A growth-focused portfolio concentrated in US equities with a strong tech sector presence

Report created on Dec 29, 2024

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

1/5
Single-Focused
Less diversification More diversification

Positions

This portfolio is heavily weighted towards US equity ETFs, with 80% in large-cap indices like the S&P 500 and Nasdaq-100, and 20% in the Russell 2000. This composition leans towards growth, reflecting a focus on capital appreciation. Compared to a typical diversified portfolio, this one is narrower, emphasizing US equities. While this approach can capture significant growth, it may lack the risk mitigation benefits of broader diversification. Consider whether this concentrated exposure aligns with your risk tolerance and investment goals.

Growth Info

Historically, the portfolio has delivered strong returns, with a CAGR of 18.7%, significantly outperforming many global benchmarks. However, it also experienced a maximum drawdown of -32.59%, indicating potential volatility. While past performance is impressive, it's crucial to remember that it doesn't guarantee future results. To manage risk, ensure your portfolio aligns with your risk tolerance, and consider diversifying to smooth out returns during market downturns.

Projection Info

A Monte Carlo simulation, which uses historical data to project future outcomes, suggests an annualized return of 19.62%. While 998 out of 1,000 simulations showed positive returns, remember that these projections are based on past trends and assumptions, which may not hold in the future. To enhance confidence in potential outcomes, consider regularly reviewing and adjusting your portfolio to reflect changing market conditions and personal financial goals.

Asset classes Info

  • Stocks
    60%
  • Other
    40%

The portfolio is primarily composed of stocks, with a small allocation to other asset classes. This allocation is typical for growth-focused portfolios, aiming for capital appreciation. However, it lacks the diversification benefits that other asset classes, like bonds or real estate, might provide. A more balanced mix could reduce volatility and provide more stable returns over time. Evaluate whether adding different asset classes aligns with your risk tolerance and investment objectives.

Sectors Info

  • Technology
    16%
  • Financials
    9%
  • Health Care
    7%
  • Industrials
    6%
  • Consumer Discretionary
    6%
  • Telecommunications
    4%
  • Consumer Staples
    3%
  • Energy
    2%
  • Real Estate
    2%
  • Basic Materials
    2%
  • Utilities
    2%

The portfolio is tech-heavy, with 15.98% in technology, followed by financial services and healthcare. This sector concentration can drive growth, especially in bullish markets, but may also increase volatility. Tech stocks are sensitive to interest rate changes and regulatory shifts. Your sector allocation aligns with growth trends but consider diversifying into underrepresented sectors to mitigate risks associated with sector-specific downturns.

Regions Info

  • North America
    60%

Geographically, the portfolio is concentrated in North America, with 59.51% exposure, and minimal allocations elsewhere. This focus can benefit from the robust US market but may miss opportunities in other regions. A more geographically diversified portfolio can reduce region-specific risks and capture growth in emerging markets. Assess whether increasing exposure to other regions aligns with your investment strategy and risk tolerance.

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 Efficient Frontier analysis suggests a more optimal portfolio could achieve a 21.97% expected return at the same risk level. This involves reallocating existing assets to achieve a better risk-return balance. While optimizing for efficiency can enhance returns, it may not address diversification or other investment goals. Consider whether such optimization aligns with your broader financial strategy and risk tolerance.

Ongoing product costs Info

  • EasyETF - BNP Paribas Easy S&P 500 UCITS ETF 0.12%
  • Amundi ETF PEA Nasdaq-100 UCITS ETF 0.23%
  • Amundi Index Solutions - Amundi Russell 2000 ETF-C EUR 0.35%
  • Weighted costs total (per year) 0.21%

The portfolio's total expense ratio (TER) is 0.21%, which is relatively low and supports better long-term performance by minimizing costs. Keeping expenses low is crucial for maximizing net returns over time. Regularly review the cost structures of your investments and consider replacing high-fee assets with lower-cost alternatives to enhance returns without increasing risk.

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