocks could be a logical addition thanks to their potential to improve portfolio diversification,” explains Arnott. Moreover, having exposure to international stocks provides an investor with access to the full spectrum of investment opportunities worldwide.
Those interested in going global with their core holdings might consider choosing both a US large-blend and a foreign large-blend fund from our list; others might simplify with one global large-blend stock fund, which combines both US and non-US stocks.
The 13 Best Stock ETFs for the Core of a Long-Term Portfolio
Would you rather invest the core of your stock portfolio in ETFs? No problem. These ETFs met our criteria in June 2025, too.
- iShares Core MSCI Total International Stock ETF IXUS
- iShares Core S&P 500 ETF IVV
- iShares Core S&P Total US Stock Market ETF ITOT
- Schwab US Broad Market ETF SCHB
- Schwab US Large-Cap ETF SCHX
- SPDR Portfolio S&P 1500 Composite Stock Market ETF SPTM
- SPDR Portfolio S&P 500 ETF SPLG
- Vanguard FTSE All-World ex-US ETF VEU
- Vanguard Large-Cap ETF VV
- Vanguard S&P 500 ETF VOO
- Vanguard Total International Stock ETF VXUS
- Vanguard Total Stock Market ETF VTI
- Vanguard Total World Stock ETF VT
Here, too, investors will find plenty of variety, so be sure to check an ETF’s analyst report for a full understanding of how the ETF invests.
How to Find More of the Best Stock Funds for the Core of an Investment Portfolio
Investors may want to expand their search for long-term core stock funds beyond this list, using parameters that matter to them. Here are two ways to do just that:
- Use the Morningstar Investor screener to create your own list of core stock funds to investigate further. Beneath Investment Type, choose either mutual funds or ETFs. In the Criteria section, Morningstar Category, choose either Large Blend, Foreign Large Blend, Global Large-Stock Blend, or all three, depending on your interest. From there, you can further screen funds by their Morningstar Ratings, expenses, and more. Once you have your list, you can choose which data points you’d like to see for each fund.
- Review Morningstar’s list of Best Core Funds, a collection of funds and ETFs from core stock and bond categories that also received a Medalist Rating from our analysts.