A comprehensive look at a globally diversified portfolio with a single ETF focus

Report created on May 27, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is entirely invested in the Vanguard Total World Stock Index Fund ETF Shares, offering broad exposure across various sectors and geographic regions. By consolidating investments into a single ETF, the portfolio simplifies management and diversification. This approach aligns well with a balanced risk profile, as it spreads risk across a wide spectrum of assets, albeit within a single investment vehicle. The simplicity of this structure is both a strength and a limitation, offering ease of management but relying heavily on the performance of one product.

Growth Info

Historically, this portfolio has demonstrated a Compound Annual Growth Rate (CAGR) of 10.49%, with a maximum drawdown of -34.22%. These figures suggest a resilient performance across varying market conditions, with the potential for significant volatility. The days contributing to 90% of returns being limited to 22 indicates that a small number of high-performing days significantly impact overall returns. Comparing this performance to a benchmark diversified portfolio might provide additional context on its relative strength.

Projection Info

The Monte Carlo simulation, a tool that uses historical data to project future outcomes, indicates a wide range of possible portfolio values. With a median projected increase of 274% and 974 out of 1,000 simulations showing positive returns, the outlook appears optimistic. However, it's crucial to remember that these projections are based on past data, which is not a reliable predictor of future performance.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

Allocating 99% to stocks with a minimal cash reserve, this portfolio is positioned for growth, reflecting a higher risk tolerance. This asset class distribution supports potential high returns over the long term but may experience significant short-term volatility. Diversifying across more asset classes could provide a buffer against this volatility.

Sectors Info

  • Technology
    23%
  • Financials
    18%
  • Industrials
    11%
  • Consumer Discretionary
    11%
  • Health Care
    10%
  • Telecommunications
    8%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    4%
  • Real Estate
    3%
  • Utilities
    3%

The sectoral allocation reveals a heavy emphasis on technology and financial services, which are sectors known for their growth potential but also for their volatility. This concentration may increase the portfolio's risk profile, especially during market downturns in these sectors. Balancing sector exposure could mitigate some of this risk.

Regions Info

  • North America
    65%
  • Europe Developed
    15%
  • Asia Emerging
    6%
  • Japan
    6%
  • Asia Developed
    4%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is heavily weighted towards North America, with significant exposure to developed Europe and emerging Asian markets. This distribution offers a mix of stability from developed markets and growth potential from emerging markets. However, the limited exposure to emerging European and Latin American markets could be a missed opportunity for diversification and growth.

Market capitalization Info

  • Mega-cap
    43%
  • Large-cap
    31%
  • Mid-cap
    19%
  • Small-cap
    5%
  • Micro-cap
    1%

The focus on mega and big-cap stocks suggests a preference for established, less volatile companies, which is appropriate for a balanced risk profile. However, the relatively small allocation to small and micro-cap stocks limits exposure to high-growth potential segments, which could enhance returns over the long term.

Dividends Info

  • Vanguard Total World Stock Index Fund ETF Shares 1.80%
  • Weighted yield (per year) 1.80%

With a dividend yield of 1.80%, the portfolio provides a modest income stream, which could be appealing for investors seeking both growth and income. This yield, combined with capital appreciation, contributes to the portfolio's total return, offering a balanced approach to wealth accumulation.

Ongoing product costs Info

  • Vanguard Total World Stock Index Fund ETF Shares 0.07%
  • Weighted costs total (per year) 0.07%

The portfolio's total expense ratio (TER) of 0.07% is impressively low, enhancing long-term return potential by minimizing cost drag. This cost efficiency is a significant advantage, allowing investors to retain a greater portion of their returns.

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