A low cost momentum tilted us focused index portfolio with strong growth characteristics and moderate diversification
Report created on Mar 16, 2026Risk profile
5/7
Diversification profile
3/5
Positions
-
FX Fidelity 500 Index Fund
FXAIX - US3159117502 70.00% -
FZ FIDELITY ZERO INTERNATIONAL INDEX FUND
FZILX - US31635T6091 20.00% -
FZ FIDELITY ZERO TOTAL MARKET INDEX FUND
FZROX - US31635T7081 10.00%
This portfolio is built almost entirely around one core index fund, with two supporting index funds that largely overlap it. The result is a very simple, 100% stock setup where one position drives most of the behavior, and the others add only modest diversification. This matters because structure determines how the portfolio reacts when markets surge or fall; a concentrated core can be efficient but also less flexible. Keeping a simple “core and satellite” approach is solid, but the overlapping funds here are highly similar. Streamlining to a smaller number of broad, complementary funds could keep things easy to manage while avoiding redundancy.
Growth
Historically, the portfolio has delivered a strong compound annual growth rate (CAGR) of about 13.9%. CAGR is the average yearly growth rate, as if returns were smoothed out over time. For example, a hypothetical $10,000 could have grown to roughly $36,000 over a decade at that pace, though actual paths would be bumpier. The maximum drawdown of about -34% shows that during sharp downturns, the portfolio can fall by a third or more, similar to broad stock benchmarks. This path is typical for growth-focused stock portfolios. Keeping expectations realistic and preparing emotionally and financially for such drops can help avoid panic selling during rough markets.
Projection
The Monte Carlo analysis uses historical return and volatility patterns to simulate many possible future paths, like running 1,000 different “what if” market scenarios. Here, most simulations showed positive outcomes, with median growth of roughly 4–5x over the horizon, but a small share showed significantly weaker results. This highlights that even strong historical data does not guarantee similar future performance; markets change, and simulations are only rough guides, not forecasts. For a growth‑oriented stock portfolio, these projections are broadly in line with expectations. Staying focused on time in the market, rather than trying to time every peak and trough, is generally more effective for capturing the upside these simulations suggest.
Asset classes
- Stocks 100%
All assets here are stocks, with no allocation to bonds, cash, or other asset classes. That makes the portfolio very growth‑oriented and sensitive to equity market cycles. While this can be appropriate for long horizons and strong risk tolerance, it also means there is no built‑in cushion during stock market sell‑offs. Benchmarks of balanced portfolios typically hold some mix of stocks and safer assets to smooth the ride. Sticking with 100% stocks can work well for those who can handle volatility, but layering in even a modest allocation to defensive assets elsewhere in your overall finances (like cash reserves or retirement accounts) can help manage total household risk without complicating this core portfolio.
Sectors
- Technology 30%
- Financials 15%
- Consumer Discretionary 10%
- Telecommunications 10%
- Industrials 10%
- Health Care 9%
- Consumer Staples 5%
- Energy 3%
- Basic Materials 3%
- Utilities 2%
- Real Estate 2%
Sector exposure is led by technology at about 30%, with meaningful weights in financials, consumer cyclicals, communication services, industrials, and healthcare. This mix is broadly similar to major large‑cap benchmarks, which is a positive sign for diversification. However, the technology and tech‑adjacent tilt means the portfolio may be more sensitive to interest rate changes, regulation, and innovation cycles. Historically, tech‑heavy allocations have outperformed in low‑rate, growth‑friendly environments but can be hit harder when risk sentiment turns. Keeping this sector mix is reasonable for growth, yet it helps to mentally prepare for sharper swings and to ensure other parts of your financial life are not also heavily tied to the same sectors.
Regions
- North America 81%
- Europe Developed 8%
- Japan 3%
- Asia Developed 3%
- Asia Emerging 2%
- Australasia 1%
- Africa/Middle East 1%
Geographically, about 81% is in North America, with smaller exposures to developed Europe and Asia and a modest slice in emerging markets. This tilt is typical for U.S.‑based investors and roughly in line with many global benchmarks, which is encouraging. The strong home tilt has worked well over the last decade as U.S. markets led, but it does mean returns are closely tied to one economic region. Maintaining some exposure abroad, as you already do, helps hedge against country‑specific risks like policy changes or slower domestic growth. Periodically checking whether the international share still matches your comfort level can help balance home bias and global diversification.
Market capitalization
- Mega-cap 47%
- Large-cap 34%
- Mid-cap 17%
- Small-cap 1%
Market capitalization exposure is dominated by mega and large companies, with only a small slice in mid and tiny exposure to small caps. This is very similar to broad market indices and supports stability and liquidity, since bigger companies tend to be more established and widely traded. The trade‑off is that potential small‑cap upside is only lightly tapped, which can matter in periods when smaller firms outperform larger ones. Keeping this large‑cap focus is entirely reasonable and aligns closely with global standards. If more return “spice” is ever desired, a modest tilt to smaller or more niche segments could be considered elsewhere, without changing the simple core structure here.
True holdings
-
0 NVIDIA CORP 6.59%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
-
1 APPLE INC 5.85%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
-
2 MICROSOFT CORP 5.24%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
-
3 AMAZON.COM INC 3.31%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
-
4 BROADCOM INC 2.77%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
-
5 ALPHABET INC CL A 2.69%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
-
6 ALPHABET INC CL C 2.16%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
-
7 META PLATFORMS INC CL A 2.03%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
-
8 TESLA INC 1.78%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
-
9 BERKSHIRE HATHAWAY INC CL B 1.40%
Part of fund(s):- FIDELITY ZERO INTERNATIONAL INDEX FUND
- FIDELITY ZERO TOTAL MARKET INDEX FUND
- Fidelity 500 Index Fund
- Top 10 total 33.81%
Looking through the top holdings, there is a heavy tilt toward large, fast-growing companies in technology and related areas. Names like NVIDIA, Apple, Microsoft, Amazon, and Meta dominate the underlying exposure, which is very similar to broad large‑cap growth indices. This concentration can supercharge returns when these winners outperform but also ties results closely to their fortunes. Because only the top 10 ETF holdings are included, the overlap is actually understated and diversification is broader than it appears, but leadership is still clearly top‑heavy. Keeping this tilt is reasonable if the goal is strong long‑term growth, while recognizing that periods of underperformance are likely if these leaders stumble or styles rotate.
Factors
Factor exposure analysis highlights a strong tilt toward momentum, with limited data on other factors like value, size, quality, yield, and low volatility. Factor exposure describes how much a portfolio leans into traits research links to returns, like owning recent winners (momentum) or cheaper stocks (value). A momentum tilt tends to do well when trends persist but can experience sharp reversals when leadership changes suddenly. Because coverage for other factors is low, the picture is incomplete, yet the dominance of recent winners from large growth areas is clear. Keeping this profile is fine for growth‑seekers, while understanding that performance may lag during value or defensive market phases and that patience is needed during style rotations.
Risk contribution
-
Fidelity 500 Index Fund
Weight: 70.00% 73.0% -
FIDELITY ZERO INTERNATIONAL INDEX FUND
Weight: 20.00% 16.4% -
FIDELITY ZERO TOTAL MARKET INDEX FUND
Weight: 10.00% 10.6%
Risk contribution measures how much each holding adds to total ups and downs, which can differ from simple weights. Here, the main index fund at 70% weight contributes about 73% of overall risk, while the smaller funds contribute roughly in line with their sizes. That means there is no hidden “small but wild” position; the risk profile is driven mainly by the big core holding, which is actually a healthy and transparent structure. Since all three funds are broadly diversified themselves, this concentration is more about index exposure than single‑stock risk. Keeping position sizes stable and rebalancing occasionally can help maintain this clear, intentional risk balance over time.
Redundant positions
-
High correlationFidelity 500 Index FundFIDELITY ZERO TOTAL MARKET INDEX FUND
The analysis shows that the main U.S. index fund and the total market fund are highly correlated, meaning they move very similarly most of the time. Correlation describes how investments move together; when it is high, owning both doesn’t add much diversification. This is why the portfolio is flagged as having overlapping assets that bring limited extra benefit. While this overlap isn’t harmful, it does reduce the impact of holding multiple funds. Simplifying by focusing on one broad core fund and using any extra slots only for clearly different exposures can keep things clean and easier to monitor, while still preserving the same overall market behavior.
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.
Risk versus return can be assessed using the Efficient Frontier, which maps the best possible risk‑return trade‑offs using the current set of assets. Here, all three funds are extremely similar, so reshuffling between them offers limited room to improve efficiency. The main gain would likely come from reducing redundancy by trimming highly overlapping holdings, as the optimization note suggests. Efficiency here means getting the most expected return for a given level of volatility, not necessarily maximizing diversification or income. With such a simple, low‑cost structure, this portfolio already sits close to a sensible point on the frontier for a stock‑only approach, especially if supported by other safer assets outside this account.
Dividends
- Fidelity 500 Index Fund 1.10%
- FIDELITY ZERO INTERNATIONAL INDEX FUND 2.60%
- FIDELITY ZERO TOTAL MARKET INDEX FUND 1.10%
- Weighted yield (per year) 1.40%
The overall dividend yield is about 1.4%, with international stocks yielding more than the U.S. holdings. Dividend yield is the annual cash payout as a percentage of investment value, like interest from a savings account but not guaranteed. For a growth‑oriented, stock‑heavy portfolio, a modest yield like this is normal and suggests most of the return is expected from price gains rather than income. This setup fits investors who are still building wealth rather than drawing cash flows. If income needs rise in the future, shifting part of the overall investment mix toward higher‑yielding assets elsewhere could help, while leaving this portfolio tilted toward long‑term capital appreciation.
Ongoing product costs
- Fidelity 500 Index Fund 0.02%
- Weighted costs total (per year) 0.01%
Costs are impressively low, with an overall expense ratio near 0.01–0.02%. The expense ratio is the annual fee taken by funds to manage investments, and even tiny differences compound over decades. Low costs are one of the strongest predictors of better net results, because less money leaks out in fees every year. This portfolio is firmly in best‑practice territory on that front, which is a real advantage versus many actively managed setups. Keeping this focus on ultra‑low‑fee, broad index funds is a smart way to tilt the odds in favor of better long‑term outcomes, especially when combined with patience and disciplined contributions over time.
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