This portfolio has only about 4.8 years of historical data, based on the youngest asset in the portfolio. Some metrics, projections, and AI insights may be less reliable and should be interpreted with caution.

High Growth Potential with Broad Diversification and Strong Historic Performance

Report created on Jul 30, 2024

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio is composed of three ETFs, with the Vanguard S&P 500 ETF making up 70%, the Vanguard Total International Stock Index Fund ETF Shares at 20%, and the Avantis® U.S. Small Cap Value ETF at 10%. This combination provides a good balance between large-cap U.S. stocks, international exposure, and small-cap value stocks. This composition is relevant because it offers broad market exposure, which can help mitigate risks associated with individual stocks or sectors. To further enhance diversification, consider adding other asset classes such as bonds or commodities.

Growth Info

Historically, the portfolio has shown a Compound Annual Growth Rate (CAGR) of 13.83% with a maximum drawdown of -35.06%. This means that while the portfolio has delivered strong returns, it has also experienced significant volatility. Understanding this is crucial as it highlights the portfolio's ability to generate returns over the long term but also its susceptibility to market downturns. To manage this, it may be beneficial to periodically review and adjust the portfolio to align with changing market conditions and personal risk tolerance.

Projection Info

Using a Monte Carlo simulation, which models potential future performance based on historical data, the portfolio shows promising results. With a hypothetical initial investment, the 5th percentile return is 26.57%, the median (50th percentile) is 471.9%, and the 67th percentile is 772.85%. This indicates a wide range of potential outcomes, emphasizing the importance of being prepared for various market conditions. To optimize future performance, consider maintaining a diversified asset allocation and regularly rebalancing the portfolio.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio is heavily weighted in stocks, accounting for 99.31% of the total allocation, with minimal exposure to cash and other assets. This high equity concentration suggests a focus on growth but also increases risk. Diversifying across multiple asset classes can help reduce volatility and provide more stable returns. Adding fixed-income securities or other alternative investments could enhance the portfolio's risk-adjusted performance.

Sectors Info

  • Technology
    25%
  • Financials
    16%
  • Consumer Discretionary
    11%
  • Industrials
    11%
  • Health Care
    11%
  • Telecommunications
    7%
  • Consumer Staples
    6%
  • Energy
    5%
  • Basic Materials
    4%
  • Real Estate
    2%
  • Utilities
    2%

The sector allocation is quite diverse, with significant exposure to Technology (24.67%), Financial Services (15.56%), and Consumer Cyclicals (11.50%). This broad sector exposure helps mitigate risks associated with sector-specific downturns. However, the heavy concentration in technology could lead to higher volatility. To achieve a more balanced sector allocation, consider periodically reviewing and adjusting the weightings to ensure they align with long-term investment goals.

Regions Info

  • North America
    81%
  • Europe Developed
    8%
  • Japan
    3%
  • Asia Emerging
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is predominantly invested in North America (80.94%), with smaller allocations to Europe Developed (8.30%) and Japan (3.31%). While this provides strong exposure to the U.S. market, it may limit the benefits of international diversification. Expanding the geographic allocation to include more emerging markets could enhance growth potential and reduce overall portfolio risk. Regularly assessing the geographic distribution can help maintain a balanced global exposure.

Dividends Info

  • Avantis® U.S. Small Cap Value ETF 1.60%
  • Vanguard S&P 500 ETF 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 3.00%
  • Weighted yield (per year) 1.67%

The portfolio's dividend yield is not specified, but given the high allocation to equities, it likely provides some level of income. Dividend-paying stocks can offer a steady income stream and potential for capital appreciation. To maximize the benefits of dividends, consider reinvesting them to compound returns over time. Regularly reviewing the dividend yield and payout ratios of the holdings can help ensure a balanced approach to income and growth.

Ongoing product costs Info

  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.06%

The total expense ratio (TER) of the portfolio is 0.06%, which is quite low. This indicates that the portfolio is cost-efficient, which is beneficial for long-term growth as lower costs mean more of the returns are retained. Keeping investment costs low is crucial for maximizing net returns. To maintain cost efficiency, regularly review the expense ratios of the holdings and consider low-cost alternatives if necessary.

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