JL Collins Goes Global - And Why That Feels Familiar

Why It Matters

The adjustment underscores that even staunch U.S.‑centric investors recognize diversification benefits, prompting non‑U.S. investors to consider total‑world funds for risk mitigation and long‑term growth.

Key Takeaways

• JL Collins added Vanguard Total World ETF (VT) to portfolio.
• Shift moves from 100% US to ~62% US, 38% international.
• Concerns: US trade policy, dollar weakening, reserve currency risk.
• NZ investors can use Smart Total World ETF for exposure.
• Emphasis on low‑cost, diversified ETFs over mutual funds.

Pulse Analysis

JL Collins built his reputation on a deceptively simple premise: buy a single low‑cost U.S. index fund and let the market do the heavy lifting. His 2016 book, *The Simple Path to Wealth*, popularized VTSAX and its ETF counterpart VTI as the go‑to vehicles for American investors. Over the past decade, that formula proved robust, delivering solid returns while keeping fees minimal. However, Collins’ recent email announced a strategic pivot—adding Vanguard’s Total World ETF (VT) to his holdings—signalling a willingness to broaden the geographic canvas of his portfolio.

The rationale behind the shift is rooted in macro‑economic realities. Persistent U.S. trade policy uncertainty, a roughly 10% depreciation of the dollar against major currencies last year, and debates over the dollar’s status as the world’s reserve currency have heightened concerns about over‑reliance on a single market. By allocating roughly 38% of his equity exposure to non‑U.S. companies, Collins aims to capture growth in Europe, Asia and emerging markets while cushioning potential domestic headwinds. This balanced approach aligns with modern portfolio theory, which advocates diversification across regions to reduce volatility and enhance risk‑adjusted returns.

For investors outside the United States—particularly in New Zealand—the lesson is clear: total‑world ETFs offer a cost‑effective path to global exposure. Products like the Smart Total World ETF and InvestNow’s Foundation Series Total World Fund mirror VT’s composition, providing a single‑ticker solution that sidesteps home‑country bias. By embracing these funds, Kiwi savers can own thousands of companies across continents, maintain low expense ratios, and avoid the administrative complexities of juggling multiple regional ETFs. Collins’ move reinforces the timeless principle that simplicity and diversification, not market timing, drive long‑term wealth accumulation.