Simple two fund equity portfolio with strong global tilt and efficient risk return profile
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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VW Vanguard FTSE All-World UCITS ETF USD Accumulation
VWCE - IE00BK5BQT80 91.14% -
VU Vanguard S&P 500 UCITS Acc
VUAA - IE00BFMXXD54 8.86%
The portfolio is extremely straightforward: two equity ETFs make up 100% of the allocation, with a heavy emphasis on a global all‑world fund and a smaller satellite in a broad US index. This kind of structure is easy to understand, easy to maintain, and naturally keeps turnover low. Having almost everything in one broadly diversified product means the overall behaviour is driven by global stock markets rather than by lots of individual moving parts. The main trade‑off is that the second ETF is highly similar to the first, so it adds more of what you already own rather than new types of exposure.
Growth
From early 2020 to March 2026, a hypothetical €1,000 grew to about €1,830, giving a compound annual growth rate (CAGR) of 11.14%. CAGR is like an “average yearly speed” for your money over the whole journey. This sits slightly above the global market benchmark, which reached €1,810, but well below the very strong US market over this period. The portfolio’s max drawdown of around -33% is similar to the global market’s big drops, showing full equity-level volatility. Remember this period includes both sharp falls and extraordinary rebounds; past performance is useful context but never a guarantee of future returns.
Projection
The 10‑year Monte Carlo simulation takes the portfolio’s past return and volatility pattern and “re‑rolls the dice” 1,000 times to see a range of possible futures. It’s like running many alternate histories based on the same statistics. The median outcome roughly quadruples the money, while a weak 5th‑percentile case still shows a small gain and the upside cases are much higher. The average simulated annual return is around 12.7%. This is encouraging, but it’s all based on historical behaviour; real‑world future returns could be better or worse, especially if market conditions change in ways the past doesn’t capture.
Asset classes
- Stocks 100%
All assets are in stocks, with no bonds, cash, or alternatives counted above 2%. That’s a pure‑equity structure, so returns are driven entirely by company earnings and market sentiment, without the stabilising effect of fixed income. For someone comfortable with meaningful ups and downs in exchange for higher long‑term growth potential, this can be a very clean setup. For others, adding even a modest percentage of lower‑risk assets can make the ride smoother. As it stands, the portfolio will broadly move in step with global equities, which is simple and transparent but means accepting full stock‑market risk.
Sectors
- Technology 28%
- Financials 17%
- Industrials 11%
- Consumer Discretionary 10%
- Telecommunications 9%
- Health Care 9%
- Consumer Staples 5%
- Basic Materials 4%
- Energy 4%
- Utilities 3%
- Real Estate 2%
Sector exposure is nicely spread, with technology the largest slice at 28%, followed by healthy allocations to financials, industrials, cyclicals, communication services and healthcare. This roughly mirrors broad global equity benchmarks, which is a strong indicator of sensible diversification across the economy. A tech‑tilt this size is common today and has been beneficial in recent years, but it does mean more sensitivity to factors like interest rates and innovation cycles. The good news is that meaningful weights in defensive, financial and industrial areas help balance that, so the portfolio is not a one‑way bet on any single economic story.
Regions
- North America 67%
- Europe Developed 14%
- Japan 5%
- Asia Emerging 5%
- Asia Developed 5%
- Australasia 2%
- Africa/Middle East 1%
- Latin America 1%
Geographically, about two‑thirds sits in North America, with the rest spread across developed Europe, Japan, other developed Asia, emerging Asia and smaller allocations to other regions. That US‑lean is close to the global market’s weight, because the US simply dominates world market capitalisation. This alignment with broad global standards is helpful: it means you’re not making a big regional “bet” by accident. The smaller allocations to emerging regions and other continents still provide diversification benefits, giving some exposure to different growth drivers, currencies and policy environments without drifting far from a neutral, market‑weighted world allocation.
Market capitalization
- Mega-cap 48%
- Large-cap 35%
- Mid-cap 17%
Nearly half the portfolio is in mega‑cap stocks, with most of the rest in large and mid‑caps. These are big, established companies that tend to have more stable business models, deep financing options and strong competitive positions. A tilt like this usually means smoother rides than a portfolio heavy in small, speculative names, but it can also reduce the chance of catching explosive small‑cap growth. For many long‑term investors, this large‑cap orientation is reassuring and in line with major indices, helping the portfolio behave predictably relative to common benchmarks and making it easier to understand what drives performance.
True holdings
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NV NVIDIA Corporation 4.50%
Part of fund(s):- Vanguard FTSE All-World UCITS ETF USD Accumulation
- Vanguard S&P 500 UCITS Acc
-
AA Apple Inc 4.16%
Part of fund(s):- Vanguard FTSE All-World UCITS ETF USD Accumulation
- Vanguard S&P 500 UCITS Acc
-
MS Microsoft Corporation 3.14%
Part of fund(s):- Vanguard FTSE All-World UCITS ETF USD Accumulation
- Vanguard S&P 500 UCITS Acc
-
AM Amazon.com Inc 2.18%
Part of fund(s):- Vanguard FTSE All-World UCITS ETF USD Accumulation
- Vanguard S&P 500 UCITS Acc
-
GO Alphabet Inc Class A 1.96%
Part of fund(s):- Vanguard FTSE All-World UCITS ETF USD Accumulation
- Vanguard S&P 500 UCITS Acc
-
AV Broadcom Inc 1.60%
Part of fund(s):- Vanguard FTSE All-World UCITS ETF USD Accumulation
- Vanguard S&P 500 UCITS Acc
-
GO Alphabet Inc Class C 1.58%
Part of fund(s):- Vanguard FTSE All-World UCITS ETF USD Accumulation
- Vanguard S&P 500 UCITS Acc
-
ME Meta Platforms Inc. 1.53%
Part of fund(s):- Vanguard FTSE All-World UCITS ETF USD Accumulation
- Vanguard S&P 500 UCITS Acc
-
23 Taiwan Semiconductor Manufacturing Co. Ltd. 1.44%
Part of fund(s):- Vanguard FTSE All-World UCITS ETF USD Accumulation
-
TS Tesla Inc 1.22%
Part of fund(s):- LS 1x Tesla Tracker ETP Securities GBP
- Vanguard FTSE All-World UCITS ETF USD Accumulation
- Vanguard S&P 500 UCITS Acc
- Top 10 total 23.30%
Looking through the ETFs, the biggest underlying positions are the usual global giants: NVIDIA, Apple, Microsoft, Amazon, Alphabet, Broadcom, Meta, TSMC and Tesla. Several of these appear in both ETFs, so there is some hidden concentration in mega‑cap growth and tech‑related names, even though you only see two tickers in the account. Because only the top‑10 ETF holdings are captured, true overlap is probably higher. This is not inherently bad; it simply means portfolio behaviour is more tied to how these few huge companies perform than the fund list might suggest at first glance.
Factors
Factor exposure shows strong tilts to low volatility, momentum and size. Factors are like underlying “personality traits” of stocks that research links to returns over time. A momentum tilt means you own more stocks that have recently done well; these can shine in trending bull markets but may suffer when trends reverse sharply. Low‑volatility exposure suggests an emphasis on historically steadier names, which can cushion some downturns. The size factor exposure here points modestly away from the very largest firms toward somewhat smaller ones. Coverage isn’t perfect, so these signals are directional rather than precise, but they explain part of the portfolio’s behaviour.
Risk contribution
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Vanguard FTSE All-World UCITS ETF USD Accumulation
Weight: 91.14% 90.8% -
Vanguard S&P 500 UCITS Acc
Weight: 8.86% 9.2%
Risk contribution measures how much each holding adds to the portfolio’s total ups and downs, which can differ from just its weight. Here, the main global ETF carries about 91% of the weight and roughly 91% of the risk, while the S&P 500 ETF contributes slightly more risk than weight but is still very close. That 1:1 pattern means there are no hidden “risk bombs” inside the allocation: each position behaves largely as its size suggests. With only two highly diversified funds, top‑three holdings account for all risk by definition, keeping position‑level risk analysis simple and transparent.
Redundant positions
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High correlationVanguard FTSE All-World UCITS ETF USD AccumulationVanguard S&P 500 UCITS Acc
The two ETFs are highly correlated, meaning they tend to move up and down together. Correlation describes how closely assets travel in the same direction; when it’s high, they don’t offset each other much during market swings. In this case, the second ETF mainly increases exposure to the same overall growth drivers instead of adding a very different return pattern. That’s fine if the goal is simply to lean slightly more into one region, but it limits diversification benefits. To significantly lower portfolio volatility, you’d need assets that behave differently from global developed equities, not just mirror them.
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 allocation sits on the efficient frontier, which is the curve showing the best expected return for each possible risk level using your existing holdings. That means the weights are already very efficient, given only these two ETFs. However, the “optimal” point with the highest Sharpe ratio (return per unit of risk) is slightly different, with a bit more expected return and only modestly higher volatility. Because both funds are so similar and highly correlated, there’s limited room to improve. Any meaningful shift in the risk‑return profile would likely require adding more differentiated assets, not just re‑weighting.
Ongoing product costs
- Vanguard S&P 500 UCITS Acc 0.07%
- Vanguard FTSE All-World UCITS ETF USD Accumulation 0.19%
- Weighted costs total (per year) 0.18%
The total ongoing cost (TER) is about 0.18% per year, which is impressively low for such broad global coverage. Costs work like friction: even small percentages compound over decades and can meaningfully reduce your final wealth. Keeping them at this level strongly supports long‑term performance, especially compared to more expensive active funds or complex products. With fees already this lean, there’s no pressing need to squeeze further unless an alternative offers clearly better structure or tax treatment. This is a real strength: a simple, diversified portfolio with institution‑level pricing is a solid foundation for compounding over many years.
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