Growth-oriented portfolio with a strong focus on momentum and a speculative touch in cryptocurrency
Report created on Aug 16, 2025Risk profile
5/7
Diversification profile
1/5
Positions
-
SP Invesco S&P 500® Momentum ETF
SPMO - US46138E3392 70.00% -
AV Avantis® U.S. Small Cap Value ETF
AVUV - US0250728773 20.00% -
FB Fidelity Wise Origin Bitcoin Trust
FBTC - US3159481098 10.00%
The portfolio exhibits a bold structure, predominantly anchored in the Invesco S&P 500® Momentum ETF, which constitutes 70% of the allocation. This is complemented by a 20% investment in the Avantis® U.S. Small Cap Value ETF, introducing a value play into the mix. The inclusion of the Fidelity Wise Origin Bitcoin Trust at 10% introduces a speculative element, focusing on cryptocurrency. This composition indicates a growth-focused strategy with a high-risk, high-reward profile, leaning heavily on momentum within the S&P 500 and diversifying slightly into small-cap value and digital assets.
Growth
Historically, the portfolio has shown an impressive Compound Annual Growth Rate (CAGR) of 36.15%, with a maximum drawdown of -20.46%. These figures suggest a volatile yet highly rewarding performance trajectory. The fact that 90% of returns came from just 16 days highlights the portfolio's reliance on short, sharp gains, typical of momentum and speculative strategies. While past performance is encouraging, it's crucial to remember that such high returns often come with increased risk and volatility.
Projection
Using Monte Carlo simulations, which project future performance based on historical data, the portfolio shows a wide range of potential outcomes. The median projection suggests a significant increase, but it's important to note that these simulations assume historical conditions will persist, which may not always be the case. This method helps in understanding potential volatility and the distribution of outcomes, but it cannot predict future market movements with certainty.
Asset classes
- Stocks 90%
- Other 10%
The portfolio's asset allocation is heavily skewed towards stocks (90%), with a speculative 10% in "other," referring to the cryptocurrency exposure. This distribution supports a growth-oriented strategy but lacks in terms of diversification across asset classes. Diversifying across more asset classes could help mitigate risk without necessarily compromising growth potential.
Sectors
- Technology 19%
- Financials 19%
- Consumer Discretionary 14%
- Telecommunications 11%
- Industrials 10%
- Consumer Staples 7%
- Energy 4%
- Health Care 2%
- Utilities 2%
- Basic Materials 1%
- Real Estate 1%
Sector allocation is well-spread across technology, financial services, and consumer cyclicals, among others. This diversification within the stock component of the portfolio is a positive aspect, as it spreads risk across different sectors of the economy. However, the heavy weighting towards technology and financial services is reflective of the momentum strategy's focus on sectors that have shown strong recent performance.
Regions
- North America 89%
Geographic exposure is predominantly North American (89%), with no direct investment in developed Europe, Latin America, Asia Emerging, or Africa/Middle East. This concentration in a single region, while beneficial in terms of familiarity and potentially reducing currency risk, limits global diversification and exposure to potentially lucrative markets outside of North America.
Market capitalization
- Mega-cap 38%
- Large-cap 23%
- Micro-cap 10%
- Mid-cap 9%
- Small-cap 9%
The portfolio's market capitalization exposure is diversified, with a significant allocation towards mega and big cap stocks. This is consistent with the momentum strategy's focus on large, established companies with strong performance trends. However, the inclusion of small and micro-cap stocks via the Avantis® U.S. Small Cap Value ETF introduces balance, potentially capturing growth in emerging companies.
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.
Considering the Efficient Frontier, which aims to optimize the risk-return ratio, this portfolio might benefit from a review of its current allocation. While the focus on momentum and speculative assets aligns with a high-growth, high-risk strategy, there may be room to adjust the asset mix to achieve a more efficient balance between risk and return, potentially by increasing diversification across more asset classes or regions.
Dividends
- Avantis® U.S. Small Cap Value ETF 1.70%
- Invesco S&P 500® Momentum ETF 0.60%
- Weighted yield (per year) 0.76%
The portfolio's overall dividend yield is relatively low at 0.76%, reflecting the growth rather than income focus of the asset allocation. While dividends contribute to total returns, the primary growth drivers in this portfolio appear to be capital appreciation from the momentum and small-cap value stocks, along with speculative gains from cryptocurrency.
Ongoing product costs
- Avantis® U.S. Small Cap Value ETF 0.25%
- Fidelity Wise Origin Bitcoin Trust 0.25%
- Invesco S&P 500® Momentum ETF 0.13%
- Weighted costs total (per year) 0.17%
The Total Expense Ratio (TER) of 0.17% is impressively low, which is beneficial for long-term growth as it minimizes the drag on performance. Keeping costs low is crucial in maximizing returns, especially in a growth-oriented strategy where every percentage point of return can compound significantly over time.
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