A growth-focused portfolio with a strong tech bias and moderate geographic diversification

Report created on Feb 23, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

3/5
Moderately Diversified
Less diversification More diversification

Positions

The portfolio is heavily concentrated in two ETFs: the Xtrackers Artificial Intelligence & Big Data UCITS ETF and the iShares Core MSCI Europe UCITS ETF. The Xtrackers ETF makes up 66% of the portfolio, while the iShares ETF accounts for 34%. This composition leans heavily towards a growth strategy, focusing primarily on technology and European equities. Compared to a typical benchmark, this portfolio is less diversified across asset classes, with a 100% allocation to stocks. To enhance diversification, consider adding other asset classes such as bonds or real estate, which can provide stability during market volatility.

Growth Info

Historically, the portfolio has performed well with a Compound Annual Growth Rate (CAGR) of 17.46%. This impressive growth rate indicates strong past performance, especially when compared to common benchmarks. However, it's important to note the portfolio's max drawdown of -33.79%, which signifies potential vulnerability during market downturns. While the historical performance is encouraging, remember that past results are not indicative of future outcomes. To mitigate potential risks, consider rebalancing the portfolio to include more defensive assets that can cushion against significant market swings.

Projection Info

The Monte Carlo analysis, which uses historical data to simulate potential future outcomes, shows promising results for this portfolio. With 1,000 simulations, the portfolio's 50th percentile projection is a 658.9% increase, indicating a positive outlook. However, it's essential to understand that these projections are based on past data and do not guarantee future performance. The optimistic projections highlight the portfolio's growth potential, but they also underscore the importance of regularly reviewing and adjusting the portfolio to align with changing market conditions and personal investment goals.

Asset classes Info

  • Stocks
    100%

The portfolio is entirely composed of stocks, with no exposure to other asset classes like bonds or cash. This single asset class focus can lead to higher volatility, especially during market downturns. While stocks offer the potential for significant growth, diversifying across different asset classes can help manage risk and provide more stable returns. Consider incorporating bonds or real estate to balance the portfolio and reduce its overall risk profile. Diversification across asset classes is key to achieving a more resilient investment strategy.

Sectors Info

  • Technology
    51%
  • Telecommunications
    12%
  • Financials
    11%
  • Consumer Discretionary
    6%
  • Industrials
    6%
  • Health Care
    5%
  • Consumer Staples
    3%
  • Basic Materials
    2%
  • Energy
    2%
  • Utilities
    1%

The portfolio is heavily weighted towards technology, which accounts for 51% of the total allocation. Other sectors include communication services, financial services, and consumer cyclicals. This tech-heavy focus can lead to higher volatility, especially during periods of interest rate hikes or regulatory changes. While the technology sector offers substantial growth potential, it's crucial to maintain a balanced sector allocation to mitigate sector-specific risks. Consider diversifying into other sectors, such as healthcare or consumer defensive, to achieve a more stable and resilient portfolio.

Regions Info

  • North America
    58%
  • Europe Developed
    37%
  • Asia Developed
    4%
  • Japan
    1%

Geographically, the portfolio has a strong bias towards North America and Europe, with 58% and 37% allocations, respectively. This regional focus provides exposure to developed markets but limits diversification into emerging markets. While developed markets offer stability, emerging markets can provide growth opportunities and further diversification. To balance geographic exposure, consider increasing allocations to Asia, Africa, or Latin America. This approach can help reduce reliance on specific regions and enhance the portfolio's resilience against regional economic fluctuations.

Market capitalization Info

  • Large-cap
    46%
  • Mega-cap
    45%
  • Mid-cap
    8%
  • Small-cap
    1%

The portfolio is predominantly invested in large-cap stocks, with 46% in big-cap and 45% in mega-cap companies. This concentration in large-cap stocks offers stability and lower volatility compared to small-cap stocks. However, it may limit the potential for higher returns typically associated with smaller companies. To enhance growth potential, consider adding more small or mid-cap stocks to the portfolio. This diversification can provide exposure to emerging companies with significant growth prospects, balancing the stability of large-cap investments.

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 can potentially be optimized using the Efficient Frontier, a concept that helps identify the best possible risk-return ratio. By adjusting the allocation between the existing ETFs, you might achieve a more efficient portfolio. However, it's important to note that this optimization is based solely on the current assets and does not guarantee diversification or alignment with other investment goals. Regularly reassess the portfolio's risk-return profile to ensure it aligns with your financial objectives and risk tolerance. Optimization is an ongoing process that requires attention and adjustment.

Ongoing product costs Info

  • iShares Core MSCI Europe UCITS ETF EUR (Acc) 0.20%
  • Xtrackers Artificial Intelligence &Big Data UCITS ETF 1C 0.35%
  • Weighted costs total (per year) 0.30%

The portfolio's Total Expense Ratio (TER) is 0.30%, which is relatively low and supports better long-term performance by minimizing costs. The iShares Core MSCI Europe UCITS ETF has a TER of 0.20%, while the Xtrackers Artificial Intelligence & Big Data UCITS ETF has a TER of 0.35%. Keeping costs low is crucial for maximizing returns over time. Regularly review and compare the TER of your holdings with similar products in the market. This proactive approach ensures that you maintain a cost-effective portfolio, enhancing overall investment returns.

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