Robo Advisor Betterment Portfolios Are Robots Better?

Build Robo Advisor's Betterment's portfolios with ETFs. How do they compare against other portfolios?
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What are the Betterment Portfolios?

Robo Advisor Betterment Portfolios can be built with 3-6 ETFs. They are exposed to between 40% and 100% equities. They have low-risk portfolios and high-risk portfolios.

For the past 10 years, the Robo Advisor Betterment 100 has returned 9.41 with a standard deviation of 17.12. The dividend yield is 2.28. The 30-year return is 9.53%. Year to date the Robo Advisor Betterment 100 portfolio has returned 12.32%%.

What is the historical return of the Betterment portfolios?

Below you can see the historical return of Betterments portfolios.

NameAsset class countYear to dateReturn in 202010 year returnCAGR since 1989 (%)Risk levelExpense ratio
Robo Advisor Betterment 100612.32%12.299.419.5330.07%
Robo Advisor Betterment 80109.46%11.048.359.0730.07%
Robo Advisor Betterment 60106.66%9.777.288.4820.07%
Robo Advisor Betterment 40114.03%8.296.017.6410.07%
Robo Advisor Betterment 901110.91%11.658.99.3630.08%
Robo Advisor Betterment 70108.05%10.387.918.9620.08%
Robo Advisor Betterment 50105.25%9.056.928.4920.09%
Robo Advisor Betterment 30122.97%7.035.077.1910.08%
Robo Advisor Betterment 20121.96%5.843.916.2910.07%
Robo Advisor Betterment 10120.94%4.682.725.3410.06%
Robo Advisor Betterment 02-0.04%3.461.534.3710.05%
Robo Advisor Betterment 2020 Taxable 100% Stocks611.55%10.08.448.6130.07%
Robo Advisor Betterment 2020 Taxable 90% Stocks1010.29%9.638.198.5130.07%
Robo Advisor Betterment 2020 Taxable 80% Stocks109.08%9.247.928.3830.08%
Robo Advisor Betterment 2020 Taxable 70% Stocks107.76%8.917.68.2120.08%
Robo Advisor Betterment 2020 Taxable 60% Stocks106.49%8.637.38.1220.08%
Robo Advisor Betterment 2020 Taxable 50% Stocks115.30%8.36.97.9520.08%
Robo Advisor Betterment 2020 Taxable 40% Stocks124.19%7.926.427.7110.08%
Robo Advisor Betterment 2020 Taxable 30% Stocks123.20%7.085.497.1410.08%
Robo Advisor Betterment 2020 Taxable 20% Stocks122.15%6.194.476.4810.07%
Robo Advisor Betterment 2020 Taxable 10% Stocks121.06%5.133.295.6710.06%
Robo Advisor Betterment 2020 Taxable 0% Stocks1-0.06%3.041.234.1710.05%
Robo Advisor Betterment 2020 Retirement 100% Stocks611.29%10.438.518.5830.07%
Robo Advisor Betterment 2020 Retirement 90% Stocks1010.42%9.498.198.4530.07%
Robo Advisor Betterment 2020 Retirement 80% Stocks109.34%8.967.928.2830.08%
Robo Advisor Betterment 2020 Retirement 70% Stocks108.16%8.477.598.0520.08%
Robo Advisor Betterment 2020 Retirement 60% Stocks107.03%8.027.297.920.08%
Robo Advisor Betterment 2020 Retirement 50% Stocks115.96%7.556.897.6820.08%
Robo Advisor Betterment 2020 Retirement 40% Stocks124.94%7.076.47.4110.08%
Robo Advisor Betterment 2020 Retirement 30% Stocks123.88%6.315.486.8710.07%
Robo Advisor Betterment 2020 Retirement 20% Stocks122.74%5.514.456.2510.07%
Robo Advisor Betterment 2020 Retirement 10% Stocks121.51%4.613.285.510.06%
Robo Advisor Betterment 2020 Retirement 0% Stocks1-0.06%3.041.234.1710.05%

How does Betterment’s portfolios compare to the best portfolios?

Below you can see the returns of the best portfolios that we have benchmarked.

NameSee PortfolioYear to dateReturn in 202010 year returnCAGR since 1989 (%)Draw Down
Premium Portfolio15.92%18.2913.8410.77-37.63%
Premium Portfolio8.30%18.118.6311.14-44.87%
Premium Portfolio13.48%19.712.8410.49-32.77%
Premium Portfolio20.78%3.198.5210.59-36.46%
Premium Portfolio20.17%3.668.6210.48-36.35%
Premium Portfolio15.18%21.0313.7810.83-37.00%
Premium Portfolio19.24%8.711.5610.65-35.26%
Premium Portfolio15.41%7.488.3910.64-37.91%
Premium Portfolio16.16%5.3610.8811.23-35.43%
Premium Portfolio20.81%3.4210.2110.47-40.85%

How do you build the Betterment portfolios with ETFs?

Below is an example of how to build a Betterment portfolio using ETFs

This is for Robo Advisor Betterment 100.

  • 34.60%  US Total Stock Market (VTI)
  • 9.20%    US Large Cap Value (VTV)
  • 7.50%    US Mid Cap Value (JKI)
  • 6.40%    US Small Cap Value (VIOV)
  • 27.30%  International Developed Blend (VEA)
  • 15.00%  Emerging Markets (VWO)

The letters in brackets denote the stock symbol for the recommended ETF. You can look up the symbols at your stockbroker. You can see a listing of all the ETFs we recommend on this page.

What is Robo Advisor Betterment?

Betterment is probably the most well-known fintech company.

It started the robo-advisor phenomenon. If you ever listened to NPR Radio or podcasts, you probably know who they are.

Betterment has 16 Billion assets under management as per 2019. Their portfolios are well diversified. They are some of the few portfolios that have emerging market bonds as an asset class.

If you want to gain a greater insight into the robo-advisory phenomenon, I recommend picking up FinTech Innovation: From Robo-Advisors to Goal-Based Investing and Gamification.

Their biggest competitor is Wealthfront. To see a comparison of robo advisor portfolios, see our article Robo Advisor Performance. This is the article where we compare the performance of various robo advisors.

This mission is too important for me to allow you to jeopardize it. – HAL 9000

What are the Betterment portfolios?

There seems to be a trend in the robo advisor portfolios. They are all highly diversified. They also use asset classes not usually seen as much in other portfolios.

The Betterments portfolios include the use of emerging market bonds and many value stocks, for example, mid-cap value. This creates a set up for potential outperformance in that they can rebalance their way to higher returns.

In circa 2014 (or maybe 2012), they changed their portfolio composition. The asset allocation that you see below is a reflection of that asset allocation. Their new asset allocation is also benchmarked, but we still need to document it here. That is upcoming.

Two sets of portfolios

In the 2020 portfolios, there are two sets of portfolios.

  1. The first set is the portfolios, the one with taxable in their name. They are meant to be used in a taxable account. They contain asset classes that minimize taxes, such as muni bonds.
  2. The second set is the portfolios with retirement in their name. They are meant to be used in a tax-sheltered/tax-deferred account. They contain asset classes that are not particularly tax-aware such as standard bonds fx – total bonds market, REITs, and the like.

What is the asset allocation of the Betterment portfolios?

Below you can see the asset allocation for all of the Betterment portfolios.

Robo Advisor Betterment 100

  • 34.60%  US Total Stock Market (VTI)
  • 9.20%    US Large Cap Value (VTV)
  • 7.50%    US Mid Cap Value (JKI)
  • 6.40%    US Small Cap Value (VIOV)
  • 27.30%  International Developed Blend (VEA)
  • 15.00%  Emerging Markets (VWO)

Robo Advisor Betterment 90

  • 30.90%  US Total Stock Market (VTI)
  • 8.20%    US Large Cap Value (VTV)
  • 6.70%    US Mid Cap Value (JKI)
  • 5.70%    US Small Cap Value (VIOV)
  • 24.60%  Int. Developed Blend (VEA)
  • 14.00%  Emerging Markets (VWO)
  • 3.50%    Total US Bond Market (BND)
  • 0.60%    Cash (money market fund) (BIL)
  • 1.20%    TIPS (VTIP)
  • 2.90%    Non-US Bonds (BNDX)
  • 1.70%    Emerging Market Bonds (VWOB)

Robo advisor Betterment 80

  • 27.00%  US Total Stock Market (VTI)
  • 7.20%    US Large Cap Value (VTV)
  • 5.90%    US Mid Cap Value (JKI)
  • 5.00%    US Small Cap Value (VIOV)
  • 22.10%  International Developed Blend (VEA)
  • 12.80%  Emerging Markets (VWO)
  • 6.80%    Total US Bond Market (BND)
  • 2.40%    TIPS (VTIP)
  • 7.20%    Non-US Bonds (BNDX)
  • 3.60%    Emerging Market Bonds (EMB / VWOB)

Robo Advisor Betterment 70

  • 23.40%  US Total Stock Market (VTI)
  • 6.30%    US Large Cap Value (VTV)
  • 5.10%    US Mid Cap Value (JKI)
  • 4.30%    US Small Cap Value (VIOV)
  • 19.30%  Int. Developed Blend (VEA)
  • 11.60%  Emerging Markets (VWO)
  • 9.80%    Total US Bond Market (BND)
  • 3.80%    TIPS (VTIP)
  • 10.90%  Non-US Bonds (BNDX)
  • 5.50%    Emerging Market Bonds (VWOB)

Robo advisor Betterment 60

  • 19.80%  US Total Stock Market (VTI)
  • 5.30%    US Large Cap Value (VTV)
  • 4.30%    US Mid Cap Value (JKI)
  • 3.60%    US Small Cap Value (VIOV)
  • 16.70%  International Developed Blend (VEA)
  • 10.30%  Emerging Markets (VWO)
  • 12.30%  Total US Bond Market (BND)
  • 5.00%    TIPS (VTIP)
  • 14.70%  Non-US Bonds (BNDX)
  • 8.00%    Emerging Market Bonds (EMB / VWOB)

Robo Advisor Betterment 50

  • 16.20%  US Total Stock Market (VTI)
  • 4.40%    US Large Cap Value (VTV)
  • 3.60%    US Mid Cap Value (JKI)
  • 3.00%    US Small Cap Value (VIOV)
  • 13.70%  Int. Developed Blend (VEA)
  • 9.00%    Emerging Markets (VWO)
  • 14.70%  Total US Bond Market (BND)
  • 6.30%    TIPS (VTIP)
  • 18.40%  Non-US Bonds (BNDX)
  • 10.70%  Emerging Market Bonds (VWOB)

Robo advisor Betterment 40

  • 12.90%  US Total Stock Market   (VTI)
  • 3.40%    US Large Cap Value (VTV)
  • 2.80%    US Mid Cap Value (JKI)
  • 2.40%    US Small Cap Value  (VIOV)
  • 11.10%  International Developed Blend (VEA)
  • 7.40%    Emerging Markets (VWO)
  • 7.00%    Short Term Treasuries (VGSH)
  • 15.10%  Total US Bond Market (BND)
  • 6.60%    TIPS (VTIP)
  • 19.50%  Non-US Bonds (BNDX)
  • 11.80%  Emerging Market Bonds (EMB / VWOB)

Robo Advisor Betterment 30

  • 9.50%    US Total Stock Market (VTI)
  • 2.60%    US Large Cap Value (VTV)
  • 2.10%    US Mid Cap Value (JKI)
  • 1.80%    US Small Cap Value (VIOV)
  • 8.30%    Int. Developed Blend (VEA)
  • 5.60%    Emerging Markets (VWO)
  • 24.20%  Short Term Treasury (VGSH)
  • 11.40%  Total US Bond Market (BND)
  • 6.10%    Short-Term Investment-Grade (VCSH)
  • 5.00%    TIPS (VTIP)
  • 14.60%  Non-US Bonds (BNDX)
  • 8.80%    Emerging Market Bonds (VWOB)

Robo Advisor Betterment 20

  • 6.30%    US Total Stock Market (VTI)
  • 1.70%    US Large Cap Value (VTV)
  • 1.40%    US Mid Cap Value (JKI)
  • 1.20%    US Small Cap Value (VIOV)
  • 5.60%    Int. Developed Blend (VEA)
  • 3.70%    Emerging Markets (VWO)
  • 42.80%  Short Term Treasury (VGSH)
  • 7.60%    Total US Bond Market (BND)
  • 10.70%  Short-Term Investment-Grade (VCSH)
  • 3.30%    TIPS (VTIP)
  • 9.80%    Non-US Bonds (BNDX)
  • 5.90%    Emerging Market Bonds (VWOB)

Robo Advisor Betterment 10

  • 3.20%    US Total Stock Market (VTI)
  • 0.90%    US Large Cap Value (VTV)
  • 0.50%    US Mid Cap Value (JKI)
  • 0.60%    US Small Cap Value (VIOV)
  • 2.80%    Int. Developed Blend (VEA)
  • 1.90%    Emerging Markets (VWO)
  • 61.40%  Short Term Treasury (VGSH)
  • 3.80%    Total US Bond Market (BND)
  • 15.40%  Short-Term Investment-Grade   (VCSH)
  • 1.70%    TIPS (VTIP)
  • 4.90%    Non-US Bonds (BNDX)
  • 2.90%    Emerging Market Bonds (VWOB)

Robo Advisor Betterment 0 = 100% Bonds

  • 80.00%  Short Term Treasury (VGSH)
  • 20.00%  Short-Term Investment-Grade (VCSH)

Resources for Betterment portfolios

Betterment has a YouTube channel that provides useful information.

Betterment website – they do have a lot of info on how they construct their portfolio and about investing in general.

Betterment also has a podcast. Find it in your favorite podcast library.

2001: A Space Odyssey on IMDB

Suggestions for your next steps

Finding the correct portfolio is hard. Maintaining your portfolio is also daunting. If you are still in doubt about which portfolio to choose, we suggest you read our article How To Invest Money: 5 Simple Steps That Work For Anyone

If you have already committed to a portfolio – good for you! If you need help maintaining the portfolio you will find our rebalance worksheet useful. Rebalancing your portfolio lowers your risk and may provide higher returns in the long run. It is completely FREE.

You can find the rebalance worksheet in our article Here Is The Most Easy To Use Portfolio Rebalance Tool.

Rebalancing lowers your portfolio risk and may increase your returns.


If you want access to our high-performing portfolios then you need to take a look at the premium portfolios. This is a paid product that gives you the 59 best-performing portfolios since 1989. The portfolios represent a great opportunity for you to have a shot at increasing the returns of your portfolio.

Portfolioeinstein Premium Portfolios

Related questions

Can you lose money with Betterment?

No. The Betterment portfolios are diversified and they consist of many kinds of stocks and bonds. You can only lose money if you sell your stocks in your Betterment account when the stock market is experiencing a downturn.

Is Betterment good for investing?

Yes. Betterment is a fantastic way to save and invest because it is all done automatically. Betterment also has very good portfolios, but not the best-performing.

Is Betterment better than Vanguard?

Betterment and Vanguard are two different things. Vanguard is for the do-it-yourself investor who has a little knowledge about investing. Betterment is for anyone who wants to get started with investing without getting into the details of investing.

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