Growth-focused portfolio heavily invested in US stocks with a tech tilt
Report created on Jun 1, 2025Risk profile
5/7
Diversification profile
2/5
Positions
-
VT Vanguard Total Stock Market Index Fund ETF Shares
VTI - US9229087690 80.00% -
QQ Invesco NASDAQ 100 ETF
QQQM - US46138G6492 20.00%
This portfolio is heavily concentrated in two ETFs, with 80% in Vanguard Total Stock Market Index Fund ETF Shares and 20% in Invesco NASDAQ 100 ETF. This composition indicates a strong focus on the US stock market, particularly in the technology sector, given the NASDAQ's tech-heavy nature. While this strategy has historically offered significant growth potential, it also exposes the portfolio to sector-specific risks and limits diversification across asset classes and geographies.
Growth
Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 13.95%, with a maximum drawdown of -27.25%. These figures suggest that while the portfolio has experienced substantial growth, it has also faced significant volatility, as indicated by the drawdown. The days contributing to 90% of returns being limited to just 16.0 suggests that the portfolio's performance is highly concentrated in short periods, emphasizing the importance of staying invested through market cycles.
Projection
Monte Carlo simulations, which use historical data to project potential future outcomes, show a wide range of possible performances for this portfolio. With 988 out of 1,000 simulations yielding positive returns and a median projected increase of 498.5%, these projections suggest optimism for future growth. However, it's crucial to remember that these simulations cannot predict unforeseen market shifts and their potential impact.
Asset classes
- Stocks 100%
The portfolio is entirely allocated to stocks, with no diversification into other asset classes like bonds or real estate. This allocation aligns with the portfolio's growth-oriented risk profile but also increases its susceptibility to stock market volatility. Diversifying into other asset classes could provide a buffer during stock market downturns.
Sectors
- Technology 34%
- Financials 12%
- Consumer Discretionary 11%
- Health Care 10%
- Telecommunications 10%
- Industrials 8%
- Consumer Staples 6%
- Energy 3%
- Utilities 2%
- Real Estate 2%
- Basic Materials 2%
With 34% allocated to technology and significant investments in financial services, consumer cyclicals, and healthcare, the portfolio is positioned to benefit from growth in these sectors. However, the heavy emphasis on technology, while potentially lucrative, introduces sector-specific risk, particularly from market corrections or regulatory changes affecting the tech industry.
Regions
- North America 99%
- Europe Developed 1%
The geographic allocation is overwhelmingly in North America (99%), with minimal exposure to developed European markets (1%) and no presence in emerging or other developed Asian markets. This concentration enhances the portfolio's exposure to US economic conditions, while limiting potential gains from global diversification.
Market capitalization
- Mega-cap 44%
- Large-cap 31%
- Mid-cap 18%
- Small-cap 5%
- Micro-cap 2%
The portfolio's focus on mega (44%) and big (31%) cap stocks suggests a preference for established, large-scale companies, likely contributing to its strong historical performance. However, the relatively smaller allocation to medium, small, and micro-cap stocks limits opportunities for outsized gains from smaller, high-growth companies.
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 might not be fully optimized for the best risk-return ratio due to its heavy concentration in a single asset class and sector. Diversifying across more asset classes and sectors could potentially offer a better balance of risk and return, enhancing the portfolio's efficiency without significantly sacrificing growth potential.
Dividends
- Invesco NASDAQ 100 ETF 0.60%
- Vanguard Total Stock Market Index Fund ETF Shares 1.30%
- Weighted yield (per year) 1.16%
The portfolio's dividend yield stands at 1.16%, with the Vanguard ETF contributing a higher yield than the Invesco ETF. While dividends provide a steady income stream, the portfolio's primary focus appears to be on capital appreciation. Investors prioritizing income alongside growth might consider diversifying into assets with higher dividend yields.
Ongoing product costs
- Invesco NASDAQ 100 ETF 0.15%
- Vanguard Total Stock Market Index Fund ETF Shares 0.03%
- Weighted costs total (per year) 0.05%
The portfolio benefits from low overall costs, with a Total Expense Ratio (TER) of 0.05%. This efficiency is crucial for long-term growth, as lower costs directly translate to higher net returns. The focus on low-cost ETFs is a prudent strategy, particularly for a growth-oriented portfolio.
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