A growth-focused portfolio with a strong tilt towards technology and US large-cap stocks

Report created on Sep 24, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

This portfolio is heavily weighted towards equity, with a 100% allocation in stocks and no exposure to other asset classes like bonds or real estate. The majority of the investment is in the Vanguard S&P 500 ETF, making up half of the portfolio. This is supplemented by significant positions in technology and large-cap growth ETFs. The concentration in a few sectors, primarily technology, and the absence of international diversification, classify this as a low-diversity portfolio. This structure suggests a focus on growth, particularly in the technology sector, but raises concerns about the portfolio's vulnerability to sector-specific downturns.

Growth Info

Historically, this portfolio has shown a Compound Annual Growth Rate (CAGR) of 17.27%, with a maximum drawdown of -29.50%. The days contributing most to returns indicate that gains are concentrated in a few significant market movements. While past performance is impressive, it's essential to note that such high returns come with increased risk, especially considering the portfolio's concentration in the technology sector. These figures should be viewed with caution, as past performance is not indicative of future results, especially in a market environment that may shift away from favoring growth stocks.

Projection Info

Using Monte Carlo simulation, which projects future performance based on historical data, the portfolio shows a wide range of outcomes. The 50th percentile outcome suggests a potential 815.2% return, indicating optimism for continued growth. However, the reliance on historical trends, especially in a portfolio with high sector concentration, might not fully account for future market shifts. Diversification could mitigate some risks and potentially smooth out extreme outcomes.

Asset classes Info

  • Stocks
    100%

The portfolio's exclusive investment in stocks, without any allocation to bonds, real estate, or commodities, limits its diversification. While this aligns with a growth-focused strategy, it exposes the investor to higher volatility and sector-specific risks. Diversifying across different asset classes can provide a buffer against stock market fluctuations, potentially reducing volatility without significantly compromising growth potential.

Sectors Info

  • Technology
    50%
  • Telecommunications
    10%
  • Consumer Discretionary
    10%
  • Financials
    8%
  • Health Care
    7%
  • Industrials
    5%
  • Consumer Staples
    4%
  • Energy
    2%
  • Utilities
    2%
  • Basic Materials
    1%
  • Real Estate
    1%

With 50% of the portfolio allocated to technology, this sector's performance will heavily influence overall returns. While technology stocks have historically provided substantial growth, they can also be more volatile and susceptible to regulatory changes and market sentiment shifts. The minimal exposure to defensive sectors like utilities and consumer staples further accentuates the portfolio's aggressive growth stance but also its vulnerability to market downturns.

Regions Info

  • North America
    99%

The portfolio's geographic allocation is almost entirely in North America, with no exposure to developed European markets, Latin America, or Asia. This geographic concentration in a single region, while simplifying the investment strategy, neglects the potential benefits of global diversification. Exposure to international markets can offer growth opportunities in different economic cycles and additional diversification benefits.

Market capitalization Info

  • Mega-cap
    53%
  • Large-cap
    30%
  • Mid-cap
    15%
  • Small-cap
    2%

The focus on mega and big-cap stocks, representing 83% of the portfolio, suggests a preference for established companies with potentially lower volatility compared to smaller companies. However, this focus might limit exposure to high-growth opportunities in the mid and small-cap segments. While the current allocation supports the portfolio's growth orientation, incorporating a broader market cap range could enhance diversification and return potential.

Redundant positions Info

  • Vanguard Information Technology Index Fund ETF Shares
    Schwab U.S. Large-Cap Growth ETF
    Invesco NASDAQ 100 ETF
    High correlation

The high correlation among the technology-focused ETFs and the large-cap growth ETFs limits the portfolio's diversification benefits. This concentration increases the risk of significant losses during market downturns that particularly affect the technology sector. Diversifying into less correlated assets or sectors could reduce portfolio volatility and improve risk-adjusted returns.

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.

Before optimizing, it's recommended to address the portfolio's lack of diversification by considering the removal or reduction of overlapping assets, particularly those within the highly correlated technology sector. This step would not only reduce the portfolio's volatility but also improve its risk-adjusted returns. Optimization, in this case, involves balancing growth objectives with a more diversified asset allocation to mitigate sector-specific and market-wide risks.

Dividends Info

  • Invesco NASDAQ 100 ETF 0.40%
  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • Vanguard Information Technology Index Fund ETF Shares 0.40%
  • Vanguard S&P 500 ETF 1.10%
  • Weighted yield (per year) 0.75%

The overall dividend yield of the portfolio is relatively low, reflecting its growth-focused strategy. While dividends contribute to total returns, the primary return driver in this portfolio is expected to be capital appreciation. Investors prioritizing income might consider diversifying into assets with higher dividend yields. However, for growth-oriented investors, reinvesting dividends from the current holdings could compound growth over time.

Ongoing product costs Info

  • Invesco NASDAQ 100 ETF 0.15%
  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • Vanguard Information Technology Index Fund ETF Shares 0.10%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.06%

The portfolio's total expense ratio (TER) is impressively low at 0.06%, which is beneficial for long-term growth as lower costs directly translate to higher net returns. This cost efficiency is a positive aspect of the portfolio, especially important in a growth-focused strategy where compound growth plays a crucial role. Maintaining low costs while potentially diversifying could further enhance the portfolio's performance.

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