Two index funds pretending to be diversified while mostly just hugging the US market
Report created on Apr 22, 2026Risk 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.
Positions
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VT Vanguard Total Stock Market Index Fund ETF Shares
VTI - US9229087690 75.00% -
VE Vanguard FTSE Developed Markets Index Fund ETF Shares
VEA - US9219438580 25.00%
This “balanced” masterpiece is literally two broad stock ETFs duct-taped together: one giant US bucket and one smaller developed ex-US bucket. That’s it. No bonds, no alternatives, no spice — just a single equity engine with a mild foreign sidecar. It looks simple and clean, but it’s also one-dimensional. Calling this “Moderately Diversified” is like calling a burger with pickles a tasting menu. The structure basically says: if global developed stocks party, everything parties; if they crash, everything crashes. The upside is clarity: this portfolio’s destiny is welded to global equities, with zero Plan B beyond “hold on and hope capitalism keeps working.”
Growth
Historically, this thing did not embarrass itself: $1,000 turning into $3,489 over ten years with a 13.38% CAGR is objectively solid. But zoom out and the roast begins. It lagged the broad US market by 1.42% per year, which over a decade is the difference between “nice” and “why is my friend richer with less effort.” It did beat the global market by 1.17% annually though, so it’s not totally asleep at the wheel. The max drawdown at -34.8% shows it crashes basically in sync with everything else. And with just 32 days driving 90% of gains, missing a handful of big up days would’ve turned “solid” into “why did I bother.” Past returns helped, but they’re not a promise.
Projection
The Monte Carlo simulation basically says: welcome to the rollercoaster, hope you like averages. Monte Carlo is just a fancy way of running thousands of “what if” futures using past-like randomness. Median outcome: $1,000 becomes about $2,856 over 15 years — not terrible, not legendary. The possible range from roughly $1,025 to $7,690 screams “could be fine, could be chaos.” A 76.8% chance of a positive result is decent, but also means nearly one in four simulated futures ends flat or worse. It’s a reminder that even a sensible-looking global equity mix is still playing the stock-market lottery, just with better odds than randomness, not guarantees.
Asset classes
- Stocks 100%
Asset class breakdown is laughably straightforward: 100% stocks, 0% everything else. For something scored as “Balanced,” this is more “all gas, no brakes.” In asset-class terms, this is a one-trick pony that either sprints or faceplants depending on where we are in the economic cycle. No bonds to smooth the ride, no cash buffer, no diversifiers that behave differently when stocks melt down. When equities are booming, that’s fun; when they’re imploding, it’s a front-row seat to the carnage. The portfolio is basically saying, “volatility is a feature, not a bug,” and then asking risk-averse brains to just cope with it.
Sectors
- Technology 27%
- Financials 15%
- Industrials 12%
- Health Care 10%
- Consumer Discretionary 9%
- Telecommunications 8%
- Consumer Staples 5%
- Energy 5%
- Basic Materials 4%
- Utilities 3%
- Real Estate 3%
Sector-wise, this thing is a closet tech-and-financials junkie, with technology at 27% and financials at 15%. That’s over 40% leaning into two areas that tend to swing hard when growth expectations or interest rates shift. Industrials, healthcare, and consumer discretionary form a middle pack, but it’s very much a modern economy, growth-tilted profile. Utilities, real estate, and staples are tiny support acts, not stabilizing anchors. Compared to a generic market, this isn’t wild, but it does mean the portfolio’s mood is heavily driven by whether high-growth names and money-related businesses are in or out of favor. Less “sector diversification,” more “hope the big drivers don’t all wobble together.”
Regions
- North America 78%
- Europe Developed 13%
- Japan 5%
- Asia Developed 2%
- Australasia 2%
Geographically, this is a love letter to North America at 78%, with Europe Developed, Japan, and a smattering of other developed regions grudgingly invited to the party. Emerging markets are notably absent, so a big slice of the world’s growth engines simply… doesn’t exist here. It’s “global” in the way a menu with one international dish is “world cuisine.” The foreign exposure slightly softens the US home bias, but make no mistake: the US still firmly drives the bus. If American large caps sneeze, this portfolio catches the flu, and the non-US piece is mostly there to say “we tried” rather than truly diversify country risk.
Market capitalization
- Mega-cap 42%
- Large-cap 31%
- Mid-cap 19%
- Small-cap 6%
- Micro-cap 2%
The market cap breakdown is classic index comfort food: 42% mega-cap, 31% large-cap, then a taper down to mid, small, and a token 2% in micro. Translation: this portfolio is basically run by the global corporate giants, while smaller companies are background noise. It’s a textbook “own the market” stance, but also means innovation and higher-risk, higher-reward smaller names barely move the needle. The biggest, most established firms call the shots; the minnows just whisper in the corner. Great for stability relative to a small-cap tilt, but not exactly adventurous. It’s as if the portfolio saw “small caps” and said, “You can come, just sit in the back.”
True holdings
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NV NVIDIA Corporation 4.80%
Part of fund(s):- Vanguard Total Stock Market Index Fund ETF Shares
-
AA Apple Inc 4.44%
Part of fund(s):- Vanguard Total Stock Market Index Fund ETF Shares
-
MS Microsoft Corporation 3.28%
Part of fund(s):- Vanguard Total Stock Market Index Fund ETF Shares
-
AM Amazon.com Inc 2.40%
Part of fund(s):- Vanguard Total Stock Market Index Fund ETF Shares
-
GO Alphabet Inc Class A 2.00%
Part of fund(s):- Vanguard Total Stock Market Index Fund ETF Shares
-
AV Broadcom Inc 1.75%
Part of fund(s):- Vanguard Total Stock Market Index Fund ETF Shares
-
GO Alphabet Inc Class C 1.58%
Part of fund(s):- Vanguard Total Stock Market Index Fund ETF Shares
-
ME Meta Platforms Inc. 1.49%
Part of fund(s):- Vanguard Total Stock Market Index Fund ETF Shares
-
TS Tesla Inc 1.25%
Part of fund(s):- LS 1x Tesla Tracker ETP Securities GBP
- Vanguard Total Stock Market Index Fund ETF Shares
-
BR Berkshire Hathaway Inc 1.02%
Part of fund(s):- Vanguard Total Stock Market Index Fund ETF Shares
- Top 10 total 24.00%
Look-through holdings reveal the usual suspects hogging the spotlight: Nvidia, Apple, Microsoft, Amazon, Alphabet, Meta, Tesla, Broadcom, and Berkshire. No direct positions, yet they dominate via overlap inside the ETFs. Nvidia at 4.8% and Apple at 4.44% are effectively co-captains of this ship. This is the classic index trap: you think you’re diversified, but a handful of mega-tech-ish names secretly steer performance. And remember, this overlap is based only on ETF top-10s, so the true concentration is likely higher. It’s like ordering a “mixed platter” and discovering 60% of it is just different shapes of fried chicken from the same bird.
Factors
Factor exposure is impressively beige: everything is basically neutral — value, size, momentum, quality, low volatility, yield. Factor exposure is like reading the ingredients label for what actually drives returns, and here it just says “market-flavored.” No big lean into cheap companies, no obsession with fast-rising names, no safety-first tilt. Weirdly, that’s kind of an achievement: the portfolio isn’t accidentally making any wild bets under the hood. It just rides whatever the broad market is doing. That means no special tailwind when certain styles shine, but also no faceplant when one cherished factor regime suddenly dies. This thing is essentially the “plain yogurt” of factor investing.
Risk contribution
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Vanguard Total Stock Market Index Fund ETF Shares
Weight: 75.00% 77.5% -
Vanguard FTSE Developed Markets Index Fund ETF Shares
Weight: 25.00% 22.5%
Risk contribution is brutally simple: 75% weight in the US total market ETF contributes about 77.5% of the risk; the 25% developed ex-US piece chips in 22.5%. So one holding is clearly the main chaos engine. Risk contribution tells you which positions actually move the portfolio when markets jerk around, and here the answer is: mostly the US bucket, with the foreign sidekick adding a bit of extra wobble. Nothing is wildly out of proportion, but the message is clear — diversification by ticker count doesn’t change the fact that most risk is concentrated in one region and one massive equity sleeve. This is a tidy-looking, but very top-heavy, risk structure.
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.
Risk vs. return optimization actually hands this portfolio a reluctant gold star. It sits right on or very near the efficient frontier, with a Sharpe ratio of 0.57 versus 0.77 for the optimal mix and 0.65 for the minimum-variance combo. The efficient frontier is just the best possible tradeoff between risk and return using the same ingredients. Being near it means that, for what it owns, this portfolio isn’t wasting much risk. You’re basically using the two funds about as intelligently as the math allows. So yes, it’s boring, concentrated in one asset class, and equity-heavy — but structurally, it’s surprisingly not dumb. Annoyingly competent, even.
Dividends
- Vanguard FTSE Developed Markets Index Fund ETF Shares 2.80%
- Vanguard Total Stock Market Index Fund ETF Shares 1.10%
- Weighted yield (per year) 1.52%
The dividend yield at 1.52% is a gentle drizzle, not an income stream. The developed ex-US piece tries to help with 2.8%, but the US total market drags that down to a modest overall payout. Dividends are just the cash companies toss back while you wait, and here that waiting room is not exactly overflowing with snacks. Anyone secretly hoping this portfolio is a stealth income machine will be disappointed. It’s clearly built for total return, not mailbox money. The yield is fine for a broad equity mix, but it’s not doing much heavy lifting in terms of smoothing volatility or cushioning drawdowns with steady cash.
Ongoing product costs
- Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
- Vanguard Total Stock Market Index Fund ETF Shares 0.03%
- Weighted costs total (per year) 0.04%
Costs are the one area where this portfolio is almost obnoxiously sensible. A total expense ratio of 0.04% is basically free in investing terms. That’s like paying service fees in loose change while the market does the real work. Fees this low mean the drag on returns is tiny, especially compared to all the fancy wrappers out there charging 10x for the same exposure. It’s the rare part of this setup that doesn’t deserve a roast. If anything, the funniest part is that such a plain, two-ETF structure is more cost-efficient than a lot of “sophisticated” portfolios pretending to be clever while quietly overcharging for the same beta.
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