Building an investment portfolio is a personal experience: What suits one investor may be ill-fitting for another. Factors such as risk tolerance and time horizon influence how an investor constructs a portfolio, as do things like the amount of money involved, the types of financial accounts at hand, and the investor’s level of experience and interest.Yet, most investors would probably agree that they own certain funds they’d call “core” holdings: Those mutual funds or exchange-traded funds they expect to do most of the heavy lifting when it comes to reaching their goals.But what types of mutual funds and ETFs are good “core” funds? The answer depends, in part, on your time horizon. For goals less than a year away, cash is the best core holding, says Morningstar Portfolio Strategist . For goals that are, say, two to six years away, a high-quality bond fund with a short to intermediate maturity.For longer-term goals—those a decade or longer out—Arnott says most investors should be looking to stock funds. “Typically, if you’re investing for a goal that’s at least 10 years away, you really want to be focusing on growth,” she adds.Morningstar research recommends three types of stock mutual funds and ETFs as the best core portfolio holdings. What Are the Best Investments for the Core of a Portfolio?The best types of mutual funds and ETFs for the core of a long-term portfolio cluster are in three Morningstar Categories: US large blend, foreign large blend, and global large blend.Why? Because the mutual funds and ETFs in these categories provide a broad representation of the overall stock market, either in the United States or globally, says Arnott. As a result, these categories have a narrower dispersion of returns than other equity categories—and therefore generate more predictable results. That’s just what investors want from their core holdings.However, some mutual funds and ETFs in these groups are more representative of their categories than others. For instance, some funds may land in one of Morningstar’s blend categories that aren’t all that broad-based (concentrated active strategies, for instance). Funds that are unlike their categories in some way are typically less likely to be suitable core holdings for most investors, by our definition. How To Find the Best Stock Funds for the Core of a Long-Term Portfolio in 2025To compile our list of the best stock funds for the core of a long-term portfolio, mutual funds and ETFs had to meet the following criteria:The best long-term core stock funds have at least one share class that earns our highest . We expect such funds to outperform over a full market cycle.These recommended mutual funds and ETFs land in the US large-blend, foreign large-blend, or global large-stock-blend categories.The best funds for the core of a long-term portfolio are good representatives of their categories, with three-year R-squareds equal to or above the category average and three-year tracking error numbers equal to or below the category average.20 Recommended Stock Mutual Funds for the Core of an Investment PortfolioThese mutual funds met our criteria for the best long-term core stock funds as of June 2025.American Funds International Growth and Income DFA US Large Company Fidelity 500 Index Fidelity Total International Index Fidelity Total Market Index iShares S&P 500 Index Parnassus Core Equity Schwab Total Stock Market Index Schwab S&P 500 Index State Street Equity 500 Index State Street Global All Cap Equity ex-US Index Vanguard 500 Index Vanguard FTSE All-World ex-US Index Vanguard Institutional Total Stock Market Index Vanguard Large Cap Index/ETF Vanguard Russell 1000 Index Vanguard Tax-Managed Capital Appreciation Vanguard Total International Stock Index Vanguard Total Stock Market Index Vanguard Total World Stock Index Given our emphasis on highly rated funds that behave like the categories in which they fall, it’s no surprise that most of the funds on our list of the best stock mutual funds for the core of a long-term portfolio are broad-based, low-cost index funds. , The Best Stock Funds for the Core of an Investment Portfolio These top-rated mutual funds and ETFs make excellent long-term core holdings in 2025. Susan Dziubinski Jun 18, 2025. Share. Securities , A first-rate mutual fund portfolio is diversified. It holds funds focusing on U.S. stocks and bonds as well as international securities. It offers both growth and value stocks as well as passively .