A tech-heavy portfolio with high US exposure and moderate risk for balanced growth

Report created on Dec 15, 2024

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

The portfolio is composed of two ETFs: Invesco EQQQ NASDAQ-100 UCITS ETF Acc, making up 60%, and Vanguard S&P 500 UCITS Acc at 40%. Both ETFs are focused on US equities, with a significant tilt towards technology stocks. This composition reflects a concentrated approach, focusing on growth through well-established tech and large-cap stocks. While this can lead to substantial gains, it also means the portfolio is sensitive to market fluctuations in these sectors. To reduce risk, consider diversifying by adding other asset classes like bonds or alternative investments to balance the equity exposure.

Growth Info

Historically, the portfolio has shown strong performance, with a compound annual growth rate (CAGR) of 18.47%. This impressive return is indicative of the robust growth of the tech and large-cap sectors over recent years. However, the max drawdown of -20.86% highlights potential volatility, especially during market downturns. Investors should be aware that past performance is not always indicative of future results, and periods of high returns can be followed by significant declines. To mitigate this, consider maintaining a diversified portfolio to cushion against potential losses.

Projection Info

Monte Carlo simulations, which use historical data to predict future outcomes, indicate a wide range of potential returns. The 50th percentile projection suggests an impressive 1,051.05% growth, while even the conservative 5th percentile shows a 300.45% increase. These projections highlight the portfolio's potential for high returns but also underscore the uncertainty inherent in market predictions. Investors should use these simulations as a guide rather than a guarantee, and remain adaptable to changing market conditions by regularly reviewing and adjusting their portfolios.

Asset classes Info

  • Stocks
    100%

The portfolio is entirely composed of stocks, with no allocation to other asset classes such as bonds or real estate. This singular focus on equities can drive significant growth, especially in a bull market, but also increases risk during downturns. A more balanced allocation across different asset classes can reduce volatility and provide a more stable return over time. Consider incorporating fixed-income securities or alternative investments to achieve a more diversified asset base, which can help manage risk and enhance long-term performance.

Sectors Info

  • Technology
    44%
  • Telecommunications
    13%
  • Consumer Discretionary
    12%
  • Health Care
    8%
  • Consumer Staples
    6%
  • Financials
    5%
  • Industrials
    5%
  • Utilities
    2%
  • Energy
    2%
  • Basic Materials
    2%
  • Real Estate
    1%

The portfolio is heavily weighted towards technology, comprising 43.84% of the total allocation. Other significant sectors include communication services, consumer cyclicals, and healthcare. This concentration in a few sectors, especially technology, can lead to higher volatility, as these industries can be more sensitive to economic changes. To reduce sector-specific risk, consider diversifying into sectors like utilities or energy, which tend to be less volatile and can provide stability during economic downturns.

Regions Info

  • North America
    98%
  • Europe Developed
    1%

Geographically, the portfolio is overwhelmingly concentrated in North America, with 98.30% of assets allocated there. This high exposure to the U.S. market can lead to outsized returns when the U.S. economy is strong but also increases vulnerability to regional economic downturns. To mitigate this risk, consider adding exposure to other regions such as Europe or emerging markets. This can help balance the portfolio and provide opportunities for growth in different economic environments, potentially enhancing overall returns.

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.

The portfolio's current allocation could potentially be optimized using the Efficient Frontier, which aims to achieve the best possible risk-return ratio. By adjusting the weightings of the existing assets, investors can find a more efficient balance that maximizes returns for a given level of risk. This process involves analyzing historical data and projections to identify the optimal mix of assets. Consider consulting with a financial advisor to explore optimization strategies and ensure the portfolio aligns with your risk tolerance and investment goals.

Ongoing product costs Info

  • Invesco EQQQ NASDAQ-100 UCITS ETF Acc 0.35%
  • Vanguard S&P 500 UCITS Acc 0.07%
  • Weighted costs total (per year) 0.24%

The portfolio's total expense ratio (TER) is 0.24%, with the Invesco EQQQ NASDAQ-100 ETF at 0.35% and the Vanguard S&P 500 ETF at 0.07%. While these costs are relatively low, reducing expenses can significantly impact long-term returns due to compounding. Consider exploring lower-cost alternatives or negotiating fees with your advisor to further improve cost efficiency. Additionally, keep an eye on any transaction fees or taxes that may apply when making adjustments to the portfolio, as these can also affect overall returns.

What next?

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.

Instrument logos provided by Elbstream.

Help us improve Insightfolio

Your feedback makes a difference! Share your thoughts in our quick survey. Take the survey