Growth-focused portfolio with heavy emphasis on large-cap US stocks and low diversification

Report created on Aug 1, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

This portfolio is heavily weighted towards large-cap US stocks, with a 100% allocation in this asset class across three ETFs. The SPDR® Portfolio S&P 500 ETF, Schwab U.S. Large-Cap Growth ETF, and Invesco S&P 500® Momentum ETF together provide exposure primarily to the technology, financial services, and consumer cyclicals sectors. The concentration in large-cap stocks and specific sectors indicates a growth-oriented strategy but comes with low diversification, as reflected by the diversification score of 2 out of 5.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 19.99% and a maximum drawdown of -32.81%, the portfolio has demonstrated strong growth potential but also significant volatility. The days that make up 90% of returns being only 36.0 highlights the portfolio's reliance on short bursts of strong performance. This pattern underscores the importance of timing in managing this portfolio, as significant gains are concentrated in relatively few days.

Projection Info

Monte Carlo simulations project a wide range of outcomes, from a 222.9% increase on the low end to a 1,886.2% increase on the high end, with all simulations showing positive returns. While encouraging, it's crucial to remember that these projections are based on historical data, which may not accurately predict future performance. The annualized return of all simulations at 22.88% suggests strong growth potential, but the investor should remain cautious of over-reliance on these forecasts.

Asset classes Info

  • Stocks
    100%

The portfolio's exclusive investment in stocks reflects a high-risk, high-reward strategy. While this has historically resulted in substantial growth, it lacks the protection against market volatility that bonds or other asset classes might provide. Diversifying across different asset classes could help mitigate risks without significantly compromising growth potential.

Sectors Info

  • Technology
    37%
  • Financials
    13%
  • Consumer Discretionary
    12%
  • Telecommunications
    12%
  • Health Care
    7%
  • Industrials
    7%
  • Consumer Staples
    5%
  • Energy
    2%
  • Utilities
    2%
  • Real Estate
    1%
  • Basic Materials
    1%

The sectoral allocation shows a heavy tilt towards technology at 37%, with financial services and consumer cyclicals also having significant weightings. This concentration in high-growth sectors has likely contributed to the portfolio's strong performance but also increases its susceptibility to sector-specific risks. Diversification across a broader range of sectors could reduce volatility and improve resilience.

Regions Info

  • North America
    100%

The geographic allocation is entirely focused on North America, missing out on potential growth opportunities in developed and emerging markets outside the US. This geographic concentration increases the portfolio's vulnerability to US market fluctuations and limits exposure to global economic growth drivers.

Market capitalization Info

  • Mega-cap
    54%
  • Large-cap
    31%
  • Mid-cap
    15%
  • Small-cap
    1%

The emphasis on mega (54%) and big (31%) cap stocks underscores the portfolio's growth orientation, as these companies often have more established businesses and stable earnings. However, the minimal allocation to small and micro-cap stocks means the portfolio may miss out on the higher growth potential these companies can offer.

Redundant positions Info

  • Schwab U.S. Large-Cap Growth ETF
    SPDR® Portfolio S&P 500 ETF
    High correlation

The high correlation between the Schwab U.S. Large-Cap Growth ETF and the SPDR® Portfolio S&P 500 ETF suggests redundancy in the portfolio, limiting diversification benefits. Reducing overlap by reallocating funds from one of these ETFs to a less correlated asset could enhance portfolio efficiency without sacrificing growth potential.

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 portfolio could benefit from optimization to improve its risk-return profile. The current high correlation among holdings suggests an opportunity to reduce overlap and enhance diversification. By adjusting allocations to decrease redundancy, the portfolio can aim for a more efficient position on the Efficient Frontier, potentially increasing returns for the same level of risk.

Dividends Info

  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • SPDR® Portfolio S&P 500 ETF 1.20%
  • Invesco S&P 500® Momentum ETF 0.60%
  • Weighted yield (per year) 0.84%

The portfolio's total dividend yield of 0.84% is modest, reflecting the growth-focused strategy that prioritizes capital appreciation over income. For investors seeking income, incorporating assets with higher dividend yields could provide a steady income stream in addition to potential capital gains.

Ongoing product costs Info

  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • SPDR® Portfolio S&P 500 ETF 0.02%
  • Invesco S&P 500® Momentum ETF 0.13%
  • Weighted costs total (per year) 0.05%

With a total expense ratio (TER) of 0.05%, the portfolio is cost-efficient, which is beneficial for long-term growth. Keeping costs low is crucial in maximizing returns, and this portfolio manages that well.

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