This portfolio has only about 7 months of historical data, based on the youngest asset in the portfolio. Some metrics, projections, and AI insights may be less reliable and should be interpreted with caution.

Cautious Yet Broadly Diversified Portfolio with High Exposure to U.S. Markets

Report created on Jul 30, 2024

Risk profile Info

3/7
Cautious
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio is composed of four main ETFs: Vanguard S&P 500 ETF (60%), Vanguard Total International Stock Index Fund ETF Shares (20%), Avantis® U.S. Small Cap Value ETF (10%), and iShares Bitcoin Trust (10%). This setup indicates a cautious approach with a focus on broad diversification. The heavy weighting in the S&P 500 ETF suggests a preference for stable, blue-chip U.S. companies, while the inclusion of international stocks and small-cap value stocks adds some diversification. The Bitcoin ETF introduces a higher risk element, which is unusual for a cautious portfolio.

Growth Info

Historically, the portfolio has performed exceptionally well, with a Compound Annual Growth Rate (CAGR) of 32.23% and a maximum drawdown of -6.18%. These figures indicate solid growth with relatively low risk, aligning well with a cautious investment strategy. However, it's important to note that past performance is not indicative of future results. The portfolio's performance has been driven by a small number of high-return days, highlighting the importance of staying invested to capture these gains.

Projection Info

Using a Monte Carlo simulation with 1,000 iterations, the portfolio's future performance was projected. The simulation assumes a hypothetical initial investment and provides a range of possible outcomes. The 5th percentile outcome is a 1,767.16% return, while the 50th percentile is 11,484.26%, and the 67th percentile is 19,131.61%. These projections suggest a wide range of potential returns, emphasizing the uncertainty inherent in investing. The annualized return across all simulations is 45.01%, indicating strong potential growth.

Asset classes Info

  • Stocks
    89%
  • Cash
    1%

The portfolio is heavily weighted towards stocks, making up 89.33% of the total allocation. There is a minimal allocation to cash (0.65%) and other assets (0.03%). This high concentration in stocks suggests a focus on growth, but it also introduces higher volatility. For a cautious investor, this allocation might be too aggressive. It may be beneficial to introduce more bonds or other fixed-income assets to balance the risk and provide more stability.

Sectors Info

  • Technology
    22%
  • Financials
    14%
  • Consumer Discretionary
    10%
  • Industrials
    10%
  • Health Care
    9%
  • Telecommunications
    7%
  • Consumer Staples
    5%
  • Energy
    5%
  • Basic Materials
    4%
  • Real Estate
    2%
  • Utilities
    2%

The sector allocation is diverse, with the largest allocations in Technology (21.61%), Financial Services (14.29%), and Consumer Cyclicals (10.45%). This broad sector exposure helps mitigate sector-specific risks. However, the portfolio is underweight in Utilities and Real Estate, which are typically more stable and defensive sectors. For a cautious investor, increasing exposure to these sectors could provide additional stability and reduce overall portfolio risk.

Regions Info

  • North America
    71%
  • Europe Developed
    8%
  • Japan
    3%
  • Asia Emerging
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is heavily skewed towards North America, which makes up 71% of the allocation. Europe Developed (8.25%) and Japan (3.31%) are the next largest allocations. While this concentration in North America aligns with the focus on U.S. markets, it exposes the portfolio to regional risks. Diversifying more into emerging markets and other developed regions could help mitigate these risks and provide more balanced growth opportunities.

Dividends Info

  • Avantis® U.S. Small Cap Value ETF 1.60%
  • Vanguard S&P 500 ETF 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 3.00%
  • Weighted yield (per year) 1.54%

The portfolio's dividend yield data is not provided, but given the high allocation to the S&P 500 ETF, it's likely to generate some dividend income. Dividends can provide a steady income stream and help cushion against market volatility. For a cautious investor, focusing on dividend-paying stocks or ETFs could enhance the portfolio's income potential and provide more stability. Reviewing the dividend yield and adjusting the allocation to include more dividend-focused investments might be beneficial.

Ongoing product costs Info

  • Avantis® U.S. Small Cap Value ETF 0.25%
  • iShares Bitcoin Trust 0.12%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.07%

The total expense ratio (TER) of the portfolio is 0.07%, which is very low and indicates cost-efficient investing. The individual expense ratios of the ETFs range from 0.03% to 0.25%, with the Avantis® U.S. Small Cap Value ETF being the most expensive. Keeping costs low is crucial for maximizing returns, especially for a cautious investor. Regularly reviewing the expense ratios and considering lower-cost alternatives can help maintain the portfolio's cost efficiency and improve overall returns.

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