Concentrated US stock portfolio with strong large cap tilt and efficient risk return tradeoff
Report created on Aug 21, 2026Risk profile
4/7
Diversification profile
2/5
Positions
-
VO Vanguard S&P 500 ETF
VOO - US9229083632 60.00% -
AV Avantis® U.S. Small Cap Value ETF
AVUV - US0250728773 20.00% -
QQ Invesco NASDAQ 100 ETF
QQQM - US46138G6492 20.00%
This portfolio is built from just three US stock ETFs, with 60% in a broad S&P 500 fund and 40% in two satellites: a US small-cap value ETF and a Nasdaq 100 ETF. So structurally it’s a straightforward “core and two satellites” setup, entirely in equities and fully US-focused. That simplicity makes it easy to understand and monitor because every dollar is tied to listed US companies rather than bonds or cash. It also means the portfolio’s ups and downs closely track stock market moves. With no built‑in defensive assets, risk is driven mainly by how US companies perform, rather than by interest rates or bond markets.
Growth
Over the period from late 2020 to mid‑2026, a hypothetical $1,000 grew to about $2,556, a compound annual growth rate (CAGR) of 17.51%. CAGR is like your average speed on a road trip, smoothing out bumps along the way. This beat both the US market (16.23%) and global market (14.14%) over the same window. The max drawdown was about -24%, similar to the benchmarks, showing that downside shocks have been in line with broad equities. Recovery from that drop took roughly 14 months, which is typical for sizeable equity drawdowns. Only 31 days generated 90% of returns, underlining how missing a handful of strong days can heavily change long‑term results.
Projection
The Monte Carlo projection looks forward 15 years using past return and volatility patterns to simulate many possible futures. Monte Carlo is basically a big “what if” machine: it runs 1,000 alternate histories, shuffling returns randomly within the historical range. The median outcome turns $1,000 into about $2,688, with a wide possible range from roughly $994 to $8,031 between the 5th and 95th percentiles. That range shows how uncertain long‑term paths can be, even with the same starting portfolio. The average simulated annual return of 8.15% is much lower than the recent historical 17% CAGR, which reflects how long‑run expectations are typically more modest than shorter, very strong windows.
Asset classes
- Stocks 100%
All of this portfolio is in stocks, with 0% in bonds, cash, or alternatives. That makes the asset-class picture very clear: there is no built‑in cushion from traditionally steadier assets. Equities historically offer higher long‑term growth potential but also larger and more frequent swings. Compared with many blended portfolios that mix stocks and bonds, this setup will usually rise more in strong markets and fall more in broad sell‑offs. Because the three ETFs all sit in the same asset class, diversification comes from different parts of the equity universe (large vs small, broad vs growth‑heavy) rather than from mixing fundamentally different asset types.
Sectors
- Technology 36%
- Financials 12%
- Consumer Discretionary 12%
- Telecommunications 9%
- Industrials 8%
- Health Care 7%
- Energy 5%
- Consumer Staples 5%
- Basic Materials 2%
- Utilities 2%
- Real Estate 1%
Sector exposure is tilted heavily toward technology at 36%, with the next largest areas being financials and consumer discretionary at 12% each, and communications at 9%. This pattern is common when combining an S&P 500 core with a Nasdaq 100 sleeve, because many of the largest US companies are tech or tech‑like businesses. Tech-heavy allocations can benefit strongly when innovation‑driven growth is in favor but can be more sensitive during periods of rising interest rates or regulatory pressure on large platforms. The remaining sectors are represented in smaller slices, providing some ballast, but leadership in portfolio behavior will generally come from technology and other growth‑oriented industries.
Regions
- North America 99%
- Europe Developed 1%
Geographically, the portfolio is almost pure US, with 99% in North America and just 1% in developed Europe. That is even more concentrated than broad global benchmarks, where the US is large but not near 100%. A strong US tilt has been rewarded over the past decade as US markets outperformed many regions. At the same time, it makes the portfolio very dependent on one economy, one political system, and one currency. If US equities hit a prolonged rough patch while other regions do better, this concentration can show up as a noticeable gap versus globally diversified portfolios that spread exposure across multiple markets and currencies.
Market capitalization
- Mega-cap 37%
- Large-cap 28%
- Mid-cap 14%
- Small-cap 10%
- Micro-cap 10%
By market size, there is a clear tilt toward bigger companies: about 37% in mega‑caps and 28% in large‑caps, with the rest spread across mid, small, and micro‑caps. This is broadly consistent with a market‑cap‑weighted core fund supplemented by a dedicated small‑cap value ETF. Larger companies tend to be more established and often less volatile, while small and micro caps can be more sensitive to economic cycles and liquidity but offer different growth and valuation characteristics. This mix creates a barbell effect: stability and brand‑name exposure from mega‑caps, plus a meaningful 20% slice in smaller firms that behave differently from the giants.
True holdings
-
NV NVIDIA Corporation 6.23%
Part of fund(s):- Invesco NASDAQ 100 ETF
- Vanguard S&P 500 ETF
-
AA Apple Inc. 5.63%
Part of fund(s):- Invesco NASDAQ 100 ETF
- Vanguard S&P 500 ETF
-
MS Microsoft Corporation 4.37%
Part of fund(s):- Invesco NASDAQ 100 ETF
- Vanguard S&P 500 ETF
-
AM Amazon.com Inc 3.37%
Part of fund(s):- Invesco NASDAQ 100 ETF
- Vanguard S&P 500 ETF
-
GO Alphabet Inc Class A 2.57%
Part of fund(s):- Invesco NASDAQ 100 ETF
- Vanguard S&P 500 ETF
-
AV Broadcom Inc 2.33%
Part of fund(s):- Invesco NASDAQ 100 ETF
- Vanguard S&P 500 ETF
-
GO Alphabet Inc Class C 2.16%
Part of fund(s):- Invesco NASDAQ 100 ETF
- Vanguard S&P 500 ETF
-
ME Meta Platforms Inc. 1.69%
Part of fund(s):- Invesco NASDAQ 100 ETF
- Vanguard S&P 500 ETF
-
MU Micron Technology Inc 0.92%
Part of fund(s):- Invesco NASDAQ 100 ETF
-
JP JPMorgan Chase & Co 0.88%
Part of fund(s):- Vanguard S&P 500 ETF
- Top 10 total 30.14%
Looking through to the top holdings, several large US tech and platform companies appear prominently: NVIDIA, Apple, Microsoft, Amazon, the two Alphabet share classes, Meta, and others. These names together make up a noticeable slice of the portfolio via multiple ETFs. For example, Apple, Microsoft, and Alphabet show up through both the S&P 500 and Nasdaq 100 funds, creating overlap. Overlap means that even though there are three ETFs, some underlying companies drive more of the portfolio than the fund count suggests. Because this analysis only uses ETF top‑10 holdings, actual overlap is likely higher, but even this limited view shows a strong concentration in a handful of mega‑cap leaders.
Factors
Factor exposure is broadly neutral across the board, with value, size, momentum, quality, yield, and low volatility all close to the 50% “market‑like” mark. Factor investing focuses on patterns like cheap vs expensive stocks (value) or recent winners (momentum) that research links to returns. Here, there are no strong tilts toward or away from any single factor. That means the portfolio is behaving much like a broad market portfolio in terms of these underlying characteristics, despite the visible tilts in sectors and geography. In practice, this suggests performance will likely be driven more by overall market direction and stock selection within the indices than by deliberate factor bets.
Risk contribution
-
Vanguard S&P 500 ETF
Weight: 60.00% 55.2% -
Invesco NASDAQ 100 ETF
Weight: 20.00% 23.4% -
Avantis® U.S. Small Cap Value ETF
Weight: 20.00% 21.4%
Risk contribution shows how much each holding adds to the portfolio’s overall ups and downs, which can differ from its weight. The S&P 500 ETF is 60% of the portfolio but contributes about 55% of total risk, slightly less than its size would suggest, reflecting its broad diversification. The Nasdaq 100 and small‑cap value ETFs are each 20% by weight but contribute 23% and 21% of risk, respectively, meaning they punch a bit above their weight. That’s typical for more volatile, concentrated, or smaller‑cap exposures. All risk comes from just three positions, so any large move in one of these ETFs feeds fairly directly into total portfolio volatility.
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 risk vs. return chart shows this portfolio sitting on or very near the efficient frontier built from its own three holdings. The efficient frontier is the curve of the best possible return for each risk level using different weightings of the same ingredients. The current Sharpe ratio of 0.79 is lower than the max‑Sharpe portfolio at 0.97, but the analysis notes the allocation is already efficient for its risk level. That means, given these three ETFs, the tradeoff between volatility and expected return is pretty well balanced. Any further improvement would mainly come from changing the ingredients, not just reshuffling their weights.
Dividends
- Avantis® U.S. Small Cap Value ETF 1.20%
- Invesco NASDAQ 100 ETF 0.40%
- Vanguard S&P 500 ETF 1.00%
- Weighted yield (per year) 0.92%
The overall dividend yield is modest at about 0.92%, with the S&P 500 ETF around 1.0%, the small‑cap value ETF at 1.2%, and the Nasdaq 100 ETF at 0.4%. Dividends are the cash payments companies make to shareholders, and they can be a meaningful part of total return over long periods, especially when reinvested. In this portfolio, most of the historical growth has likely come from price appreciation rather than income, which is common for growth‑heavy and US‑centric stock mixes. A lower yield also means short‑term income is limited, but more of company profits are being reinvested back into the businesses themselves.
Ongoing product costs
- Avantis® U.S. Small Cap Value ETF 0.25%
- Invesco NASDAQ 100 ETF 0.15%
- Vanguard S&P 500 ETF 0.03%
- Weighted costs total (per year) 0.10%
Total ongoing costs are low, with a weighted average TER of about 0.10%. The S&P 500 ETF is very cheap at 0.03%, the Nasdaq 100 ETF at 0.15%, and the small‑cap value ETF at 0.25%. TER (Total Expense Ratio) is like a small yearly subscription fee charged by each fund, taken directly out of returns. Keeping fees low is one of the few levers investors can reliably control, and here the costs are impressively low for an all‑equity setup. That leaves more of the portfolio’s gross returns in place to compound over time, especially important over multi‑decade horizons where even small fee differences can meaningfully add up.
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