A balanced and moderately diversified portfolio with a strong emphasis on stocks and growth potential

Report created on Aug 5, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

3/5
Moderately Diversified
Less diversification More diversification

Positions

The portfolio is structured with a heavy emphasis on equity ETFs, comprising 90% stocks and 10% bonds. The largest allocation is to the SPDR® Portfolio S&P 1500 Composite Stock Market ETF at 40%, followed by the Invesco S&P 500® Momentum ETF at 30%, the Avantis® International Equity ETF at 20%, and finally, the Janus Henderson AAA CLO ETF at 10%. This composition suggests a balanced approach, aiming to capture the growth of the U.S. stock market while incorporating international exposure and credit market investments for diversification. Comparing this to a typical balanced portfolio benchmark, the emphasis here is more towards growth-oriented assets, given the higher stock allocation.

Growth Info

Historically, this portfolio has exhibited a Compound Annual Growth Rate (CAGR) of 15.32%, with a maximum drawdown of -22.51%. These figures indicate a strong performance, particularly in terms of growth, but also highlight periods of significant volatility. The days contributing to 90% of returns being concentrated in just 25 days signals that much of the portfolio's gains can be attributed to very short periods of exceptional performance, which is characteristic of equity-heavy strategies. This performance should be benchmarked against similar risk-profile portfolios to assess its relative success.

Projection Info

Utilizing Monte Carlo simulations, which forecast future outcomes based on historical data, the portfolio shows a wide range of potential future returns. The median outcome (50th percentile) suggests a 482.6% increase, with all simulations indicating positive returns. However, it's crucial to understand that these projections, while useful for planning, are based on past data and cannot guarantee future results. The simulations underscore the portfolio's growth potential but also the importance of being prepared for various outcomes.

Asset classes Info

  • Stocks
    90%
  • Bonds
    10%

The allocation across asset classes with 90% in stocks and 10% in bonds leans towards a growth-oriented strategy, offering potentially higher returns but with increased risk. This allocation is suitable for investors with a medium to long-term horizon and a moderate risk tolerance. Diversification across asset classes is pivotal for managing risk, and while this portfolio is moderately diversified, investors might consider if the current stock-bond mix aligns with their risk appetite and investment goals.

Sectors Info

  • Technology
    22%
  • Financials
    16%
  • Consumer Discretionary
    11%
  • Industrials
    10%
  • Telecommunications
    9%
  • Consumer Staples
    6%
  • Health Care
    6%
  • Energy
    3%
  • Basic Materials
    3%
  • Utilities
    3%
  • Real Estate
    2%

Sector allocation shows a significant tilt towards Technology, Financial Services, and Consumer Cyclicals, which are sectors known for their growth potential but also for their volatility. The portfolio's sector composition matches well with many growth-focused investment strategies, aiming to capitalize on trends and innovations. However, investors should be mindful of sector concentration risks, as overexposure to specific sectors can increase susceptibility to sector-specific downturns.

Regions Info

  • North America
    71%
  • Europe Developed
    12%
  • Japan
    5%
  • Australasia
    1%
  • Asia Developed
    1%

Geographically, the portfolio is heavily weighted towards North America (71%), with smaller exposures to developed markets in Europe and Japan. This reflects a common strategy for U.S.-based investors, focusing on domestic and other developed markets for growth and stability. However, the negligible exposure to emerging markets might be a missed opportunity for diversification and capturing growth in faster-growing economies. Reviewing the geographic allocation could help in balancing global exposure and risk.

Market capitalization Info

  • Mega-cap
    39%
  • Large-cap
    29%
  • Mid-cap
    15%
  • Small-cap
    3%
  • Micro-cap
    1%

The market capitalization breakdown shows a strong preference for mega and big cap stocks, which tend to be more stable and less volatile than smaller companies. This allocation supports the portfolio's balanced risk profile, as larger companies are generally more resilient during market downturns. However, the modest allocation to medium, small, and micro-cap stocks might limit potential high-growth opportunities that these segments can offer, 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 Efficient Frontier analysis suggests that the portfolio can achieve a more efficient risk-return profile. Currently, the portfolio's expected return is below the optimal level that could be achieved with the same risk level. Adjusting the asset allocation to increase the expected return to 5.22%, with a risk level of 2.04, could enhance the portfolio's performance. This optimization process underscores the importance of continuously reviewing and adjusting the portfolio to maintain an optimal balance between risk and return.

Dividends Info

  • Avantis® International Equity ETF 2.80%
  • Janus Detroit Street Trust - Janus Henderson AAA CLO ETF 5.30%
  • Invesco S&P 500® Momentum ETF 0.60%
  • SPDR® Portfolio S&P 1500 Composite Stock Market ETF 1.20%
  • Weighted yield (per year) 1.75%

With a total dividend yield of 1.75%, the portfolio provides a modest income stream in addition to potential capital gains. The higher yield from the Janus Henderson AAA CLO ETF complements the lower yields from the equity ETFs, offering a balanced approach to income and growth. Investors should consider their income needs and whether the current yield aligns with their objectives, potentially adjusting allocations to meet their requirements.

Ongoing product costs Info

  • Avantis® International Equity ETF 0.23%
  • Janus Detroit Street Trust - Janus Henderson AAA CLO ETF 0.21%
  • Invesco S&P 500® Momentum ETF 0.13%
  • SPDR® Portfolio S&P 1500 Composite Stock Market ETF 0.03%
  • Weighted costs total (per year) 0.12%

The portfolio's total expense ratio (TER) of 0.12% is impressively low, which supports better long-term performance by minimizing the drag on returns caused by fees. This cost efficiency is particularly noteworthy in the context of a diversified, equity-heavy portfolio and is a strong foundation for building wealth over time. Investors should continue to monitor costs, as even small increases can significantly impact long-term outcomes.

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