Broad low cost global equity allocation with balanced risk and efficient diversification
Report created on Mar 24, 2026Risk 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.
Positions
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VT Vanguard Total Stock Market Index Fund ETF Shares
VTI - US9229087690 66.67% -
VX Vanguard Total International Stock Index Fund ETF Shares
VXUS - US9219097683 33.33%
The portfolio is built from just two broad stock ETFs, with roughly two‑thirds in a total domestic market fund and one‑third in a total international fund, plus a tiny cash slice. This creates a simple, “own almost everything” stock allocation that is easy to manage and rebalance. Holding only two highly diversified funds keeps trading decisions minimal and reduces the chance of style drift or accidental concentration in narrow themes. For someone wanting long‑term growth and willing to ride stock market ups and downs, this structure is very coherent. The main takeaway is that this is a nearly pure global equity portfolio, so return potential is high but so is exposure to equity downturns.
Growth
From 2016 to early 2026, a hypothetical $1,000 in this mix grew to about $3,232. That’s a compound annual growth rate (CAGR) of 13.31%, which sits between the US market’s 14.32% and the global market’s 11.78%. CAGR is like average speed on a road trip, smoothing out bumps to show steady progress. The portfolio’s max drawdown, about ‑34.6%, was slightly deeper than the benchmarks but broadly similar, showing it behaved like a typical diversified equity allocation. This alignment with major indices is encouraging and suggests the approach has captured global equity returns effectively, though it has modestly lagged a pure US tilt in this specific decade.
Projection
The forward projection uses Monte Carlo simulation, which means it takes the portfolio’s historical returns and volatility, scrambles them into thousands of random paths, and sees where things land. It’s like simulating many alternate futures based on past weather patterns. After 10 years, the median scenario roughly quadruples the initial amount, while the pessimistic 5th percentile still shows gains around 62%. Importantly, 991 out of 1,000 simulations end positive, reflecting the strong historical profile. However, these are models, not promises; markets can behave very differently from history. The key takeaway is that long‑term outcomes skew strongly positive but with a wide range, so staying invested through rough patches is crucial.
Asset classes
- Stocks 99%
- Cash 1%
Almost all of the portfolio sits in stocks (about 99%), with only about 1% in cash. This is a classic high‑equity allocation that prioritizes long‑term growth over short‑term stability. Compared with a typical “balanced” mix that might include a significant bond component, this setup will likely swing more in bear markets but also historically has offered higher expected returns. The high equity share is well‑aligned with long horizons and a willingness to tolerate volatility. For shorter‑term goals or lower risk tolerance, adding a meaningful slice of high‑quality bonds or cash‑like assets can smooth the ride and reduce the impact of equity drawdowns.
Sectors
- Technology 26%
- Financials 16%
- Industrials 12%
- Consumer Discretionary 10%
- Health Care 9%
- Telecommunications 8%
- Consumer Staples 5%
- Basic Materials 4%
- Energy 4%
- Utilities 3%
- Real Estate 3%
Sector exposure is broadly diversified: technology leads at 26%, followed by financials, industrials, consumer cyclicals, healthcare, communications, consumer defensive, materials, energy, utilities, and real estate. This spread closely mirrors global equity benchmarks, which is a strong sign of healthy diversification. The technology tilt is notable but not extreme given today’s index composition, so it benefits from growth and innovation trends while still balancing with more cyclical and defensive areas. Tech‑heavy allocations can be more sensitive to interest rate changes and sentiment shifts, but here they sit within a broad base of sectors, which helps moderate that risk. This sector mix is well‑balanced and aligns closely with global standards.
Regions
- North America 69%
- Europe Developed 12%
- Japan 5%
- Asia Developed 5%
- Asia Emerging 5%
- Australasia 1%
- Africa/Middle East 1%
- Latin America 1%
Geographically, about 69% is in North America, with the rest spread across developed Europe, Japan, developed and emerging Asia, plus small slices in Australasia, Latin America, and Africa/Middle East. This reflects the reality that North American markets, especially the US, dominate global stock market value. It’s similar to common global benchmarks, so there is no extreme home or foreign bias. The benefit is strong exposure to one of the world’s most dynamic markets while still owning a wide range of international companies. The tradeoff is that performance will be heavily influenced by North American conditions, so periods of US underperformance may feel more pronounced despite the international diversification.
Market capitalization
- Mega-cap 43%
- Large-cap 30%
- Mid-cap 18%
- Small-cap 5%
- Micro-cap 2%
The market cap breakdown skews heavily to larger companies: about 43% mega‑cap, 30% big, 18% medium, 5% small, and 2% micro. This is what you’d expect from traditional cap‑weighted index funds, where the biggest companies take the largest weights. Large and mega‑caps tend to be more stable and widely followed, reducing the risk of individual business blowups but sometimes limiting exposure to high‑growth smaller firms. The modest slice in small and micro caps still provides some growth punch and diversification, but they won’t dominate behavior. Anyone wanting a stronger tilt to smaller companies could layer in dedicated small‑cap exposure, though that also raises volatility and tracking error versus broad benchmarks.
True holdings
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NV NVIDIA Corporation 4.12%
Part of fund(s):- Schwab U.S. Broad Market ETF
- Vanguard Total International Stock Index Fund ETF Shares
- Vanguard Total Stock Market Index Fund ETF Shares
-
AA Apple Inc 3.93%
Part of fund(s):- Schwab U.S. Broad Market ETF
- Vanguard Dividend Appreciation Index Fund ETF Shares
- Vanguard Total International Stock Index Fund ETF Shares
- Vanguard Total Stock Market Index Fund ETF Shares
-
MS Microsoft Corporation 2.94%
Part of fund(s):- Schwab U.S. Broad Market ETF
- Vanguard Dividend Appreciation Index Fund ETF Shares
- Vanguard Total International Stock Index Fund ETF Shares
- Vanguard Total Stock Market Index Fund ETF Shares
-
AM Amazon.com Inc 2.03%
Part of fund(s):- Schwab U.S. Broad Market ETF
- Vanguard Total International Stock Index Fund ETF Shares
- Vanguard Total Stock Market Index Fund ETF Shares
-
GO Alphabet Inc Class A 1.83%
Part of fund(s):- Schwab U.S. Broad Market ETF
- Vanguard Total International Stock Index Fund ETF Shares
- Vanguard Total Stock Market Index Fund ETF Shares
-
AV Broadcom Inc 1.52%
Part of fund(s):- Schwab U.S. Broad Market ETF
- Vanguard Dividend Appreciation Index Fund ETF Shares
- Vanguard Total International Stock Index Fund ETF Shares
- Vanguard Total Stock Market Index Fund ETF Shares
-
GO Alphabet Inc Class C 1.44%
Part of fund(s):- Schwab U.S. Broad Market ETF
- Vanguard Total International Stock Index Fund ETF Shares
- Vanguard Total Stock Market Index Fund ETF Shares
-
ME Meta Platforms Inc. 1.42%
Part of fund(s):- Schwab U.S. Broad Market ETF
- Vanguard Total International Stock Index Fund ETF Shares
- Vanguard Total Stock Market Index Fund ETF Shares
-
TS Tesla Inc 1.15%
Part of fund(s):- LS 1x Tesla Tracker ETP Securities GBP
- Schwab U.S. Broad Market ETF
- Vanguard Total International Stock Index Fund ETF Shares
- Vanguard Total Stock Market Index Fund ETF Shares
-
23 Taiwan Semiconductor Manufacturing Co. Ltd. 1.14%
Part of fund(s):- Vanguard International Equity Index Funds - Vanguard FTSE Emerging Markets ETF
- Vanguard Total International Stock Index Fund ETF Shares
- iShares Asia 50 ETF
- Top 10 total 21.52%
Looking through the ETFs, the top exposures are familiar mega‑cap names like NVIDIA, Apple, Microsoft, Amazon, Alphabet, Broadcom, Meta, Tesla, and TSMC. These are present via the index funds, not as separate bets, which is normal in cap‑weighted strategies where the largest companies dominate. There is some overlap because many of these firms appear in multiple indexes, but that’s by design in global capitalization‑weighted investing. It does mean a meaningful slice of risk is tied to a relatively small group of very large companies. For anyone concerned about that, balancing with strategies that don’t strictly follow market size weights can spread influence away from a few giants.
Factors
Factor exposure shows strong tilts toward size, low volatility, and momentum. Factors are characteristics like “recent winners” (momentum) or “steadier stocks” (low volatility) that research links to long‑term returns, kind of like underlying flavors in a recipe. A size exposure of 85% suggests a meaningful bias versus a purely neutral market weighting, while 56.7% low volatility and 41.7% momentum indicate holdings that have, on average, been relatively steady and recently strong performers. These tilts can help in trending markets and may cushion some downturns, but factor relationships evolve over time. Since average signal coverage is only 44.5%, readings are somewhat incomplete and should be viewed as directional, not precise.
Risk contribution
-
Vanguard Total Stock Market Index Fund ETF Shares
Weight: 66.67% 69.4% -
Vanguard Total International Stock Index Fund ETF Shares
Weight: 33.33% 30.6%
Risk contribution looks at how much each holding adds to overall portfolio ups and downs, which can differ from simple weights. Here, the domestic total market ETF is about two‑thirds of the weight but roughly 69% of total risk, while the international ETF is one‑third of weight and about 31% of risk. That’s a fairly proportional pattern, with no single position contributing wildly more risk than its share. Because there are only two main holdings, essentially 100% of risk comes from them. The good news is that risk is distributed in line with the design. If someone wanted to fine‑tune behavior, adjusting the domestic/international split would be the key lever.
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.
On the risk‑return chart, the current portfolio sits right on the efficient frontier, meaning it already uses its two holdings in a mathematically efficient way for its chosen risk level. The efficient frontier is the curve of best possible returns for each level of risk, given the existing ingredients. The portfolio’s Sharpe ratio, a measure of return per unit of volatility, is 0.65. The optimal mix on the curve has a higher Sharpe of 0.75 with slightly more risk and return, while the minimum‑variance option lowers risk and expected return a bit. The key insight: reweighting between the same two funds could fine‑tune risk and return, but the current setup is already very solid.
Dividends
- Vanguard Total Stock Market Index Fund ETF Shares 1.20%
- Vanguard Total International Stock Index Fund ETF Shares 3.00%
- Weighted yield (per year) 1.80%
The overall dividend yield is about 1.8%, combining roughly 1.2% from the domestic fund and 3.0% from the international fund. That’s a moderate income stream for an equity‑heavy portfolio, reflecting today’s relatively low yields in many developed markets. Dividends might not cover significant ongoing spending needs, but they meaningfully contribute to total return when reinvested, especially over long periods. International exposure often boosts yield because many foreign markets distribute more cash relative to price. For growth‑focused investors, automatically reinvesting these dividends keeps the compounding engine running. Those seeking higher current income would typically look at dedicated income strategies or a mix of equities and bonds.
Ongoing product costs
- Vanguard Total Stock Market Index Fund ETF Shares 0.03%
- Vanguard Total International Stock Index Fund ETF Shares 0.05%
- Weighted costs total (per year) 0.04%
Total ongoing costs are extremely low, around 0.04% per year across the two ETFs. This is impressively low and strongly supports better long‑term performance, because fees are one of the few things investors can reliably control. Think of it as keeping more of the portfolio’s “wages” instead of paying them out as overhead. Over decades, even small fee differences can compound into meaningful dollar amounts. Compared with many actively managed strategies that charge much more, this cost structure is a real strength. It means the portfolio is essentially capturing market returns with minimal drag, which aligns with best practices for long‑term, diversified investing.
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