A balanced portfolio with strong US focus and moderate exposure to emerging markets

Report created on Dec 29, 2024

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is dominated by ETFs, with a significant 45% allocation to the S&P 500, followed by 20% each in the Nasdaq-100 and MSCI Emerging Markets, and 15% in European stocks. This structure leans heavily on equities, reflecting a growth-oriented approach. Compared to a typical balanced portfolio, there's a higher emphasis on US equities and technology sectors. While this can drive growth, it may also increase volatility. Consider diversifying further into other asset classes like bonds to reduce risk and enhance stability, aligning with a balanced risk profile.

Growth Info

Historically, the portfolio has achieved a solid CAGR of 15.25%, outperforming many balanced benchmarks. However, it's important to note the significant max drawdown of -32.06%, indicating potential vulnerability during market downturns. While past performance is not indicative of future results, these figures highlight the portfolio's capacity for high returns alongside substantial risk. To mitigate drawdown risk, consider incorporating assets with lower volatility or those that tend to perform well during market stress.

Projection Info

Forward projections using Monte Carlo simulations suggest a wide range of outcomes, with a median return of 514.24% and a 5th percentile return of 74.79%. Monte Carlo analysis uses historical data to simulate future performance, offering a glimpse into potential returns. While this provides valuable insights, it's crucial to remember that simulations rely on past data and assumptions, which may not hold in future market conditions. To better prepare for various scenarios, regularly review and adjust the portfolio as market conditions evolve.

Asset classes Info

  • Stocks
    80%
  • Other
    20%

The portfolio is heavily weighted towards stocks, comprising nearly 80% of the total allocation, with the remainder in other asset classes. This equity-centric approach can drive growth but may expose the portfolio to higher volatility. Compared to typical balanced portfolios, which often include bonds or other fixed-income assets, this allocation may benefit from additional diversification. Consider adding fixed-income or alternative assets to balance risk and return, especially during periods of market uncertainty.

Sectors Info

  • Technology
    21%
  • Financials
    14%
  • Consumer Discretionary
    9%
  • Health Care
    8%
  • Industrials
    8%
  • Telecommunications
    7%
  • Consumer Staples
    5%
  • Energy
    3%
  • Basic Materials
    3%
  • Utilities
    2%
  • Real Estate
    2%

Sector-wise, the portfolio is tech-heavy, with technology making up over 20% of the allocation, followed by financial services and consumer cyclicals. This concentration aligns with growth trends but may lead to increased volatility, especially during interest rate fluctuations. Compared to common benchmarks, the sector allocation is more skewed towards growth sectors. To enhance diversification, consider increasing exposure to traditionally defensive sectors like utilities or consumer staples, which can provide stability during economic downturns.

Regions Info

  • North America
    45%
  • Europe Developed
    15%
  • Asia Emerging
    10%
  • Asia Developed
    6%
  • Africa/Middle East
    2%
  • Latin America
    1%

Geographically, the portfolio is predominantly focused on North America, especially the US, with 44.89% exposure, followed by developed Europe and emerging Asia. This allocation reflects a strong bias towards established markets, potentially limiting exposure to higher-growth regions. While this can offer stability, consider increasing allocations to underrepresented regions like Latin America or Africa to capitalize on diverse economic growth opportunities and reduce geographic concentration 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 appears to be well-aligned with the Efficient Frontier, indicating an optimal risk-return balance given the current asset mix. This suggests that the portfolio is structured to achieve the best possible returns for its level of risk. However, optimization is based solely on existing assets and allocations. Periodically reassess this alignment as market conditions and personal circumstances change, ensuring that the portfolio continues to meet evolving financial goals.

Ongoing product costs Info

  • Amundi Index Solutions - Amundi MSCI Emerging Markets UCITS ETF-C EUR 0.20%
  • EasyETF - BNP Paribas Easy S&P 500 UCITS ETF 0.12%
  • Amundi Stoxx Europe 600 UCITS ETF C 0.07%
  • Amundi ETF PEA Nasdaq-100 UCITS ETF 0.23%
  • Weighted costs total (per year) 0.15%

The portfolio's total expense ratio (TER) is a low 0.15%, reflecting cost-effective management. This aligns well with best practices, as lower costs can significantly enhance long-term returns by reducing the drag on performance. Compared to typical ETF portfolios, this cost structure is commendable. Maintain this efficiency by regularly reviewing fund fees and considering lower-cost alternatives if available, ensuring that expenses remain minimized while maximizing investment gains.

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