A balanced portfolio with a strong focus on dividends and global diversification

Risk profile

  • Secure
    Speculative

The risk profile, derived from past market volatility, reflects the level of risk the portfolio is exposed to. This assessment helps align your investments with your financial goals and comfort with market fluctuations.

Diversification profile

  • Focused
    Diversified

The diversification assessment evaluates the spread of investments across asset classes, regions, and sectors. This ensures a balanced mix, reducing risk and maximizing returns by not concentrating in any single area.

What type of investor this portfolio is suitable for

Balanced Investors

This portfolio suits an investor with a balanced risk tolerance seeking both income and growth from dividends. It is ideal for those with a medium to long-term investment horizon, looking to benefit from global diversification while focusing on dividend income. Such an investor values steady returns and is comfortable with moderate market fluctuations, aiming to build wealth gradually over time. The emphasis on dividend aristocrats indicates a preference for established, reliable companies that can provide consistent income.

Positions

  • SPDR S&P Global Dividend Aristocrats UCITS
    ZPRG - IE00B9CQXS71
    80.00%
  • SPDR S&P Emerging Markets Dividend Aristocrats UCITS ETF (Dist)
    SPYV - IE00B6YX5B26
    20.00%

The portfolio is heavily weighted towards two ETFs, with 80% in the SPDR S&P Global Dividend Aristocrats UCITS and 20% in the SPDR S&P Emerging Markets Dividend Aristocrats UCITS ETF. This composition indicates a focus on dividend-paying stocks globally, with a significant portion in established markets and a smaller stake in emerging markets. Such a structure aims to combine the stability of developed market dividends with the growth potential of emerging markets. Balancing these two can provide a steady income stream while allowing for some capital appreciation. Consider whether this blend aligns with your income needs and growth expectations.

Growth Info

Historically, the portfolio has achieved a compound annual growth rate (CAGR) of 7.09%, with a maximum drawdown of -41.09%. This indicates that while the portfolio has provided solid growth over time, it has also experienced significant volatility. A drawdown of this magnitude suggests a need for a risk management strategy to prepare for similar future downturns. Understanding past performance helps set realistic expectations, but remember that past results do not guarantee future returns. Consider diversifying further or employing hedging strategies to mitigate potential risks.

Projection Info

The forward projection using Monte Carlo simulations suggests a wide range of potential outcomes. With 1,000 simulations, the median outcome is a 102.35% return, while the worst-case scenario (5th percentile) is a -36.91% return. This simulation uses historical data to model potential future outcomes, providing a probabilistic view of what might happen. However, it's important to note that these projections do not account for unforeseen market changes. While the median projection is positive, it's wise to prepare for both best and worst-case scenarios by periodically reviewing and adjusting your portfolio.

Asset classes Info

  • Stocks
    100%
  • Cash
    0%

The portfolio is almost entirely invested in stocks, with a negligible cash position. This allocation suggests a strong growth orientation, as stocks historically offer higher returns than other asset classes like bonds or cash. However, this also means higher volatility and risk. A portfolio heavily concentrated in stocks might not suit investors seeking capital preservation or lower volatility. Consider introducing other asset classes, such as bonds or real estate, to balance risk and potentially smooth out returns over time.

Sectors Info

  • Financials
    26%
  • Utilities
    22%
  • Telecommunications
    10%
  • Real Estate
    10%
  • Technology
    7%
  • Industrials
    6%
  • Energy
    5%
  • Consumer Discretionary
    5%
  • Basic Materials
    4%
  • Consumer Staples
    4%
  • Health Care
    3%

Sector-wise, the portfolio is diversified across financial services, utilities, communication services, and more. Financial services and utilities dominate, making up nearly half of the portfolio. This sectoral concentration could expose you to specific economic cycles and regulatory changes. While diversification across multiple sectors can mitigate some risks, it's crucial to ensure that no single sector overly influences the portfolio's performance. Regularly review sector allocations to maintain a balance that aligns with your risk tolerance and market outlook.

Regions Info

  • North America
    50%
  • Europe Developed
    18%
  • Asia Developed
    16%
  • Asia Emerging
    9%
  • Japan
    4%
  • Africa/Middle East
    2%
  • Europe Emerging
    0%
  • Latin America
    0%

Geographically, the portfolio is predominantly invested in North America, followed by developed Europe and Asia. This spread provides exposure to different economic environments and growth opportunities. However, the limited allocation to regions like Latin America and Africa/Middle East might mean missing out on potential growth in these areas. Geographic diversification can help reduce risk by spreading investments across various markets. Consider increasing exposure to underrepresented regions to capture global growth opportunities and enhance diversification.

Ongoing product costs Info

  • SPDR S&P Emerging Markets Dividend Aristocrats UCITS ETF (Dist) 0.55%
  • SPDR S&P Global Dividend Aristocrats UCITS 0.45%
  • Weighted costs total (per year) 0.47%

The portfolio incurs a total expense ratio (TER) of 0.47%, which is relatively moderate for ETF investments. While these costs may seem small, they can compound over time, impacting overall returns. Lowering costs can significantly enhance long-term performance. Consider exploring alternative ETFs with lower expense ratios or negotiating fees with your broker to reduce costs. Regularly review your investment costs to ensure they align with your financial goals and maximize net returns.

Risk vs. return

This chart shows the Efficient Frontier, calculated using your current assets with different allocation combinations. It highlights the best balance between risk and return based on historical data. "Efficient" portfolios maximize returns for a given risk or minimize risk for a given return. Portfolios below the curve are less efficient. This is informational and not a recommendation to buy or sell any assets.

Optimization using the Efficient Frontier suggests that the current asset allocation may not be achieving the best possible risk-return ratio. The Efficient Frontier theory posits that for any given level of risk, there is an optimal allocation that maximizes returns. By adjusting the weights of the existing assets, you might improve the portfolio's efficiency. This doesn't necessarily mean adding new assets but rather rebalancing the current ones. Regularly review and adjust your allocations to ensure your portfolio remains on the Efficient Frontier.

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