A love letter to dividends and S&P 500 ETFs with a side of tunnel vision
Risk 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.
What type of investor this portfolio is suitable for
Balanced Investors
This portfolio is suited for someone who loves the classics — classic rock, classic cars, and classic investing strategies. They're comfortable with a high exposure to the stock market, as long as it's through the familiar lens of the S&P 500 and dividends. They likely have a moderate to high risk tolerance, appreciating the potential for higher returns but possibly underestimating the volatility that comes with such a narrow focus. Their investment horizon might be mid to long-term, banking on the historical resilience of the stock market to smooth out the bumps along the way.
Positions
-
Vanguard S&P 500 ETF
VOO - US9229083632 40.00% -
JPMorgan Equity Premium Income ETF
JEPI - US46641Q3323 20.00% -
Schwab U.S. Dividend Equity ETF
SCHD - US8085247976 20.00% -
SPDR® Portfolio S&P 500 High Dividend ETF
SPYD - US78468R7888 20.00%
Diving into this portfolio is like walking into a party where the S&P 500 ETFs have taken over the dance floor, and everyone else is just watching. With 40% in a Vanguard S&P 500 ETF and the rest scattered among dividend-focused ETFs, it's clear there's a theme here: "If it's not broke, don't fix it." But there's a fine line between playing it safe and playing it snooze-worthy. This portfolio needs a sprinkle of excitement and a dash of diversification to keep things interesting.
Growth
With a CAGR of 15.27%, it's like this portfolio has been riding the bull market with a lasso. But relying on past performance to predict future growth is like driving with the rearview mirror — eventually, you'll hit a bump you didn't see coming. That max drawdown of -18.67%? It's a reminder that what goes up can come down, and sometimes it comes down hard.
Projection
The Monte Carlo simulation seems optimistic, predicting growth between 169.4% and 800.2% across its percentiles. But remember, Monte Carlo is like weather forecasting for your money — it's educated guessing. It assumes the past is a reliable guide for the future, which is like assuming you can wear shorts in December because it was sunny in November. Don't bet the farm on these numbers.
Asset classes
- Stocks 97%
- No data 3%
- Cash 0%
With 97% in stocks and the adventurous 3% categorized as "Not Classified," it's clear this portfolio has put almost all its eggs in one basket. This is fine if you're into high-stakes gambling with your retirement savings, but for those who prefer not to live on the edge, a bit more balance wouldn't hurt. Maybe consider bonds, real estate, or even a nice index fund that doesn't just shadow the S&P 500.
Sectors
- Technology 20%
- Financials 13%
- Consumer Staples 11%
- Health Care 11%
- Consumer Discretionary 10%
- Industrials 8%
- Telecommunications 7%
- Energy 7%
- Real Estate 6%
- Utilities 5%
- Basic Materials 2%
The sector allocation reads like a 'Who's Who' of the S&P 500, with a heavy lean towards technology and financial services. It's like betting on the popular kids to always stay popular. But history shows us that today's tech titan can be tomorrow's bankruptcy headline. Diversifying across more sectors might prevent a future portfolio roast.
Regions
- North America 99%
- Europe Developed 1%
- Asia Developed 0%
- Latin America 0%
This portfolio is so heavily invested in North America, it might as well have an eagle tattoo and sing the national anthem every morning. With a mere 1% in Europe and nothing elsewhere, it's missing out on the global market party. Emerging markets, anyone? There's a whole world out there beyond the stars and stripes.
Market capitalization
- Large-cap 38%
- Mid-cap 30%
- Mega-cap 23%
- Small-cap 6%
- Micro-cap 0%
The market cap allocation is playing it safer than a kid with floaties in the shallow end. With a heavy lean towards big and mega caps, it's clear there's a fear of the deep end where the small and micro caps swim. Yes, large companies can be less volatile, but they also often offer slower growth. Dipping a toe into smaller waters might lead to finding the next big wave.
Dividends
- JPMorgan Equity Premium Income ETF 8.60%
- Schwab U.S. Dividend Equity ETF 3.80%
- SPDR® Portfolio S&P 500 High Dividend ETF 4.50%
- Vanguard S&P 500 ETF 1.20%
- Weighted yield (per year) 3.86%
This portfolio's love affair with dividends is like having a crush on steady income — understandable, but not without its risks. High dividend yields are attractive, but they're not the only fish in the sea. Sometimes, reinvesting in growth or exploring other sectors can lead to a more balanced relationship with your investments.
Ongoing product costs
- JPMorgan Equity Premium Income ETF 0.35%
- Schwab U.S. Dividend Equity ETF 0.06%
- SPDR® Portfolio S&P 500 High Dividend ETF 0.07%
- Vanguard S&P 500 ETF 0.03%
- Weighted costs total (per year) 0.11%
The total TER of 0.11% is impressively low, like finding a designer dress at a thrift store. It's one of the few areas where this portfolio deserves a pat on the back. Keeping costs down is like dieting for your wallet — it leaves more money to grow fat in the market.
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.
The efficient frontier is somewhere shaking its head at this portfolio's risk-return profile. It's like choosing to walk through a thunderstorm because it's slightly faster than taking the covered path. Sure, you might get there quicker, but you're also going to get wet. Exploring more diversified and efficient asset allocations could offer better returns for the same level of risk, or the same returns for less risk.
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