Passive Investing for Global Citizens: A Complete Playbook

Decades of academic research and real-world data show that the majority of actively managed funds underperform their benchmark index after fees over 10+ year periods. The S&P SPIVA report (2024) shows 92% of US large-cap active funds underperformed the S&P 500 over the previous 20 years. The case for paying 1% in fees for active management is very difficult to make when the average active manager doesn't beat the market.

For most investors, a total world equity index (MSCI World + Emerging Markets, or FTSE All-World) is the logical starting point. It gives you ownership of 3,000–9,000 companies across 50+ countries, weighted by market capitalisation. Regional tilts (overweighting home country, EM, or small caps) can be added on top, but the all-world base is the sensible default.

For a single all-world ETF portfolio, rebalancing is unnecessary — the ETF rebalances internally. For multi-asset portfolios (e.g., 80% equities / 20% bonds), annual rebalancing is sufficient for most investors. More frequent rebalancing increases transaction and FX costs without meaningfully improving returns. The simplest approach: rebalance when any allocation drifts more than 5–10 percentage points from target.