Growth-focused portfolio with heavy tech exposure and low diversification

Report created on Aug 2, 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 technology, with 50% in a broad market ETF and the remaining 50% split evenly between a tech sector ETF and an S&P 500 momentum ETF. This composition indicates a strong growth orientation but comes with low diversification, as evidenced by a diversification score of 2 out of 5. The focus on a single asset class (stocks) and significant sector concentration increases volatility and risk.

Growth Info

Historically, this portfolio has demonstrated a high Compound Annual Growth Rate (CAGR) of 20.80%, with a maximum drawdown of -33.01%. These figures suggest robust growth potential but also highlight the portfolio's vulnerability during market downturns. The days contributing most to returns are relatively few, indicating that performance is heavily reliant on strong market rallies.

Projection Info

Monte Carlo simulations project a wide range of outcomes, from a 298% to a 2,401.5% increase, with all simulations showing positive returns. This optimistic projection underscores the portfolio's growth potential but should be interpreted with caution, as past performance is not a reliable indicator of future results. These projections help visualize possible future scenarios but cannot account for unforeseen market changes.

Asset classes Info

  • Stocks
    100%

The portfolio's asset allocation is entirely in stocks, offering no cushion against stock market volatility. While this allocation can lead to higher returns, it also increases risk, especially in turbulent markets. Diversifying across different asset classes, like bonds or real estate, could provide more stability.

Sectors Info

  • Technology
    46%
  • Financials
    12%
  • Consumer Discretionary
    9%
  • Telecommunications
    8%
  • Industrials
    7%
  • Health Care
    6%
  • Consumer Staples
    5%
  • Energy
    2%
  • Utilities
    2%
  • Real Estate
    2%
  • Basic Materials
    1%

With 46% in technology, the sector allocation further emphasizes the portfolio's growth focus. However, such concentration increases susceptibility to sector-specific risks. Balancing this with investments in less volatile sectors could mitigate risk without significantly compromising growth potential.

Regions Info

  • North America
    100%

The geographic allocation is entirely focused on North America, missing out on potential growth in other regions. This lack of international exposure limits diversification benefits and increases dependency on the performance of the US market.

Market capitalization Info

  • Mega-cap
    47%
  • Large-cap
    30%
  • Mid-cap
    15%
  • Small-cap
    5%
  • Micro-cap
    2%

The emphasis on mega and big-cap stocks (77% combined) aligns with the portfolio's growth and momentum strategy, as these companies often have more stable returns. However, including more mid, small, or micro-cap stocks could enhance diversification and potential for higher returns, albeit with increased risk.

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.

Given the portfolio's current composition, optimizing for the Efficient Frontier could improve the risk-return ratio. This might involve adjusting the asset allocation to include a wider range of asset classes and sectors, reducing the over-concentration in technology and large-cap stocks.

Dividends Info

  • Invesco S&P 500® Momentum ETF 0.60%
  • Vanguard Information Technology Index Fund ETF Shares 0.50%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.20%
  • Weighted yield (per year) 0.88%

The overall dividend yield of 0.88% contributes to the portfolio's returns but is not the primary focus. Given the growth orientation, this yield level is reasonable, though investors seeking income might look for opportunities to increase it without sacrificing too much growth potential.

Ongoing product costs Info

  • Invesco S&P 500® Momentum ETF 0.13%
  • Vanguard Information Technology Index Fund ETF Shares 0.10%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Weighted costs total (per year) 0.07%

The portfolio benefits from relatively low costs, with a total expense ratio (TER) of 0.07%. This efficiency supports better long-term performance by minimizing the drag on returns. Keeping costs low is crucial in maximizing investment growth over time.

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