A growth-focused portfolio with strong tech exposure and moderate international diversification

Risk profile

  • Secure
    Speculative

The risk profile, derived from past market volatility, reflects the level of risk the portfolio is exposed to. This assessment helps align your investments with your financial goals and comfort with market fluctuations.

Diversification profile

  • Focused
    Diversified

The diversification assessment evaluates the spread of investments across asset classes, regions, and sectors. This ensures a balanced mix, reducing risk and maximizing returns by not concentrating in any single area.

What type of investor this portfolio is suitable for

Growth Investors

This portfolio suits investors with a high risk tolerance seeking aggressive growth. Ideal for those with a long-term horizon, it emphasizes capital appreciation through significant exposure to U.S. equities, particularly in the technology sector. Such investors are likely willing to endure volatility in pursuit of substantial returns, making this portfolio a fit for those focused on maximizing growth over stability.

Positions

  • Invesco NASDAQ 100 ETF
    QQQM - US46138G6492
    50.00%
  • Vanguard S&P 500 ETF
    VOO - US9229083632
    20.00%
  • Avantis® U.S. Small Cap Value ETF
    AVUV - US0250728773
    15.00%
  • Vanguard Total International Stock Index Fund ETF Shares
    VXUS - US9219097683
    15.00%

The portfolio is heavily weighted towards equities, with a significant 50% allocation in the Invesco NASDAQ 100 ETF. The rest is split among the Vanguard S&P 500 ETF (20%), Avantis U.S. Small Cap Value ETF (15%), and Vanguard Total International Stock Index Fund ETF Shares (15%). This composition leans towards growth, with a strong focus on large-cap U.S. equities. While this aligns with a growth strategy, it may benefit from further diversification across asset classes, such as bonds, to mitigate risk during market downturns.

Growth Info

Historically, the portfolio has delivered a robust compound annual growth rate (CAGR) of 15.91%, outperforming many benchmarks. However, it experienced a maximum drawdown of 27.60%, indicating vulnerability during market declines. Such performance suggests that while the portfolio can deliver high returns, it may also face significant volatility. This historical performance should be viewed with caution as past results do not guarantee future success.

Projection Info

Monte Carlo simulations, using historical data, forecast a wide range of potential outcomes, with a median projected return of 607.6% over the investment horizon. While 996 out of 1,000 simulations show positive returns, indicating a strong likelihood of growth, it's crucial to acknowledge that these projections are not guarantees. They provide a probabilistic outlook, highlighting the potential for both substantial gains and possible losses.

Asset classes Info

  • Stocks
    100%
  • Cash
    0%
  • Other
    0%
  • No data
    0%

The portfolio's 100% allocation to stocks underscores a strong growth orientation but lacks diversification across asset classes. This single asset class focus can lead to increased volatility and risk exposure. Introducing bonds or alternative investments could enhance diversification, providing a buffer during equity market downturns and potentially smoothing returns over time.

Sectors Info

  • Technology
    36%
  • Consumer Discretionary
    13%
  • Telecommunications
    10%
  • Financials
    10%
  • Industrials
    8%
  • Health Care
    6%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    3%
  • Utilities
    2%
  • Real Estate
    1%

Technology dominates the sector allocation with 36%, followed by consumer cyclicals at 13%. This tech-heavy focus can lead to higher volatility, especially during interest rate hikes or tech sector downturns. Balancing sector exposure by increasing allocations to defensive sectors, such as utilities or healthcare, could reduce volatility and enhance stability.

Regions Info

  • North America
    85%
  • Europe Developed
    6%
  • Asia Emerging
    3%
  • Japan
    2%
  • Asia Developed
    2%
  • Australasia
    1%
  • Latin America
    1%
  • Africa/Middle East
    1%
  • Europe Emerging
    0%

With 85% of assets in North America, the portfolio is heavily U.S.-centric. While this aligns with historical U.S. market strength, it limits exposure to international growth opportunities. Increasing allocations to emerging markets or underrepresented regions like Europe or Asia could improve diversification and potentially capture higher growth rates abroad.

Market capitalization Info

  • Mega-cap
    43%
  • Large-cap
    30%
  • Mid-cap
    12%
  • Small-cap
    8%
  • Micro-cap
    7%

The portfolio is skewed towards large-cap stocks, with 43% in mega-cap and 30% in big-cap companies. This provides stability but may limit growth potential compared to higher allocations in small or micro-cap stocks. A more balanced market cap distribution could enhance growth prospects while maintaining a degree of stability.

Dividends Info

  • Avantis® U.S. Small Cap Value ETF 1.60%
  • Invesco NASDAQ 100 ETF 0.60%
  • Vanguard S&P 500 ETF 1.20%
  • Vanguard Total International Stock Index Fund ETF Shares 3.20%
  • Weighted yield (per year) 1.26%

The portfolio's total dividend yield is 1.26%, with the Vanguard Total International Stock Index Fund ETF Shares contributing the highest yield at 3.20%. While dividends are not a primary focus, they provide a modest income stream. Investors seeking higher income may consider increasing allocations to high-dividend sectors or funds.

Ongoing product costs Info

  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Invesco NASDAQ 100 ETF 0.15%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.13%

The portfolio's total expense ratio (TER) is 0.13%, which is impressively low. This cost efficiency supports better long-term performance by minimizing fees that can erode returns. Maintaining low costs should remain a priority, as even small increases in fees can significantly impact compounding 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.

The portfolio may benefit from optimization using the Efficient Frontier, which seeks the best risk-return ratio based on current assets. While the current allocation is growth-focused, adjusting weights to achieve an optimal balance could enhance returns or reduce risk, depending on the investor's priorities.

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