This portfolio has only about 10 years of historical data, based on the youngest asset in the portfolio. Some metrics, projections, and AI insights may be less reliable and should be interpreted with caution.

Balanced Highly Diversified Portfolio with Strong Historic Performance and Low Costs

Report created on Jul 27, 2024

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

The portfolio is composed of a mix of ETFs, with a strong leaning towards stocks at 79% and bonds at 20%. This balanced approach provides a good blend of growth potential and stability. The high diversification across different funds minimizes the risk associated with individual asset performance. This means the portfolio is well-positioned to withstand market fluctuations, offering a safer investment compared to a heavily stock-focused portfolio. To maintain this balance, regular reviews and adjustments should be considered based on market conditions and personal financial goals.

Growth Info

Historically, the portfolio has performed well with a Compound Annual Growth Rate (CAGR) of 8.27%. However, it experienced a significant maximum drawdown of -30.47%, indicating potential volatility during market downturns. Despite this, the portfolio managed to recover and deliver solid long-term returns. This highlights the importance of a long-term investment strategy and staying invested through market cycles. To further enhance performance, consider periodically reviewing and rebalancing the portfolio to align with evolving market conditions and personal risk tolerance.

Projection Info

Using a Monte-Carlo simulation with 1,000 iterations, the portfolio's future performance was projected. The median outcome suggests a potential growth of 133.54%, with the 67th percentile reaching up to 213.11%. However, there is a 5th percentile risk of a -21.28% decline. This simulation underscores the inherent uncertainty in market investments but also highlights the potential for significant growth. To mitigate risks, consider maintaining a diversified portfolio and possibly increasing bond allocation as one nears retirement or other financial goals.

Asset classes Info

  • Stocks
    79%
  • Bonds
    20%
  • Cash
    1%

The portfolio is diversified across two main asset classes: stocks (79%) and bonds (20%). This allocation provides a balanced approach, combining the growth potential of equities with the stability of fixed-income securities. A small portion is held in cash (1.2%), offering liquidity for unforeseen needs. This diversified asset class mix is essential for managing risk and achieving long-term financial goals. To ensure continued alignment with risk tolerance and investment objectives, periodic reviews and adjustments of the asset allocation are recommended.

Sectors Info

  • Real Estate
    23%
  • Technology
    16%
  • Financials
    13%
  • Industrials
    11%
  • Consumer Discretionary
    9%
  • Health Care
    8%
  • Telecommunications
    5%
  • Consumer Staples
    5%
  • Basic Materials
    4%
  • Energy
    4%
  • Utilities
    2%

The portfolio spans multiple sectors, with significant allocations in Real Estate (23%), Technology (16%), and Financial Services (13%). This broad sector exposure reduces the risk associated with sector-specific downturns. However, the heavy weighting in Real Estate could introduce some sector-specific risk. A well-diversified sector allocation helps in capturing growth opportunities across different parts of the economy. To further optimize the portfolio, consider periodically reviewing sector performances and making adjustments to maintain a balanced exposure.

Regions Info

  • North America
    70%
  • Europe Developed
    13%
  • Japan
    5%
  • Asia Emerging
    4%
  • Asia Developed
    3%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is heavily weighted towards North America (70%), with additional exposure to Europe Developed (13%) and Japan (5%). This geographic diversification helps mitigate risks associated with regional economic downturns. However, the high concentration in North America could pose a risk if the region underperforms. Geographic diversification is crucial for capturing global growth opportunities and reducing regional risks. To enhance geographic diversification, consider periodically reviewing regional performances and adjusting allocations as needed.

Dividends Info

  • iShares Core Total USD Bond Market ETF 3.70%
  • Vanguard Small-Cap Value Index Fund ETF Shares 2.10%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 3.40%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.40%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 3.20%
  • Weighted yield (per year) 2.54%

The portfolio includes dividend-paying ETFs, which can provide a steady income stream. While specific dividend yields were not provided, the presence of dividend-paying assets can enhance total returns and offer some downside protection during market downturns. Dividends are a valuable component of total return, especially for income-focused investors. To maximize the benefits of dividends, consider reinvesting them to compound returns over time or using them as a source of passive income depending on financial needs.

Ongoing product costs Info

  • iShares Core Total USD Bond Market ETF 0.06%
  • Vanguard Small-Cap Value Index Fund ETF Shares 0.07%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.05%

The portfolio boasts low costs, with a Total Expense Ratio (TER) of 0.05%. Low costs are crucial for maximizing net returns over time, as high fees can significantly erode investment gains. The low TER demonstrates a cost-efficient approach to investing, which is beneficial for long-term growth. To keep costs low, continue to prioritize low-cost ETFs and regularly review the expense ratios of all holdings to ensure they remain competitive.

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