A concentrated portfolio with a strong emphasis on large-cap US equities and growth potential

Report created on Jan 2, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

1/5
Single-Focused
Less diversification More diversification

Positions

The portfolio is heavily weighted towards equities, with 86% in stocks, focusing on large-cap US companies. This composition aligns with a typical growth-oriented strategy but lacks diversification. A more balanced allocation might include bonds or international equities to reduce risk. Consider diversifying asset classes to enhance stability and potentially smooth out performance during market volatility.

Growth Info

Historically, the portfolio has performed well with a CAGR of 22.57%, indicating strong growth. However, it experienced a maximum drawdown of -11.77%, showing vulnerability during market downturns. Comparing this with benchmarks, the portfolio's growth is impressive, but the drawdown suggests a need for risk management. Consider incorporating assets with lower volatility to mitigate potential losses.

Projection Info

The Monte Carlo simulation projects a wide range of outcomes, with a median return of 1,986.63% over the investment horizon. While historical data informs these projections, they are not guaranteed, and market conditions can change. The high variability in outcomes suggests a need for ongoing portfolio monitoring and potential adjustments based on market trends.

Asset classes Info

  • Stocks
    86%
  • Cash
    10%
  • Other
    4%

The portfolio is predominantly invested in stocks, with minimal cash and other assets. This concentration can lead to high volatility, especially in turbulent markets. Diversification across asset classes, such as adding bonds or real estate, can provide a buffer against market swings and enhance long-term stability.

Sectors Info

  • Financials
    38%
  • Telecommunications
    20%
  • Technology
    15%
  • Health Care
    7%
  • Consumer Discretionary
    7%
  • Consumer Staples
    4%
  • Industrials
    4%
  • Energy
    4%
  • Basic Materials
    1%

There is a notable concentration in financial services and communication services, which might expose the portfolio to sector-specific risks. While these sectors can offer growth, they may also be volatile. Balancing exposure across more sectors can reduce risk and improve resilience against sector downturns.

Regions Info

  • North America
    100%

The portfolio is almost entirely concentrated in North America, limiting geographic diversification. This focus can lead to increased risk if the US market underperforms. Consider adding international equities to diversify and potentially capture growth in other regions, aligning with global benchmarks.

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 portfolio could benefit from optimization using the Efficient Frontier to achieve a better risk-return balance. This involves adjusting asset weights to maximize returns for a given level of risk. While diversification is limited, optimizing within current holdings can still improve overall efficiency.

Dividends Info

  • Direxion Daily GOOGL Bull 1.5X Shares 2.50%
  • Schwab U.S. Dividend Equity ETF 3.60%
  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • Weighted yield (per year) 1.56%

The portfolio's dividend yield of 1.56% is moderate, with the Schwab U.S. Dividend Equity ETF contributing significantly. Dividends can provide a steady income stream, which is beneficial for those seeking regular returns. Consider maintaining or increasing dividend-focused investments to enhance income stability.

Ongoing product costs Info

  • Direxion Daily GOOGL Bull 1.5X Shares 1.05%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • Weighted costs total (per year) 0.19%

The total expense ratio of 0.19% is relatively low, which is advantageous for long-term growth. Lower costs mean more of your returns are retained, enhancing compounding effects over time. Continue to monitor and minimize costs, potentially replacing high-fee assets with more cost-effective alternatives.

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