Balanced and Diversified Portfolio with Global Exposure and Strong Historical Performance for Moderate Risk Investors

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 a balanced investor with moderate risk tolerance, seeking global exposure and diversification. Ideal for individuals with a long-term investment horizon, it offers the potential for capital appreciation while maintaining a diversified asset base. Such investors are comfortable with equity market volatility and are willing to endure short-term fluctuations for the prospect of higher long-term returns. The portfolio's diversification across sectors and geographies aligns with investors aiming to mitigate risks associated with individual markets or industries, providing a stable foundation for achieving financial goals.

Positions

  • Vanguard FTSE All-World UCITS ETF
    VGWL - IE00B3RBWM25
    100.00%

The portfolio is wholly invested in the Vanguard FTSE All-World UCITS ETF, providing broad diversification across various global markets and sectors. This single ETF offers exposure to a wide range of asset classes, primarily stocks, which comprise almost the entire portfolio. Such a composition ensures that the portfolio benefits from global market trends and mitigates risks associated with individual company performance. While the portfolio is well-diversified globally, having only one investment vehicle means it relies on the management of the ETF for optimal asset allocation and risk management.

Growth Info

Historically, the portfolio has demonstrated strong performance, with a compound annual growth rate (CAGR) of 12.86%. This impressive return indicates the portfolio's ability to capitalize on global market opportunities, despite experiencing a significant maximum drawdown of -33.43%. Such a drawdown highlights the inherent risks of investing in a predominantly equity-based portfolio. However, the high CAGR suggests that the portfolio has successfully navigated market volatility over time, rewarding investors with substantial returns. This performance underscores the potential benefits of maintaining a long-term investment horizon to weather market fluctuations.

Projection Info

Using a Monte Carlo simulation with 1,000 iterations, the portfolio's future performance was projected, assuming a hypothetical initial investment. The simulation revealed a 5th percentile end value of 96.97%, indicating a low probability of loss, while the 50th and 67th percentiles showed significant growth at 434.84% and 560.86%, respectively. With 996 simulations yielding positive returns, the annualized return averaged 13.45%. Monte Carlo simulations help investors understand potential future outcomes by considering various market scenarios, reinforcing the importance of diversification and long-term commitment to achieve desired financial goals.

Asset classes Info

  • Stocks
    100%
  • Other
    0%
  • Cash
    0%
  • No data
    0%

The portfolio is heavily weighted towards stocks, constituting nearly 100% of the assets, with negligible allocations in other categories. This focus on equities aligns with the portfolio's balanced risk profile, offering opportunities for capital appreciation. However, the lack of significant exposure to other asset classes, such as bonds or real estate, may increase susceptibility to stock market volatility. For investors seeking to reduce risk, incorporating a more diversified mix of asset classes could help achieve a more stable return profile. Diversification is key to managing risk and enhancing portfolio resilience.

Sectors Info

  • Technology
    25%
  • Financials
    16%
  • Health Care
    11%
  • Consumer Discretionary
    11%
  • Industrials
    10%
  • Telecommunications
    8%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    4%
  • Utilities
    3%
  • Real Estate
    2%

The portfolio's sector allocation is diverse, with the technology sector holding the largest share at approximately 25%. Other significant sectors include financial services, healthcare, and consumer cyclicals, each contributing around 10-16% to the portfolio. This distribution ensures that the portfolio benefits from various economic cycles and industry trends. However, the substantial allocation to technology may increase exposure to sector-specific risks. To maintain a balanced risk profile, it is advisable to monitor sector allocations and adjust as needed to prevent overexposure to any single sector, ensuring continued diversification.

Regions Info

  • North America
    65%
  • Europe Developed
    15%
  • Asia Emerging
    6%
  • Japan
    6%
  • Asia Developed
    4%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%
  • Europe Emerging
    0%

Geographically, the portfolio is primarily concentrated in North America, which accounts for nearly 65% of the assets. Europe and Asia also contribute significantly, providing exposure to developed and emerging markets. This global diversification helps mitigate risks associated with any single region's economic downturns while capitalizing on growth opportunities worldwide. However, the heavy reliance on North American markets may expose the portfolio to regional risks. To enhance diversification, investors could consider adjusting geographic allocations to achieve a more balanced global exposure, ensuring resilience against regional economic fluctuations.

Dividends Info

  • Vanguard FTSE All-World UCITS ETF 1.20%
  • Weighted yield (per year) 1.20%

The portfolio's dividend yield stands at 1.2%, reflecting the income generated from the underlying stocks within the ETF. This modest yield offers an additional source of return, complementing capital appreciation. While not the primary focus of the portfolio, dividends can provide a steady income stream, particularly valuable during periods of market volatility. Investors seeking higher income might consider increasing exposure to dividend-focused investments. However, the current yield aligns with the portfolio's growth-oriented strategy, balancing income generation with the potential for long-term capital gains.

Ongoing product costs Info

  • Vanguard FTSE All-World UCITS ETF 0.22%
  • Weighted costs total (per year) 0.22%

With a total expense ratio (TER) of 0.22%, the portfolio is cost-effective, minimizing the impact of fees on overall returns. This low-cost structure is a significant advantage of investing in ETFs, allowing investors to retain a larger portion of their gains. Keeping costs low is crucial for maximizing investment returns over time. Investors should remain vigilant about fees, as high costs can erode returns, particularly in low-yield environments. Regularly reviewing and comparing expense ratios can help ensure the portfolio remains competitive and cost-efficient.

What next?

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.