This portfolio has only about 2.1 years of historical data, based on the youngest asset in the portfolio. Some metrics, projections, and AI insights may be less reliable and should be interpreted with caution.
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Cautious Portfolio with Broad Diversification and Notable Overlap in Correlated Assets

Report created on Jul 22, 2024

Risk profile Info

3/7
Cautious
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio consists of six ETFs, with a significant portion allocated to Amundi Index Solutions - Amundi MSCI World III UCITS ETF USD EUR, which makes up nearly half of the portfolio. Other notable allocations include the Amundi Msci Emerging Markets II Ucits Etf and Vanguard ESG North America All Cap UCITS ETF USD Accumulation EUR. This composition indicates a focus on broad market exposure with a tilt towards ESG considerations. The allocation reflects a cautious approach, aligning with the risk classification and diversification goals. To enhance balance, consider reviewing the weightings to ensure alignment with long-term objectives.

Growth Info

Historically, the portfolio has shown impressive performance, with a compound annual growth rate (CAGR) of 19.77% and a maximum drawdown of -8.58%. This suggests that despite its cautious classification, the portfolio has delivered strong returns, likely due to its exposure to broad market indices. The concentrated days that account for 90% of returns point to the importance of staying invested through market fluctuations. To maintain this performance, it's essential to continue monitoring the portfolio's risk profile and adjust as necessary to align with market conditions.

Projection Info

Using a Monte Carlo simulation, the portfolio's future performance was projected with 1,000 simulations. The results indicate a wide range of potential outcomes, with the 50th percentile showing a 973.32% end portfolio value, suggesting significant growth potential. The simulation highlights the importance of diversification and risk management in achieving desired outcomes. While the annualized return of 18.95% is promising, it's crucial to remain aware of the inherent uncertainties in market performance. Regular portfolio reviews can help adapt to changing market dynamics and maintain alignment with investment goals.

Asset classes Info

  • Stocks
    80%
  • No data
    20%

The portfolio's asset class allocation is heavily skewed towards stocks, making up approximately 80% of the portfolio. A small portion is classified as unknown, which may indicate areas that require further investigation. This allocation aligns with a growth-oriented strategy, though it does introduce higher volatility. For a cautious investor, it's important to consider diversifying into other asset classes such as fixed income or cash to manage risk. This can help smooth out returns and provide stability during market downturns, ensuring the portfolio remains resilient over time.

Sectors Info

  • Technology
    21%
  • No data
    20%
  • Financials
    13%
  • Health Care
    10%
  • Consumer Discretionary
    9%
  • Industrials
    7%
  • Telecommunications
    7%
  • Consumer Staples
    5%
  • Basic Materials
    3%
  • Real Estate
    2%
  • Energy
    2%
  • Utilities
    1%

The sector allocation is diverse, with technology leading at over 21%, followed by financial services and healthcare. This indicates a balanced exposure to different economic sectors, reducing sector-specific risks. However, the unknown sector allocation is significant and should be clarified to understand its impact on overall diversification. Maintaining a balanced sector allocation is crucial for managing risk and capitalizing on sector-specific growth opportunities. Regularly reviewing sector weightings can ensure the portfolio remains aligned with long-term objectives and adapts to changing economic conditions.

Regions Info

  • North America
    56%
  • No data
    20%
  • Europe Developed
    13%
  • Japan
    5%
  • Asia Developed
    2%
  • Asia Emerging
    2%
  • Australasia
    2%

Geographically, the portfolio is heavily weighted towards North America, accounting for over half of the allocation. Europe Developed and Japan also have notable allocations. This geographic distribution provides exposure to established markets, which can offer stability and growth. However, the significant unknown geographic allocation warrants further investigation to understand its implications. To enhance diversification, consider exploring opportunities in underrepresented regions, which can provide additional growth potential and reduce reliance on any single market. This approach can help manage geopolitical risks and improve overall portfolio resilience.

Redundant positions Info

  • Amundi Msci Emerging Markets II Ucits Etf
    Vanguard ESG Emerging Markets All Cap UCITS ETF USD Acc EUR
    High correlation
  • Amundi Index Solutions - Amundi MSCI World III UCITS ETF USD EUR
    Vanguard ESG North America All Cap UCITS ETF USD Accumulation EUR
    High correlation

The portfolio contains highly correlated assets, particularly between the Amundi Msci Emerging Markets II Ucits Etf and Vanguard ESG Emerging Markets All Cap UCITS ETF USD Acc EUR. Similarly, the Amundi Index Solutions - Amundi MSCI World III UCITS ETF USD EUR and Vanguard ESG North America All Cap UCITS ETF USD Accumulation EUR show high correlation. This suggests potential overlap, which may limit diversification benefits. To optimize the portfolio, consider reducing exposure to overlapping positions and increasing allocation to uncorrelated assets. This can enhance diversification and improve risk-adjusted returns.

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.

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The portfolio optimization chart suggests that before optimizing, it's crucial to address the overlapping, highly correlated assets that offer limited diversification benefits. By moving along the efficient frontier, investors can achieve a riskier or more conservative portfolio. This involves adjusting the asset allocation to better align with risk tolerance and investment goals. For those seeking a more conservative approach, increasing exposure to low-risk assets can be beneficial. Conversely, those willing to take on more risk may consider reallocating to higher-growth opportunities. Regular portfolio reviews can facilitate these adjustments and enhance overall performance.

Dividends Info

  • Amundi Msci Emerging Markets II Ucits Etf 3.30%
  • Amundi Index Solutions - Amundi MSCI World III UCITS ETF USD EUR 1.50%
  • Weighted yield (per year) 1.40%

The portfolio's dividend yield is relatively low at 1.4%, with individual contributions from the Amundi Msci Emerging Markets II Ucits Etf and Amundi Index Solutions - Amundi MSCI World III UCITS ETF USD EUR. This suggests a focus on capital appreciation rather than income generation. For investors seeking regular income, this may not align with their objectives. To increase dividend income, consider reallocating a portion of the portfolio to dividend-focused investments. This can provide a steady income stream while maintaining exposure to growth opportunities. Regularly reviewing dividend yield can help ensure alignment with income goals.

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