A growth-focused portfolio with tech emphasis and strong historical performance

Risk profile

  • Secure
    Speculative

The risk profile, derived from past market volatility, reflects the level of risk the portfolio is exposed to. This assessment helps align your investments with your financial goals and comfort with market fluctuations.

Diversification profile

  • Focused
    Diversified

The diversification assessment evaluates the spread of investments across asset classes, regions, and sectors. This ensures a balanced mix, reducing risk and maximizing returns by not concentrating in any single area.

What type of investor this portfolio is suitable for

Growth Investors

This portfolio suits an investor with a high risk tolerance seeking aggressive growth and a long-term investment horizon. It is ideal for individuals comfortable with market volatility and potential drawdowns, aiming to maximize capital appreciation. The focus on equities, particularly in the technology sector, aligns with investors willing to take on higher risk for potentially higher returns. This strategy is well-suited for those looking to build significant wealth over an extended period.

Positions

  • Vanguard Total World Stock Index Fund ETF Shares
    VT - US9220427424
    30.00%
  • Invesco QQQ Trust
    QQQ - US46090E1038
    25.00%
  • Defiance Quantum
    QTUM - US26922A4206
    25.00%
  • Schwab U.S. Dividend Equity ETF
    SCHD - US8085247976
    20.00%

The portfolio is composed of four ETFs, with a significant focus on stocks, specifically technology. The Vanguard Total World Stock Index Fund ETF Shares and Invesco QQQ Trust make up 55% of the portfolio, emphasizing global and tech-heavy exposure. A 20% allocation to Schwab U.S. Dividend Equity ETF provides a focus on dividend-paying U.S. stocks. This composition is slightly more concentrated in equities compared to a typical growth portfolio, which might include a mix of bonds for risk mitigation. Consider adding fixed-income assets to balance potential volatility.

Growth Info

Historically, the portfolio has shown impressive growth, with a Compound Annual Growth Rate (CAGR) of 16.71% and a maximum drawdown of -32.16%. This indicates strong returns but also highlights the potential for significant losses during downturns. Compared to common benchmarks, this performance suggests a high-risk, high-reward profile, typical for growth-focused investments. While past performance is not a guarantee of future results, the historical data provides a solid foundation for evaluating potential risk and return.

Projection Info

The Monte Carlo simulation, which uses historical data to project future outcomes, indicates a wide range of potential returns. With 1,000 simulations, the portfolio's 50th percentile projected return is 659.47%, suggesting robust growth potential. However, it's important to note that simulations are based on past data and cannot predict future market conditions. The high number of simulations with positive returns (992) is encouraging, but investors should remain cautious and consider potential market changes.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%
  • Other
    0%
  • No data
    0%

The portfolio is heavily weighted towards stocks, with 99.3% allocation, leaving minimal exposure to other asset classes like cash or bonds. This lack of diversification across asset classes may increase vulnerability to market volatility, especially during economic downturns. A more balanced portfolio might include bonds or other fixed-income securities to provide stability and reduce risk. Consider diversifying into different asset classes to achieve a more balanced risk profile.

Sectors Info

  • Technology
    43%
  • Consumer Discretionary
    9%
  • Industrials
    9%
  • Financials
    9%
  • Telecommunications
    8%
  • Health Care
    8%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    2%
  • Utilities
    1%
  • Real Estate
    1%

The portfolio is notably concentrated in the technology sector, which comprises 42.93% of the total allocation. This is significantly higher than typical benchmarks, indicating a potential for higher volatility, especially during periods of interest rate fluctuations. While tech stocks have driven substantial growth recently, it's important to be aware of the risks associated with sector concentration. Diversifying into other sectors could help mitigate these risks and provide more balanced exposure to different economic cycles.

Regions Info

  • North America
    82%
  • Europe Developed
    7%
  • Japan
    4%
  • Asia Emerging
    3%
  • Asia Developed
    2%
  • Africa/Middle East
    1%
  • Australasia
    1%
  • Latin America
    0%
  • Europe Emerging
    0%

Geographically, the portfolio is heavily skewed towards North America, with 82.23% exposure. This concentration may limit diversification benefits and increase vulnerability to regional economic downturns. While North American markets have performed well historically, global diversification can provide exposure to different growth opportunities and reduce regional risk. Consider increasing exposure to underrepresented regions like Europe or Asia to enhance diversification and capture potential growth outside North America.

Dividends Info

  • Invesco QQQ Trust 0.60%
  • Defiance Quantum 0.60%
  • Schwab U.S. Dividend Equity ETF 3.60%
  • Vanguard Total World Stock Index Fund ETF Shares 1.90%
  • Weighted yield (per year) 1.59%

The portfolio's dividend yield stands at 1.59%, with the Schwab U.S. Dividend Equity ETF contributing a significant portion at 3.6%. This yield is relatively modest, reflecting the growth-oriented nature of the portfolio. Dividends can provide a steady income stream and help cushion against market volatility. Investors seeking higher income may consider increasing exposure to dividend-focused assets. However, the current yield aligns with a growth strategy, prioritizing capital appreciation over income.

Ongoing product costs Info

  • Invesco QQQ Trust 0.20%
  • Defiance Quantum 0.40%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • Vanguard Total World Stock Index Fund ETF Shares 0.07%
  • Weighted costs total (per year) 0.18%

The portfolio's total expense ratio (TER) is 0.18%, which is relatively low and beneficial for long-term performance. Lower costs mean more of your investment returns stay in your pocket, compounding over time. The ETFs included offer competitive fees, supporting cost-effective growth. Regularly reviewing and optimizing portfolio costs can further enhance returns. Consider maintaining this cost efficiency by evaluating any potential new additions for their expense ratios.

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.

The portfolio can be optimized using the Efficient Frontier, which seeks the best possible risk-return ratio for a given set of assets. By adjusting the allocation among existing holdings, you can potentially enhance returns without significantly increasing risk. This does not guarantee diversification across different types of investments but focuses on maximizing efficiency. Regularly revisiting and rebalancing the portfolio can help maintain an optimal risk-return balance over time.

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