Balanced and diversified portfolio with a focus on global equities and low costs

Report created on Apr 8, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

This portfolio is composed of 64% Vanguard Total World Stock Index Fund ETF, 20% Vanguard Total Bond Market Index Fund ETF, 8% Invesco NASDAQ 100 ETF, and 4% each in Berkshire Hathaway and JPMorgan Chase & Co. This allocation demonstrates a balanced approach, with a strong emphasis on global equities complemented by bonds, aligning well with a balanced investment strategy. Compared to typical benchmarks, this composition offers a diversified exposure across both stocks and bonds, providing a solid foundation for risk management. Consider maintaining this balance unless your personal risk tolerance or goals change significantly.

Growth Info

Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 7.63%, with a maximum drawdown of -25.08%. This indicates a steady growth trajectory with some volatility, typical for balanced portfolios. The performance aligns closely with global market trends, offering reassurance of its robustness. However, it's important to remember that past performance doesn't guarantee future returns. Regularly reviewing performance against benchmarks can help ensure that the portfolio continues to meet your financial objectives over time.

Projection Info

The Monte Carlo simulation, which uses historical data to predict future outcomes, projects an annualized return of 12.99% across 1,000 simulations. Notably, 988 of these simulations resulted in positive returns, suggesting a high probability of achieving gains. However, it's crucial to understand that projections are not guarantees, as they rely on historical trends that may not persist. Use these insights to guide your expectations, but remain adaptable to changing market conditions.

Asset classes Info

  • Stocks
    79%
  • Bonds
    20%
  • Cash
    1%

The portfolio's allocation is 79% in stocks, 20% in bonds, and 1% in cash, providing a strong diversification across asset classes. This distribution aligns with balanced portfolio norms, offering growth potential from equities while mitigating risk with bonds. Compared to benchmarks, this allocation is well-structured for investors seeking moderate risk and return. Continuously monitoring asset class performance can help maintain this balance, especially during market shifts.

Sectors Info

  • Technology
    20%
  • Financials
    19%
  • Consumer Discretionary
    8%
  • Industrials
    7%
  • Health Care
    7%
  • Telecommunications
    6%
  • Consumer Staples
    4%
  • Energy
    3%
  • Basic Materials
    2%
  • Real Estate
    2%
  • Utilities
    2%

Sector allocation includes 20% in Technology, 19% in Financial Services, and smaller percentages in other sectors. This distribution reflects a diversified approach, although the technology sector concentration may introduce higher volatility, especially during interest rate fluctuations. Compared to common benchmarks, this sectoral mix is balanced but slightly tech-heavy. Consider periodically reviewing sector trends and adjusting allocations to align with your risk tolerance and market outlook.

Regions Info

  • North America
    58%
  • Europe Developed
    9%
  • Asia Emerging
    4%
  • Japan
    4%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

With 58% exposure to North America, 9% to Europe Developed, and smaller allocations elsewhere, the portfolio is geographically diversified. This exposure provides stability through developed markets while offering growth potential from emerging regions. Compared to benchmarks, this geographic distribution is well-aligned, though slightly U.S.-centric. To further diversify, consider increasing exposure to underrepresented regions, such as emerging markets, if it aligns with your risk profile.

Market capitalization Info

  • Mega-cap
    39%
  • Large-cap
    23%
  • Mid-cap
    13%
  • Small-cap
    3%
  • Micro-cap
    1%

The portfolio's market capitalization is spread across 39% mega, 23% big, 13% medium, 3% small, and 1% micro-cap stocks. This distribution supports diversification, with a focus on stability from larger companies while capturing growth from smaller firms. Compared to benchmarks, this allocation is balanced, providing a mix of risk and return. Regularly reviewing market cap exposure can help ensure alignment with your investment goals and risk tolerance.

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 portfolio can be optimized using the Efficient Frontier, which suggests the best possible risk-return ratio based on current assets. This approach focuses on maximizing returns for a given level of risk, without necessarily altering diversification. Regularly reviewing and adjusting asset allocations can help maintain efficiency, ensuring the portfolio remains aligned with your risk tolerance and financial objectives.

Dividends Info

  • Vanguard Total Bond Market Index Fund ETF Shares 3.40%
  • JPMorgan Chase & Co 1.70%
  • Invesco NASDAQ 100 ETF 0.70%
  • Vanguard Total World Stock Index Fund ETF Shares 2.20%
  • Weighted yield (per year) 2.21%

The portfolio's average dividend yield is 2.21%, with contributions from various holdings. Dividends provide a steady income stream, supporting total returns, especially in volatile markets. For balanced investors, dividends can enhance portfolio stability and income. Compared to benchmarks, this yield is competitive. Consider reinvesting dividends to compound growth or using them for income, depending on your financial needs and goals.

Ongoing product costs Info

  • Vanguard Total Bond Market Index Fund ETF Shares 0.03%
  • Invesco NASDAQ 100 ETF 0.15%
  • Vanguard Total World Stock Index Fund ETF Shares 0.07%
  • Weighted costs total (per year) 0.06%

The portfolio's total expense ratio (TER) is impressively low at 0.06%, with individual fund costs ranging from 0.03% to 0.15%. Low costs support better long-term performance by minimizing drag on returns. Compared to industry averages, these costs are commendable, indicating efficient fund selection. Continue monitoring expenses, as reducing costs further can enhance net returns over time, contributing to the portfolio's overall success.

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