Concentrated global small cap value equity mix with strong factor tilts and efficient risk profile
Report created on May 6, 2026Risk profile
5/7
Diversification profile
3/5
Positions
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AV Avantis® U.S. Small Cap Value ETF
AVUV - US0250728773 65.00% -
AV Avantis® International Small Cap Value ETF
AVDV - US0250728021 35.00%
This portfolio is made of just two equity ETFs, both targeting small cap value companies, with 65% in the U.S. fund and 35% in the international fund. That means 100% of the portfolio is in stocks and fully tilted toward a single style: smaller companies trading at lower valuations. A concentrated setup like this is simple to understand and easy to track. The clear split between U.S. and non-U.S. small value gives the portfolio a very distinct identity. The flip side of this clarity is that there is no built‑in exposure to large companies, broad market indices, or bonds, so the portfolio’s behaviour will mostly follow how global small value stocks do over time.
Growth
From late 2019 to early 2026, a hypothetical $1,000 investment grew to about $2,635, giving a compound annual growth rate (CAGR) of 15.85%. CAGR is like your average speed over a long road trip, smoothing out bumps along the way. Over this period, the portfolio slightly lagged the U.S. market by 0.17% a year but beat the global market by 2.33% a year, which is a solid relative result. The max drawdown was steep at -46.86% during early 2020, deeper than the benchmarks, underlining that this mix can fall sharply in stress periods. Only 20 days made up 90% of returns, showing performance was driven by a small number of very strong days.
Projection
The Monte Carlo projection uses many simulated paths, based on historical patterns, to estimate where $1,000 might land after 15 years. Think of it as running 1,000 alternate futures using past volatility and return levels. The median outcome is about $2,689, with a middle “likely” band from roughly $1,826 to $4,191. The wider 5–95% range, $908 to $7,660, shows just how spread out outcomes can be. On average, simulations gave about 8.11% per year and a roughly 75% chance of ending above the starting amount. These are not promises; they simply illustrate that a portfolio this volatile can land in very different places over long periods.
Asset classes
- Stocks 100%
All of the portfolio is in stocks, with no bonds, cash, or alternative assets. That creates a straightforward growth‑oriented structure but leaves little built‑in cushion during equity downturns. Asset classes behave differently across economic cycles, so portfolios mixing stocks with bonds or cash often experience smoother ride‑paths. Here, the risk score of 5/7 and “Growth” label line up with the 100% equity posture. This alignment is helpful because it avoids mixed signals: the portfolio clearly aims for capital growth rather than stability. The trade‑off is that short‑term swings will largely mirror equity market ups and downs, especially in more cyclical environments.
Sectors
- Financials 22%
- Industrials 17%
- Consumer Discretionary 17%
- Energy 15%
- Basic Materials 10%
- Technology 7%
- Consumer Staples 4%
- Health Care 4%
- Telecommunications 3%
- Real Estate 1%
- Utilities 1%
Sector exposure is well spread, with financials (22%), industrials (17%), and consumer discretionary (17%) leading, followed by energy (15%) and basic materials (10%). Technology is a smaller slice at 7%, much lower than broad market indices where tech often dominates. This creates a different risk profile from typical index portfolios that lean heavily on large tech names. The tilt toward more economically sensitive sectors like financials, industrials, and energy can mean stronger reactions to economic cycles, interest rate changes, and commodity moves. At the same time, the broad presence across ten sectors suggests the portfolio isn’t overly dependent on one narrow industry theme.
Regions
- North America 68%
- Europe Developed 13%
- Japan 11%
- Australasia 3%
- Africa/Middle East 2%
- Asia Developed 1%
- Latin America 1%
Geographically, about 68% of the portfolio is in North America, 13% in developed Europe, and 11% in Japan, with smaller slices in Australasia, emerging regions, and Latin America. This is more U.S.-tilted than a fully global small‑cap mix but still has a meaningful international component. Geographic spread matters because economies grow and slow at different times, and currencies move independently. Compared with global benchmarks, this portfolio adds diversification beyond the U.S. while still anchoring in the home market, which can be comforting for a U.S. investor. The presence across several developed regions also reduces dependence on any single country’s policy or economic cycle.
Market capitalization
- Small-cap 47%
- Micro-cap 31%
- Mid-cap 21%
The portfolio is heavily tilted to the smaller end of the market: 47% small‑cap, 31% micro‑cap, and 21% mid‑cap. That’s a very different profile from broad indices, which are dominated by large and mega‑cap companies. Smaller firms tend to be more sensitive to economic conditions, interest rates, and financing conditions, and their share prices can move more sharply day to day. Over long periods, research has shown that smaller companies have sometimes delivered higher returns, but with bumpier journeys. This portfolio’s strong small and micro‑cap exposure helps explain both its higher volatility and its factor tilts, giving it a distinct behaviour pattern compared with standard large‑cap blends.
True holdings
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VS ViaSat Inc 0.77%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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MA Matson Inc 0.60%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
-
SM SM Energy Co 0.59%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
-
AV Avnet Inc 0.56%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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LE Lear Corporation 0.55%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
-
GA GATX Corporation 0.51%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
-
PL Plexus Corp 0.51%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
-
FI Five Below Inc 0.50%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
-
SN Stonex Group Inc 0.49%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
-
AR Archrock Inc 0.48%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
- Top 10 total 5.57%
Looking through to the top holdings, no single stock exceeds about 0.8% of the total portfolio, and the named companies are spread across different industries. That suggests diversification at the individual stock level, even though we only see ETF top‑10 positions, which cover about 8% of the portfolio. Because the same company can appear in multiple ETFs, there is some overlap, but within this pair the overlap appears modest. This structure means portfolio risk is driven more by broad factor exposures (small, value) than by a handful of giant single‑stock bets. Hidden concentration risk from repeated names looks limited based on the available top‑10 data.
Factors
Factor exposure is where this portfolio really stands out. Value exposure is extremely high at 91%, and size exposure is also very high at 87%. Factors are like the underlying “ingredients” that drive returns: value reflects cheaper stocks relative to fundamentals, and size reflects tilt toward smaller companies. A strong value tilt can help when cheaper stocks rebound relative to expensive ones but may lag in growth‑led markets. A strong small‑size tilt often amplifies both gains and losses. Other factors like momentum, quality, low volatility, and yield sit near neutral to mildly high, so the portfolio’s behaviour is mostly shaped by this pronounced small‑cap value positioning.
Risk contribution
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Avantis® U.S. Small Cap Value ETF
Weight: 65.00% 75.0% -
Avantis® International Small Cap Value ETF
Weight: 35.00% 25.1%
Risk contribution shows how much each holding adds to overall volatility, which can differ from its weight. The U.S. small cap value ETF is 65% of the portfolio but contributes about 75% of total risk, meaning it’s slightly more volatile or less diversified than its international counterpart. Its risk‑to‑weight ratio of 1.15 signals that it “punches above its weight” in driving ups and downs. The international ETF, at 35% weight and 25% risk contribution, dampens risk somewhat with a ratio below 1. This pattern is common: one core holding often dominates risk, even when position sizes seem balanced on paper.
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 efficient frontier analysis compares this portfolio with the best possible mixes of the same two ETFs. The Sharpe ratio, which measures return per unit of risk above a risk‑free rate, is 0.58 for the current allocation, versus 0.78 for both the optimal and minimum‑variance portfolios. Interestingly, the current portfolio sits on or very near the frontier, meaning for its chosen risk level it’s already using these two funds efficiently. The “optimal” mix offers slightly lower risk and somewhat lower return, but with better risk‑adjusted performance. In practice, this suggests the trade‑off here is about how much volatility one wants, not about wasted diversification opportunities.
Dividends
- Avantis® International Small Cap Value ETF 2.80%
- Avantis® U.S. Small Cap Value ETF 1.30%
- Weighted yield (per year) 1.82%
The blended dividend yield is about 1.82%, with the international ETF at 2.80% and the U.S. ETF at 1.30%. Yield is the annual cash payout as a percentage of price, and it can be a meaningful piece of total return over time, especially when reinvested. For a small cap value portfolio, this moderate yield is consistent with companies that may be reinvesting a portion of earnings but still paying shareholders. Compared to high‑dividend strategies, the income here is secondary to capital growth. The slightly higher yield from international positions adds a modest income boost while still keeping the focus on total return potential.
Ongoing product costs
- Avantis® International Small Cap Value ETF 0.36%
- Avantis® U.S. Small Cap Value ETF 0.25%
- Weighted costs total (per year) 0.29%
The total ongoing cost, or TER, is about 0.29% per year, combining 0.25% for the U.S. ETF and 0.36% for the international ETF. TER is like a subscription fee expressed as a percentage of your invested amount. These levels are reasonably low for actively managed, factor‑tilted small cap strategies, especially compared with many traditional active funds. Lower costs mean more of the portfolio’s gross return stays in your pocket each year, and that difference compounds over time. From a structural perspective, this is a clear strength: the portfolio’s fees do not look out of line with its specialized exposures and may support better long‑term net outcomes.
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