A growth-focused portfolio with a strong tilt towards US small-cap value stocks and international diversification

Report created on May 3, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio is heavily weighted towards the Avantis® U.S. Small Cap Value ETF, accounting for 70% of the allocation, followed by the Vanguard Total International Stock Index Fund ETF Shares at 20%, and the SPDR® Portfolio S&P 500 ETF at 10%. This composition indicates a growth-oriented strategy with a significant emphasis on small-cap value stocks in the U.S. and a substantial allocation towards international equities. The concentration in small-cap stocks, particularly in the U.S., suggests a higher risk and potential higher reward approach, while the international exposure adds a layer of diversification.

Growth Info

Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 14.29%, with a maximum drawdown of -44.38%. This performance indicates a strong growth trajectory, albeit with significant volatility. The days contributing to 90% of the returns being limited to just 11.0 highlights the portfolio's susceptibility to short-term market movements and the importance of timing in investment decisions. Comparing this to benchmarks, the high growth rate is commendable, but the volatility underscores the risk involved.

Projection Info

Monte Carlo simulations, using 1,000 iterations, project a median increase of 362.3% in portfolio value, with a wide range of outcomes indicating both the potential for substantial growth and considerable risk. The 5th percentile outcome at 1.4% suggests a near-stagnant worst-case scenario, while the 67th percentile at 597.2% underscores the portfolio's growth potential. These projections, while informative, rely on historical data and cannot guarantee future performance.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio's asset allocation is almost entirely in stocks (99%), with a minimal cash holding (1%). This allocation supports the portfolio's growth profile but also increases its sensitivity to market fluctuations. The lack of other asset classes, such as bonds or real estate (outside of stock ETFs), means there's little to buffer against stock market volatility. Diversifying across different asset classes could help manage risk without significantly compromising growth potential.

Sectors Info

  • Financials
    27%
  • Industrials
    15%
  • Consumer Discretionary
    14%
  • Energy
    11%
  • Technology
    10%
  • Consumer Staples
    6%
  • Basic Materials
    6%
  • Health Care
    5%
  • Telecommunications
    4%
  • Real Estate
    1%
  • Utilities
    1%

Sector allocation is diversified, with the largest exposures in financial services (27%), industrials (15%), and consumer cyclicals (14%). This sector spread supports the portfolio's growth orientation, as these sectors can perform well in expanding economies. However, the concentration in financial services and cyclicals also increases exposure to economic downturns. Balancing with more defensive sectors or increasing allocations to healthcare and consumer defensive sectors could provide more stability.

Regions Info

  • North America
    80%
  • Europe Developed
    8%
  • Asia Emerging
    4%
  • Japan
    3%
  • Asia Developed
    2%
  • Latin America
    1%
  • Australasia
    1%
  • Africa/Middle East
    1%

The geographic allocation is predominantly North American (80%), with smaller exposures to developed Europe (8%) and emerging Asia (4%). This distribution suggests a strong home bias, which might limit exposure to global growth opportunities, especially in emerging markets. Considering increasing allocations to underrepresented regions could enhance diversification and potentially tap into higher growth rates in those areas.

Market capitalization Info

  • Small-cap
    35%
  • Micro-cap
    34%
  • Mega-cap
    14%
  • Large-cap
    10%
  • Mid-cap
    6%

The market capitalization exposure is heavily skewed towards small (35%) and micro (34%) caps, aligning with the portfolio's growth and value focus. This concentration in smaller companies, while potentially offering higher returns, also carries higher risk and volatility compared to larger cap stocks. Introducing a more balanced cap size distribution could help smooth out returns over time.

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.

Considering the Efficient Frontier, the portfolio's current allocation suggests a focus on maximizing returns, albeit with a higher risk profile. Adjusting the asset allocation to include a wider range of asset classes and a more balanced market capitalization spread could potentially move the portfolio closer to the Efficient Frontier, optimizing the risk-return trade-off without necessarily sacrificing growth objectives.

Dividends Info

  • Avantis® U.S. Small Cap Value ETF 1.90%
  • SPDR® Portfolio S&P 500 ETF 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 3.00%
  • Weighted yield (per year) 2.06%

The portfolio's overall dividend yield stands at 2.06%, with the highest yield from the Vanguard Total International Stock Index Fund ETF Shares at 3.00%. While not the primary focus, dividends contribute to the portfolio's total return and provide a modest income stream. Given the growth orientation, the current yield is reasonable, but investors seeking higher income might consider reallocating towards higher-yielding assets.

Ongoing product costs Info

  • Avantis® U.S. Small Cap Value ETF 0.25%
  • SPDR® Portfolio S&P 500 ETF 0.02%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.19%

The total expense ratio (TER) of 0.19% is impressively low, enhancing the portfolio's long-term return potential by minimizing cost drag. This efficiency in costs is commendable and aligns well with best practices in portfolio management, where keeping costs low is crucial for maximizing investor returns over time.

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