Two fund global equity portfolio with strong diversification and low costs across regions and sectors
Report created on May 3, 2026Risk profile
4/7
Diversification profile
3/5
Positions
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MX Invesco MSCI World UCITS ETF
MXWO - IE00B60SX394 88.00% -
EI iShares Core MSCI Emerging Markets IMI UCITS
EIMI - IE00BKM4GZ66 12.00%
This portfolio is a simple two‑fund mix holding 88% in a global developed markets ETF and 12% in an emerging markets ETF. Everything is in stocks, with no bonds or cash in the strategic allocation. That means the portfolio’s ups and downs are fully driven by global equity markets rather than a blend of different asset types. The structure is straightforward and easy to understand, which is a strength from an operational perspective. With just two broad ETFs, the portfolio still reaches thousands of companies worldwide. This kind of “core plus” setup often behaves very similarly to the global stock market while leaving room for slightly different regional or style tilts.
Growth
From May 2016 to April 2026, €1,000 in this portfolio grew to €3,273, a compound annual growth rate (CAGR) of 12.61%. CAGR is like your average speed on a long road trip, smoothing out all the bumps along the way. The maximum drawdown was about -33.7% during early 2020, meaning the portfolio temporarily lost a third of its value from peak to trough before recovering in five months. Compared with benchmarks, it lagged the US market but slightly beat the global market. That pattern is common for diversified portfolios: less concentrated in the strongest region than a pure US index, but well aligned with broader global performance.
Projection
The Monte Carlo projection uses thousands of simulated paths based on historical behavior to show a range of possible 15‑year outcomes. Think of it as rolling the dice 1,000 times on future return patterns while respecting past volatility and correlations. The median outcome turns €1,000 into about €2,765, with a central band from roughly €1,778 to €4,249. There are also more extreme but less likely paths, from about breaking even to very strong growth. These simulations are not predictions; they simply illustrate what could happen if markets behave in ways similar to the past, including both good and bad stretches.
Asset classes
- Stocks 100%
All of this portfolio is invested in equities, with 100% in stock ETFs and no allocation to bonds, cash, or alternatives. Asset classes are broad categories like stocks and bonds that tend to behave differently across market cycles. A 100% equity allocation usually means higher potential long‑term returns but also larger short‑term swings, especially during market stress. Compared with a multi‑asset mix that includes bonds, this structure leans more heavily into growth and less into income or capital preservation. The “balanced” label here comes more from the global diversification within stocks than from a mix of different asset types.
Sectors
- Technology 28%
- Financials 16%
- Industrials 11%
- Consumer Discretionary 9%
- Health Care 9%
- Telecommunications 8%
- Consumer Staples 5%
- Energy 5%
- Basic Materials 4%
- Utilities 3%
- Real Estate 2%
Sector exposure is well spread, with technology at 28%, financials at 16%, and several other sectors between 3% and 11%. This distribution is similar to many global equity benchmarks, where tech is a leading sector but not the entire story. Sector diversification matters because different parts of the economy react differently to changes in rates, inflation, and growth. A tech‑heavy allocation can experience bigger swings when interest rates move or when innovation stocks fall out of favor. Here, the sizeable weights in financials, industrials, health care, and consumer‑focused areas help balance that tech exposure, supporting a more rounded overall risk profile.
Regions
- North America 66%
- Europe Developed 15%
- Asia Developed 6%
- Japan 5%
- Asia Emerging 5%
- Australasia 2%
- Africa/Middle East 1%
- Latin America 1%
Geographically, the portfolio has a clear tilt toward North America at 66%, with developed Europe at 15% and the rest spread across developed and emerging regions. This is broadly in line with global stock market weights, where North America is the largest block. Geographic diversification helps because economies and currencies can go through different cycles. The emerging markets slice, while relatively small, introduces exposure to faster‑growing but more volatile regions. Overall, this distribution avoids extreme home bias and is well‑aligned with global standards, which is helpful if the goal is to mirror the world market rather than bet heavily on a single region.
Market capitalization
- Mega-cap 48%
- Large-cap 35%
- Mid-cap 17%
- Small-cap 1%
The portfolio leans strongly toward larger companies, with 48% in mega‑caps, 35% in large‑caps, and only small slices in mid and small caps. Market capitalization (market cap) reflects a company’s size, and bigger firms often have more stable business models and easier access to financing. A large‑cap‑heavy portfolio tends to move more like mainstream indices and may be somewhat less volatile than a portfolio packed with smaller, more speculative companies. The modest exposure to mid and small caps still adds some extra growth and diversification potential, but the main behavior here will track the fortunes of global blue‑chip companies.
True holdings
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AA Apple Inc 6.59%
Part of fund(s):- Invesco MSCI World UCITS ETF
-
MS Microsoft Corporation 4.64%
Part of fund(s):- Invesco MSCI World UCITS ETF
-
AM Amazon.com Inc 4.60%
Part of fund(s):- Invesco MSCI World UCITS ETF
-
NV NVIDIA Corporation 3.87%
Part of fund(s):- Invesco MSCI World UCITS ETF
-
GO Alphabet Inc Class C 2.83%
Part of fund(s):- Invesco MSCI World UCITS ETF
-
BR Berkshire Hathaway Inc 2.48%
Part of fund(s):- Invesco MSCI World UCITS ETF
-
TS Tesla Inc 2.37%
Part of fund(s):- Invesco MSCI World UCITS ETF
- LS 1x Tesla Tracker ETP Securities GBP
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EN Siemens Energy AG 1.99%
Part of fund(s):- Invesco MSCI World UCITS ETF
-
SI Siemens Aktiengesellschaft 1.88%
Part of fund(s):- Invesco MSCI World UCITS ETF
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ME MercadoLibre Inc. 1.50%
Part of fund(s):- Invesco MSCI World UCITS ETF
- Top 10 total 32.74%
Looking through the ETFs’ top holdings, familiar global names like Apple, Microsoft, Amazon, NVIDIA, and Alphabet appear prominently, together making up a noticeable portion of the portfolio. Because these companies show up via the underlying indices, there is some concentration in the biggest global firms, but this is typical for market‑cap‑weighted funds. The coverage here is based only on each ETF’s top 10 positions, so true overlap is likely higher than reported. Even so, the broad index structure means that, beyond these giants, a long tail of smaller holdings contributes meaningfully, reducing the risk that any single company fully dominates outcomes.
Factors
Factor exposures are estimated using statistical models based on historical data and measure systematic (market-relative) tilts, not absolute portfolio characteristics. Results may vary depending on the analysis period, data availability, and currency of the underlying assets.
Factor exposure shows a very low tilt to size and yield, with neutral readings on value, momentum, and quality and a high tilt toward low volatility. Factors are characteristics like “value” or “momentum” that help explain why some groups of stocks behave differently from others. A very low size exposure means the portfolio behaves more like a large‑cap index than a small‑cap‑tilted strategy. The very low yield reading suggests it doesn’t especially favor high‑dividend stocks. The high low‑volatility tilt indicates a slight preference for steadier companies, which historically have had smaller price swings, even though that does not eliminate the risk of significant drawdowns.
Risk contribution
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Invesco MSCI World UCITS ETF
Weight: 88.00% 88.0% -
iShares Core MSCI Emerging Markets IMI UCITS
Weight: 12.00% 12.0%
Risk contribution analysis shows each ETF’s share of overall volatility closely matches its weight: the developed markets ETF at 88% contributes about 88% of risk, and the emerging markets ETF at 12% contributes about 12%. Risk contribution measures how much each holding drives the portfolio’s ups and downs, which can differ from its simple weight when assets have very different volatility. Here, the 1.00 risk/weight ratios mean the two positions have broadly similar risk per euro invested. That’s consistent with both being diversified equity funds, so there is no hidden “hot spot” where a small holding disproportionately drives overall 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.
On the efficient frontier chart, this portfolio sits essentially on the curve, with a Sharpe ratio of 0.58 versus 0.78 for the maximum‑Sharpe and 0.77 for the minimum‑variance mix using the same holdings. The Sharpe ratio is a simple measure of risk‑adjusted return: how much extra return you get per unit of volatility above a risk‑free rate. Being on or near the frontier means that, for its current level of risk, the portfolio is already using its two funds in an efficient way. Reweighting could slightly change the balance of risk and return, but the current configuration is already quite efficient.
Ongoing product costs
- iShares Core MSCI Emerging Markets IMI UCITS 0.18%
- Invesco MSCI World UCITS ETF 0.19%
- Weighted costs total (per year) 0.19%
The total ongoing fund charges are around 0.19% per year, which is very low for a globally diversified equity portfolio. These costs, often called TER (Total Expense Ratio), are like a small annual service fee taken directly from fund assets. Low costs matter because they compound over time; every euro not spent on fees can stay invested and grow. Compared with many active funds or older index products, this fee level is impressively lean. Combined with the broad exposure and simple structure, the cost profile provides a solid foundation for long‑term compounding without a large performance drag from management expenses.
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