A growth-oriented portfolio with strong diversification and focus on small cap and emerging markets

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

Growth Investors

This portfolio suits an investor seeking capital growth with moderate to high risk tolerance and a long-term horizon. It focuses on equities, particularly small cap and emerging markets, which can offer higher returns but also higher volatility. Ideal for those comfortable with market fluctuations and aiming for substantial growth over time, this portfolio is best for individuals who can withstand short-term volatility for potential long-term gains.

Positions

  • Avantis® U.S. Small Cap Value ETF
    AVUV - US0250728773
    30.00%
  • Vanguard S&P 500 ETF
    VOO - US9229083632
    30.00%
  • Avantis® International Small Cap Value ETF
    AVDV - US0250728021
    10.00%
  • WisdomTree Emerging Markets SmallCap Dividend Fund
    DGS - US97717W2816
    10.00%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares
    VEA - US9219438580
    10.00%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares
    VWO - US9220428588
    10.00%

This portfolio is composed of six ETFs, with a notable 60% allocation to U.S. assets, focusing on small cap value and S&P 500 exposure. The remaining 40% is diversified across international and emerging market equities. Such a structure aligns well with growth-focused portfolios, offering a balance between domestic stability and international opportunities. While the allocation is broadly diversified, the heavy weighting towards U.S. equities could limit exposure to faster-growing international markets. Consider periodically reviewing the balance to ensure it remains aligned with global economic shifts and personal investment goals.

Growth Info

Historically, the portfolio has achieved a CAGR of 13.9%, indicating strong growth over time. However, the maximum drawdown of -39.31% highlights its susceptibility to significant market downturns. This performance is comparable to growth-focused benchmarks, suggesting that the portfolio has been well-positioned for capital appreciation. Nonetheless, past performance should not be taken as a guarantee for future results. It's essential to maintain a long-term perspective, especially given the portfolio's growth orientation, to ride out periods of volatility.

Projection Info

Monte Carlo simulations project a wide range of potential outcomes, with a median return of 266.13% and a 67th percentile return of 423.58%. This analysis uses historical data to simulate future performance, but it's important to remember that these are estimates, not guarantees. The simulations show a high probability of positive returns, with 925 out of 1,000 simulations ending positively. This suggests a favorable risk-return profile, but investors should remain aware of inherent uncertainties in market predictions.

Asset classes Info

  • Stocks
    99%
  • Cash
    0%
  • Other
    0%
  • Bonds
    0%
  • No data
    0%

The portfolio is heavily weighted in stocks, comprising 99.47% of the total allocation. This concentration in equities is typical for growth-oriented portfolios, offering the potential for higher returns but also increased volatility. The minimal allocation to bonds and cash suggests a focus on capital appreciation over income or stability. While this aligns with a growth strategy, it may be worth considering a slight increase in fixed income or cash for risk mitigation, especially during market downturns.

Sectors Info

  • Financials
    20%
  • Technology
    17%
  • Industrials
    14%
  • Consumer Discretionary
    13%
  • Energy
    8%
  • Basic Materials
    7%
  • Health Care
    6%
  • Consumer Staples
    6%
  • Telecommunications
    5%
  • Real Estate
    2%
  • Utilities
    2%

Sector allocation is diverse, with significant exposure to financial services, technology, and industrials. These sectors align with growth trends, though they can be volatile during economic shifts. The portfolio's sector composition is well-diversified, reducing the risk of overexposure to any single industry. However, given the potential for economic changes, regularly reviewing sector exposures can help ensure the portfolio remains resilient. A balanced sector approach can help mitigate risks associated with cyclical downturns.

Regions Info

  • North America
    61%
  • Asia Emerging
    10%
  • Europe Developed
    10%
  • Asia Developed
    7%
  • Japan
    5%
  • Africa/Middle East
    3%
  • Latin America
    2%
  • Australasia
    2%
  • Europe Emerging
    1%

Geographic allocation is primarily focused on North America, with 61.47% exposure, complemented by emerging and developed markets. This distribution provides a strong base in stable economies while offering growth potential from emerging regions. However, the relatively lower exposure to certain faster-growing areas could limit growth opportunities. Regularly assessing geographic allocations can ensure the portfolio adapts to global economic changes and maximizes diversification benefits.

Dividends Info

  • Avantis® International Small Cap Value ETF 4.30%
  • Avantis® U.S. Small Cap Value ETF 1.60%
  • WisdomTree Emerging Markets SmallCap Dividend Fund 2.80%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 1.80%
  • Vanguard S&P 500 ETF 1.20%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 3.20%
  • Weighted yield (per year) 2.05%

The portfolio's total dividend yield is 2.05%, providing a modest income stream. This yield is beneficial for compounding returns, especially in a growth-focused portfolio. Dividends can offer a buffer during market volatility, but the primary focus remains on capital appreciation. Regularly reviewing dividend yields and reinvesting them can enhance long-term portfolio growth. For those seeking higher income, exploring higher-yielding assets may be worthwhile.

Ongoing product costs Info

  • Avantis® International Small Cap Value ETF 0.36%
  • Avantis® U.S. Small Cap Value ETF 0.25%
  • WisdomTree Emerging Markets SmallCap Dividend Fund 0.58%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.19%

The total expense ratio (TER) of 0.19% is impressively low, supporting better long-term performance by minimizing costs. Lower fees mean more of your returns stay invested, compounding over time. This cost efficiency is a strength of the portfolio, aligning with best practices for maximizing returns. Regularly reviewing and comparing fees with similar products can ensure ongoing cost-effectiveness. Keeping costs low is crucial for optimizing net returns.

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.

The portfolio appears well-positioned on the Efficient Frontier, offering a favorable risk-return balance. This optimization suggests that, given the current assets, the portfolio is achieving the best possible risk-return ratio. However, it's important to periodically reassess this balance as market conditions and personal goals evolve. While efficiency is about maximizing returns for a given risk level, it doesn't replace the need for diversification and risk management.

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