A growth-focused portfolio with heavy reliance on US equities and low diversification

Report created on Jul 21, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

This portfolio is heavily weighted towards the Vanguard S&P 500 ETF, making up 70% of the allocation, with the remainder split evenly between the Avantis® U.S. Small Cap Value ETF and the Vanguard Mid-Cap Value Index Fund ETF Shares. This composition indicates a strong focus on US equities across a range of market capitalizations but with a significant tilt towards large-cap stocks. The low diversity score reflects this concentration, suggesting a potential vulnerability to market fluctuations within the US market.

Growth Info

Historically, the portfolio has delivered a Compound Annual Growth Rate (CAGR) of 15.96%, with a maximum drawdown of -37.03%. These figures indicate robust growth but also highlight periods of significant value decline, which could be concerning for investors with lower risk tolerance. The days contributing to 90% of returns being concentrated in just 15.0 days underscores the portfolio's exposure to short-term volatility.

Projection Info

Using Monte Carlo simulations, which project future performance based on historical data, the portfolio shows a wide range of outcomes. The median projection suggests a 457.2% return, with a 5th percentile at a low 31.0% return, indicating potential for both high growth and significant risk. It's crucial to note that while these projections offer insight, they cannot guarantee future performance due to market unpredictability.

Asset classes Info

  • Stocks
    100%

The portfolio is entirely composed of stocks, with no allocation to bonds, cash, or other asset classes. This singular focus on equities enhances growth potential but also increases risk, as there's no cushion against stock market downturns. Diversifying across different asset classes could help mitigate this risk while still aiming for growth.

Sectors Info

  • Technology
    25%
  • Financials
    17%
  • Consumer Discretionary
    11%
  • Industrials
    10%
  • Health Care
    8%
  • Telecommunications
    7%
  • Consumer Staples
    6%
  • Energy
    5%
  • Utilities
    4%
  • Basic Materials
    3%
  • Real Estate
    3%

Sector allocation is broadly diversified within the equity component, with technology, financial services, and consumer cyclicals leading. This sector spread is generally positive for capturing growth across different areas of the economy. However, the heavy weighting in technology might expose the portfolio to higher volatility, given the sector's rapid growth and frequent price swings.

Regions Info

  • North America
    99%

The geographic allocation is almost exclusively focused on North America (99%), with no exposure to international markets. This concentration in a single region can increase risk if the US market faces downturns. Diversifying geographically could provide a buffer against such risks and tap into growth opportunities in other regions.

Market capitalization Info

  • Mega-cap
    33%
  • Mid-cap
    27%
  • Large-cap
    25%
  • Micro-cap
    8%
  • Small-cap
    8%

The portfolio spans mega to small-cap stocks, with a significant portion in mega and big caps. This distribution suggests a balance between seeking stable returns from large companies and higher growth potential from smaller firms. However, the slight allocation to micro-caps could be increased to enhance growth prospects further, albeit with additional risk.

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.

Click on the colored dots to explore allocations.

The current portfolio's expected return is below the optimal level identified through portfolio optimization, suggesting room for improvement. By adjusting the asset allocation without increasing risk, the portfolio could potentially achieve a higher expected return of 16.70%. This indicates that a more balanced approach could yield better risk-adjusted returns.

Dividends Info

  • Avantis® U.S. Small Cap Value ETF 1.70%
  • Vanguard Mid-Cap Value Index Fund ETF Shares 2.20%
  • Vanguard S&P 500 ETF 1.20%
  • Weighted yield (per year) 1.42%

The portfolio's total dividend yield stands at 1.42%, contributed by all three ETFs. While dividends are a bonus, the primary focus here seems to be on capital appreciation. Investors seeking income might look for options with higher yields, though this could come at the cost of growth potential.

Ongoing product costs Info

  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Vanguard Mid-Cap Value Index Fund ETF Shares 0.07%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.07%

The portfolio's total expense ratio (TER) is impressively low at 0.07%, which is beneficial for long-term growth as lower costs translate to higher net returns. This cost efficiency is a strong point, ensuring that more of the portfolio’s returns are retained by the investor.

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