A conservative euro-focused portfolio with ultrashort bonds and minimal diversification

Report created on Apr 15, 2025

Risk profile Info

1/7
Secure
Less risk More risk

Diversification profile Info

1/5
Single-Focused
Less diversification More diversification

Positions

The portfolio is predominantly composed of ultrashort bond ETFs, with 60% in iShares Euro Ultrashort Bond UCITS and 20% in Xtrackers II EUR Overnight Rate Swap UCITS ETF. This structure emphasizes low-risk, stable returns, typical of ultrashort bonds, while also including a small allocation to gold and Bitcoin. Compared to a typical benchmark, this portfolio is heavily weighted towards low-duration fixed income, minimizing volatility but also limiting potential growth. To enhance diversification, consider introducing other asset types that can offer higher growth potential, while still aligning with the conservative risk profile.

Growth Info

Historically, the portfolio's CAGR of 5% indicates steady, moderate growth. This aligns well with its conservative nature, focusing on capital preservation. The max drawdown of -6.68% suggests it has weathered market downturns relatively well. Compared to benchmarks, this performance is solid but lacks the higher returns seen in more diversified portfolios. To improve future performance, consider small allocations to higher-risk, high-reward assets, ensuring they align with your risk tolerance.

Projection Info

Monte Carlo simulations, which use historical data to forecast future outcomes, project a wide range of potential end values. With 949 out of 1,000 simulations showing positive returns, the portfolio's conservative nature is apparent. However, the potential for high returns, as indicated by the 50th and 67th percentiles, suggests an opportunity for growth. It's crucial to remember that these projections are not guarantees, and diversifying further could help mitigate any unexpected risks.

Asset classes Info

  • Bonds
    52%
  • Other
    30%
  • Cash
    17%
  • No data
    1%

The portfolio is primarily invested in bonds, which make up 52% of the allocation. This heavy bond focus aligns with a conservative investment strategy, providing stability and income. However, the limited exposure to equities or other growth-oriented asset classes may restrict long-term capital appreciation. To enhance diversification and potential returns, consider gradually increasing exposure to other asset classes, while maintaining alignment with your 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.

The portfolio's current allocation may not fully utilize the Efficient Frontier, which aims to optimize the risk-return ratio. By adjusting the allocation among existing assets, it's possible to achieve a better balance of risk and return. Consider exploring different combinations of the current holdings to identify an optimal allocation that maximizes returns for the given level of risk, ensuring alignment with your conservative investment goals.

Dividends Info

  • iShares USD Ultrashort Bond UCITS 6.20%
  • Weighted yield (per year) 0.62%

The portfolio's dividend yield of 0.62% is modest, reflecting its focus on ultrashort bonds. Dividends provide a steady income stream, which is beneficial for conservative investors. However, the yield is relatively low compared to equity-focused portfolios. To enhance income potential, consider allocating a small portion to dividend-paying equities, balancing income needs with risk tolerance.

Ongoing product costs Info

  • iShares USD Ultrashort Bond UCITS 0.09%
  • iShares Euro Ultrashort Bond UCITS 0.09%
  • Xtrackers II EUR Overnight Rate Swap UCITS ETF 1C 0.10%
  • Weighted costs total (per year) 0.08%

The portfolio's costs are impressively low, with a Total Expense Ratio (TER) of 0.08%. This cost efficiency supports better long-term performance by minimizing the impact of fees on returns. Keeping costs low is crucial, especially in a conservative portfolio where returns may be modest. Continue monitoring and managing costs, ensuring they remain competitive and do not erode potential gains.

What next?

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.

Instrument logos provided by Elbstream.

Help us improve Insightfolio

Your feedback makes a difference! Share your thoughts in our quick survey. Take the survey