Balanced and highly diversified portfolio with a strategic mix of global equities and bonds

Report created on Sep 15, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

The portfolio showcases a strategic mix, predominantly leaning towards equities with a 92% allocation, complemented by a 13% in bonds, indicating a slight overlap beyond the 100% mark due to rounding or leveraging techniques. The equity portion spans across a broad spectrum of market capitalizations and geographies, from large-cap U.S. stocks to small-cap international values, alongside a modest allocation in gold. This diversified approach is designed to capture growth across different market segments while using bonds and gold to potentially mitigate volatility.

Growth Info

Historically, the portfolio has demonstrated robust performance with a Compound Annual Growth Rate (CAGR) of 18.68%. The maximum drawdown experienced was -15.65%, which provides insight into the portfolio's resilience during market downturns. It's important to note, however, that past performance is not indicative of future results. The days contributing to 90% of returns were relatively few, suggesting significant returns were concentrated on specific days, highlighting the importance of staying invested over attempting to time the market.

Projection Info

Using Monte Carlo simulation, a tool that forecasts potential outcomes by varying random inputs within historical ranges, the portfolio's future performance was analyzed. The simulation suggests a wide range of possible outcomes, with a median increase of 1,199.5% over the simulation period. While encouraging, it's crucial to understand that these projections are based on past data and assumptions, which cannot perfectly predict future market movements.

Asset classes Info

  • Stocks
    92%
  • Bonds
    13%
  • Other
    1%

The portfolio's asset class distribution, with a heavy tilt towards stocks, aligns with its balanced risk profile aiming for growth while accepting moderate levels of volatility. The bond allocation serves as a buffer against stock market downturns, albeit small. Including a small percentage in gold and other non-classified assets introduces additional diversification, potentially offering protection against inflation and currency devaluation.

Sectors Info

  • Financials
    18%
  • Technology
    18%
  • Industrials
    11%
  • Consumer Discretionary
    11%
  • Basic Materials
    8%
  • Health Care
    6%
  • Telecommunications
    6%
  • Consumer Staples
    5%
  • Energy
    5%
  • Real Estate
    2%
  • Utilities
    2%

Sector allocations are well-spread, with financial services and technology sectors leading at 18% each, followed by industrials and consumer cyclicals. This sector diversity supports the portfolio's aim to capture growth across different economic segments while mitigating risks associated with overexposure to any single sector. However, the heavy weighting in technology and financial services sectors may introduce sector-specific risks, warranting periodic review.

Regions Info

  • North America
    63%
  • Europe Developed
    10%
  • Asia Emerging
    5%
  • Asia Developed
    5%
  • Japan
    5%
  • Australasia
    2%
  • Africa/Middle East
    2%
  • Latin America
    1%

Geographically, the portfolio is heavily weighted towards North America (63%), with significant exposures to developed Europe (10%) and emerging markets. This distribution suggests a focus on more stable, developed markets while still seeking growth opportunities in emerging markets. The global diversification aids in spreading risk across different economies, potentially reducing volatility and improving returns over time.

Market capitalization Info

  • Mega-cap
    27%
  • Large-cap
    22%
  • Mid-cap
    18%
  • Small-cap
    16%
  • Micro-cap
    8%

The portfolio's market capitalization breakdown shows a balanced approach, with allocations across mega (27%), big (22%), medium (18%), small (16%), and micro (8%) caps. This spread across different sizes of companies allows the portfolio to balance the stability of large-cap stocks with the growth potential of small and micro-cap stocks, enhancing diversification and potential for higher returns.

Redundant positions Info

  • Avantis® U.S. Small Cap Value ETF
    Invesco S&P MidCap Value with Momentum ETF
    High correlation
  • SPDR® Portfolio S&P 500 ETF
    Vanguard Total Stock Market Index Fund ETF Shares
    High correlation
  • Vanguard Total International Stock Index Fund ETF Shares
    Vanguard FTSE Developed Markets Index Fund ETF Shares
    High correlation

High correlation was observed between certain ETFs, particularly those tracking U.S. small caps and mid-caps, as well as S&P 500 and total stock market funds. These correlations indicate overlapping holdings that may limit the benefits of diversification. Reducing exposure to highly correlated assets could enhance the portfolio's risk-adjusted returns by ensuring that each investment contributes uniquely to the portfolio's overall performance.

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.

Optimizing the portfolio involves addressing the identified high correlations among assets to improve diversification. An optimal portfolio with a similar risk level could potentially achieve a 12.74% expected return, suggesting room for improvement in the current allocation. Adjusting the portfolio to decrease overlap and ensure each investment contributes to diversification could enhance risk-adjusted returns without significantly increasing volatility.

Dividends Info

  • Avantis® International Small Cap Value ETF 3.50%
  • Avantis® Emerging Markets Value ETF 3.80%
  • Avantis® U.S. Small Cap Value ETF 1.60%
  • WisdomTree Emerging Markets SmallCap Dividend Fund 2.60%
  • PIMCO ETF Trust 5.90%
  • FIRST EAGLE GOLD FUND CLASS A 2.90%
  • SPDR® Portfolio S&P 500 ETF 1.10%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 2.60%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.10%
  • Vanguard Total International Stock Index Fund ETF Shares 2.70%
  • Invesco S&P MidCap Value with Momentum ETF 1.90%
  • Weighted yield (per year) 2.17%

The portfolio's dividend yield stands at 2.17%, contributing to its total return. Dividends provide a stream of income, which can be particularly valuable in market downturns or for investors seeking income. The yields vary across the ETFs, with the PIMCO ETF Trust offering the highest at 5.90%. While dividends are an important consideration, they should be balanced with growth potential and risk factors of each holding.

Ongoing product costs Info

  • Avantis® International Small Cap Value ETF 0.36%
  • Avantis® Emerging Markets Value ETF 0.36%
  • Avantis® U.S. Small Cap Value ETF 0.25%
  • WisdomTree Emerging Markets SmallCap Dividend Fund 0.58%
  • PIMCO ETF Trust 0.55%
  • FIRST EAGLE GOLD FUND CLASS A 1.16%
  • SPDR® Portfolio S&P 500 ETF 0.02%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Invesco S&P MidCap Value with Momentum ETF 0.39%
  • Weighted costs total (per year) 0.20%

Costs are a critical factor in long-term investment success, and this portfolio maintains a relatively low Total Expense Ratio (TER) of 0.20%. Lower costs allow more of the investment's return to compound over time, enhancing growth. The First Eagle Gold Fund, however, has a notably higher expense ratio at 1.16%, which may warrant reconsideration given its impact on net returns.

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