This portfolio has only about 4.8 years of historical data, based on the youngest asset in the portfolio. Some metrics, projections, and AI insights may be less reliable and should be interpreted with caution.

High-Risk Growth Portfolio with Low Diversification and Heavy U.S. Exposure

Report created on Jul 25, 2024

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

The portfolio is heavily weighted towards equities, with a significant concentration in the U.S. market. It includes five ETFs, with Vanguard S&P 500 ETF making up 40%, Avantis U.S. Small Cap Value ETF at 15%, Fidelity MSCI Financials Index ETF at 15%, SPDR S&P MIDCAP 400 ETF Trust at 15%, and Vanguard Information Technology Index Fund ETF Shares at 15%. This composition shows a strong preference for growth-oriented investments, but lacks diversification, which can increase risk.

Growth Info

Historically, the portfolio has performed well with a CAGR of 15.43%. However, it has also experienced significant volatility, highlighted by a max drawdown of -37.99%. This means the portfolio has had periods of substantial losses, which is typical for growth-focused investments. The returns are concentrated, with 90% of returns coming from just 14 days. This indicates high volatility and the importance of timing in this portfolio's performance.

Projection Info

Using a Monte Carlo simulation with 1,000 iterations, the portfolio shows a wide range of potential outcomes. The 5th percentile outcome is a 37.04% return, while the median (50th percentile) is 662.4%, and the 67th percentile is 1,071.14%. The simulations indicate a high level of uncertainty but also a potential for substantial gains. The annualized return across all simulations is 18.94%, suggesting strong long-term growth potential, albeit with significant risk.

Asset classes Info

  • Stocks
    100%

The portfolio is almost entirely composed of stocks, with 99.84% allocated to equities and a negligible 0.16% in cash. This heavy reliance on stocks aligns with a high-risk, high-reward strategy. While this can lead to substantial gains, it also exposes the portfolio to significant market volatility. Diversifying into other asset classes such as bonds or real assets could help mitigate some of this risk.

Sectors Info

  • Technology
    30%
  • Financials
    26%
  • Industrials
    9%
  • Consumer Discretionary
    9%
  • Health Care
    7%
  • Energy
    5%
  • Telecommunications
    4%
  • Consumer Staples
    4%
  • Basic Materials
    3%
  • Real Estate
    2%
  • Utilities
    1%

The sector allocation is concentrated, with Technology making up 30.26% and Financial Services at 25.67%. Other sectors like Industrials, Consumer Cyclicals, and Healthcare have smaller allocations. This concentration in a few sectors increases the portfolio's vulnerability to sector-specific downturns. A more balanced sector allocation could help reduce risk and provide more stable returns.

Regions Info

  • North America
    99%
  • Europe Developed
    1%

Geographically, the portfolio is overwhelmingly focused on North America, with 98.82% of assets in this region. This lack of international diversification exposes the portfolio to risks specific to the U.S. market. Including more international assets could help spread risk and capitalize on growth opportunities in other regions.

Dividends Info

  • Avantis® U.S. Small Cap Value ETF 1.60%
  • Fidelity® MSCI Financials Index ETF 1.60%
  • SPDR® S&P MIDCAP 400 ETF Trust 1.20%
  • Vanguard Information Technology Index Fund ETF Shares 0.70%
  • Vanguard S&P 500 ETF 1.30%
  • Weighted yield (per year) 1.28%

The portfolio's dividend yield data isn't provided, but given the focus on growth-oriented ETFs, the yield is likely modest. Growth stocks typically reinvest earnings to fuel expansion rather than paying out dividends. If income generation is a goal, incorporating dividend-paying stocks or ETFs could provide a more balanced approach.

Ongoing product costs Info

  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Fidelity® MSCI Financials Index ETF 0.08%
  • SPDR® S&P MIDCAP 400 ETF Trust 0.24%
  • Vanguard Information Technology Index Fund ETF Shares 0.10%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.11%

The portfolio's total expense ratio (TER) is 0.11%, which is relatively low. This is beneficial as lower costs mean more of the returns are retained by the investor. Keeping investment costs low is a key factor in maximizing long-term returns. Regularly reviewing and minimizing expenses can further enhance portfolio performance.

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