Growth-focused portfolio with a strong emphasis on momentum strategies across diverse sectors
Report created on Sep 24, 2025Risk profile
5/7
Diversification profile
3/5
Positions
-
VT Vanguard Total Stock Market Index Fund ETF Shares
VTI - US9229087690 45.00% -
ID Invesco S&P International Developed Momentum ETF
IDMO - US46138E2220 20.00% -
SP Invesco S&P 500® Momentum ETF
SPMO - US46138E3392 20.00% -
AV Avantis® U.S. Small Cap Value ETF
AVUV - US0250728773 15.00%
The portfolio consists primarily of ETFs, with a significant emphasis on the Vanguard Total Stock Market Index Fund ETF Shares at 45%, highlighting a broad exposure to the U.S. stock market. The Invesco S&P International Developed Momentum ETF and Invesco S&P 500® Momentum ETF, each constituting 20% of the portfolio, suggest a strategic tilt towards momentum investing. The inclusion of the Avantis® U.S. Small Cap Value ETF at 15% introduces a value play into an otherwise momentum-dominated strategy. This composition underscores a growth-oriented approach, albeit with moderate diversification across asset classes, focusing solely on stocks.
Growth
With a Compound Annual Growth Rate (CAGR) of 17.86% and a maximum drawdown of -35.01%, the portfolio shows robust growth potential tempered by significant volatility. The days contributing to 90% of returns being concentrated in just 21.0 days indicate high performance peaks. This performance profile aligns with a growth-focused strategy but also highlights the inherent risk and the importance of timing in capturing returns. Comparing these figures against benchmarks could provide further insight into the portfolio's relative risk and return dynamics.
Projection
Monte Carlo simulations, employing 1,000 iterations, forecast a wide range of outcomes with a 50th percentile ending value suggesting substantial growth potential. The annualized return of all simulations at 19.75% exceeds historical performance, indicating optimistic future projections. However, the reliance on historical data for these simulations means they cannot account for unforeseen market shifts or black swan events, emphasizing the need for ongoing risk assessment and portfolio adjustments.
Asset classes
- Stocks 100%
The exclusive investment in stocks, without allocation to bonds, cash, or alternative assets, positions this portfolio for higher growth potential but also increases its susceptibility to market volatility. This singular focus on equities is appropriate for investors with a higher risk tolerance and a longer time horizon, who can withstand short-term market fluctuations in pursuit of superior long-term returns.
Sectors
- Financials 23%
- Technology 22%
- Industrials 12%
- Consumer Discretionary 12%
- Telecommunications 9%
- Health Care 6%
- Consumer Staples 6%
- Energy 5%
- Basic Materials 2%
- Utilities 2%
- Real Estate 2%
The sector allocation, with a heavy emphasis on Financial Services (23%) and Technology (22%), reflects a growth-oriented investment philosophy. These sectors are complemented by Industrials and Consumer Cyclicals, each at 12%, adding to the portfolio's cyclical exposure. The diversification across nine sectors mitigates sector-specific risks, but the significant weighting in Technology and Financial Services may increase sensitivity to economic cycles and interest rate changes.
Regions
- North America 84%
- Europe Developed 11%
- Japan 2%
- Australasia 2%
- Asia Developed 1%
The geographic distribution, heavily weighted towards North America (84%), suggests a home bias that may limit exposure to potential growth in international markets. While the developed Europe and Japan allocations offer some diversification, the negligible presence in emerging markets and other global regions could be a missed opportunity for diversification and access to high-growth potential areas outside of the U.S.
Market capitalization
- Mega-cap 40%
- Large-cap 28%
- Mid-cap 13%
- Small-cap 10%
- Micro-cap 8%
The market capitalization breakdown, with a 40% allocation to mega-cap stocks, provides a foundation of stability and liquidity. However, the balanced exposure across big, medium, small, and micro-cap stocks introduces a spectrum of growth prospects and risks, aligning with the portfolio's growth-oriented strategy. This diversification across cap sizes can potentially enhance returns while mitigating the volatility associated with smaller cap investments.
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.
Considering the Efficient Frontier, the portfolio's current configuration may not be fully optimized for the best possible risk-return ratio. Adjustments in asset allocation, diversifying further across asset classes, or rebalancing sector and geographic exposures could enhance the portfolio's efficiency. Such optimization should aim to maintain or improve growth prospects while managing volatility through broader diversification.
Dividends
- Avantis® U.S. Small Cap Value ETF 1.20%
- Invesco S&P International Developed Momentum ETF 1.40%
- Invesco S&P 500® Momentum ETF 0.50%
- Vanguard Total Stock Market Index Fund ETF Shares 1.10%
- Weighted yield (per year) 1.06%
The dividend yield, averaging 1.06% across the portfolio, contributes to the total return, albeit modestly. This yield, while not the primary focus of a growth-oriented strategy, offers a stream of income that can provide a cushion during market downturns or be reinvested to compound growth. The varying yields across the ETFs reflect the diverse approaches to growth and value within the portfolio.
Ongoing product costs
- Avantis® U.S. Small Cap Value ETF 0.25%
- Invesco S&P International Developed Momentum ETF 0.25%
- Invesco S&P 500® Momentum ETF 0.13%
- Vanguard Total Stock Market Index Fund ETF Shares 0.03%
- Weighted costs total (per year) 0.13%
The portfolio's total expense ratio (TER) of 0.13% is impressively low, enhancing its attractiveness by minimizing costs that can erode long-term returns. This cost efficiency is particularly beneficial in a growth-focused strategy, where every percentage point of return can significantly impact the compounding effect over time.
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