A focused growth-oriented portfolio with heavy reliance on US equities and low diversification

Report created on Jul 21, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

This portfolio is highly concentrated, with 80% allocated to a Vanguard S&P 500 ETF and 20% to a Vanguard Dividend Appreciation Index Fund ETF. Both funds are equity-based, leading to a 100% stock allocation. This composition reflects a strong bias toward US equities, given the geographic allocation showing 99% in North America. The portfolio's diversification is low, with a significant overlap in holdings between the two ETFs, particularly in sectors like Technology and Financial Services.

Growth Info

Historically, the portfolio has shown a Compound Annual Growth Rate (CAGR) of 14.24%, with a maximum drawdown of -33.50%. The days contributing to 90% of the returns number just 31, highlighting the impact of significant market movements on performance. While past performance is impressive, it's crucial to remember that it doesn't guarantee future results, and the high concentration in specific sectors and geographic areas may introduce volatility.

Projection Info

The Monte Carlo simulation, using 1,000 iterations, suggests a wide range of potential outcomes, from a 5th percentile increase of 105.3% to a 67th percentile increase of 688.4%. While the majority of simulations predict positive returns, the significant spread underscores the portfolio's risk level. These projections, while useful for understanding potential volatility and reward, should be approached with caution as they are based on historical data and cannot predict future market conditions accurately.

Asset classes Info

  • Stocks
    100%

The portfolio's asset class allocation is entirely in stocks, with no presence in bonds, real estate, or alternative investments. This singular focus enhances potential for growth but also increases susceptibility to market fluctuations. Diversifying across asset classes can reduce risk by spreading exposure and potentially smoothing out returns over time.

Sectors Info

  • Technology
    31%
  • Financials
    16%
  • Health Care
    11%
  • Consumer Discretionary
    10%
  • Industrials
    8%
  • Telecommunications
    8%
  • Consumer Staples
    7%
  • Energy
    3%
  • Utilities
    3%
  • Basic Materials
    2%
  • Real Estate
    2%

Sector allocation is heavily weighted towards Technology, Financial Services, and Healthcare, making the portfolio particularly sensitive to the performance of these industries. While these sectors have historically driven strong returns, they can also experience significant volatility. Diversification across a broader range of sectors could mitigate sector-specific risks.

Regions Info

  • North America
    99%

Geographic allocation is almost exclusively in North America, with no exposure to developed or emerging markets outside of this region. This concentration enhances exposure to the US economy's performance but limits potential benefits from global diversification, such as reduced volatility and access to growth in other economies.

Market capitalization Info

  • Mega-cap
    45%
  • Large-cap
    36%
  • Mid-cap
    17%
  • Small-cap
    1%

The market capitalization breakdown shows a preference for Mega and Big cap stocks, which typically offer stability and steady growth. However, the minimal exposure to Small and Micro cap stocks limits opportunities for higher growth, albeit at increased risk levels. Adjusting this allocation could balance the pursuit of growth with risk management.

Redundant positions Info

  • Vanguard Dividend Appreciation Index Fund ETF Shares
    Vanguard S&P 500 ETF
    High correlation

The high correlation between the Vanguard S&P 500 ETF and Vanguard Dividend Appreciation Index Fund ETF indicates overlapping holdings, which reduces the diversification benefits. Diversification across uncorrelated assets can lower portfolio volatility and enhance risk-adjusted returns, suggesting a need to reassess the asset mix.

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.

Before optimization, it's essential to address the portfolio's lack of diversification. The high correlation between its two holdings suggests redundancy, which doesn't contribute to diversification benefits. Exploring assets with lower correlation or adding investments in underrepresented sectors or geographies could enhance the portfolio's risk-return profile.

Dividends Info

  • Vanguard Dividend Appreciation Index Fund ETF Shares 1.70%
  • Vanguard S&P 500 ETF 1.20%
  • Weighted yield (per year) 1.30%

The dividend yield of the portfolio averages 1.30%, contributing to total returns. While not the primary focus, dividends offer a source of income and potential for reinvestment, enhancing compounding effects. Considering the growth orientation, the current yield is reasonable, balancing income generation with capital appreciation.

Ongoing product costs Info

  • Vanguard Dividend Appreciation Index Fund ETF Shares 0.06%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.04%

The portfolio benefits from low costs, with a total expense ratio (TER) of 0.04%. Low costs are crucial for long-term investment success, as they directly enhance net returns. The Vanguard funds selected are cost-efficient, aligning well with best practices for maximizing investment performance through cost control.

What next?

Ready to invest in this portfolio?

Select a broker that fits your needs and watch for low fees to maximize your returns.

Select broker

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.

Instrument logos provided by Elbstream.

Help us improve Insightfolio

Your feedback makes a difference! Share your thoughts in our quick survey. Take the survey