Balanced portfolio with a focus on US and developed markets and a moderate risk approach

Report created on Nov 4, 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 structured with a strong emphasis on equity ETFs, constituting 99% of the asset allocation, with a slight 1% in cash for liquidity. The Vanguard S&P 500 ETF, making up 45% of the portfolio, alongside the Vanguard FTSE Developed Markets Index Fund ETF Shares at 25%, indicates a heavy tilt towards large-cap stocks in the US and developed markets. This composition suggests a strategy aiming for growth through established markets, with a lesser focus on small-cap or emerging markets.

Growth Info

Historically, the portfolio has delivered a Compound Annual Growth Rate (CAGR) of 10.99%, with a maximum drawdown of -25.21%. These figures suggest a resilient performance through market cycles, albeit with significant short-term volatility. The days contributing to 90% of returns being concentrated in just 12.0 days highlight the portfolio's exposure to significant market movements, underscoring the importance of staying invested through volatility for long-term gains.

Projection Info

The Monte Carlo simulation, employing 1,000 scenarios, projects a median increase of 264.5% in portfolio value, with a broad range of outcomes indicating the inherent uncertainty in market performance. The 67th percentile outcome at 397.2% further illustrates the potential for higher returns, while the presence of 951 simulations with positive returns emphasizes the generally optimistic outlook, despite the unpredictable nature of markets.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio's near-exclusive investment in stocks, with a negligible cash position, positions it for maximum growth potential but also exposes it to market volatility. This asset class allocation is appropriate for investors with a medium to long-term horizon who can withstand periods of market downturns in exchange for higher potential returns.

Sectors Info

  • Technology
    24%
  • Financials
    18%
  • Industrials
    13%
  • Consumer Discretionary
    11%
  • Health Care
    9%
  • Telecommunications
    8%
  • Consumer Staples
    5%
  • Energy
    4%
  • Basic Materials
    4%
  • Utilities
    2%
  • Real Estate
    2%

The sectoral allocation shows a strong preference for Technology and Financial Services, which together comprise 42% of the portfolio. This concentration in sectors that can exhibit significant volatility suggests a higher risk profile but also the potential for substantial growth. The presence in Industrials, Consumer Cyclicals, and Healthcare diversifies the portfolio, though the heavy tech and financial services weighting may influence overall performance markedly during sector-specific downturns.

Regions Info

  • North America
    77%
  • Europe Developed
    13%
  • Japan
    5%
  • Asia Developed
    2%
  • Australasia
    2%

With 77% of assets in North America and a significant portion in Europe and Japan, the portfolio is well-positioned to capture growth in developed markets. However, the lack of exposure to emerging markets and other geographies may limit potential returns from faster-growing economies. This geographic distribution aligns with the portfolio's balanced risk profile but suggests an area for potential enhancement in diversification.

Market capitalization Info

  • Mega-cap
    36%
  • Large-cap
    26%
  • Mid-cap
    18%
  • Small-cap
    14%
  • Micro-cap
    7%

The market capitalization breakdown reveals a diversified approach, with a mix of mega, big, medium, small, and micro-cap stocks. This spread across market caps can help mitigate risk and capture growth from different segments of the market. The emphasis on larger companies, however, is consistent with the portfolio's moderate risk approach, as these entities typically offer more stability than their smaller counterparts.

Redundant positions Info

  • Dimensional U.S. Small Cap ETF
    Dimensional U.S. Targeted Value ETF
    High correlation
  • SPDR® Portfolio S&P 500 Growth ETF
    Vanguard S&P 500 ETF
    High correlation

The high correlation observed between certain ETFs, particularly within the US small cap and targeted value segments, and between the S&P 500 growth ETFs, indicates redundancy that may not contribute to diversification. Reducing overlap by reallocating assets from highly correlated ETFs to those with lower correlations can enhance the portfolio's risk-adjusted returns by broadening exposure across uncorrelated assets.

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.

Before optimizing, it's advisable to address the portfolio's asset overlap, particularly in highly correlated ETFs, to enhance diversification. The Efficient Frontier suggests that there's potential to improve the risk-return profile by adjusting allocations, focusing on diversifying into less correlated assets or sectors that could offer better growth prospects with manageable risk.

Dividends Info

  • Dimensional U.S. Small Cap ETF 1.00%
  • Dimensional U.S. Targeted Value ETF 1.60%
  • SPDR® Portfolio S&P 500 Growth ETF 0.50%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 2.80%
  • Vanguard S&P 500 ETF 1.10%
  • Vanguard Mid-Cap Growth Index Fund ETF Shares 0.60%
  • Weighted yield (per year) 1.51%

The dividend yield of the portfolio averages 1.51%, contributing to total returns alongside capital gains. This yield, while modest, provides a steady income stream, which can be particularly beneficial in volatile or declining markets. The variation in yield across the ETFs reflects the differing income-generating potential of the underlying assets, with the Vanguard FTSE Developed Markets Index Fund ETF Shares offering the highest yield at 2.80%.

Ongoing product costs Info

  • Dimensional U.S. Small Cap ETF 0.26%
  • Dimensional U.S. Targeted Value ETF 0.28%
  • SPDR® Portfolio S&P 500 Growth ETF 0.04%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Mid-Cap Growth Index Fund ETF Shares 0.07%
  • Weighted costs total (per year) 0.09%

The Total Expense Ratio (TER) of 0.09% is impressively low, maximizing the potential for net returns by minimizing investment costs. This cost efficiency is crucial for long-term growth, as even small differences in fees can significantly impact compounded returns over time. The portfolio's focus on low-cost ETFs demonstrates a prudent approach to cost management.

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