A conservative portfolio with high liquidity and moderate global equity exposure

Risk 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.

What type of investor this portfolio is suitable for

Conservative Investors

This portfolio suits an investor seeking stability and income with a low-risk tolerance and a medium to long-term horizon. It prioritizes capital preservation and steady returns, making it ideal for individuals who prefer a conservative approach to investing. The focus on liquidity and moderate equity exposure aligns with goals of maintaining wealth while cautiously participating in market growth.

Positions

  • iShares® 0-3 Month Treasury Bond ETF
    SGOV - US46436E7186
    50.00%
  • Vanguard Total Stock Market Index Fund ETF Shares
    VTI - US9229087690
    40.00%
  • Vanguard Total International Stock Index Fund ETF Shares
    VXUS - US9219097683
    10.00%

The portfolio is heavily weighted towards cash equivalents, with 50% in a treasury bond ETF, and the remaining 50% split between domestic and international equity ETFs. This composition leans conservative, prioritizing stability and liquidity over aggressive growth. Compared to a typical balanced portfolio, which might have a higher allocation to equities, this portfolio is positioned to minimize risk. For those seeking more growth potential, consider gradually increasing equity exposure, keeping in mind your risk tolerance and investment goals.

Growth Info

The historical performance shows a compound annual growth rate (CAGR) of 9.09%, which is impressive for a conservative portfolio. This suggests strong past returns, although it's crucial to remember that past performance doesn't guarantee future results. Compared to market benchmarks, this growth rate indicates efficient management of risk. If you're satisfied with this level of performance, maintaining the current allocation could be beneficial. However, if you're seeking higher returns, consider adjusting the equity-to-cash ratio.

Projection Info

Using Monte Carlo simulations, the portfolio's potential future outcomes are projected, with a 50th percentile end value of 244.38%. This method uses historical data to simulate various market conditions, but it's important to note that these projections are not guarantees. The simulations show a high probability of positive returns, reinforcing the portfolio's conservative nature. To align with your expectations, periodically review these projections and adjust the portfolio if necessary to meet changing financial goals.

Asset classes Info

  • Cash
    50%
  • Stocks
    50%
  • Other
    0%
  • No data
    0%

The portfolio is split between cash (50%) and stocks (50%), offering a moderate level of diversification. This allocation is typical for conservative investors, as cash provides stability while stocks offer growth potential. Compared to benchmarks, the cash allocation is higher, which reduces risk but also limits growth. If you're comfortable with more risk for potential higher returns, consider increasing stock exposure gradually.

Sectors Info

  • Technology
    14%
  • Financials
    7%
  • Health Care
    6%
  • Consumer Discretionary
    5%
  • Industrials
    5%
  • Telecommunications
    4%
  • Consumer Staples
    3%
  • Energy
    2%
  • Basic Materials
    2%
  • Real Estate
    1%
  • Utilities
    1%

The sector allocation is diverse, with technology, financial services, and healthcare being the largest, reflecting broader market trends. This distribution mirrors common benchmarks, indicating a balanced approach to sector exposure. However, technology's prominence may introduce volatility during market fluctuations. To mitigate this, you could consider slightly increasing allocations to underrepresented sectors, ensuring alignment with long-term goals and risk appetite.

Regions Info

  • North America
    41%
  • Europe Developed
    4%
  • Asia Emerging
    2%
  • Japan
    2%
  • Asia Developed
    1%
  • Australasia
    1%
  • Africa/Middle East
    0%
  • Latin America
    0%
  • Europe Emerging
    0%

Geographically, the portfolio is predominantly North American-focused, with limited exposure to other regions. This aligns with many conservative portfolios but may miss opportunities in emerging markets. Compared to global benchmarks, there's an underexposure to international markets, which could limit diversification benefits. To enhance geographic diversity, consider gradually increasing allocations to non-North American regions, keeping in mind the associated risks and potential rewards.

Dividends Info

  • iShares® 0-3 Month Treasury Bond ETF 5.10%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 3.40%
  • Weighted yield (per year) 3.41%

The portfolio offers a total dividend yield of 3.41%, significantly supported by the treasury bond ETF's yield. Dividends can provide a steady income stream, which is appealing for conservative investors. Compared to typical dividend-focused portfolios, this yield is competitive. To maintain or enhance income, consider reinvesting dividends or exploring other income-generating investments that align with your risk tolerance.

Ongoing product costs Info

  • iShares® 0-3 Month Treasury Bond ETF 0.07%
  • Vanguard Total Stock Market Index Fund ETF Shares 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 0.06% is impressively low, supporting better long-term performance by minimizing costs. This aligns well with best practices for cost-efficient investing. Compared to similar portfolios, these costs are favorable, contributing to higher net returns. Continue monitoring fund fees and consider replacing high-cost funds with lower-cost alternatives to maintain this advantage.

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.

The portfolio's current risk-return profile could be optimized using the Efficient Frontier, which suggests a more efficient allocation could yield higher returns at the same risk level. The Efficient Frontier is a concept that helps identify the best possible risk-return ratio. While the current allocation is already conservative, exploring minor adjustments could enhance returns without significantly increasing risk.

What next?

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.