A growth focused globally diversified ETF portfolio with low costs and moderate downside risk

Report created on Nov 14, 2024

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

This portfolio is built almost entirely from ETFs, with roughly 86% in stocks and 10% in bonds, plus a small cash‑like slice through short‑term Treasuries. Structurally it leans clearly toward growth, which matches the “Profile_Growth” risk label and sits close to many growth benchmarks that target around 80–90% stocks. This kind of mix matters because it largely determines how bumpy the ride will feel and how fast wealth may grow over time. The structure here is broadly solid, but there are many overlapping broad‑market funds. Simplifying into fewer core building blocks could keep the same risk profile while making the portfolio easier to manage and track.

Growth Info

Historically the portfolio delivered a compound annual growth rate (CAGR) of about 13.63%. CAGR is like your average speed on a road trip: it smooths out the ups and downs and tells you the steady “per year” growth. A hypothetical 10,000 dollars invested over the back‑test period would have grown very strongly compared with typical growth‑oriented benchmarks. The maximum drawdown of –23% means that at one point the portfolio fell about a quarter from a peak, which is moderate for a growth mix. While that downside shows real risk, the overall risk‑return tradeoff has been attractive. Still, past performance can’t guarantee anything about the next decade.

Projection Info

The Monte Carlo analysis used 1,000 simulations and an annualized return assumption around 12.2% to explore many possible futures. Monte Carlo just means the computer shakes the historical data in thousands of random combinations to see a range of outcomes, from very poor to excellent. In these runs, the median outcome (50th percentile) showed roughly tripling over the horizon, while the 5th percentile was barely positive, around 2.1% growth. That spread shows that even a strong portfolio can experience flat or weak periods. Because simulations rely heavily on historical patterns, they can understate new risks or regime shifts, so they should be treated as rough guardrails, not precise forecasts.

Asset classes Info

  • Stocks
    86%
  • Bonds
    10%

With 86% in stocks and 10% in bonds, this portfolio is tilted firmly toward growth assets, while still keeping a small ballast from bonds and short‑term government instruments. Stocks drive long‑term returns but also most of the volatility; bonds and cash‑like holdings help smooth the ride and provide “dry powder” in market sell‑offs. Against many growth benchmarks, this stock/bond split is quite typical and well aligned with a higher‑risk, long‑horizon strategy. The mix here already looks sensible, but anyone wanting a gentler ride could nudge a bit more into bonds, while someone extremely aggressive might reduce fixed income slightly. Any such adjustments should match personal time horizon and sleep‑at‑night comfort.

Sectors Info

  • Technology
    24%
  • Financials
    14%
  • Industrials
    10%
  • Consumer Discretionary
    9%
  • Health Care
    8%
  • Telecommunications
    7%
  • Consumer Staples
    5%
  • Basic Materials
    3%
  • Energy
    3%
  • Utilities
    2%
  • Real Estate
    2%

Sector exposure is nicely spread: about 24% technology, 14% financials, 10% industrials, then meaningful stakes in consumer, healthcare, communication services, and smaller slices in materials, energy, utilities, and real estate. This aligns closely with broad equity benchmarks, meaning you’re basically owning the economy’s current leaders rather than making big sector bets. Tech and related growth areas will likely drive a lot of return, but also volatility, especially if interest rates rise or growth expectations cool. The sector mix is already well balanced and in line with global norms. If future comfort with volatility changes, shifting a little toward more defensive sectors through broad value or minimum‑volatility funds could soften swings.

Regions Info

  • North America
    60%
  • Europe Developed
    10%
  • Japan
    5%
  • Asia Emerging
    4%
  • Asia Developed
    4%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, roughly 60% sits in North America, with the rest split across developed Europe, Japan, other developed Asia, and a smaller slice in emerging markets. That home‑bias toward the US and North America is very similar to many global benchmarks and what a lot of American investors hold. This alignment is helpful because it keeps country risk from being overly concentrated in smaller regions while still giving solid global exposure. The meaningful allocation outside North America helps diversify currency and policy risk. If someone wants even more global balance, gradually increasing non‑US exposure, especially in under‑owned regions, could reduce reliance on US market leadership while keeping the overall risk level similar.

Market capitalization Info

  • Mega-cap
    35%
  • Large-cap
    28%
  • Mid-cap
    16%
  • Small-cap
    5%
  • Micro-cap
    1%

By market capitalization, the portfolio leans heavily into mega and large companies (about 63% combined), with meaningful mid‑cap exposure and a modest slice of small and micro caps. Market cap just means the total value of a company’s shares; larger companies tend to be more stable, while smaller firms can be more volatile but sometimes faster‑growing. This spread is very close to broad market benchmarks, which is a plus for diversification across company sizes. The small‑ and mid‑cap exposure adds some extra growth potential and diversification. For someone wanting a bit more punch (and volatility), increasing small‑cap weight slightly could make sense; for a steadier profile, leaning more toward mega‑caps would do the opposite.

Redundant positions Info

  • Schwab Fundamental Emerging Markets Large Company Index ETF
    iShares MSCI Emerging Markets ETF
    iShares Core MSCI Emerging Markets ETF
    High correlation
  • Fidelity® Blue Chip Growth ETF
    Vanguard Total Stock Market Index Fund ETF Shares
    iShares MSCI USA Quality Factor ETF
    SPDR S&P 500 ETF Trust
    Fidelity Covington Trust - Fidelity Magellan ETF
    Vanguard Large-Cap Index Fund ETF Shares
    High correlation
  • Vanguard FTSE All-World ex-US Index Fund ETF Shares
    iShares Core MSCI EAFE ETF
    Fidelity® International Value Factor ETF
    Vanguard FTSE Developed Markets Index Fund ETF Shares
    iShares MSCI EAFE Small-Cap ETF
    Vanguard International Dividend Appreciation Index Fund ETF Shares
    High correlation
  • iShares Core S&P Small-Cap ETF
    iShares Core S&P Mid-Cap ETF
    High correlation

The correlation data shows several clusters of highly similar funds: multiple emerging‑markets ETFs, several overlapping US large‑cap and growth funds, and a group of developed‑markets international ETFs. Correlation means how often things move together; a correlation near 1 is like two dancers staying in perfect step. When holdings are highly correlated and track nearly the same slice of the market, they don’t add much diversification and can clutter the portfolio without reducing risk. The main opportunity here is simplification: trimming down to one or two core funds in each cluster (US large, developed ex‑US, emerging markets, small/mid‑caps) would keep the same effective exposures while making the portfolio cleaner and easier to monitor.

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.

From a risk‑return standpoint, this portfolio looks quite strong, with a high historical CAGR and a drawdown that’s reasonable for a growth profile. The Efficient Frontier is a concept that finds the mix of existing holdings that gives the best expected return for a given level of risk, like choosing the fastest route for your preferred driving speed. Here, the main opportunity before any optimization is to remove overlapping, near‑duplicate ETFs in the same regions and styles. Once the lineup is simplified, adjusting the weights among the remaining stock and bond funds could push the portfolio closer to that efficient line, improving the risk‑return ratio without changing the overall growth‑oriented character.

Dividends Info

  • iShares MSCI Emerging Markets ETF 2.20%
  • iShares MSCI EAFE Min Vol Factor ETF 2.80%
  • Fidelity® Blue Chip Growth ETF 0.10%
  • Fidelity® International Value Factor ETF 2.60%
  • Fidelity Covington Trust - Fidelity Magellan ETF 0.20%
  • Schwab Fundamental Emerging Markets Large Company Index ETF 4.30%
  • iShares U.S. Treasury Bond ETF 3.50%
  • SPDR® Nuveen Bloomberg High Yield Municipal Bond ETF 4.50%
  • iShares Core MSCI EAFE ETF 2.90%
  • iShares Core MSCI Emerging Markets ETF 2.80%
  • iShares Core S&P Mid-Cap ETF 1.20%
  • iShares Core S&P Small-Cap ETF 1.90%
  • iShares National Muni Bond ETF 3.10%
  • iShares MSCI USA Quality Factor ETF 0.90%
  • iShares MSCI EAFE Small-Cap ETF 2.90%
  • SPDR S&P 500 ETF Trust 1.10%
  • iShares MSCI USA Min Vol Factor ETF 1.50%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 2.70%
  • Vanguard FTSE All-World ex-US Index Fund ETF Shares 2.60%
  • Vanguard International Dividend Appreciation Index Fund ETF Shares 1.80%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.10%
  • Vanguard Value Index Fund ETF Shares 2.00%
  • Vanguard Large-Cap Index Fund ETF Shares 1.10%
  • Weighted yield (per year) 1.64%

The overall dividend yield around 1.64% is modest, which fits a growth‑oriented mix where total return (price gains plus dividends) matters more than current income. Dividend yield is just the annual cash payouts divided by price, similar to rental income from a property. Many of the core US growth funds pay low yields, while some international and bond holdings pay more, with a few positions yielding above 3–4%. For an investor focused on income, this yield might feel a bit light, but for long‑term growth it’s perfectly reasonable and aligned with global benchmarks. If income becomes a bigger priority later, gradually shifting part of the equity sleeve toward higher‑yielding or dividend‑focused strategies could help.

Ongoing product costs Info

  • iShares MSCI Emerging Markets ETF 0.70%
  • iShares MSCI EAFE Min Vol Factor ETF 0.22%
  • Fidelity® Blue Chip Growth ETF 0.59%
  • Fidelity® International Value Factor ETF 0.18%
  • Fidelity Covington Trust - Fidelity Magellan ETF 0.59%
  • Schwab Fundamental Emerging Markets Large Company Index ETF 0.39%
  • iShares U.S. Treasury Bond ETF 0.05%
  • SPDR® Nuveen Bloomberg High Yield Municipal Bond ETF 0.35%
  • iShares Core MSCI EAFE ETF 0.07%
  • iShares Core MSCI Emerging Markets ETF 0.09%
  • iShares Core S&P Mid-Cap ETF 0.05%
  • iShares Core S&P Small-Cap ETF 0.06%
  • iShares National Muni Bond ETF 0.05%
  • iShares MSCI USA Quality Factor ETF 0.15%
  • iShares MSCI EAFE Small-Cap ETF 0.40%
  • SPDR S&P 500 ETF Trust 0.10%
  • iShares MSCI USA Min Vol Factor ETF 0.15%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
  • Vanguard FTSE All-World ex-US Index Fund ETF Shares 0.07%
  • Vanguard International Dividend Appreciation Index Fund ETF Shares 0.15%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard Value Index Fund ETF Shares 0.04%
  • Vanguard Large-Cap Index Fund ETF Shares 0.04%
  • Weighted costs total (per year) 0.17%

The average total expense ratio (TER) of about 0.17% is impressively low, especially for such a well‑diversified and factor‑tilted portfolio. TER is like a small annual membership fee charged by each fund; lower fees leave more of the return in your pocket, which compounds meaningfully over decades. Many holdings are ultra‑low‑cost broad index ETFs, with only a few higher‑fee strategies. Overall costs here are a real strength and support strong long‑term performance. If you choose to streamline overlapping funds, prioritizing the lower‑cost options that offer similar exposure is one simple way to nudge the TER even lower while keeping the same broad strategy and risk profile intact.

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