A growth-focused portfolio with high tech exposure and moderate geographic diversification

Report created on Mar 23, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

3/5
Moderately Diversified
Less diversification More diversification

Positions

The portfolio consists of 100% equities, with significant allocations to individual stocks and ETFs. BYD Co Ltd ADR and Invesco QQQ Trust are the largest holdings, each over 20%. While it has a strong growth focus, the absence of bonds or alternative assets like real estate or commodities limits diversification. Comparing to a typical balanced portfolio, which includes a mix of stocks and bonds, this portfolio is heavily weighted towards equities, increasing potential volatility. Consider integrating different asset classes to mitigate risk and enhance stability during market downturns.

Growth Info

Historically, the portfolio has performed well, with a CAGR of 21.44%. This indicates a strong growth trajectory over time, outperforming many standard benchmarks. However, the maximum drawdown of -38.38% suggests significant volatility, which could impact investors with lower risk tolerance. Past performance, though impressive, is not a guarantee of future results. It is essential to evaluate whether the historical performance aligns with your risk appetite and long-term goals, and consider rebalancing if the volatility is a concern.

Projection Info

The Monte Carlo simulation, a method using historical data to predict future outcomes, shows potential growth with a median return of 252.8%. However, the 5th percentile projects a significant loss, highlighting potential risks. While 717 out of 1,000 simulations show positive returns, it's crucial to remember that these are based on past data and assumptions, which may not hold in the future. Diversifying further or adjusting allocations could enhance the likelihood of achieving desired outcomes, especially in uncertain market conditions.

Asset classes Info

  • Stocks
    100%

With a 100% allocation to stocks, the portfolio is heavily concentrated in a single asset class. This lack of diversification can lead to increased risk, as equities can be volatile. Compared to a more balanced portfolio with bonds or other asset classes, this approach may not provide the same level of risk mitigation. Introducing fixed income or alternative investments could help stabilize returns and reduce overall portfolio risk, providing a buffer against equity market downturns.

Sectors Info

  • Technology
    44%
  • Consumer Discretionary
    31%
  • Telecommunications
    7%
  • Financials
    4%
  • Health Care
    4%
  • Industrials
    4%
  • Consumer Staples
    2%
  • Energy
    2%
  • Basic Materials
    1%
  • Utilities
    1%
  • Real Estate
    1%

The portfolio is tech-heavy, with 44% in the technology sector, reflecting a strong growth orientation. While this can drive returns, it also increases exposure to sector-specific risks, such as regulatory changes or tech market corrections. Compared to broader market indices, this concentration suggests higher volatility. Diversifying into other sectors like healthcare or consumer staples could reduce risk and provide a more balanced exposure, potentially smoothing returns during tech sector downturns.

Regions Info

  • North America
    56%
  • Asia Emerging
    40%
  • Europe Developed
    2%
  • Japan
    1%
  • Asia Developed
    1%

Geographic exposure is concentrated in North America (56%) and Asia Emerging (40%), with minimal allocation to Europe and other regions. This concentration could limit diversification benefits and expose the portfolio to region-specific risks, such as geopolitical tensions or economic shifts. Compared to global benchmarks, which often have broader geographic diversification, this portfolio might benefit from increased exposure to developed markets in Europe or emerging markets in Latin America to balance regional risks.

Market capitalization Info

  • Large-cap
    56%
  • Mega-cap
    30%
  • Mid-cap
    9%
  • Small-cap
    3%
  • Micro-cap
    1%

The portfolio is predominantly invested in large-cap stocks, with 56% in big caps and 30% in mega caps. This focus on larger companies can provide stability and lower volatility compared to small-cap stocks, which can be more volatile but offer higher growth potential. However, the limited exposure to small and micro-cap stocks (only 4%) may restrict growth opportunities. Increasing allocation to smaller companies could enhance growth potential, albeit with increased risk, and improve overall diversification.

Redundant positions Info

  • Vanguard S&P 500 ETF
    Invesco QQQ Trust
    High correlation

High correlation between assets like Vanguard S&P 500 ETF and Invesco QQQ Trust suggests limited diversification benefits. When assets move together, the portfolio may not be protected during market downturns. Reducing overlap and adding less correlated assets can enhance diversification and reduce risk. Consider including assets with lower correlation to existing holdings, such as international equities or commodities, to improve risk-adjusted returns and provide a buffer against market volatility.

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.

Optimizing this portfolio using the Efficient Frontier could enhance the risk-return balance. The Efficient Frontier represents the best possible return for a given level of risk. By adjusting allocations among current assets, you can potentially improve this ratio. However, optimization is based on historical data and assumptions, which may not predict future market conditions. Regular reviews and adjustments are necessary to maintain optimal performance, especially in changing market environments.

Dividends Info

  • Apple Inc 0.50%
  • BYD Co Ltd ADR 0.80%
  • First Trust NASDAQ Cybersecurity ETF 0.20%
  • Ford Motor Company 7.50%
  • Alphabet Inc Class A 0.50%
  • International Seaways Inc 13.20%
  • Jackson Financial Inc 3.40%
  • Microsoft Corporation 0.80%
  • O’Shares U.S. Small-Cap Quality Dividend ETF 0.80%
  • Invesco QQQ Trust 0.50%
  • Royal Caribbean Cruises Ltd 0.40%
  • Regeneron Pharmaceuticals Inc 0.10%
  • iShares Semiconductor ETF 0.60%
  • Toyota Motor Corporation ADR 2.90%
  • Global X Uranium ETF 3.10%
  • Vanguard FTSE Europe Index Fund ETF Shares 1.70%
  • Vanguard S&P 500 ETF 1.00%
  • Vanguard FTSE All-World ex-US Small-Cap Index Fund ETF Shares 1.20%
  • Invesco S&P SmallCap Quality ETF 0.60%
  • Weighted yield (per year) 0.72%

The portfolio's dividend yield is modest at 0.72%, with contributions from stocks like Ford Motor Company and International Seaways Inc. While dividends can provide a steady income stream, the focus here is clearly on growth, as reflected by the low yield. For investors seeking income, increasing exposure to high-dividend stocks or ETFs could enhance cash flow. However, it's important to balance this with growth objectives, as higher dividends often come with lower growth potential.

Ongoing product costs Info

  • First Trust NASDAQ Cybersecurity ETF 0.59%
  • O’Shares U.S. Small-Cap Quality Dividend ETF 0.48%
  • Invesco QQQ Trust 0.20%
  • iShares Semiconductor ETF 0.35%
  • Global X Uranium ETF 0.69%
  • Vanguard FTSE Europe Index Fund ETF Shares 0.13%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard FTSE All-World ex-US Small-Cap Index Fund ETF Shares 0.08%
  • Invesco S&P SmallCap Quality ETF 0.29%
  • Weighted costs total (per year) 0.07%

The portfolio's total expense ratio (TER) is low at 0.07%, which is advantageous for long-term returns. Lower costs mean more of your money remains invested, compounding over time. This aligns well with best practices for cost efficiency. Maintaining a focus on low-cost funds and monitoring expense ratios can help optimize returns. However, ensure that cost savings do not compromise diversification or growth potential, as sometimes higher-cost funds offer unique benefits.

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