Thousands of companies, one fund
Large, mid and small.
All tracks and lessons
Funds and portfolios0/10
The magic of compound interestIndex funds 101: boring beats cleverWhat an ETF isIndex funds, mutual funds and ETFs comparedThe S&P 500, explainedTotal market fundsInternational diversificationSector and thematic fundsThe three-fund portfolio and rebalancingDollar-cost averaging: investing without timing the market
Total market funds
A total-market fund adds mid and small companies to the large ones — thousands of holdings in one fund.
In this lesson you will
- Explain what a total-market fund holds
- Compare it with an S&P 500 fund
- Know what else a portfolio might need
A total US stock market fund aims to hold nearly every publicly traded US company — large, mid and small — weighted by size. It typically holds thousands of companies.
How it differs from an S&P 500 fund
Because large companies dominate by size, a total-market fund and an S&P 500 fund often move similarly. The total-market fund adds exposure to mid and small companies, which make up a smaller but meaningful share.
Why some investors prefer it
- One fund covers the whole US market.
- No need to decide between large, mid and small funds.
- Index versions are often low-cost.
What it still leaves out
A total US fund does not include international companies or bonds. Those are usually added with separate funds if wanted. Education only — GetGuac does not recommend specific funds or investments.
By the GetGuac team · Editorial policy
Three ideas to keep
Similar but not identical
To an S&P 500 fund.
US only
International and bonds are separate.
Do it in 4 steps
Compare holdings counts
Total market vs S&P 500.
Check small-company share
In the fund’s fact sheet.
Avoid doubling up
Both funds overlap heavily.
Decide on international and bonds
Separately.
Overlap between two funds
Illustrative: large companies are 80% of a total-market fund by weight.
| Fund | Large companies | Mid and small |
|---|---|---|
| S&P 500 fund | About 100% | 0% |
| Total market fund | 80% | 20% |
Holding both mostly duplicates the large companies; one is usually enough for US stocks.
Where this usually goes wrong
- Holding both and calling it diversification
- Thinking total US means global
- Ignoring costs
If you hold two US stock funds, check how much their top holdings overlap.
Tools and guides for this lesson
Quick quiz
1. A total US market fund holds…
2. Why do total market and S&P 500 funds move similarly?
3. A total US market fund includes international companies…
0 of 3 answered
Puzzle
You hold $6,000 in a total-market fund where mid and small companies are 20%. How much is in mid and small companies?
Show the answer
$1,200
$6,000 × 0.2 = $1,200.