Strong value tilted US equity barbell with efficient risk profile and meaningful small cap exposure
Report created on Mar 23, 2026Risk profile
- Secure Speculative
The risk profile, derived from past market volatility, reflects the level of risk the portfolio is exposed to. This assessment helps align your investments with your financial goals and comfort with market fluctuations.
Diversification profile
- Focused Diversified
The diversification assessment evaluates the spread of investments across asset classes, regions, and sectors. This ensures a balanced mix, reducing risk and maximizing returns by not concentrating in any single area.
Positions
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AV Avantis® U.S. Equity ETF
AVUS - US0250728856 50.00% -
AV Avantis® U.S. Small Cap Value ETF
AVUV - US0250728773 50.00%
This is a very focused two‑fund portfolio, split 50/50 between a broad US equity ETF and a US small cap value ETF. That means every dollar is in stocks, with no bonds, cash, or alternatives in the mix. A structure like this is straightforward to understand and easy to maintain, because there are only two moving parts. The “barbell” between total US and small cap value leans growth‑oriented overall, with a clear tilt toward cheaper smaller companies. The key takeaway is that outcomes will be tightly linked to the US stock market, but with an extra boost (and extra swings) from the small value side.
Growth
From late 2019 to March 2026, a hypothetical $1,000 grew to about $2,372, for a 16.25% compound annual growth rate (CAGR). CAGR is like your average speed on a road trip, smoothing out all the bumps. This beats both the US market’s 14.51% and the global market’s 11.97% over the same period, which is impressive. The trade‑off is a max drawdown of about –42.5%, deeper than the benchmarks’ roughly –34%. That’s the worst peak‑to‑trough fall, and it signals real gut‑check moments. Returns have been excellent, but they came with sharper drops that require emotional and financial resilience.
Projection
The Monte Carlo projection uses historical return and volatility patterns to play out 1,000 possible futures, like rolling the dice many times on your current strategy. It shows a wide range: after 10 years, the 5th percentile outcome is roughly +56%, while the median is about +611%, and higher scenarios go even further. Almost all simulations end positive, and the average simulated annual return of about 17.7% looks strong. Still, these are models built from the past, not promises. Structural changes in markets, interest rates, or valuations can make the future different, so these numbers are better viewed as a rough map of possible paths, not a forecast.
Asset classes
- Stocks 100%
All assets are in stocks, with 0% in bonds, cash, or other asset classes. This is classic “growth” positioning: maximum exposure to equity upside, but also full exposure to equity downside. Having only one major asset class means limited protection in broad stock market sell‑offs; there is no built‑in buffer from fixed income or defensive assets. The upside is simplicity and strong long‑run growth potential if you can stay invested through volatility. The key implication is that this setup fits situations where time horizon is long and short‑term losses are tolerable, but it can be uncomfortable when markets fall sharply and stay down for a while.
Sectors
- Financials 20%
- Technology 16%
- Consumer Discretionary 15%
- Energy 14%
- Industrials 13%
- Telecommunications 6%
- Health Care 6%
- Consumer Staples 5%
- Basic Materials 4%
- Utilities 1%
Sector exposure is fairly spread out: financials, technology, consumer cyclicals, energy, and industrials each take significant slices, with smaller allocations to communications, healthcare, defensive consumer names, materials, and a tiny bit of utilities. This broad spread across economic areas is a positive sign—sector diversification looks healthy and roughly aligned with what you’d expect from a broad US equity focus, adjusted for the value and small‑cap tilt. One implication is that performance will be driven by the overall US economy rather than hinging on a single hot theme. Still, cyclical areas like financials, energy, and discretionary can make results more sensitive to economic booms and recessions.
Regions
- North America 98%
- Latin America 1%
- Europe Developed 1%
Geographically, this is almost pure North America at 98%, with tiny exposures to Latin America and developed Europe. That’s a strong home‑bias toward the US market, which has actually been beneficial in the last decade and lines up with many US investors’ preferences. The flip side is that returns will largely follow US economic and policy conditions—interest rates, inflation, and domestic growth matter a lot here. Under‑exposure to the rest of the world means missing some diversification benefits that can come from different economic cycles. So, the portfolio is well aligned with US benchmarks, but less insulated if US stocks underperform other regions for a stretch.
Market capitalization
- Small-cap 31%
- Micro-cap 24%
- Mega-cap 18%
- Large-cap 14%
- Mid-cap 13%
Market‑cap exposure is tilted toward smaller companies: roughly 31% in small caps and 24% in micro caps, with about 18% in mega caps and the rest spread across big and mid caps. That’s quite different from typical market‑cap‑weighted indexes, which are dominated by mega and large caps. Smaller companies can grow faster but also tend to be more volatile and sensitive to economic slowdowns or credit conditions. The presence of mega‑caps still anchors part of the portfolio to stable global franchises, but the overall mix clearly skews toward the “smaller and cheaper” end of the spectrum, amplifying both upside potential and short‑term swings.
True holdings
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NV NVIDIA Corporation 2.52%
Part of fund(s):- Avantis® U.S. Equity ETF
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AA Apple Inc 2.41%
Part of fund(s):- Avantis® U.S. Equity ETF
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MS Microsoft Corporation 1.87%
Part of fund(s):- Avantis® U.S. Equity ETF
-
AM Amazon.com Inc 1.61%
Part of fund(s):- Avantis® U.S. Equity ETF
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GO Alphabet Inc Class A 1.24%
Part of fund(s):- Avantis® U.S. Equity ETF
-
ME Meta Platforms Inc. 1.19%
Part of fund(s):- Avantis® U.S. Equity ETF
-
GO Alphabet Inc Class C 0.99%
Part of fund(s):- Avantis® U.S. Equity ETF
-
JP JPMorgan Chase & Co 0.65%
Part of fund(s):- Avantis® U.S. Equity ETF
-
XO Exxon Mobil Corp 0.63%
Part of fund(s):- Avantis® U.S. Equity ETF
-
MU Micron Technology Inc 0.59%
Part of fund(s):- Avantis® U.S. Equity ETF
- Top 10 total 13.71%
Looking through the ETFs, the top underlying exposures show familiar mega‑cap names—NVIDIA, Apple, Microsoft, Amazon, and Alphabet—together making up a meaningful slice of the overall exposure. Because both ETFs can hold some of the same large companies, there’s hidden overlap: those big names can influence results more than the simple 50/50 ETF split suggests. Only about 40% of the portfolio is captured via top‑10 holdings, so actual overlap is likely higher. This kind of concentration in a handful of giants can boost returns when they’re strong but also ties part of the portfolio tightly to the fortunes of a small group of companies.
Factors
Factor exposure shows strong tilts toward value and size (both around 85%), with moderate momentum exposure and middling low‑volatility. Factors are like recurring traits—cheapness, small size, recent strong performance—that help explain why some groups of stocks behave differently. A strong value and small‑size tilt has historically delivered higher long‑term returns in many studies, but often with long dry spells and harsher drawdowns. The momentum tilt can help in trending markets, while limited low‑volatility exposure means less built‑in cushioning when markets get rough. Overall, this is a classic “factor‑rich” growth profile: potentially rewarding over decades but emotionally demanding over shorter cycles.
Risk contribution
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Avantis® U.S. Small Cap Value ETF
Weight: 50.00% 58.1% -
Avantis® U.S. Equity ETF
Weight: 50.00% 41.9%
Even though both ETFs have equal 50% weights, the small cap value ETF contributes about 58% of total portfolio risk, versus roughly 42% from the broad US equity ETF. Risk contribution measures how much each holding drives the overall ups and downs, not just how big it is. Here, the higher volatility of small caps means they punch above their weight in driving portfolio swings. That’s not necessarily a problem if the tilt is intentional, but it’s useful to know which piece is doing the heavy lifting. Rebalancing toward a slightly smaller allocation to the risk‑heavier ETF would materially change how bumpy the ride feels.
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 on the efficient frontier, which is the curve showing the best return achievable for each risk level using only the existing holdings. That’s good news: the mix between the two ETFs is already efficient. However, it’s not at the point with the highest Sharpe ratio, which is a simple measure of return per unit of risk. The optimal and minimum‑variance allocations here both offer a higher Sharpe (around 0.7 vs. 0.6) at slightly lower risk and return. There’s also a same‑risk optimized version that could target higher expected return by leaning more into the riskier component.
Dividends
- Avantis® U.S. Equity ETF 1.30%
- Avantis® U.S. Small Cap Value ETF 1.80%
- Weighted yield (per year) 1.55%
The combined dividend yield of about 1.55% is modest and in line with a growth‑oriented US equity mix. Dividends are the cash payouts investors receive from companies; over long periods they can be a significant part of total return, especially when reinvested. Here, most of the expected return is coming from price appreciation and factor tilts rather than high income. For investors focused on growth, that’s perfectly consistent and keeps taxes and drag from very high payouts limited. For anyone wanting meaningful current income, though, this yield level on its own would usually need to be supplemented by other sources beyond this stock‑only approach.
Ongoing product costs
- Avantis® U.S. Equity ETF 0.15%
- Avantis® U.S. Small Cap Value ETF 0.25%
- Weighted costs total (per year) 0.20%
Total ongoing costs (TER) sit around 0.20%, blending a 0.15% fee for the broad US ETF and 0.25% for the small cap value ETF. That’s impressively low for a factor‑tilted structure and is a real strength of this setup. Fees are like friction on a wheel: the less you have, the more of the gross return you actually keep, and the impact compounds over decades. Being near or below typical index‑fund pricing for a more specialized strategy is a big positive. It means more of the outperformance from small and value tilts, if they appear, accrues to the investor rather than being eaten by costs.
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