This portfolio has only about 10 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.
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Balanced and Broadly Diversified Portfolio with Strong Historic Performance

Report created on Jul 23, 2024

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio consists of two primary ETFs: Vanguard S&P 500 ETF, making up 60%, and Vanguard Total International Stock Index Fund ETF Shares at 40%. This setup provides a solid foundation with exposure to both U.S. and international markets. The heavy weighting towards the S&P 500 suggests a strong belief in the U.S. market's performance, while the international ETF adds global diversification. This blend aims to balance risk and return, making it a well-rounded choice for a balanced investor.

Growth Info

Historically, the portfolio has shown a Compound Annual Growth Rate (CAGR) of 10.18%, which is quite impressive. However, it also experienced a maximum drawdown of -33.89%, indicating significant volatility at times. The fact that 90% of the returns were generated in just 25 days highlights the importance of staying invested during volatile periods. This performance suggests that while the portfolio can deliver strong returns, it demands a level of patience and resilience from the investor.

Projection Info

Using a Monte-Carlo simulation with 1,000 runs, we projected the portfolio's future performance based on a hypothetical initial investment. The median (50th percentile) end value was 224.59%, and the 67th percentile was 331.03%, indicating a strong potential for growth. The 5th percentile at 5.51% shows that even in less favorable scenarios, the portfolio has a good chance of positive returns. This simulation underscores the portfolio's potential for long-term growth, albeit with some risk involved.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio is heavily weighted towards stocks, with 98.75% in equities, leaving a minimal allocation to cash and other assets. This high equity exposure suggests a focus on capital appreciation rather than income generation or capital preservation. While this can lead to higher returns, it also increases risk. To reduce volatility, consider diversifying into other asset classes like bonds, which can provide more stability during market downturns.

Sectors Info

  • Technology
    24%
  • Financials
    16%
  • Health Care
    11%
  • Industrials
    11%
  • Consumer Discretionary
    11%
  • Telecommunications
    7%
  • Consumer Staples
    6%
  • Energy
    5%
  • Basic Materials
    4%
  • Real Estate
    3%
  • Utilities
    2%

The sector allocation is quite diverse, with significant weights in Technology (23.79%), Financial Services (15.55%), and Healthcare (11.05%). This broad sector exposure helps mitigate risks associated with any single industry. However, the high concentration in technology could lead to increased volatility. To further balance the portfolio, it might be wise to consider a more even distribution across sectors, reducing the heavy reliance on tech stocks.

Regions Info

  • North America
    63%
  • Europe Developed
    16%
  • Japan
    7%
  • Asia Emerging
    6%
  • Asia Developed
    4%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is predominantly invested in North America (62.78%), followed by Europe Developed (16.12%) and Japan (6.61%). This allocation provides a good mix of developed markets, but emerging markets have limited exposure. While developed markets offer stability, emerging markets can provide higher growth potential. Increasing exposure to emerging markets could enhance diversification and potentially boost returns, albeit with higher risk.

Dividends Info

  • Vanguard S&P 500 ETF 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 3.00%
  • Weighted yield (per year) 1.98%

The portfolio's dividend yield wasn't provided, but given the high equity exposure, some level of dividend income can be expected, particularly from the S&P 500 ETF. Dividends can provide a steady income stream and add to total returns. If income generation is a goal, consider increasing the allocation to dividend-paying stocks or ETFs. This can help balance the need for growth with the desire for regular income.

Ongoing product costs Info

  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.05%

The portfolio's total expense ratio (TER) is impressively low at 0.05%, with the Vanguard S&P 500 ETF at 0.03% and the Vanguard Total International Stock Index Fund ETF Shares at 0.08%. Low costs are crucial for maximizing net returns over the long term. This cost efficiency is a significant strength of the portfolio. Maintaining low costs should remain a priority, as high fees can erode returns, especially in a balanced portfolio aimed at long-term growth.

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