A balanced and broadly diversified portfolio with a strong tilt towards technology and dividends

Report created on May 8, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio showcases a strategic allocation across several ETFs, emphasizing global stocks with a significant tilt towards technology through the Invesco NASDAQ 100 ETF. The Vanguard Total World Stock Index Fund ETF Shares serve as the backbone, providing broad market exposure. The inclusion of the Schwab U.S. Dividend Equity ETF and SPDR® DoubleLine Total Return Tactical ETF introduces a focus on income through dividends and bonds, respectively, while the FT Cboe Vest Gold Target Income ETF adds a layer of commodity exposure. The blend of growth and income-oriented assets, alongside a modest allocation to gold, illustrates a balanced approach to risk and return.

Growth Info

The portfolio has achieved a Compound Annual Growth Rate (CAGR) of 9.04%, with a maximum drawdown of -24.15%. These figures highlight the portfolio's ability to generate growth over time, despite experiencing significant volatility. The performance is further underscored by the fact that a small number of days contributed to a large portion of returns, a common characteristic of equity investments. This historical performance, while indicative of past resilience and growth potential, should be viewed with the understanding that past results do not guarantee future performance.

Projection Info

Utilizing a Monte Carlo simulation, which projects future outcomes based on historical data, the portfolio shows a wide range of potential future returns. With the majority of simulations indicating positive returns and a median projected increase of 175.2%, the analysis suggests a favorable outlook. However, it's crucial to recognize the inherent limitations of relying solely on historical data for future projections, as it cannot account for unforeseen market shifts or global events.

Asset classes Info

  • Stocks
    82%
  • Bonds
    16%
  • Other
    2%
  • Cash
    1%

The portfolio's asset class distribution, with 82% in stocks, 16% in bonds, and a small allocation to other categories, aligns with a balanced investment strategy aimed at long-term growth with moderate risk. This composition supports diversification, balancing the higher volatility and growth potential of stocks with the stability of bonds. Adjusting the ratio between these asset classes can fine-tune the portfolio's risk profile and growth objectives.

Sectors Info

  • Technology
    23%
  • Financials
    9%
  • Consumer Discretionary
    9%
  • Health Care
    8%
  • Telecommunications
    8%
  • Industrials
    7%
  • Consumer Staples
    7%
  • Energy
    5%
  • Basic Materials
    2%
  • Utilities
    2%
  • Real Estate
    1%

The sectoral allocation demonstrates a significant emphasis on technology, reflecting a conviction in its growth prospects. However, this concentration increases exposure to sector-specific risks, such as regulatory changes or technological disruptions. The portfolio also maintains a diversified exposure across other sectors like financial services and consumer cyclicals, which can provide a hedge against tech-specific volatility. Balancing sector exposures can mitigate risks and capitalize on growth opportunities across the broader economy.

Regions Info

  • North America
    66%
  • Europe Developed
    7%
  • Asia Emerging
    3%
  • Japan
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Latin America
    1%
  • Africa/Middle East
    1%

Geographic allocation is heavily weighted towards North America, with limited exposure to developing regions and other developed markets. This concentration may limit the portfolio's potential to benefit from global economic growth and diversification. Expanding exposure to underrepresented regions could reduce geographic risk and tap into emerging market growth.

Market capitalization Info

  • Mega-cap
    32%
  • Large-cap
    30%
  • Mid-cap
    16%
  • Small-cap
    3%
  • Micro-cap
    1%

The market capitalization breakdown, with a focus on mega and big cap stocks, suggests a preference for established, large-scale companies known for their stability and potential for steady growth. While this can offer a degree of safety, especially in volatile markets, incorporating a broader mix of medium, small, and micro-cap stocks could enhance diversification and introduce higher growth potential, albeit with increased risk.

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 appears to balance risk and return effectively. However, there's always room for optimization to potentially achieve a better risk-return ratio. This could involve adjusting the asset allocation, diversifying further across sectors or geographies, or even rebalancing more frequently. These adjustments aim to fine-tune the portfolio's performance, aligning it more closely with the investor's risk tolerance and investment goals.

Dividends Info

  • FT Cboe Vest Gold Target Income ETF 17.50%
  • Invesco NASDAQ 100 ETF 0.60%
  • Schwab U.S. Dividend Equity ETF 4.10%
  • SPDR® DoubleLine Total Return Tactical ETF 5.30%
  • Vanguard Total World Stock Index Fund ETF Shares 1.90%
  • Weighted yield (per year) 3.45%

The portfolio's dividend yield is bolstered by specific ETFs, contributing to its total income. This focus on dividend-yielding investments can provide a steady income stream, which is particularly beneficial in volatile or declining markets. However, it's important to balance the pursuit of dividends with the overall growth potential of the portfolio, ensuring that income generation does not come at the expense of capital appreciation.

Ongoing product costs Info

  • FT Cboe Vest Gold Target Income ETF 0.85%
  • Invesco NASDAQ 100 ETF 0.15%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • SPDR® DoubleLine Total Return Tactical ETF 0.55%
  • Vanguard Total World Stock Index Fund ETF Shares 0.07%
  • Weighted costs total (per year) 0.19%

The portfolio's overall expense ratio is relatively low, which is commendable as lower costs can significantly enhance long-term returns. The variance in individual ETF fees, from the high-cost FT Cboe Vest Gold Target Income ETF to the low-cost Vanguard and Schwab ETFs, highlights the importance of cost awareness in portfolio construction. Continuously monitoring and optimizing for cost efficiency without compromising on strategic allocation is key to maximizing net returns.

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