Balanced portfolio with a strong focus on U.S. equities and low-cost index funds
Report created on Sep 13, 2025Risk profile
4/7
Diversification profile
5/5
Positions
-
FX Fidelity 500 Index Fund
FXAIX - US3159117502 70.00% -
FZ FIDELITY ZERO INTERNATIONAL INDEX FUND
FZILX - US31635T6091 20.00% -
FX FIDELITY U.S. BOND INDEX FUND INSTITUTIONAL PREMIUM CLASS
FXNAX - US3161463563 10.00%
The portfolio is heavily weighted towards equity, with a 70% allocation in the Fidelity 500 Index Fund, 20% in the Fidelity Zero International Index Fund, and a conservative 10% in the Fidelity U.S. Bond Index Fund Institutional Premium Class. This composition leans towards growth, with a significant emphasis on U.S. equities. The diversification across sectors and geographies, alongside a balanced mix of asset classes, aligns with a strategy aimed at mitigating risk while capitalizing on the growth potential of equities.
Growth
Historically, the portfolio has demonstrated a Compound Annual Growth Rate (CAGR) of 12.89%, with a maximum drawdown of -30.50%. These figures suggest a strong performance, albeit with periods of significant volatility. The days contributing most to returns highlight the portfolio's sensitivity to market movements. This performance, when compared to benchmarks, should be evaluated in the context of the portfolio's risk score and the investor's risk tolerance.
Projection
Using Monte Carlo simulations, which project future performance based on historical data, the portfolio shows a wide range of potential outcomes. While past performance doesn't guarantee future results, these simulations suggest a majority of scenarios result in positive returns, with a median annualized return of 9.16%. This tool helps in understanding potential risks and returns, though it's important to remember that simulations cannot predict future market conditions with certainty.
Asset classes
- Stocks 90%
- Bonds 10%
The portfolio's asset allocation is heavily skewed towards stocks (90%), with a minimal bond holding (10%). This allocation supports growth objectives but may increase volatility. Comparing this mix to a balanced benchmark, the portfolio might benefit from a slightly higher bond allocation to mitigate risk, especially in turbulent market conditions.
Sectors
- Technology 26%
- Financials 15%
- Consumer Discretionary 10%
- Industrials 9%
- Health Care 8%
- Telecommunications 8%
- Consumer Staples 5%
- Energy 3%
- Basic Materials 2%
- Utilities 2%
- Real Estate 2%
The sectoral allocation reveals a substantial tilt towards technology, financial services, and consumer cyclical sectors, which could drive growth but also increase exposure to sector-specific downturns. The diversified sector coverage is commendable, yet the concentration in high-growth sectors suggests a higher risk and reward profile.
Regions
- North America 72%
- No data 10%
- Europe Developed 8%
- Japan 3%
- Asia Developed 2%
- Asia Emerging 2%
- Australasia 1%
- Africa/Middle East 1%
With 72% of assets in North America and a modest allocation to international markets, the portfolio is well-positioned to capture U.S. market growth. However, the limited exposure to emerging markets and other developed regions might restrict global diversification benefits and exposure to global growth opportunities.
Market capitalization
- Mega-cap 43%
- Large-cap 31%
- Mid-cap 15%
- Small-cap 1%
The focus on mega and large-cap stocks (74% combined) is indicative of a preference for stability and established companies. While this may reduce volatility compared to portfolios with higher small or micro-cap exposure, it could also limit potential for outsized gains from smaller, high-growth companies.
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.
Considering the Efficient Frontier, the portfolio appears to be positioned for growth with a reasonable risk profile. However, there may be room for optimization to achieve a better risk-return balance. Adjusting the allocation between asset classes or diversifying further geographically and across sectors could enhance efficiency without significantly increasing risk.
Dividends
- Fidelity 500 Index Fund 1.10%
- FIDELITY U.S. BOND INDEX FUND INSTITUTIONAL PREMIUM CLASS 3.50%
- FIDELITY ZERO INTERNATIONAL INDEX FUND 2.40%
- Weighted yield (per year) 1.60%
The overall dividend yield of 1.60% contributes to the portfolio's total return, providing a steady income stream in addition to potential capital appreciation. This yield, while modest, complements the growth-focused strategy by offering periodic cash flow.
Ongoing product costs
- Fidelity 500 Index Fund 0.02%
- FIDELITY U.S. BOND INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.02%
- Weighted costs total (per year) 0.02%
The exceptionally low total expense ratio (TER) of 0.02% is a significant strength, ensuring that costs do not erode returns significantly. This cost efficiency is particularly beneficial over the long term, as even small differences in fees can have a substantial impact on net investment growth.
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