A balanced and broadly diversified portfolio with a strong focus on stocks and minimal costs
Report created on Jul 20, 2025Risk profile
4/7
Diversification profile
4/5
Positions
-
VT Vanguard Total Stock Market Index Fund Admiral Shares
VTSAX - US9229087286 80.00% -
VT VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND ADMIRAL SHARES
VTIAX - US9219098186 20.00%
The portfolio is heavily weighted towards stock investments, with 80% in the Vanguard Total Stock Market Index Fund Admiral Shares and 20% in the Vanguard Total International Stock Index Fund Admiral Shares. This allocation demonstrates a clear preference for equities, with a significant lean towards the US market. The broad diversification across sectors and geographies, as indicated by the inclusion of both domestic and international stock funds, is designed to mitigate risk while capturing growth opportunities globally.
Growth
Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 12.65%, with a maximum drawdown of -34.70%. This performance suggests resilience and the potential for strong returns over time, despite significant market downturns. The days contributing most to returns highlight the impact of short-term volatility and the importance of staying invested for the long term to capture growth.
Projection
Monte Carlo simulations, based on historical data, project a wide range of outcomes, with a median annualized return of 11.13%. This forward-looking analysis underscores the uncertainty in financial markets but also indicates a high likelihood of positive returns, aligning with the portfolio's balanced risk profile.
Asset classes
- Stocks 99%
- Cash 1%
With 99% of the portfolio in stocks and 1% in cash, the asset class allocation underscores a strong growth orientation. This composition is appropriate for investors with a moderate to high risk tolerance, aiming for capital appreciation over cash preservation or income generation.
Sectors
- Technology 27%
- Financials 16%
- Consumer Discretionary 11%
- Industrials 10%
- Health Care 10%
- Telecommunications 8%
- Consumer Staples 6%
- Energy 3%
- Basic Materials 3%
- Real Estate 3%
- Utilities 3%
The sector allocation, with technology, financial services, and consumer cyclicals leading, reflects a growth-focused strategy. This sector composition is typical of diversified equity portfolios aiming to capitalize on economic growth and innovation, though it may introduce volatility related to specific sector risks.
Regions
- North America 81%
- Europe Developed 8%
- Asia Emerging 3%
- Japan 3%
- Asia Developed 2%
- Australasia 1%
- Africa/Middle East 1%
The geographic allocation, heavily weighted towards North America (81%), with smaller exposures to developed Europe and emerging Asia, suggests a preference for the stability and growth potential of developed markets. However, the limited exposure to emerging markets might mean missing out on higher growth opportunities available in these regions.
Market capitalization
- Mega-cap 42%
- Large-cap 31%
- Mid-cap 19%
- Small-cap 6%
- Micro-cap 2%
The market capitalization breakdown, favoring mega and big-cap stocks, aligns with the portfolio's balanced risk approach, leveraging the stability and lower volatility of larger companies. However, the relatively smaller allocation to small and micro-cap stocks limits exposure to higher growth potential albeit with higher risk.
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.
The portfolio's current allocation appears well-optimized for a balanced risk-return profile, based on the Efficient Frontier concept. This suggests that, within the current asset selection, the portfolio is positioned to achieve the best possible return for the level of risk taken, though continuous review and adjustment are essential to maintain this optimization over time.
Dividends
- VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND ADMIRAL SHARES 2.10%
- Vanguard Total Stock Market Index Fund Admiral Shares 0.90%
- Weighted yield (per year) 1.14%
The dividend yield, averaging 1.14% across the portfolio, contributes to total returns but is not the primary focus. This yield level is consistent with a growth-oriented investment strategy where capital appreciation is prioritized over income generation.
Ongoing product costs
- VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND ADMIRAL SHARES 0.09%
- Vanguard Total Stock Market Index Fund Admiral Shares 0.04%
- Weighted costs total (per year) 0.05%
The total expense ratio (TER) of 0.05% is impressively low, maximizing the potential for net returns. Keeping costs minimal is crucial for long-term investment success, especially when investing in broadly diversified, passive index funds.
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