A well-diversified growth portfolio with a strong U.S. focus and moderate risk exposure

Report created on Apr 27, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio consists of four ETFs, with a significant 50% allocation to the Vanguard S&P 500 ETF, reflecting a strong focus on large-cap U.S. equities. The Avantis U.S. Small Cap Value ETF comprises 20%, adding exposure to smaller, potentially higher-growth companies. The Vanguard Total International Stock Index Fund ETF shares another 20%, offering global diversification. The remaining 10% is allocated to the Vanguard Total Bond Market Index Fund ETF, providing some fixed-income stability. This composition aligns with a growth-focused strategy, balancing domestic equity dominance with international and fixed-income exposure.

Growth Info

The historical performance of the portfolio is robust, with a Compound Annual Growth Rate (CAGR) of 12.24%. This suggests a solid return over the long term, although the maximum drawdown of -33.24% indicates significant volatility. Compared to a standard benchmark like the S&P 500, this performance is competitive, reflecting the benefits of diversification. However, it's important to remember that historical performance is not a guarantee of future results. Regularly reviewing performance relative to benchmarks can ensure alignment with investment goals.

Projection Info

Monte Carlo simulations, which use historical data to project future outcomes, suggest a wide range of potential portfolio returns. With a median projection of 186.5% and a positive return in 915 out of 1,000 simulations, the portfolio shows promising growth potential. However, a 5th percentile projection of -16.4% highlights inherent risks. While these simulations provide valuable insights, they rely on past data and assumptions, so actual future performance may vary. Regularly updating projections with current data can help maintain realistic expectations.

Asset classes Info

  • Stocks
    89%
  • Bonds
    10%
  • Cash
    1%

The portfolio's asset allocation is heavily weighted towards stocks at 89%, with bonds making up 10% and cash at 1%. This stock-heavy allocation is typical for a growth portfolio, aiming for higher returns through equity exposure. The bond component adds a layer of stability, potentially smoothing out volatility. Compared to traditional benchmarks, this allocation is aggressive, suitable for investors with a higher risk tolerance. Periodically reassessing the balance between stocks and bonds can ensure it remains aligned with changing risk appetites and market conditions.

Sectors Info

  • Technology
    19%
  • Financials
    18%
  • Consumer Discretionary
    11%
  • Industrials
    10%
  • Health Care
    8%
  • Telecommunications
    6%
  • Energy
    6%
  • Consumer Staples
    5%
  • Basic Materials
    4%
  • Utilities
    2%
  • Real Estate
    2%

Sector allocation is diversified, with technology (19%) and financial services (18%) leading the way. This mirrors common benchmarks, ensuring broad exposure across industries. The portfolio's sector balance reduces sector-specific risks, although the tech-heavy weighting could lead to higher volatility during market downturns or interest rate hikes. Regularly reviewing sector trends and adjusting allocations can help mitigate risks and capitalize on emerging opportunities. Maintaining a diversified sector allocation supports long-term growth and resilience.

Regions Info

  • North America
    71%
  • Europe Developed
    8%
  • Asia Emerging
    3%
  • Japan
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is heavily skewed towards North America (71%), with limited exposure to other regions like Europe Developed (8%) and Asia Emerging (3%). This U.S.-centric focus aligns with the strong performance of U.S. markets in recent years but may limit diversification benefits. Increasing exposure to international markets could reduce reliance on U.S. economic conditions and tap into growth opportunities abroad. Regularly assessing geographic allocations can ensure a balanced approach to global diversification.

Market capitalization Info

  • Mega-cap
    32%
  • Large-cap
    23%
  • Mid-cap
    13%
  • Small-cap
    11%
  • Micro-cap
    10%

The portfolio's market capitalization allocation is well-distributed, with 32% in mega caps and 23% in big caps, providing stability and growth potential. Medium, small, and micro caps collectively make up 34%, adding diversity and potential for higher returns. This distribution aligns with a growth-oriented strategy, balancing established companies with smaller, potentially higher-growth firms. Regularly reviewing market cap allocations can help maintain an optimal balance between stability and growth potential.

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.

The portfolio can be optimized using the Efficient Frontier, which identifies the best risk-return ratio based on current assets. This process involves adjusting allocations to achieve an optimal balance, maximizing returns for a given level of risk. While the current allocation is well-diversified, exploring slight adjustments could enhance efficiency. Regularly reviewing the portfolio's position on the Efficient Frontier can ensure it remains aligned with risk and return objectives.

Dividends Info

  • Avantis® U.S. Small Cap Value ETF 1.90%
  • Vanguard Total Bond Market Index Fund ETF Shares 3.70%
  • Vanguard S&P 500 ETF 1.40%
  • Vanguard Total International Stock Index Fund ETF Shares 3.10%
  • Weighted yield (per year) 2.07%

The portfolio's dividend yield is a modest 2.07%, with contributions from the Avantis U.S. Small Cap Value ETF and the Vanguard Total Bond Market Index Fund ETF. While dividends provide a steady income stream, this portfolio's focus is on growth rather than income. Investors seeking higher income may consider increasing bond exposure or selecting higher-yielding equities. Regularly reviewing dividend yields can ensure the portfolio aligns with income goals.

Ongoing product costs Info

  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Vanguard Total Bond Market Index Fund ETF Shares 0.03%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.08%

The portfolio's total expense ratio (TER) is impressively low at 0.08%, reflecting cost-efficient fund selection. Low costs are crucial for long-term performance, as they minimize the drag on returns. The use of low-cost Vanguard ETFs helps achieve this efficiency. Regularly reviewing and minimizing costs can enhance net returns, supporting long-term growth objectives. This cost structure aligns well with best practices for maintaining a cost-effective investment strategy.

What next?

Ready to invest in this portfolio?

Select a broker that fits your needs and watch for low fees to maximize your returns.

Select broker

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.

Instrument logos provided by Elbstream.

Help us improve Insightfolio

Your feedback makes a difference! Share your thoughts in our quick survey. Take the survey