A balanced portfolio with a strong focus on large-cap equities and international diversification

Report created on Jul 28, 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 is predominantly invested in equities, with a significant 60% allocation to U.S. large-cap stocks and 25% in international large-cap equities. The inclusion of a 10% allocation to bonds and smaller exposures to emerging markets and international small-cap equities enhances its diversification. This structure suggests a strategy aimed at capturing growth through large companies while mitigating risk with bonds and diversifying globally.

Growth Info

Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 10.75%, with a maximum drawdown of -34.99%. This performance indicates a resilient portfolio capable of strong returns, though it has experienced significant volatility. The days contributing to 90% of the returns highlight the impact of high-return days on overall performance, underscoring the importance of staying invested through market cycles for long-term growth.

Projection Info

Monte Carlo simulations, which project future performance based on historical data, suggest a wide range of outcomes for this portfolio. With the median simulation predicting a 141.9% return, and 92% of simulations yielding positive returns, the forward-looking scenario is generally optimistic. However, the reliance on past data means these projections cannot guarantee future results, especially in changing market conditions.

Asset classes Info

  • Stocks
    90%
  • Bonds
    11%

With 90% of the portfolio in stocks and 10% in bonds, the asset class allocation leans heavily towards equities, reflecting a growth-oriented strategy with a moderate risk profile. This mix is appropriate for investors seeking higher returns and who are comfortable with the associated risk levels. The bond allocation provides a buffer against equity market volatility, contributing to the portfolio's balanced classification.

Sectors Info

  • Financials
    16%
  • Technology
    13%
  • Industrials
    11%
  • Consumer Discretionary
    9%
  • Health Care
    9%
  • Telecommunications
    8%
  • Energy
    8%
  • Consumer Staples
    7%
  • Basic Materials
    5%
  • Utilities
    3%
  • Real Estate
    2%

The sectoral distribution is well-diversified, covering financial services, technology, industrials, and consumer cyclicals as the top sectors. This diversification spreads risk and potential for growth across different parts of the economy. However, the significant weight in financial services and technology sectors could expose the portfolio to sector-specific risks, such as regulatory changes or rapid technological shifts.

Regions Info

  • North America
    63%
  • Europe Developed
    14%
  • Japan
    6%
  • Asia Developed
    3%
  • Asia Emerging
    2%
  • Australasia
    1%
  • Latin America
    1%

Geographic allocation emphasizes North America (63%) and developed European markets (14%), with smaller exposures to Japan, Asia, and emerging markets. This geographic spread supports diversification benefits but also reflects a conservative approach, potentially limiting exposure to high-growth emerging markets. Increasing allocations to underrepresented regions could enhance growth prospects and risk diversification.

Market capitalization Info

  • Large-cap
    33%
  • Mega-cap
    28%
  • Mid-cap
    22%
  • No data
    10%
  • Small-cap
    6%
  • Micro-cap
    1%

The portfolio's market capitalization exposure is tilted towards big and mega-cap companies, which tend to be more stable and less volatile than smaller companies. While this can lead to more predictable returns, it may also limit the portfolio's growth potential, as smaller companies often offer higher growth rates. Consideration could be given to increasing the allocation to small and micro-cap stocks to enhance growth prospects.

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 Efficient Frontier analysis suggests there might be opportunities to optimize the risk-return profile of the portfolio. Adjusting allocations among current assets could potentially achieve a better balance between risk and return, aligning more closely with the investor's goals and risk tolerance. Regular reviews and adjustments in response to changing market conditions and personal financial goals are recommended.

Dividends Info

  • Fidelity® Total Bond ETF 4.60%
  • Schwab Fundamental Emerging Markets Large Company Index ETF 4.00%
  • Schwab Fundamental International Large Company Index ETF 3.00%
  • Schwab Fundamental U.S. Large Company Index ETF 1.70%
  • Schwab International Small-Cap Equity ETF 2.90%
  • Weighted yield (per year) 2.41%

The portfolio's dividend yield averages 2.41%, contributing to its total return. The bond ETF's higher yield provides income, while the equity components balance income with growth potential. In a low-interest-rate environment, this yield is attractive, but investors should also consider the growth potential of reinvested dividends versus the immediate income.

Ongoing product costs Info

  • Fidelity® Total Bond ETF 0.36%
  • Schwab Fundamental Emerging Markets Large Company Index ETF 0.39%
  • Schwab Fundamental International Large Company Index ETF 0.25%
  • Schwab Fundamental U.S. Large Company Index ETF 0.25%
  • Schwab International Small-Cap Equity ETF 0.11%
  • Weighted costs total (per year) 0.26%

With a Total Expense Ratio (TER) averaging 0.26%, the portfolio's costs are relatively low, which is beneficial for long-term growth. Lower costs mean more of the portfolio's returns are retained by the investor, compounding over time. Continuously monitoring and minimizing costs where possible remains a key strategy for enhancing portfolio performance.

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