Highly aggressive portfolio tilted to quantum technology with strong growth focus and limited diversification

Report created on Nov 13, 2024

Risk profile Info

6/7
Aggressive
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

This portfolio is extremely stock-heavy and very concentrated in a specific theme: quantum and high-growth names. Roughly 60% sits in broad and style ETFs, while about 40% is in individual, niche stocks. Compared with a typical aggressive benchmark, which still spreads across many industries and styles, this setup is much more focused and less diversified. That focus can turbocharge gains if the theme wins, but it also makes the ride much bumpier. One helpful move could be to treat the broad ETFs as the “core” and keep the niche single stocks as a smaller “satellite,” so that no narrow theme or small group of names can dominate the portfolio’s overall fate.

Growth Info

Historic results here look spectacular on paper: a 36.3% CAGR (Compound Annual Growth Rate) would turn $10,000 into around $48,000 over five years, assuming that rate was consistent. CAGR is like measuring the average speed on a long road trip, smoothing out the ups and downs. But the max drawdown of about -39% shows that big crashes have already happened. Also, most gains came in just 16 trading days, meaning timing mattered a lot. Past returns, especially over short or unusual periods, don’t guarantee anything similar ahead, so it helps to focus more on whether the risk profile still feels comfortable going forward.

Projection Info

The Monte Carlo analysis simulates many possible futures by remixing historical patterns, kind of like shuffling and replaying the past 1,000 times. Here, results are extremely wide: the 5th percentile shows almost total loss, and even the median outcome is very negative, with only about one-third of simulations ending positive. The average simulated return looks high, but that’s heavily driven by a few huge wins, not typical paths. This underlines how “boom or bust” the portfolio is. Simulations are only rough scenarios based on the past; they can’t predict new shocks or structural changes. Still, they suggest dialing in how much downside you’re truly okay with.

Asset classes Info

  • Stocks
    100%

The entire portfolio is in stocks, with 0% in bonds, cash, or alternatives. That’s fully in line with an aggressive growth stance but much riskier than a typical benchmark, which usually includes some stabilizing assets. When everything is in one asset class, drawdowns during market stress can be deep and emotionally hard to sit through. Equities are historically strong long-term builders of wealth, but they demand patience and a strong stomach. If day-to-day volatility ever feels overwhelming, even a small buffer in safer assets or a cash reserve for opportunities can help smooth the ride and reduce the temptation to sell during big market drops.

Sectors Info

  • Technology
    49%
  • Industrials
    14%
  • Financials
    8%
  • Consumer Discretionary
    8%
  • Health Care
    7%
  • Telecommunications
    6%
  • Energy
    3%
  • Consumer Staples
    2%
  • Basic Materials
    1%
  • Utilities
    1%
  • Real Estate
    1%

Sector exposure is heavily tilted: about half the portfolio sits in technology, with meaningful chunks in industrials and financial-related areas, and relatively small weights in defensive sectors like consumer staples, utilities, and healthcare. This kind of tech-heavy, innovation-focused mix can shine when growth stories are in favor and interest rates are supportive, but can fall sharply when markets rotate toward safety or profitability. This is much more concentrated than a broad benchmark, which spreads sector risk more evenly. Keeping a deliberate cap on any theme-heavy sector and slowly building exposure to more defensive, cash-generating businesses could help balance out the boom-and-bust nature of the current tilt.

Regions Info

  • North America
    98%
  • Europe Developed
    1%

Geographically, the portfolio is almost entirely tied to North America, at roughly 98%, with only a token slice elsewhere. This lines up with a strong home bias for a US investor and has actually worked well over the last decade, as US markets have outperformed many regions. But it also ties most of the risk to one economy, one currency, and one policy environment. If the US underperforms for a stretch or faces region-specific shocks, there’s little offset from other markets. Gradually introducing some exposure to non-US companies, whether developed or emerging, could add another layer of diversification without changing the overall growth-focused character.

Market capitalization Info

  • Mid-cap
    33%
  • Mega-cap
    25%
  • Large-cap
    23%
  • Micro-cap
    10%
  • Small-cap
    8%

Market cap exposure is nicely spread across mega, big, medium, small, and even micro caps, which is a positive. About a third in mid caps and meaningful allocations to small and micro caps give strong upside potential and factor diversification beyond just giants. That said, smaller and micro-cap names can be extremely volatile, less liquid, and more sensitive to economic swings. Their prices can jump or drop on relatively little news. Benchmarks usually lean more toward mega and large caps, so this portfolio is clearly skewed to higher-risk, higher-reward territory. Setting rough guardrails on how much total weight sits in small and micro caps can help manage that extra volatility.

Redundant positions Info

  • Schwab U.S. Large-Cap Growth ETF
    Vanguard S&P 500 ETF
    High correlation

The broad US ETFs in the portfolio are highly correlated, meaning they tend to move together, especially in big market moves. Correlation is just a measure of how similarly two investments behave; when it’s high, they don’t add much diversification. Holding multiple funds that own many of the same large US companies can create overlap, giving the illusion of diversification without really spreading risk. This allocation is still solid as a US equity core, but slimming down redundant holdings and instead adding things that truly behave differently in stress periods can make the overall risk profile more robust without sacrificing long-term growth potential.

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.

On a risk-return chart called the Efficient Frontier, this portfolio likely sits on the far high-risk side, with potentially more volatility than needed for the expected return. Efficient Frontier just means the set of portfolios that give the best possible trade-off between risk and return using the current ingredients. Optimization here would focus on adjusting weights among what’s already held, trimming overlapping highly correlated positions, and dialing back extreme concentration in any one theme. “Efficient” doesn’t mean safest or most diversified overall; it just means squeezing the most return per unit of volatility. Periodically checking whether minor rebalancing could move the portfolio closer to that efficient line may improve the long-term risk-reward profile.

Dividends Info

  • Avantis® U.S. Small Cap Value ETF 1.60%
  • Fortress Transp & Infra Inv 0.70%
  • Defiance Quantum ETF 0.70%
  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • Vanguard S&P 500 ETF 1.10%
  • Weighted yield (per year) 0.69%

Dividend yield is low at around 0.69%, which fits an aggressive, growth-oriented profile. Growth companies often reinvest profits rather than pay them out, aiming to compound value over time. That can be great if those reinvestments pay off, but it means most of the return needs to come from price appreciation, not income. For someone who doesn’t need current cash flow, a low-yield growth mix is totally reasonable. If future goals include spending from the portfolio or reducing sequence-of-returns risk in retirement, gradually adding a sleeve of steadier, dividend-paying or cashflow-generating holdings could provide a more predictable income stream down the road.

Ongoing product costs Info

  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Defiance Quantum ETF 0.40%
  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.07%

The overall cost profile is impressively low, with a total TER (Total Expense Ratio) near 0.07%. TER is like an annual “membership fee” a fund charges, and keeping it small leaves more of the return in your pocket. The broad market ETFs are especially cheap and align well with best practices for core holdings. The more specialized quantum and small-cap value funds cost more, which is normal for niche strategies but still worth monitoring. Over many years, even a 0.3–0.5% difference can compound into a noticeable gap. Continuing to favor low-cost, broad vehicles for the core and being selective about higher-fee strategies supports stronger long-term outcomes.

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