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A textbook example of over-diversification where more is less and less is more

Report created on May 6, 2025

Risk profile Info

3/7
Cautious
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

Diving into this portfolio is like opening a Swiss Army knife and finding out half the tools are just different shaped bottle openers. With a hefty 70% in stocks and a cautious 25% in bonds, it seems like a balanced meal until you realize it's mostly carbs. The spread across numerous ETFs might give the illusion of diversification, but it's more about collecting them like trading cards than strategic allocation. A closer look suggests a 'more is better' approach, which isn't always the case in investing.

Growth Info

Historically, this portfolio has chugged along with a CAGR of 8.70%, which isn't bad until you realize it's like winning a race because the other runners were tying their shoelaces. The max drawdown of -24.75% is a stark reminder that volatility is part and parcel of this journey, and days that make up 90% of returns being so few highlights how timing the market is a fool's errand. In essence, past performance is like relying on yesterday's lottery numbers to win today's jackpot.

Projection Info

Monte Carlo simulations are the financial equivalent of asking a magic 8-ball about your future wealth, offering a range of outcomes from dismal to delightful. In this portfolio's case, the 5th to 67th percentile spread from 1.2% to 226.7% paints a picture of uncertainty wide enough to drive a truck through. It's a sobering reminder that future projections are educated guesses, not guarantees, and heavily depend on the input assumptions, which in this case, seem to have been set by an optimist with a reality distortion field.

Asset classes Info

  • Stocks
    70%
  • Bonds
    25%

With stocks and bonds making up the lion's share of this portfolio, it's like attending a potluck dinner and only bringing bread and water. The 70% allocation in stocks is aggressively cautious or cautiously aggressive, depending on how you squint. The 25% in bonds is like wearing a life jacket in a kiddie pool — safety first, but perhaps overly so. The absence of alternative investments suggests a lack of creativity, or maybe just a fear of commitment to anything that doesn't have "ETF" in its name.

Sectors Info

  • Technology
    17%
  • Financials
    12%
  • Industrials
    8%
  • Consumer Discretionary
    8%
  • Health Care
    7%
  • Telecommunications
    6%
  • Consumer Staples
    4%
  • Basic Materials
    3%
  • Energy
    2%
  • Utilities
    2%
  • Real Estate
    2%

The sector allocation in this portfolio suggests a fear of missing out, with a smorgasbord approach that covers everything from tech to utilities. However, with technology taking up a 17% share, it's clear where the heart truly lies. The rest feels like an afterthought, like adding vegetables to a pizza to make it "healthy." This approach to sector allocation is akin to throwing darts at a board blindfolded — sometimes you'll hit a bullseye, but more often, you're just making holes in the wall.

Regions Info

  • North America
    39%
  • Europe Developed
    12%
  • Japan
    8%
  • Asia Emerging
    5%
  • Asia Developed
    3%
  • Africa/Middle East
    1%
  • Latin America
    1%
  • Australasia
    1%

Geographically, this portfolio screams "home bias" with a side of wanderlust. North America holding a 39% stake is like having a safety net made of eagle feathers — patriotic but not particularly comforting in a storm. The smattering of allocations across Europe, Japan, and emerging markets is the investing equivalent of collecting fridge magnets from airports — it looks worldly, but it's superficial. The negligible positions in Africa, Latin America, and Australasia are like acknowledging they exist on the map, but not much beyond that.

Market capitalization Info

  • Mega-cap
    32%
  • Large-cap
    25%
  • Mid-cap
    12%
  • No data
    5%
  • Small-cap
    1%

The market cap allocation seems to play it safe with a strong lean towards mega and big caps, which is akin to only shopping at big-box retailers — convenient but hardly adventurous. The minimal exposure to small and micro caps suggests a fear of the unknown or perhaps just a sensible aversion to volatility. However, this conservative approach may limit growth potential, like always ordering the same dish at a restaurant because you know you'll at least not get food poisoning.

Redundant positions Info

  • Vanguard S&P 500 UCITS ETF
    iShares Core MSCI World UCITS ETF USD (Acc)
    High correlation

The high correlation between the Vanguard S&P 500 UCITS ETF and the iShares Core MSCI World UCITS ETF USD (Acc) is like buying two different brands of vanilla ice cream and expecting a flavor explosion. This redundancy not only clutters the portfolio but also dilutes the impact of diversification. It's akin to wearing two raincoats in a drizzle — not only is it overkill, but you'll also likely end up just as wet from sweating as you would from the rain.

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.

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The portfolio's approach to optimization seems to have been inspired by a "throw everything at the wall and see what sticks" strategy. The recommendation to remove overlapping assets is like being told to stop buying the same shirt in different colors — it's obvious once pointed out, but somehow overlooked. The pursuit of diversification has led to a diffusion of focus, making the portfolio a jack of all trades but master of none. It's a gentle reminder that sometimes, less is indeed more.

Dividends Info

  • Vanguard S&P 500 UCITS ETF 0.30%
  • Weighted yield (per year) 0.04%

The focus on dividends seems to be an afterthought, with a total yield that wouldn't even excite a savings account. It's like tipping with pocket change — technically, you're doing something, but it's hardly making an impact. This oversight might be a missed opportunity for income, especially in a 'cautious' portfolio that could use the steady cash flow as a buffer against volatility. It's akin to leaving your car's eco-mode on while drag racing; you're in the race, but you're not winning it.

Ongoing product costs Info

  • iShares Core Global Aggregate Bond UCITS ETF 0.10%
  • iShares Core MSCI Europe UCITS ETF EUR (Acc) 0.20%
  • iShares Core MSCI World UCITS ETF USD (Acc) 0.20%
  • iShares Core MSCI Japan IMI UCITS ETF USD (Acc) 1.00%
  • iShares Core MSCI Emerging Markets IMI UCITS 0.18%
  • iShares MSCI World Value Factor UCITS 0.30%
  • Vanguard EUR Corporate Bond UCITS ETF EUR Accumulation 0.09%
  • Vanguard EUR Eurozone Government Bond UCITS ETF EUR Accumulation 0.07%
  • Vanguard S&P 500 UCITS ETF 0.07%
  • Weighted costs total (per year) 0.18%

Kudos for keeping the costs low, with a total TER of 0.18%. It's one of the few areas where this portfolio shines, like finding a designer dress at a thrift store — a rare gem in a sea of questionable choices. However, the cost savings are somewhat overshadowed by the portfolio's other inefficiencies. It's akin to saving money on gas by riding a bike, but then living so far from work that you're exhausted by the time you arrive.

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