A well-diversified global equity portfolio with a focus on balanced risk and broad sector exposure

Report created on Aug 25, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio is predominantly invested in global equities through three iShares ETFs, with a significant majority allocated to the iShares MSCI ACWI UCITS ETF. This ETF provides comprehensive coverage of both developed and emerging markets, ensuring a broad geographic spread. The inclusion of the iShares MSCI World Value Factor UCITS ETF and the iShares MSCI World Small Cap UCITS ETF introduces a focus on value stocks and smaller companies, respectively, which can offer potential for higher returns albeit with increased volatility. This composition underscores a strategy aimed at capturing global equity growth while attempting to balance risk through diversification across market capitalizations and value-oriented investments.

Growth Info

Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 11.07%, with a maximum drawdown of -26.49%. These figures suggest a resilient performance across various market cycles, with the portfolio demonstrating the ability to recover from downturns and capitalize on growth trends. The concentrated days of returns indicate that a significant portion of the portfolio's gains can be attributed to relatively few, highly positive market days. This underscores the importance of staying invested over the long term to capture these critical periods of strong performance.

Projection Info

The Monte Carlo simulation, based on 1,000 scenarios, projects a wide range of potential outcomes, with the median scenario suggesting a 240.3% increase in portfolio value. This analysis, while hypothetical, helps illustrate the range of possible future states based on historical data and volatility patterns. However, it's crucial to remember that these projections do not guarantee future performance and should be viewed as one of many tools in making informed investment decisions.

Asset classes Info

  • Stocks
    100%

With 100% of the portfolio allocated to stocks, there's a clear emphasis on capital growth over income generation. This asset class distribution is typical for investors with a balanced to moderately aggressive risk profile, aiming for higher long-term returns. While equities can offer significant growth potential, they also come with higher volatility compared to bonds or cash equivalents. Investors should ensure this level of risk aligns with their financial goals and investment horizon.

Sectors Info

  • Technology
    25%
  • Financials
    17%
  • Industrials
    12%
  • Consumer Discretionary
    10%
  • Health Care
    9%
  • Telecommunications
    8%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    4%
  • Real Estate
    3%
  • Utilities
    3%

The sector allocation shows a diversified exposure with a heavier weighting towards technology and financial services. This sector composition reflects a growth-oriented approach, given the high growth potential in technology and the cyclical nature of financial services, which can benefit from economic expansions. However, the concentration in these sectors also introduces sector-specific risks, including regulatory changes and economic cycles affecting these industries more profoundly.

Regions Info

  • North America
    62%
  • Europe Developed
    18%
  • Japan
    9%
  • Asia Emerging
    4%
  • Asia Developed
    4%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%

The geographic distribution, with a dominant 62% in North America and significant exposures to Europe and Japan, provides a well-rounded global exposure. This allocation benefits from the stability and growth potential in developed markets while still capturing some growth in emerging markets. However, the relatively low exposure to emerging markets might limit potential high-growth opportunities available in these regions, which could be an area for further diversification.

Market capitalization Info

  • Mega-cap
    39%
  • Large-cap
    34%
  • Mid-cap
    19%
  • Small-cap
    6%
  • Micro-cap
    1%

The market capitalization breakdown, with a focus on mega and big-cap stocks, suggests a preference for established, large companies likely to offer stability and steady growth. The inclusion of medium, small, and micro-cap stocks, although in smaller proportions, introduces the potential for higher growth but also higher volatility. This blend aims to strike a balance between risk and return, leveraging the growth potential of smaller companies while anchoring the portfolio with the stability of larger firms.

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-positioned for optimizing the risk-return trade-off based on its current composition. The focus on equities across a range of geographies and sectors, combined with a moderate approach to market capitalization, suggests a strategic balance aimed at maximizing returns for a given level of risk. However, continuously reviewing and adjusting the asset allocation in response to changing market conditions and personal financial goals can further enhance portfolio efficiency.

Ongoing product costs Info

  • iShares MSCI World Value Factor UCITS 0.30%
  • iShares MSCI ACWI UCITS ETF USD (Acc) GBP 0.20%
  • iShares MSCI World Small Cap UCITS ETF USD (Acc) 0.35%
  • Weighted costs total (per year) 0.24%

The portfolio's total expense ratio (TER) of 0.24% is relatively low, enhancing its attractiveness by minimizing the drag on returns due to costs. Keeping investment costs low is crucial for long-term growth, as even small differences in fees can significantly impact compound returns over time. This efficient cost structure is a positive aspect of the portfolio, supporting better net performance for the investor.

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