Balanced and broadly diversified portfolio with a strong focus on stocks and global exposure

Report created on May 5, 2025

Risk profile Info

4/7
Balanced
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Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is structured around a core of equity and bond ETFs, with a 75% allocation to stocks and 25% to bonds. The equity portion is diversified across major markets, including the S&P 500, EURO STOXX 50, and emerging markets, while the bond allocation is focused on global aggregate bonds, hedged in GBP. This composition suggests a balanced approach, aiming to capture growth through equities while using bonds to mitigate volatility.

Growth Info

Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 9.59%, with a maximum drawdown of -20.57%. These figures indicate a relatively strong performance, with the ability to recover from downturns. The days contributing to 90% of returns being so few highlights the impact of significant market movements on portfolio returns, underscoring the importance of maintaining a long-term perspective.

Projection Info

Monte Carlo simulations, which use historical data to project future performance, suggest a wide range of outcomes for this portfolio. With the median projection showing a 144.8% increase and 860 out of 1,000 simulations yielding positive returns, the forward outlook appears optimistic. However, it’s crucial to remember that these projections are speculative and depend heavily on past market behavior.

Asset classes Info

  • Stocks
    75%
  • Bonds
    25%

The allocation between stocks (75%) and bonds (25%) demonstrates a balanced risk appetite, leaning towards growth. This mix allows the portfolio to participate in the upside potential of the equity markets while having a cushion against volatility through its bond holdings. Comparing this to benchmark norms, it aligns well with a balanced investment strategy.

Sectors Info

  • Technology
    19%
  • Financials
    14%
  • Consumer Discretionary
    9%
  • Industrials
    8%
  • Health Care
    6%
  • Telecommunications
    6%
  • Consumer Staples
    5%
  • Energy
    3%
  • Utilities
    2%
  • Basic Materials
    2%
  • Real Estate
    1%

The sectoral distribution, with technology, financial services, and consumer cyclicals leading, mirrors the broader market composition, especially in developed markets. This sectoral allocation positions the portfolio to benefit from growth in key economic sectors but also exposes it to sector-specific risks, such as regulatory changes or economic downturns affecting consumer spending.

Regions Info

  • North America
    40%
  • Europe Developed
    25%
  • Asia Emerging
    5%
  • Asia Developed
    3%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is heavily weighted towards North America and developed Europe, with a modest allocation to emerging markets. This distribution provides a solid foundation in stable, developed economies while offering growth potential through emerging markets exposure. However, the limited exposure to regions like Asia Developed and Latin America suggests room for increased diversification.

Market capitalization Info

  • Mega-cap
    43%
  • Large-cap
    22%
  • Mid-cap
    9%
  • Small-cap
    1%

The focus on mega and large-cap stocks (65% combined) is indicative of a preference for stability and lower volatility associated with larger, well-established companies. However, the minimal exposure to small and micro-caps means potentially missing out on higher growth opportunities these segments can offer.

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.

Considering the Efficient Frontier, this portfolio seems well-positioned for its risk-return profile but may benefit from periodic reviews to ensure optimal asset allocation. Adjustments may be needed to maintain the desired risk level and take advantage of changing market conditions or new investment opportunities.

Ongoing product costs Info

  • iShares VII PLC - iShares Core EURO STOXX 50 ETF EUR Acc 0.10%
  • iShares Core MSCI Emerging Markets IMI UCITS 0.18%
  • Vanguard Global Aggregate Bond UCITS ETF GBP Hedged Accumulation 0.10%
  • Vanguard S&P 500 UCITS Acc 0.07%
  • Weighted costs total (per year) 0.10%

The overall portfolio cost, with a Total Expense Ratio (TER) averaging 0.10%, is impressively low, enhancing net returns over time. Keeping costs minimized is a crucial aspect of long-term investment success, as lower costs directly translate to higher returns for investors.

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