High quality US dividend equity portfolio with strong value tilt and efficient historical risk balance
Report created on Jun 13, 2026Risk profile
4/7
Diversification profile
3/5
Positions
-
FD Fidelity® High Dividend ETF
FDVV - US3160928400 33.34% -
DG iShares Core Dividend Growth ETF
DGRO - US46434V6213 33.33% -
SC Schwab U.S. Dividend Equity ETF
SCHD - US8085247976 33.33%
This portfolio is extremely simple: three US-focused dividend equity ETFs at almost identical one‑third weights. That means the structure is straightforward to follow, with no bonds, cash, alternatives, or satellite positions. A setup like this keeps the overall “moving parts” low, which can make it easier to understand how the portfolio behaves over time. The trade‑off is that all the risk and return come from one broad type of asset: dividend‑paying stocks, mostly in one country. Overall, this is a clean, focused equity income mix where each holding pulls a very similar amount of weight in both allocation and risk.
Growth
One or more local-currency benchmark funds are unavailable for this report.
From late 2016 to mid‑2026, $1,000 invested grew to about $3,326, giving a compound annual growth rate (CAGR) of 13.17%. CAGR is like average speed on a road trip: it smooths the ups and downs into one yearly growth number. Over this period, the portfolio slightly outpaced the global market benchmark, which returned 12.45% annually. The worst drop, or max drawdown, was about ‑36.1%, a bit deeper than the global market’s ‑33.5%. That 2020 decline recovered within about eight months. This pattern suggests the portfolio has delivered a modest performance edge while still behaving like a typical equity portfolio in major sell‑offs.
Projection
The Monte Carlo projection uses past returns and volatility to simulate many possible 15‑year paths for a $1,000 investment. Think of it as running 1,000 “what if” market histories that resemble the past but unfold in slightly different ways. The median outcome is about $2,913, with a 25–75% “middle range” of roughly $1,852–$4,275. About three‑quarters of simulations end positive, and the average annualized return across all paths is 8.26%. These numbers are not predictions, just illustrations of what could happen if markets behaved somewhat like they have before. Real‑world results can be better or worse than the simulated ranges.
Asset classes
- Stocks 101%
The asset‑class picture is highly concentrated: 101% in stocks (a small rounding difference above 100%). There is no allocation to bonds, cash, or other asset types, so all portfolio behavior is tied to equity market moves. Equities historically have offered higher long‑term growth than bonds but come with larger short‑term swings. Compared with diversified “multi‑asset” mixes that blend stocks and bonds, this portfolio will generally react more strongly to equity bull and bear markets. One positive is that using broad equity funds, rather than single stocks, still spreads risk across many underlying companies within that single asset class.
Sectors
- Technology 24%
- Financials 16%
- Consumer Staples 13%
- Health Care 13%
- Consumer Discretionary 8%
- Industrials 7%
- Energy 7%
- Utilities 5%
- Real Estate 3%
- Telecommunications 3%
- Basic Materials 1%
Sector exposure is spread across many areas, with notable tilts. Technology is the largest at 24%, followed by financials at 16%, consumer staples and health care each at 13%. The rest is split among consumer discretionary, industrials, energy, utilities, real estate, telecom, and materials. Compared with a broad US market index, this mix leans more toward traditional dividend‑heavy sectors like financials, utilities, and staples, and relatively less toward unprofitable or speculative segments. Portfolios with stronger weights in defensive, cash‑generating businesses can be more resilient in slowdowns, but they may lag when high‑growth, non‑dividend companies are leading the market.
Regions
- North America 98%
- Europe Developed 2%
Geographically, the portfolio is overwhelmingly US‑centric, with about 98% in North America and only a small 2% slice in developed Europe. That means corporate earnings, regulation, and currency exposure are all largely tied to the US. This can be a positive when US markets outperform global peers, as they have in several recent periods, but it does limit diversification across different economies and policy regimes. In contrast, global equity benchmarks typically have a much larger share in non‑US markets. Here, the structure is clear: it behaves mostly like a US dividend stock portfolio with only minimal overseas influence.
Market capitalization
- Large-cap 57%
- Mid-cap 22%
- Mega-cap 15%
- Small-cap 6%
By market capitalization, the mix is dominated by large and mega‑cap companies: about 57% large‑cap and 15% mega‑cap, with 22% mid‑cap and 6% small‑cap. Larger companies tend to be more established, with steadier earnings and more consistent dividend policies, while smaller firms can be more volatile but sometimes deliver higher growth. Compared with a cap‑weighted broad market, this tilt toward bigger dividend payers aligns well with a quality‑and‑income focus. The modest slice in mid‑ and small‑caps adds some diversification, but the portfolio’s behavior will be driven mainly by big, well‑known US companies.
True holdings
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AA Apple Inc 3.17%
Part of fund(s):- Fidelity® High Dividend ETF
- iShares Core Dividend Growth ETF
-
UN UnitedHealth Group Incorporated 2.69%
Part of fund(s):- Schwab U.S. Dividend Equity ETF
- iShares Core Dividend Growth ETF
-
MS Microsoft Corporation 2.48%
Part of fund(s):- Fidelity® High Dividend ETF
- iShares Core Dividend Growth ETF
-
NV NVIDIA Corporation 2.40%
Part of fund(s):- Fidelity® High Dividend ETF
-
AV Broadcom Inc 2.16%
Part of fund(s):- Fidelity® High Dividend ETF
- iShares Core Dividend Growth ETF
-
KO The Coca-Cola Company 1.98%
Part of fund(s):- Fidelity® High Dividend ETF
- Schwab U.S. Dividend Equity ETF
-
TX Texas Instruments Incorporated 1.86%
Part of fund(s):- Schwab U.S. Dividend Equity ETF
-
QC Qualcomm Incorporated 1.84%
Part of fund(s):- Schwab U.S. Dividend Equity ETF
-
PG Procter & Gamble Company 1.81%
Part of fund(s):- Fidelity® High Dividend ETF
- Schwab U.S. Dividend Equity ETF
-
JP JPMorgan Chase & Co 1.79%
Part of fund(s):- Fidelity® High Dividend ETF
- iShares Core Dividend Growth ETF
- Top 10 total 22.18%
Looking through to the top holdings, a handful of large US names show up across the ETFs. Companies like Apple, UnitedHealth, Microsoft, NVIDIA, Broadcom, Coca‑Cola, and Procter & Gamble each represent around 1.8–3.2% of the overall portfolio when overlaps are combined. Since these positions may appear in more than one ETF, their true influence is higher than any single fund’s listing suggests. Because only top‑10 ETF holdings are captured, actual overlap is probably understated. This kind of hidden concentration means a small set of very large companies can quietly drive a meaningful share of portfolio returns and risk.
Factors
Factor exposure shows strong tilts toward value, quality, yield, and low volatility, with neutral exposure to size and momentum. Factors are like investing “ingredients” that explain why a portfolio behaves a certain way. High value exposure (71%) means it leans toward stocks priced cheaply relative to fundamentals. High quality (63%) and low volatility (63%) suggest a bias to companies with stable earnings and historically smoother price swings. Elevated yield (70%) lines up with the dividend focus. This combination often performs relatively well in more defensive or choppy markets, while it may lag portfolios tilted toward aggressive growth or high momentum when those are in favor.
Risk contribution
-
Fidelity® High Dividend ETF
Weight: 33.34% 33.5% -
iShares Core Dividend Growth ETF
Weight: 33.33% 33.4% -
Schwab U.S. Dividend Equity ETF
Weight: 33.33% 33.2%
Risk contribution shows each of the three ETFs making almost exactly one‑third of overall portfolio volatility, very close to their one‑third weights. Risk/weight ratios are all around 1.0, meaning no single fund is significantly more or less volatile than its allocation would imply. This is what you’d expect when holdings are similar in style and highly correlated. It also means the portfolio doesn’t hide a small, high‑octane sleeve driving most of the ups and downs. Instead, each ETF plays a similar role in overall risk, and changes in any one fund would linearly affect the portfolio’s behavior.
Redundant positions
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High correlationFidelity® High Dividend ETFiShares Core Dividend Growth ETFSchwab U.S. Dividend Equity ETF
The correlation data indicates that all three ETFs move very closely together, with pairs like the iShares fund and the Fidelity and Schwab funds behaving almost identically. Correlation measures how often assets move in the same direction; high correlation limits diversification benefits during market stress. In practice, this portfolio acts more like a single, well‑diversified US dividend equity fund than three independent strategies. That’s not necessarily negative—consistency can be useful—but it means adding or removing one ETF is unlikely to drastically change how the portfolio responds to broad market moves, since their styles and factor tilts are closely aligned.
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.
On the efficient frontier chart, the current mix already sits on or very near the curve, meaning it is using its existing holdings efficiently for its level of risk. The Sharpe ratio, which measures return per unit of risk above cash, is 0.59 for the current allocation, while an optimized mix of the same three ETFs could reach about 0.78. However, the differences in expected return and risk between the current, optimal, and minimum‑variance portfolios are very small. This suggests the portfolio’s simple equal‑weight structure is already doing a solid job of balancing risk and return given the three chosen funds.
Dividends
- iShares Core Dividend Growth ETF 1.90%
- Fidelity® High Dividend ETF 2.70%
- Schwab U.S. Dividend Equity ETF 3.20%
- Weighted yield (per year) 2.60%
The blended dividend yield is around 2.6%, with the Schwab ETF at about 3.2%, Fidelity at 2.7%, and the iShares fund at 1.9%. Dividend yield is the annual cash payout as a percentage of current price, and it can be an important part of total return, especially when reinvested. Here, the yield is higher than the broader US market’s typical level, matching the portfolio’s stated income focus. Because all three holdings emphasize dividends in some way, the portfolio is positioned to generate a steady cash stream, while still capturing equity‑like growth from underlying company earnings over time.
Ongoing product costs
- iShares Core Dividend Growth ETF 0.08%
- Fidelity® High Dividend ETF 0.15%
- Schwab U.S. Dividend Equity ETF 0.06%
- Weighted costs total (per year) 0.10%
Total ongoing costs are impressively low, with a weighted average expense ratio (TER) of about 0.10%. Individual ETF fees range from 0.06% to 0.15%, all in a very competitive band for passive or rules‑based funds. Costs work like a permanent headwind: every dollar paid in fees is one that can’t compound for the investor. Keeping expenses this low supports better long‑term outcomes relative to higher‑fee strategies aiming at similar exposures. This cost profile is a real strength of the portfolio—the structure is doing what it should by delivering diversified dividend exposure without taking much away in annual charges.
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