High octane US growth strategy with heavy tech tilt and efficient risk return balance
Report created on Jun 6, 2024Risk profile
5/7
Diversification profile
2/5
Positions
-
SC Schwab U.S. Large-Cap Growth ETF
SCHG - US8085243009 80.00% -
SM VanEck Semiconductor ETF
SMH - US92189F6768 20.00%
The portfolio is a very focused two‑ETF setup: roughly 80% in a broad US large‑cap growth fund and 20% in a dedicated semiconductor fund. That means it’s 100% in stocks, with a strong growth bias and big exposure to a single industry. Structure like this is simple to understand and easy to maintain, which many investors like. But simplicity here also means higher concentration in similar types of companies. The main takeaway is that this setup targets aggressive capital growth rather than stability, so it fits investors who are comfortable with bigger ups and downs and prefer a “growth rocket” over a “steady cruiser.”
Growth
Over the last decade, $1,000 grew to about $6,658, a compound annual growth rate (CAGR) near 20.9%. CAGR is the “average speed” of growth per year, smoothing out the bumps. This crushed both the US and global markets, which ran around 13.8% and 11.2%. The tradeoff is a max drawdown of about -37.7%, meaning at one point it was down that much from a previous peak. Also, 90% of returns came from just 41 days, showing returns were very lumpy. This history is excellent, but it’s crucial to remember past outperformance doesn’t guarantee the next decade looks similar.
Asset classes
- Stocks 100%
Asset‑class exposure is straightforward: 100% in equities, with no bonds, cash, or alternatives. Stocks historically deliver higher long‑term returns than bonds, but they can drop sharply in bear markets. With no stabilizing ballast, drawdowns will likely feel intense compared with a mixed stock‑bond portfolio. This all‑equity stance lines up with a growth‑oriented profile but may be emotionally challenging in deep corrections. For someone comfortable riding out multi‑year volatility in pursuit of higher potential gains, this is coherent. For anyone needing near‑term liquidity or smoother returns, adding other asset classes could be worth considering.
Sectors
- Technology 56%
- Telecommunications 13%
- Consumer Discretionary 10%
- Health Care 7%
- Financials 6%
- Industrials 5%
- Consumer Staples 1%
- Basic Materials 1%
- Energy 1%
Sector exposure is dominated by technology and adjacent growth areas, with tech over half the portfolio, plus notable telecom and consumer discretionary exposure. That’s very different from broad market benchmarks, which spread more across financials, industrials, health care, and staples. A tech‑ and semiconductor‑heavy portfolio tends to shine in periods of innovation, low interest rates, and strong earnings growth, but it can be hit hard when rate expectations jump or the chip cycle turns. The upside is clear sector conviction and alignment with long‑term innovation trends; the tradeoff is higher cyclicality and sensitivity to tech valuation swings.
Regions
- North America 96%
- Asia Developed 2%
- Europe Developed 1%
Geographically, exposure is overwhelmingly in North America, with only small slices to developed Asia and Europe. That means returns will track closely with the US market and its currency, politics, and regulatory environment. This kind of home‑biased allocation has paid off over the last decade because US growth and tech leadership have been exceptional. However, it also means less benefit from regional diversification if US markets underperform or face specific shocks. For someone who believes US large‑cap growth and semiconductors will keep leading, this concentration is consistent, but global diversification is intentionally kept minimal here.
Market capitalization
- Mega-cap 60%
- Large-cap 27%
- Mid-cap 12%
- Small-cap 1%
By market cap, the portfolio is heavily tilted toward mega‑caps, then large‑caps, with only a small sliver in mid and small companies. Mega‑caps often bring strong balance sheets, global reach, and more predictable earnings, which can be comforting during turbulence. At the same time, they’re already widely followed and richly valued, so future returns might be more modest if expectations are stretched. Lower exposure to mid and small caps reduces the classic “size” diversification benefit but also removes some of their added volatility. Overall, this design leans into the biggest, most established growth names as core drivers.
True holdings
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NV NVIDIA Corporation 13.05%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- VanEck Semiconductor ETF
-
AA Apple Inc 7.97%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
-
MS Microsoft Corporation 6.14%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
-
AV Broadcom Inc 4.86%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
- VanEck Semiconductor ETF
-
AM Amazon.com Inc 4.43%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
-
GO Alphabet Inc Class A 3.80%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
-
TS Tesla Inc 3.05%
Part of fund(s):- LS 1x Tesla Tracker ETP Securities GBP
- Schwab U.S. Large-Cap Growth ETF
-
GO Alphabet Inc Class C 3.02%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
-
ME Meta Platforms Inc. 2.94%
Part of fund(s):- Schwab U.S. Large-Cap Growth ETF
-
TS Taiwan Semiconductor Manufacturing 2.34%
Part of fund(s):- VanEck Semiconductor ETF
- Top 10 total 51.60%
Looking through the ETFs, the largest underlying names are familiar mega‑cap growth and chip leaders: NVIDIA, Apple, Microsoft, Broadcom, Amazon, Alphabet, Tesla, Meta, and Taiwan Semiconductor. Several names appear via both funds, creating hidden overlap that boosts exposure to a small group of giants, especially NVIDIA. Overlap isn’t “bad,” but it does mean portfolio behavior is tied heavily to how a handful of big tech and chip names perform. Since only ETF top‑10s are captured, true overlap is probably even higher, so investors should assume this portfolio will move closely with megacap US tech and semiconductors.
Factors
Factor exposure shows clear tilts: very low value and low yield, plus low exposure to low volatility. Value and yield factors focus on cheaper, often more mature or income‑paying companies; this portfolio instead leans into expensive growth with minimal dividends. Low exposure to low volatility means it’s tilted toward more aggressive, higher‑beta names rather than “steady eddies.” Size, momentum, and quality look roughly neutral, so there’s no strong tilt there. In practice, this means the portfolio may excel in strong growth and tech bull markets but can see sharper price swings during rate spikes or growth scares.
Risk contribution
-
Schwab U.S. Large-Cap Growth ETF
Weight: 80.00% 74.1% -
VanEck Semiconductor ETF
Weight: 20.00% 25.9%
Risk contribution measures how much each holding drives the portfolio’s overall ups and downs, which can differ from simple weights. Here, the large‑cap growth ETF is 80% of the weight and contributes about 74% of total risk, while the 20% semiconductor ETF contributes roughly 26% of risk. That second fund punches above its weight, which fits a niche, more volatile industry. This setup is still largely driven by the broad growth ETF but with a risk‑amplifying satellite in semis. Anyone comfortable with this tilt should just be aware that even a relatively small chip allocation meaningfully boosts overall volatility.
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.
On the risk‑return chart, the current portfolio sits right on or very close to the efficient frontier, with a Sharpe ratio around 0.81. The efficient frontier is the curve of “best possible” risk/return mixes using these same holdings in different weights. Being near it means the current mix is already using these two ETFs effectively for its chosen risk level. The max‑Sharpe mix would take more risk for higher expected return, while the minimum‑variance mix slightly softens risk with a small drop in return. Overall, there’s no glaring inefficiency here; the tradeoff is purposefully aggressive but well‑structured.
Dividends
- Schwab U.S. Large-Cap Growth ETF 0.30%
- VanEck Semiconductor ETF 0.30%
- Weighted yield (per year) 0.30%
The overall dividend yield is around 0.3%, which is very low and aligns with a pure growth focus. Yield is the annual cash income you receive as a percentage of your investment; here, returns depend mainly on price appreciation, not income. For long‑term accumulators who are reinvesting and don’t need cash flow, this can be perfectly fine, especially if they believe growth companies will keep compounding earnings. Investors relying on their portfolio for regular income, though, would find this setup inadequate and might need to pair it with higher‑yielding holdings elsewhere to meet spending needs.
Ongoing product costs
- Schwab U.S. Large-Cap Growth ETF 0.04%
- VanEck Semiconductor ETF 0.35%
- Weighted costs total (per year) 0.10%
Costs are impressively low, with a blended total expense ratio around 0.10%. TER is the annual fee charged by the funds, taken invisibly out of returns. Keeping fees this low is a major structural win because every 0.1–0.3% saved compounds meaningfully over decades. The combination of a rock‑bottom‑cost core ETF and a modestly priced satellite sector ETF strikes a nice balance between targeted exposure and efficiency. On the cost front, this portfolio is already in excellent shape and compares very favorably to the average active fund or more complex ETF lineups that layer on unnecessary fees.
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