Balanced Portfolio with Strong Tech Focus and Impressive Historic Performance

Report created on Jun 14, 2024

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.

Positions

The portfolio consists of two main ETFs: Vanguard FTSE All-World UCITS ETF USD Accumulation at 80% and Invesco EQQQ NASDAQ-100 UCITS ETF Acc at 20%. This setup offers a balanced approach, combining a global market exposure with a tech-heavy focus. Such a composition is broadly diversified, covering a wide range of sectors and geographies. This balance is key for mitigating risks while still being exposed to high-growth areas. To maintain this balance, it's crucial to regularly review the allocation, ensuring it aligns with your risk tolerance and long-term goals.

Growth Info

Historically, the portfolio has shown a strong performance with a CAGR of 13.65% and a max drawdown of -15.82%. This indicates a robust growth potential while managing risk effectively. The days that make up 90% of returns being just 15 suggests that the portfolio has experienced significant gains in a relatively short period. Understanding these metrics is vital as it highlights the portfolio's volatility and potential for high returns. It's important to continue monitoring performance to ensure it remains in line with your financial objectives.

Projection Info

Using a Monte Carlo simulation with 1,000 iterations, the portfolio's future performance was projected, assuming a hypothetical initial investment. The results showed a 5th percentile end value of 163.99%, a median of 653.61%, and a 67th percentile of 905.64%. This simulation provides a range of potential outcomes, helping to understand the likelihood of various returns. With 999 simulations showing positive returns, the outlook is optimistic. Regularly conducting such analyses can help in making informed adjustments to the portfolio as needed.

Asset classes Info

  • Stocks
    100%

The portfolio is heavily weighted towards stocks, with 99.98% in this asset class. This concentration in equities indicates a growth-oriented strategy, which can offer high returns but also comes with increased volatility. Understanding the implications of such a focus is crucial, as it affects the portfolio's risk profile. To manage risk, consider diversifying into other asset classes like bonds or real estate, which can provide stability and reduce overall portfolio volatility.

Sectors Info

  • Technology
    30%
  • Financials
    13%
  • Consumer Discretionary
    11%
  • Health Care
    10%
  • Telecommunications
    10%
  • Industrials
    9%
  • Consumer Staples
    6%
  • Basic Materials
    3%
  • Energy
    3%
  • Utilities
    3%
  • Real Estate
    2%

The sector allocation shows a strong emphasis on technology at 30.45%, followed by financial services and consumer cyclicals. This tech-heavy focus aligns with growth trends but can increase exposure to sector-specific risks. Diversifying across more sectors can help mitigate potential downturns in any single industry. Regularly reviewing sector allocations ensures alignment with market trends and personal risk preferences, potentially enhancing the portfolio's resilience and long-term performance.

Regions Info

  • North America
    71%
  • Europe Developed
    12%
  • Asia Emerging
    5%
  • Japan
    5%
  • Asia Developed
    3%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is heavily tilted towards North America with 71.16% allocation, followed by Europe Developed. This concentration reflects a bias towards regions with strong economic performance and growth potential. However, it also exposes the portfolio to regional risks. Broadening geographic exposure to emerging markets or underrepresented regions could offer additional growth opportunities and risk diversification. Continual assessment of geographic allocation is essential to capitalize on global market dynamics.

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.

Portfolio optimization can be an effective tool, but it's essential first to ensure the current strategy aligns with your risk tolerance and financial goals. Moving along the efficient frontier allows for adjustments towards a riskier or more conservative portfolio. For riskier exposure, increase allocations to high-growth sectors, while for a conservative approach, consider adding fixed-income assets. Prioritize understanding personal risk appetite and long-term goals before making significant changes.

Ongoing product costs Info

  • Invesco EQQQ NASDAQ-100 UCITS ETF Acc 0.35%
  • Vanguard FTSE All-World UCITS ETF USD Accumulation 0.22%
  • Weighted costs total (per year) 0.25%

The portfolio's total expense ratio stands at 0.25%, with the Vanguard ETF at 0.22% and the Invesco ETF at 0.35%. These costs are relatively low, which is beneficial for long-term growth as they can significantly impact net returns over time. Keeping investment costs low is essential for maximizing returns, so it's crucial to regularly review and compare expense ratios to ensure competitiveness. Continuing to prioritize cost-efficiency will aid in achieving better net performance.

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