Balanced and highly diversified portfolio with a global reach and a focus on stocks

Report created on Aug 8, 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 is well-structured, comprising 79% stocks, 16% bonds, 5% real estate, and a minimal cash position. This allocation reflects a balanced approach, leaning towards growth through its significant equity exposure while maintaining risk mitigation through bonds and real estate. The heavy weighting in the Vanguard Total Stock Market Index Fund ETF Shares and the iShares Core MSCI EAFE ETF suggests a strong focus on diversification across both U.S. and international equities. The inclusion of emerging markets, albeit at a lower percentage, adds further diversification and potential for higher returns, albeit with increased risk.

Growth Info

Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 9.33%, with a maximum drawdown of -30.25%. This indicates a relatively strong performance, with the ability to recover from market downturns, a critical aspect for balanced investors. The days contributing to 90% of returns being limited to 25 suggests that timing the market is less critical than maintaining a consistent investment strategy. This performance is a testament to the portfolio's diversified nature and balanced asset allocation.

Projection Info

Using Monte Carlo simulations, the forward projection of this portfolio shows a wide range of outcomes, with the 50th percentile suggesting a potential 121.2% return. It's important to note, however, that while Monte Carlo simulations provide a range of possible outcomes based on historical data, they do not guarantee future results. The simulation's indication that 905 out of 1,000 scenarios resulted in positive returns underscores the portfolio's resilience but should be viewed with cautious optimism.

Asset classes Info

  • Stocks
    79%
  • Bonds
    16%
  • Real Estate
    5%
  • Cash
    1%

The asset class distribution is strategically aligned with a balanced risk profile. Stocks, as the dominant asset class, are the main growth drivers, while bonds offer stability and income, reducing overall volatility. Real estate serves as an inflation hedge and provides additional diversification benefits. This mix supports a balanced growth strategy, suitable for investors with a moderate risk tolerance and a long-term investment horizon.

Sectors Info

  • Technology
    17%
  • Financials
    15%
  • Industrials
    10%
  • Consumer Discretionary
    8%
  • Health Care
    8%
  • Real Estate
    7%
  • Telecommunications
    6%
  • Consumer Staples
    5%
  • Basic Materials
    3%
  • Energy
    3%
  • Utilities
    2%

Sector allocation is broad, with technology and financial services leading, followed by industrials, healthcare, and consumer cyclicals. This sector spread is indicative of a growth-oriented strategy while maintaining a level of balance across cyclical and defensive sectors. The technology sector's prominence is reflective of its significant role in modern economies, though it may introduce higher volatility.

Regions Info

  • North America
    43%
  • Europe Developed
    20%
  • Japan
    7%
  • Asia Emerging
    6%
  • Asia Developed
    3%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is well-diversified with a strong emphasis on North America and developed European markets, supplemented by exposures to Japan, emerging Asia, and other regions. This global reach enhances the portfolio's growth potential while spreading risk across different economic and geopolitical environments. However, the concentration in developed markets may limit exposure to high-growth emerging markets.

Market capitalization Info

  • Mega-cap
    35%
  • Large-cap
    26%
  • Mid-cap
    17%
  • Small-cap
    5%
  • Micro-cap
    1%

The market capitalization breakdown shows a preference for mega and big-cap stocks, which tend to be more stable and less volatile than their smaller counterparts. This is consistent with the portfolio's balanced profile, aiming for growth while managing risk. However, the relatively lower allocation to small and micro-caps suggests a potential underutilization of high-growth opportunities in these segments.

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.

Considering the Efficient Frontier, this portfolio appears well-optimized for its current risk-return profile. It strikes a balance between growth potential and risk management, aligning with a balanced investor's objectives. However, continuous monitoring and rebalancing are essential to maintain this optimization, especially as market conditions and personal investment goals evolve.

Dividends Info

  • Vanguard Total Bond Market Index Fund ETF Shares 3.80%
  • Vanguard Total International Bond Index Fund ETF Shares 4.30%
  • iShares Core MSCI EAFE ETF 3.10%
  • Vanguard Real Estate Index Fund ETF Shares 3.90%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.20%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 2.70%
  • Weighted yield (per year) 2.54%

The dividend yield of the portfolio contributes to its overall return, offering a blend of income and growth. With a total yield of 2.54%, the portfolio provides a steady income stream, complementing capital appreciation. The higher yields from bonds and real estate ETFs balance the lower yield from the total stock market ETF, illustrating a strategic income approach within a growth-focused portfolio.

Ongoing product costs Info

  • Vanguard Total Bond Market Index Fund ETF Shares 0.03%
  • Vanguard Total International Bond Index Fund ETF Shares 0.07%
  • iShares Core MSCI EAFE ETF 0.07%
  • Vanguard Real Estate Index Fund ETF Shares 0.12%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.06%

The portfolio's total expense ratio (TER) of 0.06% is impressively low, maximizing the potential for net returns. Low costs are crucial for long-term investment success, as they compound positively over time. This efficient cost structure is a significant strength, allowing more of the investment's return to be retained by the investor.

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