A growth-focused portfolio with strong U.S. exposure and a stable dividend yield

Risk 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.

What type of investor this portfolio is suitable for

Growth Investors

This portfolio suits an investor with a growth-oriented mindset and moderate to high risk tolerance. It is ideal for those with a long-term investment horizon, seeking to capitalize on market growth while accepting potential volatility. The focus on U.S. equities, coupled with emerging market exposure, aligns with individuals aiming for significant capital appreciation. Investors comfortable with market fluctuations and willing to stay invested through economic cycles will find this portfolio well-suited to their goals.

Positions

  • Vanguard Total Stock Market Index Fund ETF Shares
    VTI - US9229087690
    60.00%
  • Franklin FTSE India ETF
    FLIN - US35473P7693
    22.50%
  • Xtrackers MSCI EAFE Hedged Equity ETF
    DBEF - US2330512003
    17.50%

The portfolio is heavily weighted towards the Vanguard Total Stock Market Index Fund ETF Shares, comprising 60% of the total. This fund provides broad exposure to the U.S. stock market. The Franklin FTSE India ETF and Xtrackers MSCI EAFE Hedged Equity ETF add international diversification, accounting for 22.5% and 17.5%, respectively. Compared to benchmarks, this allocation leans towards growth with a solid U.S. core. This composition is beneficial for capturing U.S. market growth while diversifying internationally. To enhance diversification, consider adding other asset classes, such as bonds, to balance risk during downturns.

Growth Info

Historically, the portfolio has delivered a strong Compound Annual Growth Rate (CAGR) of 13.21%, outperforming many market averages. However, the maximum drawdown of -34.86% indicates significant volatility during downturns. This performance is typical for a growth-oriented portfolio, which can yield high returns but also faces substantial risks. To mitigate potential losses, consider incorporating assets with lower volatility or defensive characteristics, which can stabilize returns during market corrections.

Projection Info

Forward projections using Monte Carlo simulations, which estimate future outcomes based on historical data, suggest an annualized return of 12.55%. The median outcome indicates a potential portfolio growth of 315.7%. While these projections are promising, it's important to remember that they rely on past data and assumptions. Real-world results can vary due to unforeseen economic or market conditions. Regularly reviewing and adjusting the portfolio in response to market changes can help align it with evolving financial goals and risk tolerance.

Asset classes Info

  • Stocks
    100%
  • Cash
    0%
  • Other
    0%
  • No data
    0%

The portfolio is entirely composed of stocks, which aligns with a growth strategy but increases vulnerability to equity market volatility. While this concentration can maximize returns during bullish markets, it may lead to larger losses in downturns. Diversifying across asset classes, such as including bonds or real estate, can provide stability and reduce overall portfolio risk. This balanced approach can help achieve a more consistent performance over time, especially for investors with moderate risk tolerance.

Sectors Info

  • Technology
    24%
  • Financials
    18%
  • Consumer Discretionary
    11%
  • Industrials
    10%
  • Health Care
    10%
  • Telecommunications
    7%
  • Consumer Staples
    6%
  • Energy
    5%
  • Basic Materials
    4%
  • Utilities
    3%
  • Real Estate
    2%

The portfolio's sector allocation is tech-heavy, with 24% exposure, followed by financial services and consumer cyclicals. This reflects a growth-oriented approach but may lead to higher volatility, especially if interest rates rise or tech valuations fluctuate. The sector diversity aligns well with global standards, though it may benefit from increased exposure to defensive sectors like healthcare or utilities, which can offer stability during economic downturns. This adjustment can help smooth returns across different market cycles.

Regions Info

  • North America
    60%
  • Asia Emerging
    23%
  • Europe Developed
    12%
  • Japan
    4%
  • Australasia
    1%
  • Asia Developed
    1%
  • Africa/Middle East
    0%
  • Latin America
    0%
  • Europe Emerging
    0%

The geographic allocation is predominantly North American at 60%, with a notable 23% in emerging Asian markets, particularly India. This balance provides exposure to both mature and high-growth markets. However, the limited allocation to Europe and other regions may restrict diversification benefits. To reduce geographic risk, consider increasing exposure to underrepresented areas like Europe or Latin America. This can help cushion the portfolio against regional economic downturns and capitalize on global growth opportunities.

Market capitalization Info

  • Mega-cap
    47%
  • Large-cap
    33%
  • Mid-cap
    14%
  • Small-cap
    4%
  • Micro-cap
    1%

The portfolio's market capitalization is skewed towards mega and large-cap stocks, which together make up 80%. This focus provides stability and liquidity but may limit growth potential compared to smaller-cap stocks. Including more mid- and small-cap stocks can enhance growth prospects, as these companies often have higher growth rates. However, they also come with increased risk. Balancing the portfolio with a mix of market caps can better capture diverse opportunities and mitigate concentration risks.

Dividends Info

  • Xtrackers MSCI EAFE Hedged Equity ETF 0.50%
  • Franklin FTSE India ETF 1.00%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.20%
  • Weighted yield (per year) 1.03%

The portfolio's dividend yield stands at 1.03%, with the Vanguard Total Stock Market Index Fund ETF Shares contributing the most. While not the primary focus of a growth portfolio, dividends can provide a steady income stream and enhance total returns. For investors seeking income, consider increasing exposure to high-dividend sectors or funds. However, ensure that the pursuit of dividends does not compromise growth objectives or increase risk beyond acceptable levels.

Ongoing product costs Info

  • Xtrackers MSCI EAFE Hedged Equity ETF 0.36%
  • Franklin FTSE India ETF 0.19%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Weighted costs total (per year) 0.12%

With a Total Expense Ratio (TER) of 0.12%, the portfolio is cost-efficient. Low costs are crucial for maximizing long-term returns, as fees can erode gains over time. The Vanguard fund's minimal expense ratio contributes significantly to this efficiency. Maintaining low costs should remain a priority. Regularly reviewing and comparing fund expenses can help ensure the portfolio remains cost-effective. Consider replacing higher-cost funds with similar, lower-cost alternatives to further enhance returns.

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.

The portfolio could be optimized using the Efficient Frontier concept, which seeks the best possible risk-return ratio for a given set of assets. Currently, the allocation is growth-focused but could benefit from adjustments to improve efficiency. By reallocating within existing assets, the portfolio can potentially achieve higher returns for the same level of risk or maintain returns while reducing risk. Regularly reviewing asset performance and rebalancing can help maintain optimal efficiency.

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