Globally diversified stock portfolio with strong factor tilts and efficient risk adjusted performance
Report created on May 3, 2024Risk profile
4/7
Diversification profile
4/5
Positions
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VG Vanguard FTSE Developed World UCITS ETF USD Accumulation
VGVF - IE00BK5BQV03 75.00% -
IS iShares Core MSCI Emerging Markets IMI UCITS
IS3N - IE00BKM4GZ66 25.00%
The structure is extremely simple and clean: two broad equity ETFs, with 75% in developed markets and 25% in emerging markets. Everything is in stocks, with no bonds, cash, or alternatives. This makes the portfolio easy to manage and very transparent. A 75/25 split between developed and emerging areas gives meaningful exposure to faster-growing regions while keeping the bulk in more established markets. For someone comfortable with stock market ups and downs, this is a straightforward way to capture global growth. The main takeaway is that simplicity here is a strength, as long as the 100% equity stance matches the risk tolerance and time horizon.
Growth
From early 2020 to March 2026, $1,000 grew to about $1,759, a compound annual growth rate (CAGR) of 9.51%. CAGR is like average speed on a long road trip, smoothing out bumps. The max drawdown was about -33%, similar to major market selloffs in that period. The portfolio slightly lagged both the U.S. market and the broad global market, which is normal when holding more outside the U.S., given recent U.S. outperformance. Only 18 days made up 90% of returns, highlighting how missing a few strong days can drastically change outcomes. The results show solid long-term growth with volatility typical of an all-stock allocation.
Asset classes
- Stocks 100%
All assets are in stocks, with 0% in bonds, real estate funds, or cash. That creates maximum exposure to global equity growth but also full exposure to market downturns. Asset classes are like different engines in a portfolio; adding bonds or other diversifiers typically reduces swings but can also lower long-term returns. For someone in the “balanced” risk range, this equity-only structure is on the aggressive side but not extreme if the time horizon is long. The positive side is simplicity and strong growth potential. The trade-off is accepting that there will be periods of large temporary losses.
Sectors
- Technology 28%
- Financials 17%
- Industrials 11%
- Consumer Discretionary 10%
- Telecommunications 8%
- Health Care 8%
- Consumer Staples 5%
- Basic Materials 5%
- Energy 4%
- Utilities 3%
- Real Estate 2%
Sector allocation is broad, with notable weight in technology at 28%, followed by financials, industrials, and consumer-focused areas. This mix is quite similar to many global equity benchmarks, which is a strong indicator of healthy diversification. A tech tilt means returns can be more sensitive to interest rates, innovation cycles, and sentiment around growth companies. At the same time, sizable exposure to financials, industrials, healthcare, and staples helps balance out that risk across different parts of the economy. Overall, this sector spread is well-balanced and aligns closely with global standards, providing a solid foundation for long-term growth.
Regions
- North America 53%
- Europe Developed 13%
- Asia Developed 13%
- Asia Emerging 10%
- Japan 5%
- Africa/Middle East 2%
- Latin America 2%
- Australasia 1%
- Europe Emerging 1%
Geographically, over half of the allocation is in North America, with the rest split across developed Europe, developed Asia, Japan, and multiple emerging regions. This is more globally diversified than a typical U.S.-only approach, and closer to a true world-market view. Compared with many common benchmarks, there is a slightly larger tilt toward emerging and non-U.S. markets, which can add both opportunity and volatility. This kind of global reach reduces dependence on any single country’s economy or policy. It also means performance may diverge from a pure U.S. index, sometimes lagging when the U.S. leads and potentially outperforming when other regions catch up.
Market capitalization
- Mega-cap 49%
- Large-cap 33%
- Mid-cap 16%
- Small-cap 1%
Nearly half of the portfolio sits in mega-cap companies, with another third in large caps, and a meaningful slice in mid caps. Small caps are present but modest at about 1%. Market capitalization (or “market cap”) measures company size on the stock market, and each band behaves differently. Mega and large caps tend to be more stable and dominate index performance, while mid and small caps can be more volatile but offer higher growth potential. This mix provides a solid anchor in big established firms while still capturing some of the dynamism of smaller businesses. It’s a balanced size profile for a global equity allocation.
True holdings
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NV NVIDIA Corporation 3.54%
Part of fund(s):- Vanguard FTSE Developed World UCITS ETF USD Accumulation
-
AA Apple Inc 3.28%
Part of fund(s):- Vanguard FTSE Developed World UCITS ETF USD Accumulation
-
23 Taiwan Semiconductor Manufacturing Co. Ltd. 2.91%
Part of fund(s):- iShares Core MSCI Emerging Markets IMI UCITS
-
MS Microsoft Corporation 2.48%
Part of fund(s):- Vanguard FTSE Developed World UCITS ETF USD Accumulation
-
AM Amazon.com Inc 1.72%
Part of fund(s):- Vanguard FTSE Developed World UCITS ETF USD Accumulation
-
GO Alphabet Inc Class A 1.55%
Part of fund(s):- Vanguard FTSE Developed World UCITS ETF USD Accumulation
-
00 Samsung Electronics Co Ltd 1.31%
Part of fund(s):- iShares Core MSCI Emerging Markets IMI UCITS
-
AV Broadcom Inc 1.26%
Part of fund(s):- Vanguard FTSE Developed World UCITS ETF USD Accumulation
-
GO Alphabet Inc Class C 1.26%
Part of fund(s):- Vanguard FTSE Developed World UCITS ETF USD Accumulation
-
ME Meta Platforms Inc. 1.21%
Part of fund(s):- Vanguard FTSE Developed World UCITS ETF USD Accumulation
- Top 10 total 20.51%
Looking through to the top holdings, exposure is dominated by well-known global giants like NVIDIA, Apple, Microsoft, and major Asian tech and semiconductor names. Several appear in both ETFs, creating some hidden concentration in large technology and communication-related firms even without owning them directly. Because only top-10 ETF holdings are captured, the true overlap is likely higher but not fully visible. This concentration is not necessarily bad; these companies have driven a lot of global equity returns. The key point is to be aware that a “broad” ETF approach can still lean heavily on a relatively small group of mega-cap leaders.
Factors
Factor exposures are estimated using statistical models based on historical data and measure systematic (market-relative) tilts, not absolute portfolio characteristics. Results may vary depending on the analysis period, data availability, and currency of the underlying assets.
Factor exposure shows high tilts toward value, size, quality, and low volatility, with more neutral exposure to momentum and yield. Factors are like the underlying “personality traits” of investments that drive returns over time. A strong quality and low-volatility tilt often leads to smoother rides in rough markets, as these companies usually have stronger balance sheets and steadier earnings. High value and size exposure suggests more emphasis on reasonably priced and smaller firms, which has historically been rewarding over very long periods but can lag in growth-obsessed markets. This combination is quite attractive for long-term investors seeking a slightly steadier, fundamentals-focused equity profile.
Risk contribution
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Vanguard FTSE Developed World UCITS ETF USD Accumulation
Weight: 75.00% 74.8% -
iShares Core MSCI Emerging Markets IMI UCITS
Weight: 25.00% 25.2%
Risk contribution shows almost a perfect match between weights and risk: the developed markets ETF contributes about 75% of total volatility, and the emerging markets ETF about 25%. Risk contribution measures how much each holding adds to the overall ups and downs, which can differ from its weight if one holding is much more volatile. In this case, both funds have similar risk per unit of weight, so there are no stealth “risk hogs.” That alignment is reassuring and means position sizing is well-calibrated. Any future changes in weights will have a fairly predictable impact on the portfolio’s overall 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.
On the risk–return chart, the current mix sits right on or very near the efficient frontier, with a Sharpe ratio of 0.53. The Sharpe ratio compares return to volatility, like measuring how much “reward” you get per unit of risk. The optimal mix of these two ETFs has a slightly higher Sharpe, but the improvement is small, and the minimum-variance portfolio is also very close. This indicates the current allocation is already highly efficient for its risk level. Any tweaks would be more about personal preference for developed vs. emerging exposure rather than fixing a structural inefficiency.
Ongoing product costs
- iShares Core MSCI Emerging Markets IMI UCITS 0.18%
- Vanguard FTSE Developed World UCITS ETF USD Accumulation 0.12%
- Weighted costs total (per year) 0.14%
The overall cost level is impressively low, with a blended total expense ratio (TER) of about 0.14%. TER is the ongoing annual fee charged by funds, quietly deducted from returns, much like a small service charge. Keeping costs this low is a major advantage: even a 0.3–0.5% difference per year can add up to thousands of dollars over decades. These ETFs are firmly in the low-cost camp relative to industry averages. The costs are impressively low, supporting better long-term performance and leaving more of the market’s return in the investor’s pocket rather than going to fund managers.
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