A high equity portfolio with a strong focus on the S&P 500 and minimal bond exposure

Report created on Jul 18, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

1/5
Single-Focused
Less diversification More diversification

Positions

This portfolio is heavily weighted towards equities, with 91% invested in the Vanguard S&P 500 ETF, and the remaining 9% in the Vanguard Total Bond Market Index Fund ETF Shares. This composition suggests a strong belief in the long-term growth potential of the US stock market, with a minimal hedge against market volatility through bond investments. The single-focused diversification underscores a concentrated approach, primarily relying on the performance of large-cap US companies.

Growth Info

Historically, the portfolio has shown a Compound Annual Growth Rate (CAGR) of 13.25%, with a maximum drawdown of -31.96%. This performance highlights the inherent volatility and risk associated with a high equity concentration, especially in a single geographic region. The days contributing to 90% of returns being limited to 31 suggests significant gains are concentrated in short, strong market rallies, a characteristic feature of equity-heavy portfolios.

Projection Info

Monte Carlo simulations, using historical data to forecast future performance, suggest a wide range of outcomes. With 978 out of 1,000 simulations predicting positive returns, the median projected growth is substantial. However, the broad spread between the 5th and 67th percentiles indicates considerable uncertainty, underscoring the risk involved in such a heavily equity-weighted strategy.

Asset classes Info

  • Stocks
    91%
  • Bonds
    9%

The allocation across asset classes with 91% stocks and 9% bonds reflects a growth-oriented strategy with a higher risk tolerance. This mix prioritizes capital appreciation over income or stability, fitting for investors who can withstand market fluctuations. The absence of cash or alternative investments further emphasizes the aggressive growth focus.

Sectors Info

  • Technology
    30%
  • Financials
    13%
  • Consumer Discretionary
    10%
  • Health Care
    9%
  • Telecommunications
    9%
  • Industrials
    7%
  • Consumer Staples
    5%
  • Energy
    3%
  • Utilities
    2%
  • Real Estate
    2%
  • Basic Materials
    2%

The sectoral allocation within the S&P 500 ETF—dominated by Technology, Financial Services, and Consumer Cyclicals—mirrors the broader market trends, exposing the portfolio to sectors with higher growth potential but also higher volatility. The concentration in these sectors may amplify returns during bull markets but also increase susceptibility to sector-specific downturns.

Regions Info

  • North America
    91%

With 91% of assets allocated to North America, the portfolio's geographic exposure is heavily skewed towards the US market. This concentration benefits from the robust performance of the US economy and its stock market but lacks international diversification, which could mitigate risk and capture global growth opportunities.

Market capitalization Info

  • Mega-cap
    42%
  • Large-cap
    32%
  • Mid-cap
    16%
  • Small-cap
    1%

The market capitalization breakdown—favoring mega and big-cap stocks—aligns with the portfolio's emphasis on stability and growth within the equity component. These companies typically offer more resilience during market downturns compared to their smaller counterparts but might offer lower growth potential in booming markets.

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 current allocation and risk-return profile, the portfolio could potentially be optimized for a better risk-return ratio. By incorporating a broader range of asset classes or diversifying geographically and across sectors, the portfolio might achieve a more efficient position on the Efficient Frontier, enhancing expected returns for the given level of risk.

Dividends Info

  • Vanguard Total Bond Market Index Fund ETF Shares 3.80%
  • Vanguard S&P 500 ETF 1.20%
  • Weighted yield (per year) 1.43%

The dividend yields from the Vanguard Total Bond Market Index Fund ETF Shares and the Vanguard S&P 500 ETF contribute to a total portfolio yield of 1.43%. While not the primary focus, these dividends provide a modest income stream, which can be reinvested for compounding growth or used as income in a drawdown strategy.

Ongoing product costs Info

  • Vanguard Total Bond Market Index Fund ETF Shares 0.03%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.03%

The portfolio benefits from exceptionally low costs, with a Total Expense Ratio (TER) of 0.03%. Low costs are crucial for long-term investment success, as they directly enhance net returns by reducing the drag on performance. This efficient cost structure is a significant strength of the portfolio.

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