Balanced portfolio with a global outlook and a tilt towards technology

Report created on Oct 13, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is heavily weighted towards ETFs, with a significant emphasis on global and US equities. The Vanguard Total World Stock Index Fund ETF Shares make up 75% of the portfolio, providing broad exposure to global stock markets. The SPDR® Portfolio S&P 500 ETF and Schwab U.S. Dividend Equity ETF complement this with focused exposure to the US market and dividend-paying stocks, respectively. This composition suggests a strategy aiming for diversified growth with a balanced risk profile, leveraging the stability and potential growth of large and mega-cap companies worldwide.

Growth Info

Historically, the portfolio has demonstrated a Compound Annual Growth Rate (CAGR) of 12.82%, with a maximum drawdown of -34.05%. This performance is indicative of a balanced risk-return profile, suitable for investors with a moderate risk tolerance. The days contributing most to returns highlight the portfolio's sensitivity to market highs and lows. When compared to benchmarks, this performance should be evaluated in the context of the portfolio's risk score and diversification strategy, suggesting it has navigated market fluctuations effectively while capturing growth opportunities.

Projection Info

Monte Carlo simulations project a wide range of potential outcomes, with the median simulation suggesting significant growth. The analysis indicates a strong likelihood of positive returns, aligning with the portfolio's balanced risk classification. However, it's crucial to understand that these projections are based on historical data and assumptions, and actual future performance can vary due to unforeseen market changes. This forward-looking analysis should be one of several tools used in ongoing portfolio evaluation and adjustment.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio's allocation is almost entirely in stocks (99%), with a minimal cash holding. This high equity exposure aligns with its growth-oriented strategy but also increases sensitivity to market volatility. While the diversification across numerous sectors and geographies mitigates some risk, the lack of alternative asset classes such as bonds or real estate might limit the portfolio's ability to hedge against equity market downturns. Incorporating a wider range of asset classes could enhance resilience and reduce volatility without significantly compromising growth potential.

Sectors Info

  • Technology
    27%
  • Financials
    16%
  • Consumer Discretionary
    11%
  • Industrials
    10%
  • Health Care
    9%
  • Telecommunications
    9%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    3%
  • Utilities
    2%
  • Real Estate
    2%

With 27% allocated to technology, the portfolio is positioned to capitalize on the sector's growth potential but also bears sector-specific risks, such as regulatory changes or market sentiment shifts. Financial Services and Consumer Cyclicals follow, providing a mix of stability and growth. This sectoral distribution reflects a common growth-oriented strategy but warrants periodic review to ensure alignment with changing market conditions and sector outlooks. Diversifying further within underrepresented sectors could reduce volatility and improve long-term performance.

Regions Info

  • North America
    74%
  • Europe Developed
    11%
  • Asia Emerging
    4%
  • Japan
    4%
  • Asia Developed
    3%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

The geographic distribution is heavily skewed towards North America (74%), particularly the US, reflecting a bias towards developed markets known for stability and strong corporate governance. While this concentration has likely contributed to the portfolio's historical performance, it may also limit exposure to emerging market growth opportunities and increase vulnerability to region-specific economic downturns. Increasing exposure to underrepresented regions could offer enhanced diversification benefits and access to faster-growing economies.

Market capitalization Info

  • Mega-cap
    42%
  • Large-cap
    33%
  • Mid-cap
    19%
  • Small-cap
    4%
  • Micro-cap
    1%

The focus on mega (42%) and big (33%) cap stocks underpins the portfolio's balanced risk profile, leveraging the stability and lower volatility associated with larger, well-established companies. However, the relatively smaller allocation to medium, small, and micro-cap stocks suggests potential underutilization of growth opportunities in these segments. While larger companies offer stability, smaller companies can provide higher growth potential, albeit with increased risk. A slight reallocation towards smaller caps could introduce more growth opportunities, assuming it aligns with the investor's risk tolerance.

Redundant positions Info

  • SPDR® Portfolio S&P 500 ETF
    Vanguard Total World Stock Index Fund ETF Shares
    High correlation

The high correlation between the SPDR® Portfolio S&P 500 ETF and Vanguard Total World Stock Index Fund ETF Shares indicates overlapping exposures, particularly to US equities, which may limit the diversification benefits. While this concentration has contributed to the portfolio's robust performance, it also exposes the investor to increased risk during market downturns. Diversifying into assets with lower correlation could spread risk more effectively, potentially enhancing the portfolio's overall resilience.

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.

Optimizing the portfolio along the Efficient Frontier could enhance the risk-return profile by adjusting asset allocations to achieve the best possible balance. The current emphasis on highly correlated assets suggests an opportunity to improve diversification without necessarily sacrificing potential returns. By reducing overlap and exploring less correlated investments, the portfolio could achieve a more efficient distribution of risk and return, potentially offering the same or better returns for a lower level of risk.

Dividends Info

  • Schwab U.S. Dividend Equity ETF 3.90%
  • SPDR® Portfolio S&P 500 ETF 1.10%
  • Vanguard Total World Stock Index Fund ETF Shares 1.70%
  • Weighted yield (per year) 1.69%

The portfolio's dividend yield is modest, with the Schwab U.S. Dividend Equity ETF contributing the most significant portion. This yield contributes to the portfolio's total return, providing a steady income stream in addition to capital appreciation. For investors valuing income alongside growth, this allocation strategy aligns well. However, revisiting the dividend-yielding component's size could ensure it continues to meet income needs without disproportionately affecting growth potential or risk exposure.

Ongoing product costs Info

  • Schwab U.S. Dividend Equity ETF 0.06%
  • SPDR® Portfolio S&P 500 ETF 0.02%
  • Vanguard Total World Stock Index Fund ETF Shares 0.07%
  • Weighted costs total (per year) 0.06%

The portfolio's total expense ratio (TER) is low, enhancing net returns for the investor. This cost efficiency is crucial for long-term growth, as even small differences in fees can significantly impact compounded returns over time. The choice of low-cost ETFs demonstrates a strategic approach to maximizing returns by minimizing expenses, a practice that aligns with best investment principles.

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