A balanced and globally diversified portfolio with a strategic focus on major equity markets

Report created on Sep 3, 2025

Risk profile Info

4/7
Balanced
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Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is evenly split between the Vanguard S&P 500 ETF and the Vanguard Total International Stock Index Fund ETF, offering a 50-50 exposure to U.S. and international stocks. This allocation provides a broad diversification across major equity markets, aligning with a balanced risk profile. The simplicity of this two-fund strategy underscores its appeal for investors seeking comprehensive market coverage without the complexity of managing multiple asset classes or sector-specific investments.

Growth Info

Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 12.07%, with a maximum drawdown of -33.88%. These figures indicate a resilient performance across various market conditions, especially considering the significant recovery from the drawdown. The performance is reflective of the inherent volatility in equity markets but also demonstrates the growth potential of a diversified investment in top global companies.

Projection Info

Monte Carlo simulations, which project future performance based on historical data, suggest a wide range of outcomes for this portfolio. The median projection shows a potential increase of 367.8%, with 992 out of 1,000 simulations yielding positive returns. This analysis, while informative, is based on past trends and cannot guarantee future results. Investors should consider this in the context of their risk tolerance and investment horizon.

Asset classes Info

  • Stocks
    98%
  • Cash
    2%

The portfolio's asset allocation is heavily weighted towards stocks (98%), with a minimal cash reserve (2%). This high equity exposure is typical for growth-oriented portfolios but comes with higher volatility. The absence of bonds or alternative investments limits diversification benefits that could mitigate risk. Investors might explore adding other asset classes to balance the growth potential against market downturns.

Sectors Info

  • Technology
    24%
  • Financials
    18%
  • Industrials
    12%
  • Consumer Discretionary
    10%
  • Health Care
    9%
  • Telecommunications
    8%
  • Consumer Staples
    6%
  • Basic Materials
    4%
  • Energy
    4%
  • Utilities
    3%
  • Real Estate
    3%

Sector allocation shows a heavy emphasis on technology and financial services, comprising 42% of the portfolio. This concentration in high-growth sectors can enhance returns but also increases susceptibility to sector-specific downturns. Diversification across a broader range of sectors could provide a buffer against volatility in any single sector.

Regions Info

  • North America
    54%
  • Europe Developed
    19%
  • Asia Emerging
    8%
  • Japan
    8%
  • Asia Developed
    6%
  • Australasia
    2%
  • Africa/Middle East
    2%
  • Latin America
    1%

Geographically, the portfolio is well-diversified, with significant exposure to North America (54%) and developed European markets (19%). Emerging markets exposure, though present, is limited. This geographic distribution supports risk management by spreading investments across different economic regions, but investors might consider increasing their stake in emerging markets to capitalize on higher growth potential.

Market capitalization Info

  • Mega-cap
    46%
  • Large-cap
    32%
  • Mid-cap
    17%
  • Small-cap
    2%

The portfolio's market capitalization breakdown—46% mega, 32% big, 17% medium, and a small allocation to small caps—indicates a conservative approach favoring established, large companies. This can reduce volatility but may also limit growth opportunities found in smaller, more dynamic firms. A slight increase in small to medium cap exposure could enhance growth prospects.

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 portfolio's current allocation between U.S. and international equities reflects a balanced approach to risk and return, potentially near the Efficient Frontier. This concept suggests the portfolio is optimized for the best possible risk-return ratio given its current assets. However, continuous review and minor adjustments could further enhance this balance, especially considering changing market conditions and personal financial goals.

Dividends Info

  • Vanguard S&P 500 ETF 1.20%
  • Vanguard Total International Stock Index Fund ETF Shares 2.80%
  • Weighted yield (per year) 2.00%

The overall dividend yield of 2.00% combines growth and income elements, providing a steady income stream in addition to capital appreciation. This yield, while modest, complements the portfolio's growth orientation and can be reinvested to compound returns over time. Investors should consider their income needs and tax implications when evaluating dividend strategies.

Ongoing product costs Info

  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.04%

With a total expense ratio (TER) of 0.04%, this portfolio benefits from exceptionally low costs, enhancing net returns over the long term. Low costs are crucial for long-term investment strategies, as they directly contribute to higher net returns by minimizing the drag on performance.

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