A growth-focused portfolio with a strong emphasis on global diversification and low costs

Report created on Jul 22, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio is structured around three main funds, focusing on total market, international exposure, and small-cap value, with weightings of 55%, 30%, and 15% respectively. This composition reflects a strategic balance between domestic and international equities, with a tilt towards growth through the inclusion of the small-cap fund. The portfolio's diversification is broad, covering a wide range of sectors and geographies, which is commendable for spreading risk across different investment landscapes. The heavy allocation towards stocks, at 99%, aligns with the growth profile, but it's important to recognize the limited cushion against market volatility provided by the minimal cash holding.

Growth Info

The portfolio has demonstrated a strong historical performance, with a Compound Annual Growth Rate (CAGR) of 12.75%. However, it's important to note the significant maximum drawdown of -35.69%, which indicates a notable level of risk during turbulent market periods. The days contributing most to returns are relatively few, highlighting the impact of short-term gains. This performance should be viewed with the understanding that past success is not a guaranteed indicator of future returns, especially considering the inherent volatility in equity markets.

Projection Info

Using Monte Carlo simulations, the portfolio's forward-looking projections show a wide range of potential outcomes, with the median scenario suggesting a substantial growth of 268.5% over the simulation period. While the majority of simulations resulted in positive returns, the presence of scenarios with negative outcomes underscores the importance of risk management and the unpredictability of markets. These projections are useful for setting expectations, but they rely on historical data and assumptions that may not accurately predict future market behavior.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio's almost exclusive investment in stocks, with a very small cash component, is typical for growth-oriented investors seeking higher returns. While this asset allocation enhances potential for growth, it also increases exposure to market fluctuations. Diversifying across different asset classes, such as bonds or real estate, could provide additional layers of protection against market downturns, without significantly compromising growth potential.

Sectors Info

  • Technology
    22%
  • Financials
    19%
  • Industrials
    11%
  • Consumer Discretionary
    10%
  • Health Care
    9%
  • Telecommunications
    7%
  • Consumer Staples
    6%
  • Real Estate
    4%
  • Energy
    4%
  • Basic Materials
    4%
  • Utilities
    3%

The sectoral allocation demonstrates a strong preference for technology and financial services, which are sectors often associated with high growth but also with higher volatility. The presence of industrials, consumer cyclical, and healthcare sectors adds a level of balance, but the concentration in high-growth areas might increase susceptibility to sector-specific downturns. A more even distribution across sectors could mitigate some of these risks.

Regions Info

  • North America
    72%
  • Europe Developed
    12%
  • Japan
    5%
  • Asia Emerging
    4%
  • Asia Developed
    3%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

The geographic allocation underscores a significant emphasis on North American assets, complemented by diversified international exposure. This global footprint is beneficial for capturing growth across different economies, though the heavy weighting towards North America could mean missed opportunities in emerging markets, which may offer higher growth potential. Increasing exposure to underrepresented regions could enhance returns and spread risk more evenly.

Market capitalization Info

  • Mega-cap
    36%
  • Large-cap
    26%
  • Mid-cap
    16%
  • Small-cap
    11%
  • Micro-cap
    9%

The market capitalization breakdown shows a balanced exposure across mega, big, medium, small, and micro-cap stocks. This diversification is advantageous as it combines the stability of larger companies with the growth potential of smaller firms. However, the allocation towards smaller caps, while beneficial for growth, introduces higher volatility, suggesting a need for continuous monitoring and possible rebalancing based on risk tolerance.

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, the portfolio appears to be positioned for a favorable risk-return trade-off given its current allocation. However, there's always room for improvement by fine-tuning the asset mix to inch closer to the frontier. This process involves adjusting the allocations to achieve the best possible balance between risk and return, tailored to the investor's risk tolerance. Regular reviews and adjustments are essential to maintain this optimization over time.

Dividends Info

  • Fidelity Small Cap Value Index Fund 1.70%
  • Fidelity Total Market Index Fund 1.00%
  • FIDELITY TOTAL INTERNATIONAL INDEX FUND INSTITUTIONAL PREMIUM CLASS 2.40%
  • Weighted yield (per year) 1.52%

The dividend yields from the funds add a layer of income to the portfolio's total return, with an overall yield of 1.52%. While dividends are not the primary focus for growth-oriented portfolios, they can provide a steady income stream and contribute to compounding returns over time. Considering the portfolio's growth focus, the current yield is appropriate, but investors should remain open to adjusting their dividend strategy as their financial goals evolve.

Ongoing product costs Info

  • Fidelity Small Cap Value Index Fund 0.05%
  • Fidelity Total Market Index Fund 0.02%
  • FIDELITY TOTAL INTERNATIONAL INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.06%
  • Weighted costs total (per year) 0.04%

The portfolio's total expense ratio (TER) of 0.04% is impressively low, which is crucial for maximizing long-term growth by minimizing the drag on returns caused by fees. Keeping costs low is a best practice in investment management, as high fees can significantly erode returns over time. This aspect of the portfolio is well-optimized, demonstrating a thoughtful approach to fund selection.

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