A growth-focused portfolio with a strong emphasis on US and technology stocks

Report created on Jun 10, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is predominantly invested in stocks, with a significant allocation to the Vanguard Total Stock Market Index Fund ETF Shares (60%), highlighting a broad exposure to the US market. The Invesco S&P 500® Momentum ETF (20%) adds a strategic tilt towards US stocks demonstrating strong momentum, while the Vanguard Total International Stock Index Fund ETF Shares (20%) provides international diversification. The heavy emphasis on ETFs suggests a preference for passive investment strategies, aiming to replicate market returns at a low cost. This composition aligns with a growth-oriented investment profile, leveraging broad diversification across sectors and geographies, albeit with a strong bias towards the US.

Growth Info

Historically, this portfolio has shown a Compound Annual Growth Rate (CAGR) of 16.41%, with a maximum drawdown of -33.84%. These figures indicate a robust growth trajectory, albeit with significant volatility, as evidenced by the drawdown. The days contributing to 90% of returns being concentrated in just 29.0 days underscores the impact of short-term market movements on overall performance. Comparatively, this performance suggests a higher risk-return profile, typical of growth-oriented investments, where periods of high returns can be interspersed with sharp declines.

Projection Info

Using Monte Carlo simulation, a method that forecasts potential outcomes by varying random inputs within historical ranges, this portfolio's future performance was analyzed across 1,000 simulations. The projections show a wide range of outcomes, with a 5th percentile at a 116.0% gain and a median (50th percentile) at a 661.1% gain, indicating potential for significant growth. However, it's important to remember that such simulations are based on past data, which cannot perfectly predict future market conditions. The high percentage of simulations with positive returns (995 out of 1,000) underscores the portfolio's growth potential but also highlights the inherent uncertainties in market investments.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The asset allocation is heavily skewed towards stocks (99%), with a minimal cash holding (1%). This allocation underscores the portfolio's growth orientation but comes with higher market risk. The lack of investment in bonds or alternative asset classes limits diversification benefits that could potentially reduce volatility. For investors seeking growth, this allocation is appropriate, yet it might be worth considering a slight increase in non-equity assets for risk management purposes, especially during market downturns.

Sectors Info

  • Technology
    25%
  • Financials
    17%
  • Consumer Discretionary
    11%
  • Industrials
    10%
  • Telecommunications
    9%
  • Health Care
    9%
  • Consumer Staples
    7%
  • Energy
    4%
  • Utilities
    3%
  • Basic Materials
    3%
  • Real Estate
    3%

The sector allocation reflects a significant technology weighting (25%), followed by financial services (17%) and consumer cyclicals (11%). This tech-heavy focus is common in growth-oriented portfolios, given the sector's potential for high returns. However, it may also introduce higher volatility, particularly in response to market shifts or regulatory changes. The diversified exposure to other sectors like healthcare and industrials mitigates this risk to some extent, but the concentration in technology underscores the portfolio's aggressive growth stance.

Regions Info

  • North America
    81%
  • Europe Developed
    8%
  • Asia Emerging
    3%
  • Japan
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%

Geographically, the portfolio is heavily weighted towards North America (81%), with modest exposure to developed Europe (8%) and emerging Asia (3%). This distribution reflects a strong bias towards the US market, which may limit global diversification benefits and expose the portfolio to region-specific risks. While the US market has historically offered strong growth opportunities, expanding the allocation to emerging markets and other developed regions could enhance diversification and potentially tap into higher growth rates abroad.

Market capitalization Info

  • Mega-cap
    44%
  • Large-cap
    31%
  • Mid-cap
    17%
  • Small-cap
    5%
  • Micro-cap
    1%

With 44% in mega-cap stocks and 31% in big-cap stocks, the portfolio leans heavily towards larger, more established companies, which tend to be less volatile than smaller companies. However, this concentration may also limit potential for outsized gains that smaller, more agile companies can offer. The presence of medium (17%), small (5%), and micro (1%) cap stocks introduces some level of growth potential and diversification, balancing the stability of large caps with the higher growth prospects of smaller caps.

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.

When analyzed for risk vs. return optimization using the Efficient Frontier, this portfolio shows a strong alignment towards the higher end of the risk-return spectrum. This alignment indicates that the current asset allocation is geared towards maximizing returns for a given level of risk, which is consistent with a growth-oriented investment strategy. However, it's essential to periodically review this allocation, as shifts in market conditions or changes in the investor's risk tolerance could warrant adjustments to ensure the portfolio remains optimally positioned for the desired balance of risk and return.

Dividends Info

  • Invesco S&P 500® Momentum ETF 0.50%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 2.90%
  • Weighted yield (per year) 1.46%

The portfolio's dividend yield stands at 1.46%, with the highest yield from the Vanguard Total International Stock Index Fund ETF Shares (2.90%). While not the primary focus of a growth-oriented portfolio, dividends contribute to total returns and can provide a steady income stream, which can be particularly valuable during market downturns. Given the portfolio's growth focus, the moderate overall yield is appropriate, but investors might consider rebalancing if a higher income generation becomes a priority.

Ongoing product costs Info

  • Invesco S&P 500® Momentum ETF 0.13%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.05%

The portfolio benefits from low overall costs (Total TER of 0.05%), which is crucial for maximizing long-term returns. Lower costs mean more of the portfolio's gross returns are retained by the investor, a significant advantage in compounding wealth over time. The emphasis on low-cost ETFs is a strategic choice that aligns with best practices for long-term investment success. Maintaining this focus on cost efficiency, especially when considering new investments or rebalancing, will continue to support the portfolio's performance.

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