A balanced portfolio with a strong tilt towards US equities and technology sector

Report created on Jul 19, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

3/5
Moderately Diversified
Less diversification More diversification

Positions

The portfolio is composed of two ETFs: Vanguard S&P 500 UCITS Acc, representing 70% of the portfolio, and Vanguard FTSE Developed World UCITS ETF USD Accumulation, making up the remaining 30%. This structure indicates a strong bias towards US equities, given the significant weight of the S&P 500 ETF. While this setup suggests a focus on developed markets, it also highlights a potential overlap in holdings between the two ETFs, especially in large-cap stocks. The portfolio's classification as moderately diversified is supported by its asset allocation, which is solely in stocks, spanning various sectors and geographies, albeit with a heavy concentration in North America.

Growth Info

Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 13.59%, with a maximum drawdown of -25.50%. These figures suggest a robust performance, particularly in the context of its risk classification. The days contributing to 90% of returns being limited to just 22 indicates that the portfolio’s returns are significantly influenced by a few high-performing days, underlining the importance of staying invested through market cycles.

Projection Info

Monte Carlo simulations project a wide range of outcomes, with the median scenario suggesting a potential 449.5% increase in portfolio value. The high percentage of simulations resulting in positive returns (998 out of 1,000) underscores the portfolio's strong foundation. However, these projections are based on historical data, which does not guarantee future performance. This method helps visualize potential future outcomes but should be interpreted with caution.

Asset classes Info

  • Stocks
    100%

With 100% of the portfolio allocated to stocks, the investor is exposed to higher volatility and potential for growth, fitting the balanced risk profile. However, the absence of other asset classes like bonds or real estate limits opportunities for diversification and risk mitigation during stock market downturns.

Sectors Info

  • Technology
    32%
  • Financials
    15%
  • Consumer Discretionary
    10%
  • Telecommunications
    9%
  • Health Care
    9%
  • Industrials
    9%
  • Consumer Staples
    6%
  • Energy
    3%
  • Utilities
    2%
  • Real Estate
    2%
  • Basic Materials
    2%

The sector allocation reveals a heavy tilt towards technology, financial services, and consumer cyclicals, which may drive growth but also increases susceptibility to sector-specific risks. The technology sector, in particular, can be volatile, influenced by changes in interest rates, regulatory environments, and market sentiment.

Regions Info

  • North America
    91%
  • Europe Developed
    5%
  • Japan
    2%
  • Asia Developed
    1%
  • Australasia
    1%

The geographic allocation is heavily skewed towards North America (91%), with minimal exposure to other regions. This concentration enhances the portfolio's vulnerability to regional economic fluctuations and political developments. Diversifying more into other developed and emerging markets could provide a buffer against North American market downturns.

Market capitalization Info

  • Mega-cap
    47%
  • Large-cap
    35%
  • Mid-cap
    18%
  • Small-cap
    1%

The distribution across market capitalizations shows a preference for mega and big-cap stocks, which typically offer stability and steady growth. However, the minimal allocation to small and micro-cap stocks might limit the portfolio's potential to benefit from the rapid growth of smaller companies.

Redundant positions Info

  • Vanguard FTSE Developed World UCITS ETF USD Accumulation
    Vanguard S&P 500 UCITS Acc
    High correlation

The two ETFs in the portfolio are highly correlated, especially since they both focus on developed markets and likely share many of the same holdings. This redundancy reduces the diversification benefits, as both ETFs will tend to react similarly to market movements.

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.

Optimizing the portfolio involves addressing the high correlation between the two ETFs to enhance diversification benefits. This could involve reallocating some funds to assets with lower correlation to developed market equities, such as emerging market ETFs, fixed income securities, or alternative asset classes. The goal is to achieve a more efficient risk-return ratio by diversifying across less correlated assets.

Ongoing product costs Info

  • Vanguard S&P 500 UCITS Acc 0.07%
  • Weighted costs total (per year) 0.05%

The total expense ratio (TER) of 0.05% is impressively low, enhancing the portfolio's attractiveness by minimizing costs. Lower costs directly translate to higher net returns for investors, making this portfolio cost-efficient and more likely to achieve its performance objectives over the long term.

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