Strong value and small cap equity portfolio with global diversification and efficient risk return profile
Report created on Jun 15, 2026Risk profile
4/7
Diversification profile
3/5
Positions
-
FS Fidelity Total Market Index Fund
FSKAX - US3159116934 40.00% -
DF U.S. SMALL CAP VALUE PORTFOLIO U.S. SMALL CAP VALUE PORTFOLIO - INSTITUTIONAL CLASS
DFSVX - US2332038197 25.00% -
DF DFA INTERNATIONAL VALUE PORTFOLIO DFA INTERNATIONAL VALUE PORTFOLIO- INSTITUTIONAL CLASS
DFIVX - US25434D2036 14.00% -
DI DFA INTERNATIONAL SMALL CAP VALUE PORTFOLIO DFA INTERNATIONAL SMALL CAP VALUE PORTFOLIO - INSTITUTIONAL CLASS
DISVX - US2332037363 12.00% -
DF EMERGING MARKETS VALUE PORTFOLIO EMERGING MARKETS VALUE PORTFOLIO - INSTITUTIONAL CLASS
DFEVX - US2332035870 9.00%
This portfolio is a five-fund, 100% stock mix built around a broad US total market core and several value-tilted satellite funds. The largest holding is the Fidelity Total Market Index at 40%, giving a baseline exposure to the whole US market. Around it sit focused allocations to US small cap value, international value, international small cap value, and emerging markets value. This structure mixes one very broad, low-cost fund with more specialized strategies targeting specific parts of the market. The result is a portfolio that looks simple at the fund level but more complex under the hood, with clear tilts toward cheaper and smaller companies while still anchored by a mainstream core fund.
Growth
One or more local-currency benchmark funds are unavailable for this report.
From mid-2016 to April 2026, $1,000 in this portfolio grew to about $3,317, a compound annual growth rate (CAGR) of 12.97%. CAGR is like average speed on a road trip: it smooths out the bumps to show how fast wealth grew per year. Over the same period, a global market benchmark returned 12.74% annually, so this portfolio slightly outpaced it. The trade-off was a deeper maximum drawdown of -39.13% during early 2020, versus -33.53% for the benchmark. That sharper drop is consistent with heavier exposure to smaller and value stocks. Still, the rapid recovery within eight months shows how strongly it bounced back after the shock.
Projection
The Monte Carlo projection models many possible 15‑year paths for $1,000, using historical returns and volatility as inputs. Monte Carlo is basically a big “what if” machine: it shuffles returns thousands of times to see a range of outcomes instead of one forecast. Here, the median outcome lands around $2,774, with a central band from about $1,784 to $4,220. There are also more extreme but less likely paths, from roughly $905 up to $8,138. These numbers are not promises; they’re statistical scenarios assuming the future is somewhat similar to the past. The key takeaway is that outcomes cluster around growth, but with plenty of room for both disappointment and pleasant surprise.
Asset classes
- Stocks 100%
All of this portfolio is invested in stocks, with no bonds or cash in the mix. That makes the asset allocation very straightforward: it’s all in one high-risk, high-return asset class rather than split across safer assets. Equities historically have offered higher long-term growth than bonds or cash, but with larger and more frequent swings. A 100% stock allocation tends to be more sensitive to market cycles, both on the upside and the downside. The “balanced” risk classification here comes more from diversification within equities and efficient weighting, not from blending in lower-risk asset classes. In practice, that means return potential and volatility both lean toward the higher side.
Sectors
- Financials 22%
- Technology 18%
- Industrials 12%
- Consumer Discretionary 11%
- Energy 9%
- Basic Materials 7%
- Health Care 6%
- Telecommunications 6%
- Consumer Staples 5%
- Real Estate 2%
- Utilities 2%
Sector-wise, the portfolio is reasonably spread out, with financials (22%) and technology (18%) as the two biggest slices, followed by industrials and consumer discretionary. No single sector dominates to an extreme degree, which is helpful for diversification across different parts of the economy. Compared to a typical broad global index, technology’s share here is somewhat lower and financials’ share a bit higher, which lines up with a value tilt. Sectors like energy and basic materials are also meaningfully represented, which can behave differently from growth-oriented areas. This kind of sector balance can smooth out shocks that hit one industry, though it also means performance may differ from more tech-heavy benchmarks during strong growth cycles.
Regions
- North America 68%
- Europe Developed 14%
- Japan 6%
- Asia Emerging 4%
- Asia Developed 4%
- Australasia 2%
- Africa/Middle East 1%
- Latin America 1%
Geographically, about 68% of the portfolio is in North America, mainly the US, with the rest spread across developed Europe, Japan, developed Asia, Australasia, and emerging markets. This means the portfolio is US-anchored but not US-only. A typical global market index often has a slightly lower US share, so there is a mild home bias but still substantial international diversification. International developed markets make up a significant chunk, and emerging markets, while a smaller piece, add exposure to faster-growing but more volatile economies. This geographic mix helps reduce dependence on a single economy or currency, while still leaning into the depth and liquidity of the US market.
Market capitalization
- Mega-cap 26%
- Small-cap 22%
- Large-cap 22%
- Mid-cap 20%
- Micro-cap 10%
The market cap breakdown is quite balanced: 26% mega-cap, 22% large-cap, 20% mid-cap, 22% small-cap, and even 10% micro-cap. That’s a much heavier tilt toward smaller companies than a typical global index, which is usually dominated by mega and large caps. Smaller stocks often have higher growth and risk, while mega caps tend to be steadier but more tied to broad market moves. This wide spread across size categories means the portfolio participates in opportunities across the spectrum, from giant household names to more niche companies. It also means performance can diverge meaningfully from large-cap benchmarks, especially in periods when small caps strongly lead or lag.
Factors
Factor exposures are estimated using statistical models based on historical data and measure systematic (market-relative) tilts, not absolute portfolio characteristics. Results may vary depending on the analysis period, data availability, and currency of the underlying assets.
Factor exposure shows strong tilts toward value (75%) and size (69%), both graded as “high” relative to a market-average score of 50%. Factors are like underlying traits of the stocks you hold, and research has linked value (cheaper stocks) and smaller size to distinct long-run return patterns, often with bumpier rides. Neutral scores in momentum, quality, and low volatility suggest the portfolio behaves broadly like the market on those dimensions, rather than leaning hard one way or another. Yield is slightly low at 30%, reflecting a focus on price-based value rather than purely income. Overall, this setup tends to do well when value and small caps are in favor, but can lag when growth or mega caps dominate.
Risk contribution
-
Fidelity Total Market Index Fund
Weight: 40.00% 39.8% -
U.S. SMALL CAP VALUE PORTFOLIO U.S. SMALL CAP VALUE PORTFOLIO - INSTITUTIONAL CLASS
Weight: 25.00% 31.8% -
DFA INTERNATIONAL VALUE PORTFOLIO DFA INTERNATIONAL VALUE PORTFOLIO- INSTITUTIONAL CLASS
Weight: 14.00% 12.6% -
DFA INTERNATIONAL SMALL CAP VALUE PORTFOLIO DFA INTERNATIONAL SMALL CAP VALUE PORTFOLIO - INSTITUTIONAL CLASS
Weight: 12.00% 9.8% -
EMERGING MARKETS VALUE PORTFOLIO EMERGING MARKETS VALUE PORTFOLIO - INSTITUTIONAL CLASS
Weight: 9.00% 6.0%
Risk contribution highlights how much each fund drives overall volatility, which isn’t always the same as its weight. The Fidelity Total Market Index makes up 40% of the portfolio and contributes almost exactly 40% of risk, so it’s very proportional. The US Small Cap Value fund is 25% of the weight but contributes nearly 32% of risk, showing it’s more volatile and more influential than its size alone suggests. International and emerging markets value funds contribute less risk than their weights, partly thanks to diversification benefits. The top three holdings together account for over 84% of total risk, indicating that while the lineup is diversified, most of the day-to-day movement is driven by a handful of core positions.
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 risk–return chart shows the current portfolio lying on or very close to the efficient frontier, meaning it’s using its existing holdings in a way that’s already quite efficient. The Sharpe ratio, which compares excess return to volatility, is 0.58 for the current mix, while a mathematically optimal combination of the same funds reaches 0.82 with slightly lower risk and slightly higher expected return. A minimum-variance mix has even lower risk and a Sharpe of 0.78. The gap between the current Sharpe and the frontier options is modest, not dramatic. In plain terms, this structure is already making effective use of the chosen building blocks without obvious inefficiencies.
Dividends
- EMERGING MARKETS VALUE PORTFOLIO EMERGING MARKETS VALUE PORTFOLIO - INSTITUTIONAL CLASS 3.10%
- DFA INTERNATIONAL VALUE PORTFOLIO DFA INTERNATIONAL VALUE PORTFOLIO- INSTITUTIONAL CLASS 3.70%
- U.S. SMALL CAP VALUE PORTFOLIO U.S. SMALL CAP VALUE PORTFOLIO - INSTITUTIONAL CLASS 1.50%
- DFA INTERNATIONAL SMALL CAP VALUE PORTFOLIO DFA INTERNATIONAL SMALL CAP VALUE PORTFOLIO - INSTITUTIONAL CLASS 6.60%
- Fidelity Total Market Index Fund 1.00%
- Weighted yield (per year) 2.36%
The portfolio’s overall dividend yield comes in around 2.36%, a blend of lower-yielding US core and small cap funds with higher-yielding international and emerging markets value funds. Dividends are cash payments from companies, and they can be an important part of total return, especially when reinvested. Compared to high-income strategies, this yield is moderate rather than aggressively income-focused. It reflects a mix where some funds lean into value and naturally pick up higher payouts, while others target broad growth and small caps that often retain more earnings. This balance means returns rely on both price appreciation and dividends, rather than leaning heavily on one source.
Ongoing product costs
- EMERGING MARKETS VALUE PORTFOLIO EMERGING MARKETS VALUE PORTFOLIO - INSTITUTIONAL CLASS 0.44%
- DFA INTERNATIONAL VALUE PORTFOLIO DFA INTERNATIONAL VALUE PORTFOLIO- INSTITUTIONAL CLASS 0.28%
- U.S. SMALL CAP VALUE PORTFOLIO U.S. SMALL CAP VALUE PORTFOLIO - INSTITUTIONAL CLASS 0.31%
- DFA INTERNATIONAL SMALL CAP VALUE PORTFOLIO DFA INTERNATIONAL SMALL CAP VALUE PORTFOLIO - INSTITUTIONAL CLASS 0.43%
- Fidelity Total Market Index Fund 0.02%
- Weighted costs total (per year) 0.22%
Average costs, measured by the total expense ratio (TER), are about 0.22% per year across the portfolio. TER is the annual fee charged by funds to cover management and operating expenses, and it quietly reduces returns over time. The core Fidelity index fund is extremely low-cost at 0.02%, which helps pull the overall fee down, while the more specialized DFA strategies sit in the 0.28–0.44% range. For an actively tilted, factor-focused equity lineup, a blended 0.22% is impressively low and compares well with many similar strategies. Keeping costs contained like this supports better long-term performance, because less return is being eaten by fees each year.
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