Concentrated small value tilt pursuing aggressive growth with high volatility and moderate income potential
Report created on Mar 24, 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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AV Avantis® U.S. Small Cap Value ETF
AVUV - US0250728773 100.00%
This portfolio is extremely focused: 100% in a single U.S. small‑cap value ETF. Structurally, that means all risk and return come from one building block rather than a mix of funds or asset classes. That simplicity can be appealing and easy to manage, especially when it aligns with a clear philosophy like tilting toward small, undervalued companies. The flip side is no built‑in balance from bonds, cash, or other styles. For someone wanting one‑ticket exposure to an aggressive equity strategy, this setup is coherent, but it relies heavily on being comfortable with big swings and sticking with the plan through rough patches.
Growth
Historically, the portfolio turned $1,000 into about $2,395, beating both U.S. and global markets in compound annual growth rate (CAGR) terms. CAGR, the average yearly growth rate, came in at 17.63%, versus roughly 14.7% for the U.S. market and 12.3% for the global market. That stronger growth came with a much deeper maximum drawdown near ‑49%, compared with roughly ‑34% for the benchmarks. Max drawdown is the worst peak‑to‑trough loss and shows how painful downturns can feel. Only 15 days made up 90% of returns, underscoring how missing a handful of strong days could meaningfully change outcomes. Past performance, though, doesn’t guarantee similar future results.
Projection
The Monte Carlo projection uses past returns and volatility to simulate 1,000 possible future paths for the next 10 years. Think of it as running many alternate “what if” histories, then looking at the range of outcomes. The median path suggests very strong growth, with cumulative returns above 600%, and most simulations end positive. However, the 5th percentile shows that low‑end outcomes can still be modest, around 20% total over a decade. These simulations help visualize uncertainty but are anchored on historical patterns that may not repeat. They can frame expectations—wide swings, high upside, and meaningful downside risk—rather than promise any specific result.
Asset classes
- Stocks 100%
Asset‑class exposure is simple: 100% in stocks, with no bonds, cash, or alternatives. That aligns well with an aggressive risk profile and a long time horizon, because equities historically deliver higher returns but with bigger ups and downs. The absence of bonds means there’s little natural cushion during market stress, so portfolio value can drop quickly and sharply. For someone in or near retirement, that can be uncomfortable, but for a long‑term growth‑focused investor, it can be acceptable. The clarity here is a plus: this is pure growth‑oriented equity exposure, and any added stability would need to come from outside this holding.
Sectors
- Financials 25%
- Energy 19%
- Consumer Discretionary 18%
- Industrials 15%
- Technology 6%
- Basic Materials 5%
- Consumer Staples 4%
- Health Care 4%
- Telecommunications 2%
- Real Estate 1%
Sector exposure leans heavily on financials, energy, consumer cyclicals, and industrials, with smaller allocations to tech, materials, consumer defensive, healthcare, and communications. Compared to broad market indices, this pattern is less tech‑centric and more tied to economically sensitive businesses that can benefit when growth and inflation are favorable. Portfolios skewed toward cyclical sectors may outperform in strong economic expansions but can be hit harder in recessions or credit stress. It’s positive that exposure is spread across several sectors rather than dominated by a single one, but the tilt toward economically sensitive areas means returns will likely track the business cycle more than defensive or stable sectors.
Regions
- North America 97%
- Latin America 2%
- Europe Developed 1%
Geographically, the portfolio is overwhelmingly concentrated in North America, with nearly all exposure in that region and only tiny weights elsewhere. This largely aligns with a home‑country focus for a U.S.‑based investor and matches many domestic benchmarks, so it feels familiar and easy to follow. The advantage is exposure to deep, liquid markets with strong corporate governance. The trade‑off is limited diversification from other economies and currencies, which might perform differently during U.S. slowdowns or policy shifts. For someone who wants global balance, complementary holdings would be needed, but as a focused U.S. small‑cap value slice, this concentration is consistent and intentional.
Market capitalization
- Small-cap 53%
- Micro-cap 45%
- Mid-cap 2%
Market‑cap exposure is very skewed toward the smaller end: over half in small caps and nearly half in micro caps, with only a sliver in mid caps. Small‑ and micro‑cap companies tend to be less researched and more volatile, but historically have offered higher potential returns as compensation for that added risk. They can react strongly to changes in interest rates, credit conditions, and economic expectations. This heavy small‑cap tilt means the portfolio will often move differently from large‑cap‑dominated benchmarks. That’s useful if diversification away from mega‑caps is a goal, but it also requires tolerance for sharper drawdowns and more frequent swings in daily values.
True holdings
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VS ViaSat Inc 1.10%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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FI Five Below Inc 1.06%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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SM SM Energy Co 0.97%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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MA Matson Inc 0.90%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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M Macy’s Inc 0.83%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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AR Archrock Inc 0.83%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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GA GATX Corporation 0.83%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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MG Magnolia Oil & Gas Corp 0.80%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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LB Liberty Oilfield Services Inc 0.79%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
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CR California Resources Corp 0.79%
Part of fund(s):- Avantis® U.S. Small Cap Value ETF
- Top 10 total 8.89%
Looking through the ETF’s top holdings, exposure is spread across many smaller companies, with the largest names around 1% each. ViaSat, Five Below, SM Energy, and several energy and industrial names make up a modest slice, and there is no single stock dominating risk or return. Because only the top 10 holdings are captured here, true overlap and concentration are likely broader across many more names. This pattern is typical of diversified small‑cap funds: lots of small positions instead of a few giants. The takeaway is that stock‑specific blowups matter less than broad style or factor behavior, since no individual company holds outsized weight.
Factors
Factor exposure is strongly tilted toward value and size, with moderate momentum and neutral‑ish low volatility. Factor exposure describes how much a portfolio leans into traits like cheapness (value) or smaller company size that research links to long‑term returns. Here, the high value score means holdings are generally priced lower relative to fundamentals, which can pay off if sentiment toward cheaper stocks improves. The strong size tilt reinforces exposure to smaller firms, boosting both potential upside and risk. Positive momentum helps when trends persist but can reverse quickly. This combination tends to fare well in pro‑cyclical environments yet can lag during growth or large‑cap‑led rallies.
Risk contribution
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Avantis® U.S. Small Cap Value ETF
Weight: 100.00% 100.0%
Risk contribution shows how much each holding drives the overall volatility of the portfolio. With a single ETF at 100% weight, that fund also contributes 100% of the risk, giving a one‑to‑one risk‑to‑weight ratio. In practice, underlying stocks within the ETF each contribute differently, but at the portfolio level there’s no diversification across different vehicles or asset types. That simplicity is easy to understand: if this ETF is down sharply, the whole portfolio is down sharply. Aligning risk with intentions here would mean deciding whether a single aggressive factor fund is the desired core, or whether additional, less correlated positions are needed alongside it.
Dividends
- Avantis® U.S. Small Cap Value ETF 1.70%
- Weighted yield (per year) 1.70%
The dividend yield is about 1.7%, providing some modest income but clearly positioning the strategy as growth‑tilted rather than income‑oriented. Dividends are the cash distributions companies pay out of profits, and over long periods they can be a meaningful part of total return, especially when reinvested. For small‑cap value stocks, dividends can also signal financial health and discipline, though payout policies vary widely. Here, the yield is lower than many dedicated income strategies but reasonable for a smaller‑company universe. Investors relying on regular cash flow would likely need other income sources, while those focused on growth may simply reinvest these dividends automatically.
Ongoing product costs
- Avantis® U.S. Small Cap Value ETF 0.25%
- Weighted costs total (per year) 0.25%
The total expense ratio (TER) of 0.25% is quite competitive for an actively tilted small‑cap ETF and supports efficient long‑term compounding. TER represents the annual fee charged by the fund as a percentage of assets, quietly reducing returns each year. Over long horizons, even small fee differences can compound into noticeable gaps in ending wealth. In this case, costs are impressively low given the specialized exposure and broad underlying stock list, which is a strong positive. Keeping fees modest while pursuing a distinct factor tilt helps more of the portfolio’s gross return show up in your net results over decades.
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