This portfolio has only about 3.8 years of historical data, based on the youngest asset in the portfolio. Some metrics, projections, and AI insights may be less reliable and should be interpreted with caution.

Balanced Portfolio with Strong Diversification and Moderate Risk

Report created on Jul 26, 2024

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is composed of three ETFs: Vanguard S&P 500 ETF (60%), Invesco NASDAQ 100 ETF (20%), and Vanguard Total International Stock Index Fund ETF Shares (20%). The allocation indicates a strong preference for US equities, with some exposure to international markets. Having a mix of different ETFs helps in spreading out the risk and capturing growth from various market segments. However, the heavy concentration in US stocks may expose the portfolio to country-specific risks. A more balanced allocation could be considered to mitigate this.

Growth Info

Historically, this portfolio has performed well, with a Compound Annual Growth Rate (CAGR) of 12.3%. The maximum drawdown was -27.06%, indicating that while the portfolio has potential for high returns, it also comes with significant risk. The fact that 90% of returns were made in just 15 days highlights the importance of staying invested for the long term. This performance suggests that the portfolio is capable of delivering strong returns, but the investor should be prepared for periods of volatility.

Projection Info

Using a Monte Carlo simulation with 1,000 runs, we projected the portfolio's future performance. This simulation models various possible outcomes based on historical data, providing a range of potential returns. The median (50th percentile) end value was 349.09%, with a 5th percentile of 31.91% and a 67th percentile of 493.92%. The annualized return across all simulations was 12.94%. These projections indicate a high probability of positive returns, but also underscore the inherent uncertainty in investing.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio is heavily weighted in stocks, comprising 99.32% of the allocation, with minimal exposure to cash and other assets. This high concentration in equities makes the portfolio suitable for investors with a higher risk tolerance and a long-term investment horizon. However, for those looking to reduce risk, incorporating more fixed-income assets like bonds could provide stability and reduce volatility.

Sectors Info

  • Technology
    31%
  • Financials
    12%
  • Consumer Discretionary
    11%
  • Health Care
    11%
  • Telecommunications
    10%
  • Industrials
    9%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    3%
  • Utilities
    2%
  • Real Estate
    2%

Sector allocation is diverse, with significant exposure to Technology (30.94%), Financial Services (11.68%), and Consumer Cyclicals (11.19%). This diversification across sectors helps to mitigate sector-specific risks. However, the heavy weighting in Technology could make the portfolio vulnerable to downturns in this sector. A more balanced sector allocation could be beneficial for reducing risk and ensuring steady returns across different market conditions.

Regions Info

  • North America
    81%
  • Europe Developed
    9%
  • Japan
    3%
  • Asia Emerging
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is predominantly focused on North America (80.64%), with smaller allocations in Europe Developed (8.54%), Japan (3.31%), and other regions. This concentration in North American markets could expose the portfolio to regional economic risks. Diversifying more into international markets could help in spreading risk and capturing growth opportunities from different parts of the world.

Dividends Info

  • Invesco NASDAQ 100 ETF 0.70%
  • Vanguard S&P 500 ETF 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 3.10%
  • Weighted yield (per year) 1.54%

The portfolio's dividend yield is not explicitly provided, but given the composition, it is likely to be moderate. Dividend-paying stocks can provide a steady income stream, which can be particularly beneficial during market downturns. Investors looking for regular income might consider adding more high-dividend stocks or funds to the portfolio to enhance the yield.

Ongoing product costs Info

  • Invesco NASDAQ 100 ETF 0.15%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.06%

The total expense ratio (TER) of the portfolio is quite low at 0.06%, with individual costs for Invesco NASDAQ 100 ETF (0.15%), Vanguard S&P 500 ETF (0.03%), and Vanguard Total International Stock Index Fund ETF Shares (0.08%). Low costs are beneficial as they help in maximizing net returns. Maintaining a low-cost structure is crucial for long-term investment success, so continuing to focus on cost-efficient funds is recommended.

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