Growth-focused portfolio with high technology exposure and low diversification

Report created on Aug 21, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

This portfolio predominantly invests in technology and growth-oriented assets, with a 50% allocation to a technology ETF and a 40% allocation to a growth index ETF. The remaining 10% is dedicated to a dividend growth fund. This structure indicates a strong focus on capital appreciation, particularly within the tech sector, but it also highlights a significant concentration risk due to its low diversity across sectors and asset classes.

Growth Info

Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 20.09%, which is impressive. However, it also experienced a maximum drawdown of -34.47%, illustrating the high level of risk associated with its concentration in high-growth sectors. The days contributing to 90% of returns are notably few, indicating that the portfolio's performance is heavily reliant on short, significant growth spurts, a characteristic of volatile markets.

Projection Info

Monte Carlo simulations, which use historical data to project future performance, suggest a wide range of outcomes for this portfolio. With the majority of simulations indicating positive returns, there's a potential for substantial growth. However, the significant spread between the 5th and 67th percentiles underscores the high risk and uncertainty inherent in this growth-focused strategy.

Asset classes Info

  • Stocks
    100%

The portfolio's assets are entirely in stocks, with no allocation to bonds, real estate, or cash equivalents. This single-asset class approach maximizes exposure to stock market growth but also increases susceptibility to market volatility. Diversifying across asset classes could provide a buffer during stock market downturns.

Sectors Info

  • Technology
    72%
  • Telecommunications
    6%
  • Consumer Discretionary
    6%
  • Financials
    4%
  • Health Care
    4%
  • Industrials
    3%
  • Consumer Staples
    2%
  • Consumer Discretionary
    1%
  • Basic Materials
    1%
  • Real Estate
    1%

With 72% of the portfolio invested in technology, followed by smaller allocations to communication services and consumer cyclicals, the sectoral allocation further concentrates risk. While the tech sector can offer high returns, it's also subject to rapid changes and volatility. Balancing sector exposure could reduce risk without significantly compromising growth potential.

Regions Info

  • North America
    99%
  • Europe Developed
    1%

Geographic exposure is heavily skewed towards North America (99%), with minimal exposure to developed Europe and no presence in emerging markets or other regions. This geographic concentration could limit the portfolio's growth potential and resilience against region-specific economic downturns.

Market capitalization Info

  • Mega-cap
    56%
  • Large-cap
    28%
  • Mid-cap
    10%
  • Small-cap
    4%
  • Micro-cap
    1%

The portfolio favors mega-cap (56%) and large-cap (28%) companies, which tend to be more stable than smaller companies but may offer lower growth potential. Including more mid-cap and small-cap stocks could enhance growth prospects and diversification.

Redundant positions Info

  • Vanguard Information Technology Index Fund ETF Shares
    Vanguard Growth Index Fund ETF Shares
    High correlation

The high correlation between the technology ETF and the growth index ETF indicates overlapping investments, which reduces the portfolio's diversification benefits. Diversifying into less correlated assets could help manage risk more effectively.

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.

Given the portfolio's current construction, optimizing for the Efficient Frontier would involve reducing the overlap between highly correlated assets and increasing diversification across sectors, asset classes, and geographies. This optimization aims to achieve a more favorable risk-return profile, enhancing the portfolio's efficiency.

Dividends Info

  • VANGUARD DIVIDEND GROWTH FUND INVESTOR SHARES 1.10%
  • Vanguard Information Technology Index Fund ETF Shares 0.50%
  • Vanguard Growth Index Fund ETF Shares 0.40%
  • Weighted yield (per year) 0.52%

The portfolio's overall dividend yield is relatively low at 0.52%, reflecting its focus on growth rather than income. For investors seeking income, increasing the allocation to higher-yielding assets could provide a more balanced approach to growth and income generation.

Ongoing product costs Info

  • VANGUARD DIVIDEND GROWTH FUND INVESTOR SHARES 0.22%
  • Vanguard Information Technology Index Fund ETF Shares 0.10%
  • Vanguard Growth Index Fund ETF Shares 0.04%
  • Weighted costs total (per year) 0.09%

The portfolio benefits from low management costs, with a total expense ratio (TER) of just 0.09%. This cost efficiency is commendable, as lower costs can significantly enhance long-term returns by minimizing the drag on performance.

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