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A tech-heavy portfolio that thinks diversification is a suggestion, not a rule

Report created on Jul 26, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

At first glance, this portfolio looks like it was crafted during a tech enthusiast's dream rather than a financial advisor's office. With 40% in a tech ETF and another 40% in an S&P 500 ETF (which is also tech-heavy), followed by 20% in a Russell 1000 Growth ETF, it's like putting all your eggs in a basket and then putting that basket in a slightly larger, tech-centric basket. It’s less diversified and more of a single-minded bet on the tech sector's eternal growth.

Growth Info

Historically, this portfolio has been riding the tech wave with a CAGR of 18.44%. While that number might have you fist-pumping, remember that past performance is like relying on yesterday's lottery numbers to play today's game. The max drawdown of -32.52% is a stark reminder that when tech sneezes, this portfolio could catch a cold. And relying on 38 days for 90% of returns? That's not investing; that's playing financial roulette.

Projection Info

The Monte Carlo simulation's optimistic view, with a median projection of 863.4% growth, sounds like a fairy tale. But remember, Monte Carlo is more about simulating a range of possible outcomes than predicting future riches. It's like forecasting weather in the tropics; sunny days are likely, but storms can appear out of nowhere. With almost all simulations showing positive returns, it's essential to remember that in the real world, markets don't always go up, especially for portfolios as narrowly focused as this one.

Asset classes Info

  • Stocks
    100%

Diversification across asset classes? Non-existent. With 100% in stocks, this portfolio is like a tightrope walker without a safety net. The thrill of high-wire acts might be appealing, but the potential for a painful fall is real. A little bond action or some real estate could act as a cushion for when the tech sector hits turbulence.

Sectors Info

  • Technology
    62%
  • Consumer Discretionary
    7%
  • Financials
    7%
  • Telecommunications
    7%
  • Health Care
    5%
  • Industrials
    4%
  • Consumer Staples
    3%
  • Energy
    1%
  • Utilities
    1%
  • Real Estate
    1%
  • Basic Materials
    1%

Tech's 62% stranglehold on this portfolio is like betting your retirement on a single horse. Sure, the tech sector has been a thoroughbred, but even Secretariat had bad days. The minimal sprinkling across other sectors isn't diversification; it's seasoning. Without meaningful exposure to other sectors, this portfolio is missing out on balanced nutrition.

Regions Info

  • North America
    99%

With 99% in North America, this portfolio has a severe case of home bias. It's like refusing to eat at any restaurant that's not in your neighborhood. Sure, you might have some great options locally, but you're missing out on the world's flavors and, more importantly, its growth opportunities. A dash of international exposure could add some much-needed spice.

Market capitalization Info

  • Mega-cap
    53%
  • Large-cap
    28%
  • Mid-cap
    14%
  • Small-cap
    4%
  • Micro-cap
    1%

The mega and big cap focus (81% combined) suggests a preference for the market's Goliaths, leaving the Davids (small and micro caps) with mere scraps. While it's comforting to side with the giants, remember that today's agile startups could be tomorrow's behemoths. Overlooking them could mean missing out on significant growth opportunities.

Redundant positions Info

  • Vanguard S&P 500 ETF
    Vanguard Russell 1000 Growth Index Fund ETF Shares
    Vanguard Information Technology Index Fund ETF Shares
    High correlation

The high correlation among the ETFs selected is like buying three different brands of vanilla ice cream and expecting a diverse flavor experience. It's redundant and offers little in the way of genuine diversification benefits. Mixing in some chocolate or strawberry (i.e., different asset classes or uncorrelated investments) could make for a more balanced and less volatile portfolio.

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.

When it comes to risk vs. return optimization, this portfolio is like a car with a powerful engine and no brakes. It's thrilling until you need to stop or turn. The reliance on highly correlated, tech-heavy assets for growth without considering the volatility or potential downturns is a risky maneuver. Broadening the investment horizon beyond tech could provide a smoother, more controlled ride.

Dividends Info

  • Vanguard Information Technology Index Fund ETF Shares 0.50%
  • Vanguard Russell 1000 Growth Index Fund ETF Shares 0.50%
  • Vanguard S&P 500 ETF 1.20%
  • Weighted yield (per year) 0.78%

The dividend yield here is like finding loose change in the couch cushions; it's nice to have but won't significantly impact your financial health. A 0.78% total yield is nothing to write home about, especially for a growth-focused portfolio. While dividends aren't the main game here, a more balanced approach could provide income alongside growth.

Ongoing product costs Info

  • Vanguard Information Technology Index Fund ETF Shares 0.10%
  • Vanguard Russell 1000 Growth Index Fund ETF Shares 0.08%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.07%

At least the portfolio's costs are under control, with a Total TER of 0.07%. It's like finding a cheap, efficient car that only drives on the tech highway. Low costs are commendable, but when your investment strategy is as narrow as this, you're saving pennies while risking dollars.

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