Balanced and diversified portfolio with a global reach and a focus on long-term growth

Report created on Aug 2, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

This portfolio exhibits a strategic balance between equities and fixed income, with a 45% allocation to the Vanguard Total Stock Market Index Fund ETF Shares, providing broad exposure to the U.S. stock market. The inclusion of 20% in both the Vanguard Long-Term Corporate Bond Index Fund ETF Shares and Vanguard Total International Stock Index Fund ETF Shares, along with 15% in the Vanguard FTSE Emerging Markets Index Fund ETF Shares, enhances its diversification. This structure aims to mitigate risk while capturing growth opportunities globally, aligning with a balanced risk profile.

Growth Info

Historically, the portfolio has demonstrated a Compound Annual Growth Rate (CAGR) of 9.61%, with a significant drawdown of -30.60%. This performance, characterized by periods of volatility, underscores the importance of a balanced approach to risk management. The days contributing most to returns highlight the market's unpredictable nature, suggesting that strategic asset allocation and patience are crucial for long-term growth.

Projection Info

Monte Carlo simulations, using historical data to forecast future outcomes, show a wide range of possibilities for this portfolio. With the majority of simulations (945 out of 1,000) predicting positive returns and a median projected growth of 159.4%, these results underscore the potential for significant growth. However, the presence of scenarios with negative returns highlights the inherent uncertainties in investing, emphasizing the need for a balanced risk approach.

Asset classes Info

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

The portfolio's asset allocation—79% in stocks and 20% in bonds—supports its balanced risk classification. This mix aims to capture the growth potential of equities while using bonds to provide stability during market downturns. The inclusion of a small cash position (1%) offers liquidity, which is essential for managing unforeseen needs or taking advantage of new investment opportunities.

Sectors Info

  • Technology
    20%
  • Financials
    14%
  • Consumer Discretionary
    9%
  • Industrials
    9%
  • Health Care
    7%
  • Telecommunications
    7%
  • Consumer Staples
    5%
  • Basic Materials
    3%
  • Energy
    3%
  • Real Estate
    2%
  • Utilities
    2%

With sector allocations spread across technology, financial services, consumer cyclicals, and industrials, among others, the portfolio is positioned to benefit from a variety of economic conditions. The heavy weighting in technology (20%) may increase volatility but also offers high growth potential. Balancing sectors like healthcare and consumer defensive can help mitigate this risk, underscoring the portfolio's comprehensive approach to diversification.

Regions Info

  • North America
    46%
  • Asia Emerging
    12%
  • Europe Developed
    8%
  • Asia Developed
    5%
  • Japan
    3%
  • Africa/Middle East
    2%
  • Latin America
    2%
  • Australasia
    1%

Geographic diversification is a strength of this portfolio, with significant allocations to North America, Asia Emerging, and Europe Developed. This global exposure helps mitigate the risk of regional economic downturns and capitalizes on growth opportunities in both developed and emerging markets. The portfolio's broad geographic spread aligns with its goal of capturing global growth while managing risk.

Market capitalization Info

  • Mega-cap
    34%
  • Large-cap
    24%
  • Mid-cap
    14%
  • Small-cap
    4%
  • Micro-cap
    1%

The market capitalization breakdown—34% in mega, 24% in big, and 14% in medium-sized companies—indicates a bias towards larger, potentially more stable companies. This allocation can provide a foundation of stability and resilience, though incorporating a greater variety of small and micro-cap stocks could enhance growth potential and diversification benefits.

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 Efficient Frontier analysis suggests this portfolio is near optimal for its current asset mix, aiming for the best possible risk-return ratio. However, continuous review and adjustment are essential to maintaining this balance, especially as market conditions change. Investors should consider whether shifts in allocation between existing assets could further optimize returns for the given level of risk.

Dividends Info

  • Vanguard Long-Term Corporate Bond Index Fund ETF Shares 4.90%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.20%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 2.80%
  • Vanguard Total International Stock Index Fund ETF Shares 2.90%
  • Weighted yield (per year) 2.52%

Dividend yields, with a total portfolio yield of 2.52%, contribute to the portfolio's total return, offering a steady income stream in addition to potential capital gains. This income is particularly valuable during market fluctuations, providing a cushion that can help smooth out returns over time. The balanced approach to both growth and income supports the portfolio's long-term investment strategy.

Ongoing product costs Info

  • Vanguard Long-Term Corporate Bond Index Fund ETF Shares 0.04%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 0.08%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.04%

With a total expense ratio (TER) of 0.04%, the portfolio benefits from low costs, which can significantly enhance long-term returns. Keeping investment costs low is crucial, as they compound over time, potentially eating into the portfolio's gains. This focus on cost efficiency is a positive aspect of the portfolio's management strategy.

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