The MoneyWeek ETF portfolio – early 2026 update

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There have been no changes to our exchange-traded fund (ETF) portfolio since April, which is in line with our goal of changing it as rarely as we can. The MoneyWeek ETF portfolio has done what we want: it held up well during the US tariff shock in April (down around 7% at worst) and rebounded as markets rallied, ending the year up by 14.5%.

We were helped by our 10% position in gold, which has been extremely strong, but also by better performance of the rest of the world versus America. Within the core equity part of the portfolio, we have equal amounts in the US, Europe, Japan and emerging markets. Implicitly, this means we are very underweight America (US stocks are about 65% of the MSCI ACWI global benchmark) compared with most portfolios. This has been a huge drag on returns in recent years, but began to work in our favour in 2025.

That said, the switch from a regular S&P 500 ETF into an equal-weighted fund in March has not paid off. We think that this decision – which reduces how concentrated our US exposure is in the tech giants – is the right medium-term call, but clearly we moved too early and would have been better off in the original fund last year.

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The bond conundrum in our ETF portfolio

European real estate (including UK) is showing some tentative signs of recovery and our decision to narrow our real-estate focus accordingly paid off so far. The ETF we now hold has outperformed the global one that we held previously (which is heavily weighted towards the US) and we continue to prefer the higher yield that it offers.

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Header Cell - Column 0	MoneyWeek's ETF portfolio	Header Cell - Column 2
Row 0 - Cell 0	Invesco US Treas. 0-1 Yrs GBP Hdgd (LSE: TIGB)	10%
Row 1 - Cell 0	iShares $ Treas. 3-7 Yr GBP Hdgd (LSE: CBUG)	10%
Row 2 - Cell 0	iShares $ TIPS 0-5 GBP Hdgd (LSE: TI5G)	10%
Row 3 - Cell 0	iShares Physical Gold (LSE: SGLN)	10%
Row 4 - Cell 0	Xtrackers S&P 500 Equal Weight (LSE: XDWE)	10%
Row 5 - Cell 0	Vanguard FTSE Dev. Europe (LSE: VEUR)	10%
Row 6 - Cell 0	Vanguard FTSE Japan (LSE: VJPN)	10%
Row 7 - Cell 0	iShares Core MSCI Em. Markets (LSE: EMIM)	10%
Row 8 - Cell 0	Xtrackers FTSE Dev. Eur. Real Estate (LSE: XDER)	10%
Row 9 - Cell 0	SPDR MSCI World Energy (LSE: ENGW)	10%

We hold an energy ETF not because we are especially bullish on oil, but because we think there are risks of both short-term shocks and longer-term underinvestment, and that one of the most likely triggers for sustained inflation is through energy costs. Given that energy stocks appear fairly cheap, it still seems like a attractively priced hedge against these risks.

Our bond investments are concentrated in shorter-dated bonds because we don’t think that longer-dated ones offer enough compensation for the extra fiscal and political risks. Our holdings are in US government bonds, but this is partly because the selection of ETFs currently available gives us much more granular choice for US bonds than for UK ones. However, we are now using bond ETFs that hedge the currency exposure back to sterling because we think the outlook for the dollar has become much more risky and there is no longer much benefit in having unhedged dollar bond exposure.

This is the part of the portfolio that looks most troublesome in many ways. There’s little value in bonds already and a strong chance that interest rates come down even more than investors expect (especially in the US). That would further reduce the yields available on bonds. So at some point in 2026, we may have to overhaul our bond positions – but not yet.

This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.

Cris Sholto Heaton is an investment analyst and writer who has been contributing to MoneyWeek since 2006 and was managing editor of the magazine between 2016 and 2018. He is especially interested in international investing, believing many investors still focus too much on their home markets and that it pays to take advantage of all the opportunities the world offers. He often writes about Asian equities, international income and global asset allocation.

Cris began his career in financial services consultancy at PwC and Lane Clark & Peacock, before an abrupt change of direction into oil, gas and energy at Petroleum Economist and Platts and subsequently into investment research and writing. In addition to his articles for MoneyWeek, he also works with a number of asset managers, consultancies and financial information providers.

He holds the Chartered Financial Analyst designation and the Investment Management Certificate, as well as degrees in finance and mathematics. He has also studied acting, film-making and photography, and strongly suspects that an awareness of what makes a compelling story is just as important for understanding markets as any amount of qualifications.