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Balanced portfolio with a strong focus on US equities and moderate diversification

Report created on Oct 3, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

3/5
Moderately Diversified
Less diversification More diversification

Positions

This portfolio exhibits a concentration in US equities, with significant allocations to the Fidelity Contrafund K6 and Fidelity 500 Index Fund, together comprising 70% of the portfolio. This heavy weighting towards large-cap stocks, alongside investments in mid-cap, small-cap, and international equities, suggests a strategy aimed at capturing growth across different market segments. However, the portfolio's diversification is moderately limited by its predominant focus on stocks, with minimal exposure to bonds and almost no allocation to alternative asset classes or cash equivalents.

Growth Info

Historically, the portfolio has delivered a Compound Annual Growth Rate (CAGR) of 14.92%, with a maximum drawdown of -30.97%. These figures indicate a strong performance, albeit with significant volatility. The days contributing to 90% of returns being concentrated in just 30 days highlight the portfolio's susceptibility to short-term market movements. Comparing this performance against a balanced benchmark would provide further insights into its risk-adjusted returns, but the high CAGR suggests the portfolio has capitalized well on market upswings.

Projection Info

Monte Carlo simulations, using historical data to forecast future performance, suggest a wide range of potential outcomes, with the 50th percentile indicating a 343.4% return. While these projections offer a glimpse into possible future scenarios, it's crucial to remember that such simulations are based on past data and cannot account for unforeseen market changes. Therefore, while the portfolio shows promise, investors should consider these projections as one of many tools in making informed decisions.

Asset classes Info

  • Stocks
    90%
  • Bonds
    8%
  • Cash
    1%
  • Other
    1%

The asset allocation is heavily skewed towards stocks (90%), with a smaller portion in bonds (8%) and negligible allocations to cash and other assets. This composition aligns with the portfolio's balanced but growth-oriented strategy. However, the limited exposure to non-equity assets could increase volatility and risk, especially during market downturns. Broadening the asset class mix could enhance stability without significantly compromising growth potential.

Sectors Info

  • Technology
    23%
  • Financials
    17%
  • Telecommunications
    14%
  • Consumer Discretionary
    10%
  • Industrials
    9%
  • Health Care
    8%
  • Consumer Staples
    4%
  • Basic Materials
    2%
  • Utilities
    2%
  • Energy
    2%
  • Real Estate
    2%

Sector allocations reveal a strong emphasis on technology, financial services, and communication services, which are sectors known for their high growth potential. However, this concentration also exposes the portfolio to sector-specific risks, such as regulatory changes or economic cycles affecting these industries disproportionately. Diversifying across a broader range of sectors could mitigate these risks while still capturing growth opportunities in other areas.

Regions Info

  • North America
    83%
  • No data
    8%
  • Europe Developed
    5%
  • Japan
    2%
  • Asia Developed
    1%

The geographic allocation is predominantly North American (83%), with minimal exposure to developed markets in Europe and Asia, and no direct investment in emerging markets. This concentration in the US market may limit global diversification benefits and expose the portfolio to region-specific economic and political risks. Increasing exposure to international and emerging markets could offer additional growth opportunities and risk mitigation through geographical diversification.

Market capitalization Info

  • Mega-cap
    45%
  • Large-cap
    22%
  • Mid-cap
    16%
  • Small-cap
    5%
  • Micro-cap
    2%

With a focus on mega (45%) and big-cap (22%) stocks, the portfolio is positioned to benefit from the stability and potential growth of large, established companies. However, the allocation to medium, small, and micro-cap stocks, though modest, introduces a layer of growth potential and volatility. Balancing market cap exposure can optimize the trade-off between risk and return, especially in different market cycles.

Redundant positions Info

  • Fidelity Contrafund K6
    Fidelity 500 Index Fund
    High correlation
  • FIDELITY EXTENDED MARKET INDEX FUND INSTITUTIONAL PREMIUM CLASS
    AMG GW&K SMALL CAP CORE FUND CLASS I
    High correlation

The high correlation between certain funds, notably the Fidelity Contrafund K6 and Fidelity 500 Index Fund, suggests redundancy in the portfolio, limiting diversification benefits. Similarly, the overlap between the FIDELITY EXTENDED MARKET INDEX FUND and the AMG GW&K SMALL CAP CORE FUND indicates a potential area for consolidation. Reducing overlap by reallocating from highly correlated assets could enhance portfolio diversification and efficiency.

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.

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Considering the portfolio's current composition, optimization efforts should focus on addressing the identified high correlations between certain assets. By reallocating funds from overlapping investments to underrepresented asset classes or sectors, the portfolio could achieve a more efficient risk-return profile. Utilizing the Efficient Frontier concept could guide these adjustments, aiming for an allocation that maximizes returns for a given level of risk.

Dividends Info

  • DFA Inflation Protected Securities Prtfl 0.90%
  • Fidelity Contrafund K6 0.40%
  • FIDELITY EXTENDED MARKET INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.40%
  • FIDELITY INTERNATIONAL INDEX FUND INSTITUTIONAL PREMIUM CLASS 2.30%
  • Fidelity 500 Index Fund 1.10%
  • AMG GW&K SMALL CAP CORE FUND CLASS I 4.00%
  • MIDCAP FUND (F/K/A MIDCAP BLEND FUND) INSTITUTIONAL CLASS 3.10%
  • Weighted yield (per year) 1.01%

The portfolio's dividend yield stands at 1.01%, with the highest yields from the AMG GW&K SMALL CAP CORE FUND and the MIDCAP FUND. While dividends contribute to the total return, the portfolio's focus seems more on growth than income generation. For investors seeking a balance between growth and income, adjusting allocations to increase exposure to higher-yielding assets could provide a more consistent income stream alongside capital appreciation.

Ongoing product costs Info

  • DFA Inflation Protected Securities Prtfl 0.11%
  • Fidelity Contrafund K6 0.45%
  • FIDELITY EXTENDED MARKET INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.04%
  • FIDELITY INTERNATIONAL INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.04%
  • Fidelity 500 Index Fund 0.02%
  • AMG GW&K SMALL CAP CORE FUND CLASS I 0.95%
  • MIDCAP FUND (F/K/A MIDCAP BLEND FUND) INSTITUTIONAL CLASS 0.67%
  • Weighted costs total (per year) 0.26%

The Total Expense Ratio (TER) of 0.26% reflects a cost-efficient structure, particularly given the inclusion of low-cost index funds. However, the higher costs associated with the AMG GW&K SMALL CAP CORE FUND and the MIDCAP FUND highlight opportunities to review and possibly reallocate to more cost-effective options without compromising strategic objectives. Maintaining low investment costs is crucial for enhancing long-term returns.

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