Growth-oriented portfolio with a strong focus on stocks and global diversification

Report created on Jul 21, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is heavily weighted towards equities, with a 50% allocation in a broad-market U.S. index, 25% in U.S. small-cap stocks, and 25% in international stocks. This composition reflects a growth-oriented strategy, leveraging both the stability and growth potential of large-cap stocks alongside the higher growth potential of small-cap stocks. The international component enhances global exposure, potentially increasing diversification benefits. However, the absence of bonds or alternative assets might limit risk mitigation during market downturns.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 11.70% and a maximum drawdown of -36.25%, the portfolio's historical performance showcases its growth potential amidst significant volatility. The days contributing to 90% of returns highlight the impact of short-term, high-gain periods on overall performance. This performance profile is indicative of a higher-risk, higher-reward strategy, aligning with the portfolio's growth orientation. Comparatively, this performance may outpace conservative benchmarks while introducing greater short-term risk.

Projection Info

Monte Carlo simulations, which run numerous scenarios to forecast potential future outcomes, suggest a wide range of possible performances for this portfolio. With 970 out of 1,000 simulations yielding positive returns and a median projected increase of 281.4%, these outcomes reinforce the portfolio's growth potential. However, the significant spread between the 5th and 67th percentiles underscores the inherent risk. Such projections are valuable for understanding potential volatility but should be viewed as one of many tools in investment decision-making.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio's near-exclusive focus on stocks (99%) with a minimal cash reserve (1%) is typical for aggressive growth strategies. This asset class distribution aims to maximize growth by capitalizing on the higher average returns of equities over the long term. However, the lack of fixed-income assets or alternatives means there's little to cushion the impact of stock market volatility. Investors might consider if a slight increase in cash or fixed-income assets could provide a more balanced risk-reward profile.

Sectors Info

  • Technology
    23%
  • Financials
    16%
  • Industrials
    13%
  • Consumer Discretionary
    11%
  • Health Care
    10%
  • Telecommunications
    7%
  • Consumer Staples
    6%
  • Real Estate
    4%
  • Energy
    4%
  • Basic Materials
    4%
  • Utilities
    3%

Sector allocation leans heavily towards technology, financial services, and industrials, which are sectors often associated with growth but also with volatility. This sectoral emphasis can lead to significant performance swings based on the health of these industries. While the portfolio benefits from exposure to a wide range of sectors, the concentration in high-growth areas underscores its aggressive stance. Diversifying further into defensive sectors could provide stability during market downturns without significantly diluting growth potential.

Regions Info

  • North America
    77%
  • Europe Developed
    10%
  • Asia Emerging
    4%
  • Japan
    4%
  • Asia Developed
    3%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

With 77% of assets in North America and a balanced exposure across developed and emerging markets internationally, the portfolio is well-positioned to capture global growth while maintaining a core focus on U.S. equities. This geographic distribution supports diversification but is heavily reliant on the performance of the U.S. market. Considering increasing the allocation to emerging markets or underrepresented regions could offer broader exposure to global growth trends and potentially enhance returns.

Market capitalization Info

  • Mega-cap
    32%
  • Large-cap
    23%
  • Mid-cap
    21%
  • Small-cap
    19%
  • Micro-cap
    4%

The portfolio's market capitalization breakdown, featuring a mix of mega, big, medium, small, and micro-cap stocks, is conducive to growth and diversification. This mix allows for potential outperformance in various market conditions, as smaller companies may offer higher growth potential while larger companies provide stability. However, the relatively high allocation to small and micro-cap stocks increases volatility and risk. Balancing market cap exposure can help manage risk while still targeting growth.

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 current allocation suggests a well-considered approach to balancing risk and return, aiming for an optimal position on the Efficient Frontier. This means the portfolio is designed to achieve the highest possible returns for the level of risk taken. However, as market conditions and personal circumstances evolve, it's important to reassess this balance. Regularly reviewing and adjusting the asset allocation can help maintain an optimal risk-return profile, especially as new investment opportunities arise.

Dividends Info

  • VANGUARD SMALL-CAP INDEX FUND ADMIRAL SHARES 1.00%
  • VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND ADMIRAL SHARES 2.10%
  • Vanguard Total Stock Market Index Fund Admiral Shares 0.90%
  • Weighted yield (per year) 1.22%

The portfolio's overall dividend yield of 1.22% contributes to its total return, albeit modestly compared to its capital gains focus. While dividends offer a passive income stream and can provide a buffer during market dips, the primary goal here appears to be capital appreciation. For investors seeking higher income, reallocating a portion towards higher-yielding assets could be beneficial, though it may alter the portfolio's growth trajectory.

Ongoing product costs Info

  • VANGUARD SMALL-CAP INDEX FUND ADMIRAL SHARES 0.05%
  • VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND ADMIRAL SHARES 0.09%
  • Vanguard Total Stock Market Index Fund Admiral Shares 0.04%
  • Weighted costs total (per year) 0.06%

With an average total expense ratio (TER) of 0.06%, the portfolio benefits from low costs, which can significantly enhance long-term returns. Vanguard's reputation for low-cost funds aligns well with the strategy of minimizing expenses to maximize investor returns. Even so, it's essential to periodically review fund expenses in the context of comparable options, ensuring that costs remain competitive without sacrificing performance quality.

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