This portfolio has only about 4.3 years of historical data, based on the youngest asset in the portfolio. Some metrics, projections, and AI insights may be less reliable and should be interpreted with caution.

Balanced Growth Portfolio with Broad Diversification and Strong Historical Performance

Report created on Jul 28, 2024

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio consists of five ETFs, with the largest allocation to the Vanguard Total Stock Market Index Fund ETF Shares at 40%. Other significant holdings include the Avantis U.S. Small Cap Value ETF and BNY Mellon International Equity ETF, each at 20%. Smaller allocations are to the Avantis International Small Cap Value ETF and Schwab U.S. Dividend Equity ETF. This composition shows a strong tilt towards equities, which is typical for a growth-oriented portfolio. To balance growth and risk, it is crucial to maintain a diversified mix of assets.

Growth Info

Historically, this portfolio has performed impressively, with a compound annual growth rate (CAGR) of 19.93%. However, it has also experienced a maximum drawdown of -23.11%, indicating significant volatility. The performance is concentrated, with 90% of returns coming from just 26 days. This highlights the importance of staying invested during both market highs and lows to capture these critical performance days. To reduce volatility, consider adding more stable assets.

Projection Info

Using a Monte Carlo simulation with 1,000 iterations, we project the portfolio's future performance based on a hypothetical initial investment. The median outcome (50th percentile) shows a potential growth of 1,094.17%, while the 5th percentile suggests a minimum growth of 260.31%. These projections indicate a high likelihood of positive returns, but also underscore the inherent risk and variability in growth-oriented investments. Diversifying further or adding safer assets could help mitigate this risk.

Asset classes Info

  • Stocks
    100%

The portfolio is overwhelmingly invested in stocks, with 99.66% allocated to equities. There are minimal allocations to cash, bonds, and other asset classes. This heavy equity exposure aligns with a growth strategy but also increases vulnerability to market downturns. Diversifying across more asset classes, like bonds or alternative investments, could provide stability and reduce overall portfolio risk, especially during volatile market periods.

Sectors Info

  • Financials
    18%
  • Technology
    16%
  • Industrials
    15%
  • Consumer Discretionary
    13%
  • Health Care
    9%
  • Energy
    8%
  • Consumer Staples
    6%
  • Basic Materials
    6%
  • Telecommunications
    5%
  • Real Estate
    2%
  • Utilities
    2%

The sector allocation is diverse, with significant investments in Financial Services (18.31%), Technology (15.99%), and Industrials (14.69%). Other notable sectors include Consumer Cyclicals, Healthcare, and Energy. This broad sector diversification helps mitigate risks associated with any single industry. However, to further balance the portfolio, consider monitoring sector performance and rebalancing periodically to avoid overexposure to any one sector.

Regions Info

  • North America
    73%
  • Europe Developed
    16%
  • Japan
    7%
  • Australasia
    2%
  • Asia Developed
    1%

Geographically, the portfolio is heavily weighted towards North America, which constitutes 72.56% of the holdings. Other significant regions include Europe Developed and Japan. This geographic diversity helps hedge against region-specific risks but still leaves the portfolio somewhat exposed to North American market fluctuations. Expanding investments into emerging markets or other underrepresented regions could enhance diversification and provide additional growth opportunities.

Dividends Info

  • Avantis® International Small Cap Value ETF 3.10%
  • Avantis® U.S. Small Cap Value ETF 1.60%
  • BNY Mellon International Equity ETF 2.80%
  • Schwab U.S. Dividend Equity ETF 3.50%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.40%
  • Weighted yield (per year) 2.10%

The portfolio includes the Schwab U.S. Dividend Equity ETF, which provides a source of dividend income. Dividends can offer a steady income stream and reduce reliance on capital gains for returns. This is particularly beneficial during volatile markets. To enhance income stability, consider increasing exposure to dividend-paying assets or funds, which can provide a cushion against market downturns and contribute to overall portfolio stability.

Ongoing product costs Info

  • Avantis® International Small Cap Value ETF 0.36%
  • Avantis® U.S. Small Cap Value ETF 0.25%
  • BNY Mellon International Equity ETF 0.04%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Weighted costs total (per year) 0.11%

The portfolio's total expense ratio (TER) is relatively low at 0.11%, with individual ETF costs ranging from 0.03% to 0.36%. Low costs are crucial for maximizing net returns over time. Keeping expenses in check allows more of the investment returns to compound. Regularly reviewing and potentially replacing higher-cost ETFs with lower-cost alternatives can further improve the portfolio's efficiency and long-term performance.

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