A conservative income-focused portfolio with high dividend yield and moderate diversification

Risk profile

  • Secure
    Speculative

The risk profile, derived from past market volatility, reflects the level of risk the portfolio is exposed to. This assessment helps align your investments with your financial goals and comfort with market fluctuations.

Diversification profile

  • Focused
    Diversified

The diversification assessment evaluates the spread of investments across asset classes, regions, and sectors. This ensures a balanced mix, reducing risk and maximizing returns by not concentrating in any single area.

What type of investor this portfolio is suitable for

Conservative Investors

This portfolio suits a conservative investor focused on income generation with low to moderate risk tolerance. Prioritizing steady dividend income, it appeals to individuals seeking reliable cash flow. With a moderate diversification score, it provides some growth potential while maintaining stability. Ideal for those with a medium to long-term horizon, it offers a balance of income and capital preservation, making it suitable for retirees or those nearing retirement.

Positions

  • Ares Capital Corporation
    ARCC - US04010L1035
    12.50%
  • British American Tobacco p.l.c.
    BTI - US1104481072
    12.50%
  • Panagram Bbb-B Clo ETF
    CLOZ - US81752T5285
    12.50%
  • Janus Detroit Street Trust - Janus Henderson AAA CLO ETF
    JAAA - US47103U8457
    12.50%
  • JPMorgan Equity Premium Income ETF
    JEPI - US46641Q3323
    12.50%
  • JPMorgan Nasdaq Equity Premium Income ETF
    JEPQ - US46654Q2030
    12.50%
  • Altria Group
    MO - US02209S1033
    12.50%
  • Schwab U.S. Dividend Equity ETF
    SCHD - US8085247976
    12.50%

This portfolio consists of equal allocations across eight assets, including both common stocks and ETFs, each making up 12.5% of the portfolio. The balanced distribution helps mitigate concentration risk and aligns with a conservative profile. Compared to typical benchmarks, this structure is moderately diversified, focusing on income-generating assets. To enhance diversification, consider introducing more varied asset types or reducing reliance on a few high-yield positions. This could provide a more robust buffer against market volatility.

Growth Info

Historically, this portfolio has delivered a commendable CAGR of 11.61%, outperforming many conservative benchmarks. With a maximum drawdown of just -8.35%, it has shown resilience during downturns. However, it's important to remember that past performance doesn't guarantee future results. To sustain this performance, regularly review asset performance and market conditions. This vigilance can help maintain the portfolio's growth trajectory while managing risks effectively.

Projection Info

Using Monte Carlo simulations, this portfolio's potential future performance was analyzed. The 50th percentile projection suggests a significant growth of 357.6%, indicating a strong return potential. However, simulations rely on historical data and assumptions, which may not reflect future market conditions. Regularly updating these projections can provide more accurate insights. Consider stress-testing the portfolio under different economic scenarios to understand potential risks and opportunities better.

Asset classes Info

  • Stocks
    71%
  • Bonds
    24%
  • No data
    4%
  • Cash
    2%

The portfolio primarily comprises stocks (71%) and bonds (24%), with a small portion in cash. This allocation supports income generation while maintaining moderate risk. Compared to conservative benchmarks, the stock allocation is slightly higher, which may increase volatility. Consider adjusting the stock-bond ratio to align more closely with risk tolerance. Incorporating more bonds or cash can provide stability during market fluctuations.

Sectors Info

  • Consumer Staples
    30%
  • Financials
    15%
  • Technology
    10%
  • Health Care
    4%
  • Consumer Discretionary
    4%
  • Industrials
    4%
  • Telecommunications
    3%
  • Energy
    3%
  • Utilities
    1%
  • Basic Materials
    1%
  • Real Estate
    0%

The portfolio is heavily weighted towards consumer defensive (30%) and financial services (15%), providing stability and income. This concentration may limit exposure to growth sectors like technology and healthcare. While consumer defensive stocks are less volatile, diversifying across more sectors could capture growth opportunities and reduce sector-specific risks. Evaluate sector trends and adjust allocations to balance stability with potential growth.

Regions Info

  • North America
    62%
  • Europe Developed
    13%
  • Latin America
    0%
  • Asia Developed
    0%
  • Asia Emerging
    0%

The geographic allocation is predominantly North American (62%), with limited exposure to Europe (13%) and none to Asia or Latin America. This focus on North America may limit diversification benefits. Expanding geographic exposure can reduce regional risk and capture global growth opportunities. Consider adding assets from emerging markets to enhance diversification and potentially boost returns.

Market capitalization Info

  • Large-cap
    54%
  • Mega-cap
    9%
  • Mid-cap
    7%
  • Small-cap
    1%
  • Micro-cap
    0%

The portfolio leans towards large-cap stocks, with big (54%) and mega (9%) companies dominating. This focus provides stability and reliable dividends but may limit growth potential. Including more mid-cap and small-cap stocks could enhance diversification and capture higher growth opportunities. Regularly review market cap distribution to ensure alignment with investment goals.

Dividends Info

  • Ares Capital Corporation 9.60%
  • British American Tobacco p.l.c. 5.20%
  • Panagram Bbb-B Clo ETF 8.90%
  • Janus Detroit Street Trust - Janus Henderson AAA CLO ETF 6.10%
  • JPMorgan Equity Premium Income ETF 8.20%
  • JPMorgan Nasdaq Equity Premium Income ETF 12.10%
  • Altria Group 5.20%
  • Schwab U.S. Dividend Equity ETF 4.20%
  • Weighted yield (per year) 7.44%

With a total yield of 7.44%, this portfolio is designed for income generation. High dividend yields from assets like JPMorgan Nasdaq Equity Premium Income ETF (12.10%) provide consistent cash flow. However, high yields can also signal higher risk. Regularly review dividend sustainability and adjust allocations to maintain a balance between income and risk. This strategy ensures steady returns without compromising portfolio stability.

Ongoing product costs Info

  • Panagram Bbb-B Clo ETF 0.51%
  • Janus Detroit Street Trust - Janus Henderson AAA CLO ETF 0.21%
  • JPMorgan Equity Premium Income ETF 0.35%
  • JPMorgan Nasdaq Equity Premium Income ETF 0.35%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • Weighted costs total (per year) 0.18%

The portfolio's total expense ratio (TER) is 0.18%, which is impressively low, supporting better long-term performance. Lower costs mean more of your money is working for you, enhancing returns. Regularly review and compare expense ratios to ensure they remain competitive. Minimizing costs without sacrificing quality can significantly impact overall portfolio performance.

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.

This portfolio can be optimized using the Efficient Frontier, focusing on the best risk-return ratio. Optimization involves adjusting the current asset allocation to improve returns for a given level of risk. However, this analysis is based on historical data and assumptions, which may not predict future outcomes. Regularly re-evaluate the portfolio's efficiency to ensure it aligns with changing market conditions and personal investment goals.

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