A conservative Canadian portfolio with balanced exposure and moderate dividend yield

Report created on Jan 26, 2025

Risk profile Info

2/7
Conservative
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio is composed of four ETFs: Vanguard Balanced Portfolio, iShares Core Equity Portfolio, Horizons High Interest Savings ETF, and Vanguard S&P 500 Index ETF. Each of the first two ETFs holds 36% of the portfolio, while the latter two hold 14% each. This allocation provides a mix of equity and fixed income, aligning well with the conservative risk classification. Compared to a typical benchmark, this portfolio is moderately diversified, with a broad exposure to various asset classes. This balance is suitable for conservative investors seeking steady returns with lower risk.

Growth Info

Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 8.35% with a maximum drawdown of -15.89%. This performance is relatively stable, reflecting the conservative risk profile. While past performance is not indicative of future results, it provides a baseline for expectations. Compared to benchmarks, this portfolio's historical returns align with conservative growth objectives. To enhance returns, consider periodic rebalancing to maintain target allocations, especially during market fluctuations.

Projection Info

The Monte Carlo simulation, which uses historical data to predict future outcomes, indicates a median growth of 222.5% across 1,000 simulations. The portfolio shows a strong probability of positive returns, with 998 simulations ending positively. This forward projection suggests a robust potential for growth, even under conservative assumptions. However, it's important to remember that simulations are based on past data and cannot predict future market conditions with certainty. Regularly reviewing the portfolio's alignment with personal goals is advisable.

Asset classes Info

  • US Equity
    40%
  • Stocks
    15%
  • Bonds
    14%
  • Cash
    14%

The asset allocation includes 40% US equity, 15% general equity, 14% bonds, and 14% cash, offering a balanced mix across asset classes. This allocation provides diversification, reducing risk while capturing growth opportunities. Compared to benchmarks, the portfolio's bond and cash allocation supports its conservative classification. Investors might consider slightly increasing equity exposure to enhance growth potential, depending on individual risk tolerance and market conditions.

Sectors Info

  • Technology
    20%
  • Financials
    17%
  • Industrials
    9%
  • Consumer Discretionary
    8%
  • Health Care
    7%
  • Telecommunications
    6%
  • Energy
    6%
  • Consumer Staples
    4%
  • Basic Materials
    4%
  • Utilities
    2%
  • Real Estate
    2%

The portfolio is diversified across various sectors, with notable allocations in technology (20%) and financial services (17%). This sectoral balance aligns with common benchmarks, providing exposure to both growth and defensive sectors. However, the significant tech allocation may introduce volatility, especially during interest rate changes. To mitigate sector-specific risks, consider periodically reviewing sector weightings and adjusting as needed to maintain a balanced approach.

Regions Info

  • North America
    67%
  • Europe Developed
    9%
  • Japan
    4%
  • Asia Emerging
    2%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%

Geographically, the portfolio is heavily weighted towards North America (67%), with smaller exposures to Europe, Japan, and emerging markets. This concentration in North America aligns with many benchmarks but may limit diversification benefits. While this focus has historically been beneficial, diversifying further into international markets could reduce regional risk and capture global growth opportunities. Regularly assessing geographic allocations can help optimize the portfolio's risk-return profile.

Market capitalization Info

  • Mega-cap
    32%
  • Large-cap
    23%
  • Mid-cap
    13%
  • Small-cap
    3%
  • Micro-cap
    1%

The portfolio's market capitalization exposure includes 32% in mega caps and 23% in big caps, with lesser allocations in medium, small, and micro caps. This tilt towards larger companies aligns with a conservative approach, as mega and big caps tend to be more stable and less volatile. However, including a slightly higher allocation to mid and small caps could enhance growth potential. This adjustment should be considered based on individual risk tolerance and market conditions.

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 Efficient Frontier suggests a more optimized portfolio with the same risk level could achieve a higher return of 3.95%. This optimization focuses on maximizing returns for the given risk, not necessarily diversification. Adjusting current asset allocations could improve the risk-return ratio without increasing overall risk. Regularly reviewing and rebalancing the portfolio in line with Efficient Frontier insights can help maintain optimal performance.

Dividends Info

  • Horizons High Interest Savings ETF 2.40%
  • Vanguard Balanced Portfolio 1.30%
  • Vanguard S&P 500 Index ETF 0.50%
  • iShares Core Equity Portfolio 2.00%
  • Weighted yield (per year) 1.59%

With a total dividend yield of 1.59%, the portfolio provides moderate income, supporting the conservative investment objective. The Horizons High Interest Savings ETF offers the highest yield at 2.40%, contributing to income stability. For investors seeking higher income, exploring additional dividend-focused investments or increasing allocations to higher-yielding assets could be beneficial. However, this should be balanced with the portfolio's overall risk and growth objectives.

What next?

Ready to invest in this portfolio?

Select a broker that fits your needs and watch for low fees to maximize your returns.

Select broker

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.

Instrument logos provided by Elbstream.

Help us improve Insightfolio

Your feedback makes a difference! Share your thoughts in our quick survey. Take the survey