A growth-oriented portfolio with a strong tech focus and low geographic diversification

Report created on Apr 8, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

The portfolio is heavily weighted towards ETFs, with a significant allocation to the Invesco NASDAQ 100 ETF at 35% and the Vanguard Total Stock Market ETF at 30%. This composition suggests a strong focus on broad market exposure and tech growth, albeit with a limited number of individual stocks. Compared to a typical balanced portfolio, this structure leans heavily towards equities, which may increase potential returns but also elevates risk. Consideration for diversification across asset classes, such as bonds or commodities, could provide a buffer during market volatility and align more closely with a balanced risk profile.

Growth Info

Historically, the portfolio has performed well, boasting a Compound Annual Growth Rate (CAGR) of 12.59%. This growth rate is impressive, indicating strong past performance, particularly in tech-heavy markets. The max drawdown of -26.60% highlights the potential volatility, which is a significant risk factor. While past performance is not indicative of future results, understanding these metrics helps set expectations. To mitigate the impact of potential downturns, consider rebalancing to include more defensive assets or sectors that could provide stability during market corrections.

Projection Info

Monte Carlo simulations, which use historical data to project future outcomes, indicate a wide range of potential returns. The 5th percentile shows a 70.3% return, while the 67th percentile suggests a 1,045.3% return. With 987 out of 1,000 simulations yielding positive results, the outlook is optimistic. However, it's crucial to remember that these projections are based on past data and assumptions, which may not hold in the future. Regularly reviewing and adjusting your portfolio in response to market changes can help maintain alignment with your investment goals.

Asset classes Info

  • Stocks
    100%

The portfolio is 100% allocated to stocks, which limits diversification benefits typically achieved through a mix of asset classes. While equities can offer substantial growth, they also bring higher risk, especially during market downturns. A more diversified asset allocation, including bonds or alternative investments, could reduce volatility and provide more consistent returns over time. Balancing growth and stability is key to achieving long-term investment success, especially for those with moderate risk tolerance.

Sectors Info

  • Technology
    29%
  • Financials
    23%
  • Consumer Discretionary
    10%
  • Telecommunications
    9%
  • Health Care
    9%
  • Consumer Staples
    7%
  • Industrials
    6%
  • Energy
    4%
  • Basic Materials
    1%
  • Utilities
    1%
  • Real Estate
    1%

The sector allocation is heavily skewed towards technology at 29%, followed by financial services at 23%. This concentration may expose the portfolio to sector-specific risks, particularly if tech experiences a downturn. While tech has been a strong performer, diversification across more sectors could mitigate potential volatility. Consider increasing exposure to underrepresented sectors like healthcare or consumer defensive, which may offer more stability and less correlation with the tech sector's performance.

Regions Info

  • North America
    99%
  • Europe Developed
    1%

Geographically, the portfolio is overwhelmingly concentrated in North America, with 99% of assets. This lack of geographic diversification may leave the portfolio vulnerable to regional economic downturns. While the U.S. market has been strong, expanding exposure to international markets, particularly emerging markets, could enhance diversification and growth potential. A balanced geographic allocation can help mitigate risks associated with economic and political changes in a single region.

Market capitalization Info

  • Large-cap
    45%
  • Mega-cap
    36%
  • Mid-cap
    15%
  • Small-cap
    3%
  • Micro-cap
    1%

The portfolio is weighted towards large-cap and mega-cap stocks, which comprise 81% of the allocation. These companies typically offer stability and steady returns but may limit growth potential compared to smaller-cap stocks. Including more mid-cap or small-cap stocks could enhance growth prospects and provide a more balanced risk-return profile. Diversifying across market capitalizations helps capture opportunities across different stages of company growth and market cycles.

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 potentially be optimized using the Efficient Frontier, which seeks the best possible risk-return ratio. This involves adjusting the allocation of existing assets to achieve a more efficient portfolio. While this approach focuses on maximizing returns for a given level of risk, it doesn't necessarily address diversification across different asset classes or sectors. Regularly reviewing the portfolio's efficiency and making adjustments can help maintain alignment with investment goals and risk tolerance.

Dividends Info

  • Goldman Sachs Group Inc 2.50%
  • JPMorgan Chase & Co 1.70%
  • Morgan Stanley 3.60%
  • Invesco NASDAQ 100 ETF 0.70%
  • Schwab U.S. Dividend Equity ETF 4.20%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.50%
  • Weighted yield (per year) 1.92%

The portfolio has a total dividend yield of 1.92%, with the Schwab U.S. Dividend Equity ETF contributing significantly at 4.20%. Dividend income can provide a steady cash flow and cushion against market volatility. For investors seeking income, maintaining or increasing dividend-paying assets could be beneficial. However, it's essential to balance dividend yield with growth potential, as high-yield stocks may not always offer the best total return prospects.

Ongoing product costs Info

  • Invesco NASDAQ 100 ETF 0.15%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Weighted costs total (per year) 0.07%

The portfolio's total expense ratio (TER) is impressively low at 0.07%, which is beneficial for long-term performance. Low costs mean more of your investment returns are retained, compounding over time. This cost efficiency aligns well with best practices in portfolio management. Continually monitoring and managing costs can further enhance net returns. Consider reviewing any other fees or expenses that might impact the overall cost of managing the portfolio.

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