Two fund global equity portfolio balancing US tilt with broad international diversification at low cost
Report created on Jul 26, 2026Risk profile
5/7
Diversification profile
3/5
Positions
-
FZ FIDELITY ZERO TOTAL MARKET INDEX FUND
FZROX - US31635T7081 65.00% -
FZ FIDELITY ZERO INTERNATIONAL INDEX FUND
FZILX - US31635T6091 35.00%
This portfolio is very straightforward: two equity index mutual funds, one focused on the total US market at 65%, and one focused on international stocks at 35%. That means every dollar is in stocks, with no bonds, cash-like funds, or alternatives in the mix. A simple structure like this makes it easier to understand what’s driving returns because there are only two moving parts. It also means changes in global stock markets flow directly into the portfolio value. The growth-focused risk classification and mid‑high risk score line up logically with this all‑equity setup, since stocks tend to have larger ups and downs than mixed stock‑bond portfolios.
Growth
Over the period from mid‑2018 to mid‑2026, $1,000 in this portfolio grew to about $2,555. That works out to a Compound Annual Growth Rate (CAGR) of 12.53%, which is like averaging that gain per year over the whole stretch. The portfolio slightly lagged the US market benchmark but beat the global market benchmark, reflecting its mix of US and international exposure. The biggest drop, or max drawdown, was about -34% during early 2020, similar in depth and timing to major equity indices. Needing only 22 days to generate 90% of returns shows how a few strong days can dominate long‑term performance, which is common with diversified stock portfolios.
Projection
The Monte Carlo projection uses past return and volatility patterns to simulate many possible 15‑year futures. Think of it as re‑rolling history 1,000 different ways, mixing good and bad markets randomly to see a range of outcomes. Here, the median pathway turns $1,000 into about $2,751, with a fairly wide “likely” middle band between roughly $1,785 and $4,132. The annualized return across simulations is about 8.05%, lower than the historical figure, which already bakes in some uncertainty. Importantly, these numbers are not promises. They’re just statistical sketches based on what markets have done before, and real‑world returns can land outside even the 5%–95% range.
Asset classes
- Stocks 100%
All of the portfolio sits in one asset class: stocks. There’s no exposure to bonds, cash, or other diversifying assets. Being 100% in equities tends to boost long‑term growth potential but also makes the portfolio more sensitive to market swings and economic shocks. Compared with many broad benchmarks that include bonds, this is a more return‑oriented profile. Within stocks, though, the combination of domestic and international index funds spreads exposure across thousands of companies. That internal diversification can help soften company‑specific or country‑specific issues, even though the overall ride is still very much tied to the global equity cycle.
Sectors
- Technology 27%
- Financials 16%
- Industrials 12%
- Consumer Discretionary 9%
- Health Care 9%
- Telecommunications 8%
- Consumer Staples 5%
- Energy 5%
- Basic Materials 4%
- Utilities 3%
- Real Estate 2%
Sector exposure is well‑spread, with technology the largest slice at 27%, followed by financials at 16% and industrials at 12%. Consumer‑related areas, health care, telecom, energy, materials, utilities, and real estate all have smaller but meaningful roles. This layout looks broadly similar to major global equity benchmarks, which is a positive sign for diversification. A tech tilt can mean more sensitivity to growth expectations and interest rates, while financials often react strongly to credit and rate cycles. Because no single sector dominates overwhelmingly, the portfolio isn’t overly exposed to any one economic story, helping it behave like a broad market proxy rather than a narrow theme.
Regions
- North America 68%
- Europe Developed 13%
- Asia Developed 6%
- Japan 6%
- Asia Emerging 4%
- Australasia 2%
- Africa/Middle East 1%
- Latin America 1%
Geographically, about 68% is in North America, with the rest split across developed Europe, Japan, other developed Asia, emerging Asia, and smaller slices in Australasia, Latin America, and Africa/Middle East. This creates a clear US and North American tilt but still keeps a meaningful allocation abroad. Compared with a pure US portfolio, this setup adds currency and regional diversification, so local issues in one market are partly balanced by others. Compared with a fully global‑cap‑weighted mix, it leans somewhat more toward North America, which has been a strong performer in recent years. Overall, this is a broadly diversified global footprint with a home‑region bias.
Market capitalization
- Mega-cap 45%
- Large-cap 32%
- Mid-cap 17%
- Small-cap 4%
- Micro-cap 1%
Market capitalization exposure is skewed toward larger companies, with 45% in mega‑caps and 32% in large‑caps. Mid‑caps, small‑caps, and micro‑caps together make up about 22%. This mirrors how most global stock indices behave, since the biggest companies naturally dominate by value. Larger firms often have more diversified business lines and more stable earnings, which can moderate volatility compared with a small‑cap‑heavy mix. The meaningful though smaller slice in mid and smaller caps still adds some growth and dynamism. In practice, this means the portfolio tends to track the behavior of big, well‑known companies while keeping some exposure to the different return patterns of smaller businesses.
Factors
Factor exposure is mostly balanced, with value, size, momentum, and quality all near neutral, meaning the portfolio behaves similarly to a broad market index for those traits. Factor exposure is like checking which “characteristics” the holdings lean toward, such as cheaper stocks (value) or recent winners (momentum). The only notable tilt here is toward low volatility, which is moderately high. That suggests the underlying stocks, on average, have been a bit less jumpy than the market, potentially softening some swings. Yield exposure is on the low side, so dividends are not the main driver of returns; price changes matter more than income.
Risk contribution
-
FIDELITY ZERO TOTAL MARKET INDEX FUND
Weight: 65.00% 69.3% -
FIDELITY ZERO INTERNATIONAL INDEX FUND
Weight: 35.00% 30.7%
Risk contribution shows how much each holding drives the portfolio’s overall ups and downs, which can differ from simple weight. Here, the US total market fund is 65% of assets but contributes about 69% of risk, slightly more than its size alone would suggest. The international fund is 35% of assets yet contributes about 31% of risk, a bit less than proportional. This pattern indicates that volatility and correlation with the rest of the portfolio are a bit higher for the US sleeve. Overall, the risk profile is still reasonably aligned with the weight split, with no single holding dominating risk in an extreme way.
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 efficient frontier analysis suggests this two‑fund mix is already on or very close to the frontier, which is the curve of best possible risk/return combinations using these same holdings. The current portfolio Sharpe ratio of 0.51 trails the optimal mix’s 0.71, but that higher figure comes with slightly more risk and higher expected return. Sharpe ratio is a simple measure of risk‑adjusted return, comparing excess return over a risk‑free rate to volatility. Being near the frontier is a positive sign: it means, given just these two funds, the allocation is broadly efficient and isn’t obviously leaving a large risk/return improvement on the table through simple reweighting.
Dividends
- FIDELITY ZERO INTERNATIONAL INDEX FUND 2.40%
- FIDELITY ZERO TOTAL MARKET INDEX FUND 0.90%
- Weighted yield (per year) 1.42%
The portfolio’s total dividend yield is about 1.42%, combining a 0.90% yield from the US total market fund and a higher 2.40% yield from the international fund. Yield is the annual cash payout as a percentage of your investment value, like interest on a savings account but not guaranteed. Here, dividends contribute a modest portion of overall return, with most of the heavy lifting coming from price changes. International stocks tend to pay higher dividends on average, so they punch above their weight in income terms. For an all‑equity, growth‑oriented mix, this level of yield is quite typical and keeps tax‑sensitive distributions relatively contained.
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