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Understanding Diversification

O
Apr 30, 2026 · 14:37

Hi all,

I've been seeing a lot of top stocks being discussed and which one is the "better" one to invest in. For example, VOO vs VTI. I understand they have different compositions, so for a more direct comparison, VTI vs FZROX / VXUS vs FZILX. I also know that it's kind of a blackbox for how Fidelity manages their FZ--- stocks, whereas the Vanguard ones are public and clear.

From what I've seen, people usually invest in one or the other, not both. But I guess I can't seem to understand why not invest in both?

I'm thinking about a scenario like I invest equally in both:

VOO - $500 and

VTI - $500

So given their overlap, isn't this nearly the same as investing all my money in just one ETF, like:

VOO - $1000 or VTI - $1000

By investing in both, maybe you can reap the partial benefits of one outperforming the other? I'd love to learn more about this, so thanks to anyone who responds.