A balanced and highly diversified portfolio with a strong emphasis on global equities and low costs

Report created on Sep 15, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

The portfolio is predominantly composed of equity ETFs, with a 65% allocation to the Vanguard Total Stock Market Index Fund ETF Shares and a 25% allocation to the Vanguard Total International Stock Market Index Fund ETF Shares. This indicates a strong emphasis on stock investments, both domestic and international, making up 90% of the portfolio. The remaining 10% is allocated to bond ETFs, split between domestic and international bonds, aimed at providing stability and income. This composition showcases a balanced approach, leaning towards growth with a cushion of income-generating assets to mitigate volatility.

Growth Info

Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 12.29%, with a maximum drawdown of -32.33%. These figures highlight the portfolio's ability to generate substantial returns while also experiencing significant volatility. The days contributing to 90% of returns being concentrated in just 32.0 days underscores the impact of short-term, high-gain periods on overall performance. Comparing this to benchmark indices could provide further context on risk-adjusted returns.

Projection Info

Using Monte Carlo simulations, which project future performance based on historical data, the portfolio shows a wide range of potential outcomes. The 50th percentile outcome of a 150.5% return is promising, but the significant spread to the 5th percentile (9.1% return) indicates a considerable risk of lower-than-expected returns. It's important to note that while these simulations offer valuable insights, they cannot guarantee future results, as they are based on past data and assumptions.

Asset classes Info

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

The allocation towards 89% stocks and 10% bonds, with a minimal 1% in cash, aligns with a growth-focused strategy while maintaining a buffer for income and risk management. This asset class distribution is suitable for investors with a balanced risk profile, seeking long-term growth with some level of income. The minimal cash holding suggests a fully invested stance, aiming to maximize market participation.

Sectors Info

  • Technology
    24%
  • Financials
    15%
  • Industrials
    10%
  • Consumer Discretionary
    9%
  • Health Care
    8%
  • Telecommunications
    7%
  • Consumer Staples
    5%
  • Energy
    3%
  • Basic Materials
    3%
  • Real Estate
    2%
  • Utilities
    2%

The sector allocation is heavily weighted towards Technology (24%) and Financial Services (15%), followed by Industrials and Consumer Cyclicals. This concentration in high-growth sectors may increase volatility but also offers the potential for higher returns, especially in bull markets. The presence of defensive sectors like Healthcare and Consumer Defensive provides a counterbalance, potentially reducing downside risk during market downturns.

Regions Info

  • North America
    67%
  • Europe Developed
    10%
  • Asia Emerging
    4%
  • Japan
    4%
  • Asia Developed
    3%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographic allocation is predominantly in North America (67%), with significant exposure to developed and emerging markets globally. This diversified geographic distribution helps mitigate the risk associated with any single country or region, while the heavy weighting towards the U.S. aligns with its status as a major driver of global market performance. However, investors might consider increasing exposure to underrepresented regions for even greater diversification.

Market capitalization Info

  • Mega-cap
    38%
  • Large-cap
    28%
  • Mid-cap
    17%
  • Small-cap
    5%
  • Micro-cap
    1%

The market capitalization breakdown shows a preference for larger companies, with Mega and Big caps comprising 66% of the portfolio. This bias towards larger, more established companies may reduce volatility and provide stable returns, but it could also limit growth potential compared to more aggressive allocations that include a higher percentage of Medium, Small, or Micro cap stocks.

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's current allocation suggests it is near the Efficient Frontier, indicating an optimal balance between risk and return based on historical data. However, it's important to remember that the Efficient Frontier is a theoretical concept based on past performance, which does not guarantee future results. Regularly reviewing and adjusting the portfolio in response to changing market conditions and personal financial goals can help maintain this balance.

Dividends Info

  • Vanguard Total Bond Market Index Fund ETF Shares 3.70%
  • Vanguard Total International Bond Index Fund ETF Shares 4.30%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.10%
  • Vanguard Total International Stock Index Fund ETF Shares 2.70%
  • Weighted yield (per year) 1.78%

The dividend yields from the bond ETFs are notably higher than those from the stock ETFs, contributing to the portfolio's overall yield of 1.78%. This income can provide a steady cash flow, which is beneficial for reinvestment or as a buffer during market volatility. Considering the current yield environment, the portfolio's income component is strategically positioned to enhance total returns while offering some level of income stability.

Ongoing product costs Info

  • Vanguard Total Bond Market Index Fund ETF Shares 0.03%
  • Vanguard Total International Bond Index Fund ETF Shares 0.07%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.04%

With a total expense ratio (TER) of 0.04%, the portfolio benefits from exceptionally low costs, which is crucial for enhancing long-term returns. Low costs ensure that a larger portion of investment returns is retained by the investor, rather than being eroded by fees. This is particularly advantageous in a diversified portfolio where the compounding effect of cost savings can be significant over time.

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