Balanced and broadly diversified portfolio with a strong focus on US equities and modest global exposure

Report created on Aug 19, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio is heavily weighted towards the Vanguard S&P 500 ETF, constituting 75% of the total allocation, showcasing a significant emphasis on large-cap US equities. The remaining 25% is distributed among international equities, real estate, mid-cap value stocks, and a target retirement fund, providing a moderate level of diversification across asset classes and geographic regions. The heavy allocation towards a single ETF suggests a strong conviction in the performance of large-cap US stocks, but it also indicates potential concentration risk.

Growth Info

Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 14.01%, with a maximum drawdown of -34.61%. These figures highlight a relatively strong performance, especially considering the significant exposure to the S&P 500, which has historically performed well. However, the substantial drawdown indicates that the portfolio is not immune to market volatility, underscoring the importance of diversification and risk management strategies.

Projection Info

Monte Carlo simulations, which use historical data to project future outcomes, suggest a wide range of potential future performances for this portfolio. The 50th percentile outcome of a 241.7% increase is promising, but the significant spread to the 5th percentile at only 2.5% increase illustrates the uncertainty and risk involved. These projections are useful for understanding potential volatility but should be viewed with caution as they cannot guarantee future returns.

Asset classes Info

  • Stocks
    99%

The portfolio's asset allocation is heavily skewed towards stocks (99%), with no exposure to bonds or cash. This allocation supports higher potential returns but also increases volatility and risk, especially in market downturns. Including bonds or other less volatile asset classes could provide a cushion against stock market fluctuations, potentially smoothing out returns over time.

Sectors Info

  • Technology
    28%
  • Financials
    15%
  • Consumer Discretionary
    9%
  • Health Care
    9%
  • Telecommunications
    9%
  • Industrials
    9%
  • Real Estate
    7%
  • Consumer Staples
    6%
  • Energy
    3%
  • Utilities
    3%
  • Basic Materials
    2%
  • Consumer Discretionary
    2%

Sector allocation is concentrated in technology, financial services, and a mix of consumer cyclicals and healthcare, reflecting common trends in large-cap US equity markets. This concentration in high-growth sectors could lead to higher volatility, especially in market corrections. Diversifying across more sectors, including defensive ones like utilities or consumer staples, may help mitigate some of this risk.

Regions Info

  • North America
    88%
  • Europe Developed
    4%
  • Asia Emerging
    3%
  • Asia Developed
    2%
  • Japan
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

With 88% of assets allocated to North America, primarily the US, the portfolio is heavily reliant on the performance of the US market. While this has historically been a strong market, the modest exposure to developed and emerging markets outside the US (12%) may limit potential growth opportunities and risk mitigation benefits offered by global diversification.

Market capitalization Info

  • Mega-cap
    42%
  • Large-cap
    32%
  • Mid-cap
    19%
  • Small-cap
    6%
  • Micro-cap
    1%

The market capitalization breakdown shows a strong preference for mega and big-cap stocks, which are generally considered less volatile than smaller companies. This allocation aligns with the portfolio's balanced risk profile but may limit exposure to the higher growth potential of mid and small-cap stocks. Including a broader range of market caps could enhance diversification and potential returns.

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.

Considering the Efficient Frontier, the portfolio's current allocation appears to lean heavily towards equities, particularly large-cap US stocks. While this may offer a favorable risk-return trade-off historically, there's potential for optimization by diversifying into other asset classes and regions. Adjusting allocations to include assets with different risk-return profiles could enhance the portfolio's efficiency, potentially offering a better balance between risk and return.

Dividends Info

  • FIDELITY REAL ESTATE INDEX FUND INSTITUTIONAL CLASS 2.80%
  • SPDR® S&P 400 Mid Cap Value ETF 1.80%
  • STATE STREET GLOBAL EQUITY EX-U.S. INDEX FUND CLASS I 3.60%
  • State Street Emerging Markets Equity Ind 2.40%
  • VANGUARD TARGET RETIREMENT 2055 FUND INVESTOR SHARES 1.90%
  • Vanguard S&P 500 ETF 1.20%
  • Weighted yield (per year) 1.54%

The overall dividend yield of the portfolio is 1.54%, contributed by holdings across various funds and ETFs. While not the primary focus, these dividends can provide a steady income stream and help reduce volatility by offering returns outside of capital gains. For investors seeking income, increasing exposure to higher-yielding assets could be beneficial.

Ongoing product costs Info

  • FIDELITY REAL ESTATE INDEX FUND INSTITUTIONAL CLASS 0.07%
  • SPDR® S&P 400 Mid Cap Value ETF 0.15%
  • STATE STREET GLOBAL EQUITY EX-U.S. INDEX FUND CLASS I 0.26%
  • State Street Emerging Markets Equity Ind 0.07%
  • VANGUARD TARGET RETIREMENT 2055 FUND INVESTOR SHARES 0.08%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.06%

The portfolio's total expense ratio (TER) is remarkably low at 0.06%, which is advantageous for long-term growth as lower costs directly translate to higher net returns. This low-cost approach is commendable and aligns with best practices for maximizing investment efficiency over time.

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