Balanced and highly diversified portfolio with a global equity focus and strategic bond allocation

Report created on Aug 1, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

Your portfolio showcases a well-considered blend of equity and bond ETFs, leaning heavily towards stocks with an 81% allocation, complemented by an 18% investment in bonds. This composition suggests a balanced approach, aiming to capture growth through equities while using bonds to mitigate volatility. The significant weight in the Vanguard Total Stock Market Index Fund ETF indicates a strong preference for broad market exposure, particularly to the U.S. stock market, which is balanced by international exposure through the Vanguard FTSE Developed Markets and Emerging Markets Index Fund ETFs.

Growth Info

Historically, your portfolio has achieved a Compound Annual Growth Rate (CAGR) of 9.86%, with a maximum drawdown of -30.51%. This performance underscores the portfolio's resilience and potential for solid returns over time. However, the concentration on specific days for the majority of returns highlights the impact of market volatility. Comparing this to benchmark indices can provide further insight into the portfolio's relative performance, emphasizing the importance of understanding market cycles and timing in investment decisions.

Projection Info

Monte Carlo simulations, which use historical data to forecast a range of possible future outcomes, suggest a median annualized return of 8.52% for your portfolio. While these projections provide valuable insights, it's crucial to remember that they are based on past trends and cannot guarantee future performance. The wide range of outcomes, from the 5th percentile at 3.4% to the 67th percentile at 251.5%, reflects the inherent uncertainty in predicting market movements and underscores the importance of maintaining a diversified and balanced portfolio.

Asset classes Info

  • Stocks
    81%
  • Bonds
    18%
  • Cash
    1%

Your strategic allocation across asset classes, with a predominant focus on stocks, aligns with a balanced risk profile aiming for growth while managing volatility through bonds. This diversification is crucial in spreading risk and potential reward across different market conditions. However, considering the small allocations to TIPS and dividend-focused ETFs, there may be room to enhance income generation or inflation protection within the bond allocation.

Sectors Info

  • Technology
    20%
  • Financials
    15%
  • Industrials
    9%
  • Consumer Discretionary
    9%
  • Health Care
    7%
  • Telecommunications
    6%
  • Consumer Staples
    5%
  • Basic Materials
    3%
  • Energy
    3%
  • Utilities
    2%
  • Real Estate
    2%

The sectoral distribution within your portfolio, led by technology and financial services, is reflective of the broader market trends and offers growth potential. However, this concentration also exposes you to sector-specific risks, such as regulatory changes or economic downturns affecting these industries more severely. Diversifying across more sectors or reducing concentration in any one sector could help mitigate these risks.

Regions Info

  • North America
    49%
  • Europe Developed
    10%
  • Asia Emerging
    10%
  • Asia Developed
    5%
  • Japan
    4%
  • Africa/Middle East
    2%
  • Australasia
    1%
  • Latin America
    1%

With nearly half of your portfolio allocated to North America and significant investments in developed and emerging markets, your geographic distribution supports diversification and exposure to global growth opportunities. Yet, the relatively low allocation to regions like Latin America and Africa/Middle East suggests potential areas for increased exposure to enhance diversification and tap into emerging market growth.

Market capitalization Info

  • Mega-cap
    35%
  • Large-cap
    25%
  • Mid-cap
    15%
  • Small-cap
    4%
  • Micro-cap
    1%

The emphasis on mega and big-cap stocks is indicative of a preference for stability and established companies, which often offer lower volatility but also potentially lower growth rates compared to smaller companies. Considering a slight increase in medium, small, or micro-cap stocks could introduce higher growth potential, albeit with increased risk.

Redundant positions Info

  • Vanguard Dividend Appreciation Index Fund ETF Shares
    Vanguard Total Stock Market Index Fund ETF Shares
    High correlation

The high correlation between the Vanguard Dividend Appreciation Index Fund ETF Shares and the Vanguard Total Stock Market Index Fund ETF Shares indicates overlapping investments that may not contribute to diversification. Identifying and reducing such overlaps can enhance the portfolio's efficiency by ensuring each asset contributes to diversification and potential return.

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.

Optimizing your portfolio along the Efficient Frontier could further enhance the risk-return profile. This involves adjusting the asset allocation to achieve the best possible balance between risk and return, based on historical performance. Given the current asset mix, focusing on reducing overlap and possibly increasing allocations to underrepresented sectors or geographies could move the portfolio closer to this optimal curve.

Dividends Info

  • iShares iBoxx $ Investment Grade Corporate Bond ETF 4.40%
  • Schwab U.S. TIPS ETF 3.00%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 2.70%
  • Vanguard Dividend Appreciation Index Fund ETF Shares 1.70%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.20%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 2.80%
  • Weighted yield (per year) 2.31%

The overall dividend yield of your portfolio stands at 2.31%, contributing to total returns and offering a steady income stream. Given the diverse range of yields across the ETFs, there's an opportunity to optimize for income by reassessing the balance between growth-focused equity ETFs and higher-yielding bond ETFs, depending on your income needs and risk tolerance.

Ongoing product costs Info

  • iShares iBoxx $ Investment Grade Corporate Bond ETF 0.14%
  • Schwab U.S. TIPS ETF 0.03%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
  • Vanguard Dividend Appreciation Index Fund ETF Shares 0.06%
  • 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%

With a Total Expense Ratio (TER) averaging 0.06%, your portfolio benefits from relatively low costs, which is commendable. Lower costs directly translate to higher net returns over time, showcasing the efficiency of your investment choices. Maintaining this focus on cost-effective investments will continue to serve your portfolio well.

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