A balanced and broadly diversified portfolio with a focus on global stocks and consumer staples

Report created on Apr 30, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio is structured around three core ETFs, emphasizing a strong foundation in both the U.S. and international equities, complemented by a targeted allocation in consumer staples. This composition reflects a strategic balance between broad market exposure and defensive positioning. By allocating 60% to U.S. equities, 30% to international stocks, and 10% to consumer staples, the portfolio leverages global diversification while aiming for stability through consumer staples—a sector known for its resilience during market volatility.

Growth Info

Historically, this portfolio has demonstrated a Compound Annual Growth Rate (CAGR) of 10.41%, with a maximum drawdown of -33.64%. These figures suggest a robust performance, balancing growth with a moderate level of risk. The days contributing to 90% of returns being limited to 22.0 indicates that while the portfolio has benefited from significant positive movements, it's also exposed to market volatility. Comparing this to benchmarks, the performance underscores the portfolio's effective balance of risk and return.

Projection Info

Using a Monte Carlo simulation, which projects future returns based on historical data, the portfolio's potential outcomes span a wide range. With a median projected increase of 215.9% and 971 out of 1,000 simulations showing positive returns, the analysis supports optimism for future growth. However, it's crucial to remember that these projections are hypothetical and subject to the limitations of past data, which may not fully predict future market conditions.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio's allocation is almost entirely in stocks (99%), with a minimal cash position (1%). This asset class concentration in equities underlines a growth-oriented strategy but also involves higher volatility and risk compared to portfolios with a more significant allocation to bonds or other asset classes. Diversification within equities across various geographies and sectors helps mitigate this risk to some extent.

Sectors Info

  • Technology
    22%
  • Financials
    15%
  • Consumer Staples
    15%
  • Industrials
    10%
  • Consumer Discretionary
    10%
  • Health Care
    9%
  • Telecommunications
    7%
  • Energy
    4%
  • Basic Materials
    3%
  • Real Estate
    3%
  • Utilities
    2%

The sectoral allocation reveals a well-thought-out blend of growth and stability. Technology and financial services, representing 22% and 15% of the portfolio respectively, offer growth potential. In contrast, the significant allocation to consumer defensive (15%) provides a stabilizing effect. This sectoral spread indicates a balanced approach, aiming to capture market upswings while cushioning against downturns.

Regions Info

  • North America
    72%
  • Europe Developed
    12%
  • Asia Emerging
    5%
  • Japan
    5%
  • Asia Developed
    3%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is heavily weighted towards North America (72%), followed by developed Europe (12%) and emerging Asia (5%). This distribution suggests a preference for the stability and mature markets of North America and Europe, with a cautious exposure to the growth potential in emerging markets. Expanding into more diverse geographies could further enhance diversification and potential for growth.

Market capitalization Info

  • Mega-cap
    41%
  • Large-cap
    30%
  • Mid-cap
    20%
  • Small-cap
    6%
  • Micro-cap
    2%

The market capitalization breakdown shows a preference for larger companies, with 41% in mega-cap and 30% in large-cap stocks. This bias towards larger, more established companies is consistent with the portfolio's balanced risk profile, offering stability and potential for steady growth. However, a modest increase in small and micro-cap exposure could offer higher growth potential, albeit with increased risk.

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 suggests it is positioned near the Efficient Frontier, indicating an optimal balance between risk and return based on historical data. However, continuous reassessment is vital to maintain this balance, especially as market conditions evolve. Adjustments to asset allocation or diversifying further across sectors and geographies could enhance the portfolio's efficiency, potentially offering better returns for the same level of risk.

Dividends Info

  • Fidelity® MSCI Consumer Staples Index ETF 2.20%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.40%
  • Vanguard Total International Stock Index Fund ETF Shares 3.10%
  • Weighted yield (per year) 1.99%

The portfolio's dividend yield stands at 1.99%, with the highest yield from the Vanguard Total International Stock Index Fund ETF Shares at 3.10%. This yield contributes to the portfolio's total return, providing a steady income stream alongside capital appreciation. For investors particularly focused on income, adjusting the balance towards higher-yielding assets could enhance the portfolio's income-generating capability.

Ongoing product costs Info

  • Fidelity® MSCI Consumer Staples Index ETF 0.08%
  • 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%

With a total expense ratio (TER) of 0.04%, the portfolio benefits from low costs, which is commendable. Lower costs directly translate to higher net returns over time, emphasizing the importance of cost efficiency in investment selection. This efficient cost structure is a strong foundation for long-term growth, aligning well with the portfolio's balanced strategy.

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