Concentrated low cost growth portfolio closely tracking the broad United States stock market
Report created on May 29, 2024Risk profile
5/7
Diversification profile
2/5
Positions
-
SC Schwab U.S. Large-Cap Growth ETF
SCHG - US8085243009 50.00% -
VO Vanguard S&P 500 ETF
VOO - US9229083632 50.00%
This portfolio is extremely simple: two U.S. equity ETFs at 50% each, both focused on large companies. One fund leans into faster‑growing businesses, while the other tracks a very broad basket of big U.S. stocks. That means the entire allocation rides on the fortunes of large U.S. companies, with no bonds, cash, or non‑U.S. markets in the mix. Simplicity can be powerful because it’s easy to understand and maintain. The flip side is that all the ups and downs come from one major asset type, so when that part of the market struggles, the whole portfolio feels it without much of a cushion.
Growth
From 2016 to 2026, $1,000 grew to about $4,147, giving a compound annual growth rate (CAGR) of 15.32%. CAGR is like the average yearly “speed” of your money over that whole trip, smoothing out the bumps. This comfortably beat both the U.S. market overall and a global market basket, which is a strong outcome. The worst drop along the way, the max drawdown, was about -33%, similar to the benchmarks. So the portfolio has delivered stronger returns without meaningfully worse crashes, which is exactly what growth‑oriented investors generally hope to see, while still needing the emotional ability to sit through deep declines.
Asset classes
- Stocks 100%
Every dollar is in stocks, with no allocation to bonds, cash, or alternatives. That creates a very “equity‑only” profile: high long‑term growth potential paired with meaningful short‑term swings. Compared with more classic balanced mixes that add bonds for stability, this structure prioritizes growth over downside protection. For investors with long horizons and steady incomes, that can make sense. But it also means that in severe market downturns, the portfolio has no built‑in ballast to help soften falls. Anyone using this setup would typically keep a separate cash or bond buffer elsewhere for emergencies or near‑term spending.
Sectors
- Technology 39%
- Telecommunications 13%
- Consumer Discretionary 11%
- Financials 10%
- Health Care 9%
- Industrials 7%
- Consumer Staples 4%
- Energy 2%
- Basic Materials 2%
- Utilities 1%
- Real Estate 1%
Sector exposure leans heavily into technology at 39%, followed by telecommunications, consumer discretionary, and financials, with smaller slices across other areas. This looks quite similar to many modern U.S. equity benchmarks, so it’s aligned with how the market itself is structured today, which is a positive for diversification within stocks. Tech and related growth sectors have powered recent returns, but they can be more sensitive to interest rate changes and investor sentiment. That means periods of rapid gains can be followed by sharp pullbacks. Keeping this tilt intentional and understood is important when big swings eventually show up.
Regions
- North America 100%
Geographically, the portfolio is 100% North America, entirely in U.S. companies. That simplifies currency risk and makes performance closely match the U.S. economic and market cycle. Versus global benchmarks that include large chunks of other developed and emerging countries, this is a notable home‑country tilt. When U.S. stocks outperform the world, that focus is very rewarding; when they lag, there’s no offset from foreign markets. Some investors prefer this because most of their spending is in dollars, while others like mixing in non‑U.S. exposure so that results aren’t tied so tightly to a single country’s fortunes.
Market capitalization
- Mega-cap 55%
- Large-cap 29%
- Mid-cap 15%
- Small-cap 1%
Market‑cap exposure is dominated by mega‑cap and large‑cap stocks, with only a thin slice in mid‑ and small‑caps. That means the portfolio moves largely with the biggest, most established companies, the same names that dominate major U.S. indexes. Big firms tend to be more stable and financially resilient than tiny ones but may not provide the same “lottery ticket” upside as very small, fast‑growing businesses. The trade‑off is smoother behavior relative to a small‑cap‑heavy mix, but also more reliance on a concentrated group of corporate giants. This alignment with broad benchmarks is a strong sign of mainstream equity exposure.
True holdings
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NV NVIDIA Corporation 9.42%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- Vanguard S&P 500 ETF
-
AA Apple Inc 8.30%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- Vanguard S&P 500 ETF
-
MS Microsoft Corporation 6.32%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- Vanguard S&P 500 ETF
-
AM Amazon.com Inc 4.50%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- Vanguard S&P 500 ETF
-
GO Alphabet Inc Class A 3.91%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- Vanguard S&P 500 ETF
-
AV Broadcom Inc 3.35%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- Vanguard S&P 500 ETF
-
GO Alphabet Inc Class C 3.12%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- Vanguard S&P 500 ETF
-
ME Meta Platforms Inc. 3.04%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- Vanguard S&P 500 ETF
-
TS Tesla Inc 2.87%
Part of fund(s):- LS 1x Tesla Tracker ETP Securities GBP
- Schwab U.S. Large-Cap Growth ETF
- Vanguard S&P 500 ETF
-
LL Eli Lilly and Company 1.40%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- Top 10 total 46.23%
Looking through the ETFs, the top underlying positions are the same mega U.S. names: NVIDIA, Apple, Microsoft, Amazon, Alphabet, Broadcom, Meta, Tesla, and Eli Lilly. Many of these appear in both funds, creating hidden concentration in a handful of giants, even though you technically only own two ETFs. Because the data only covers ETF top‑10 holdings, the true overlap is probably a bit higher. This kind of clustering can supercharge returns when these companies do well but also ties the portfolio’s fate closely to a small group of growth‑heavy leaders, making performance more sensitive to news about them.
Factors
Factor exposure shows mild tilts away from value, size, and yield, with neutral readings on momentum, quality, and low volatility. In plain English, this leans a bit toward larger, growthier, lower‑dividend companies, without extreme bets on any single factor. Factors are like investing “personalities” (cheap vs. expensive, big vs. small, steady vs. jumpy) that research has linked to returns. Here, the modest growth bias fits the large‑cap growth focus but stays within a fairly balanced range. That means the portfolio should behave roughly like the overall market, just slightly faster‑moving when growth stocks are in favor.
Risk contribution
-
Schwab U.S. Large-Cap Growth ETF
Weight: 50.00% 54.6% -
Vanguard S&P 500 ETF
Weight: 50.00% 45.4%
Risk contribution shows how much each ETF drives the portfolio’s overall ups and downs, which can differ from simple weight. The growth ETF is 50% of the portfolio but contributes about 55% of risk, while the broad S&P 500 ETF is 50% of weight and 45% of risk. That tells you the growth slice is slightly more volatile, as expected, and pulls returns more on the way up and down. Importantly, no single holding dominates risk in an extreme way, which is healthy. Still, any shift in the balance between these two funds would subtly tilt the overall risk profile.
Redundant positions
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High correlationVanguard S&P 500 ETFSchwab U.S. Large-Cap Growth ETF
The two ETFs have a correlation of 0.95, meaning they move very similarly most of the time. Correlation measures how often assets zig and zag together, where 1.0 would be nearly identical motion. Because both funds focus on large U.S. stocks, it’s natural that there’s limited diversification benefit between them. This doesn’t make the portfolio “bad,” but it does mean you’re essentially running a single U.S. equity strategy with a growth tilt, not two independent return streams. Anyone wanting more shock absorbers would normally look at mixing in less‑correlated assets, like bonds or different regions, outside this core.
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 mix sits right on or very close to the efficient frontier. The efficient frontier represents the best possible trade‑off between risk (volatility) and return using just these holdings at different weights. The portfolio’s Sharpe ratio of 0.73, a measure of return per unit of risk, is close to the maximum achievable with these two ETFs, which is a strong sign of efficiency. An even more “optimal” mix would only slightly tweak risk and return. That means the main questions are about overall risk level and diversification, not about fixing a poorly constructed allocation.
Dividends
- Schwab U.S. Large-Cap Growth ETF 0.30%
- Vanguard S&P 500 ETF 1.20%
- Weighted yield (per year) 0.75%
The overall dividend yield is about 0.75%, with the growth ETF paying very little and the broad market ETF doing most of the income work. Dividends are the cash payments companies distribute to shareholders, like a small paycheck from your investments. A lower yield is typical for growth‑oriented portfolios because those companies often reinvest profits instead of paying them out. This setup makes more sense for investors focused on long‑term growth rather than immediate income. For someone seeking current cash flow, this level of yield would usually be complemented with separate income‑oriented holdings.
Ongoing product costs
- Schwab U.S. Large-Cap Growth ETF 0.04%
- Vanguard S&P 500 ETF 0.03%
- Weighted costs total (per year) 0.04%
Costs are impressively low: the total ongoing fee (TER) is about 0.04% per year. TER, or Total Expense Ratio, is what the fund charges annually to manage the money, like a tiny membership fee. At this level, fees barely nibble at returns, which strongly supports long‑term compounding. Keeping costs down is one of the few things investors can control, and this portfolio does that extremely well. Over decades, paying a fraction of a percent instead of a full percent can mean thousands of extra dollars staying in your account rather than going to fund managers.
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