Balanced portfolio with a strong tilt towards technology and US markets

Report created on Aug 18, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

This portfolio is characterized by a significant allocation to equity ETFs, particularly those tracking major US indices and the technology sector, alongside a smaller but strategic exposure to international markets and bonds. The presence of three major US stock ETFs (Invesco QQQ Trust, Vanguard S&P 500 ETF, Vanguard Total Stock Market Index Fund ETF Shares) each with a 20% allocation, underscores a heavy emphasis on US equities. The inclusion of both developed and emerging market ETFs, alongside bond holdings, suggests an attempt at diversification, although the portfolio's equity-heavy composition leans towards higher growth potential at the expense of increased volatility.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 12.94% and a maximum drawdown of -29.70%, the portfolio has demonstrated strong growth but not without significant volatility. The days contributing to 90% of returns being concentrated in just 34.0 days highlights the portfolio's reliance on short, sharp gains, a common characteristic of equity-heavy portfolios. This performance profile suggests the portfolio has historically been well-positioned during market upswings but may be susceptible to sudden downturns.

Projection Info

Monte Carlo simulations, projecting future performance based on historical data, suggest a wide range of outcomes with a median increase of 311.9% and 978 out of 1,000 simulations showing positive returns. These projections are useful for understanding potential volatility and return scenarios but should be interpreted with caution, as past performance is not a reliable indicator of future results. The broad spread in simulation outcomes underscores the inherent uncertainty in market movements.

Asset classes Info

  • Stocks
    87%
  • Bonds
    13%
  • Cash
    1%

The portfolio's asset allocation is heavily skewed towards stocks (87%), with a minor allocation to bonds (13%) and a negligible cash holding. This asset mix positions the portfolio for growth but exposes it to higher market volatility. Comparatively, a more balanced asset class distribution could offer better protection against downturns while still capturing upside potential.

Sectors Info

  • Technology
    30%
  • Financials
    12%
  • Consumer Discretionary
    10%
  • Telecommunications
    9%
  • Industrials
    8%
  • Health Care
    7%
  • Consumer Staples
    5%
  • Energy
    3%
  • Basic Materials
    3%
  • Utilities
    2%
  • Real Estate
    2%

The sector allocation reveals a heavy concentration in technology (30%), financial services (12%), and consumer cyclicals (10%), which aligns with the portfolio's growth orientation. However, this sector concentration increases susceptibility to sector-specific risks. Diversifying across a broader range of sectors could mitigate this risk while still allowing for significant growth opportunities.

Regions Info

  • North America
    81%
  • Europe Developed
    8%
  • Asia Emerging
    3%
  • Japan
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographic exposure is predominantly in North America (81%), with modest allocations to developed Europe (8%) and emerging Asia (3%). This geographic distribution reflects a strong home bias, potentially limiting exposure to growth opportunities in other regions. Increasing allocations to underrepresented areas could enhance global diversification and reduce geographical risk.

Market capitalization Info

  • Mega-cap
    41%
  • Large-cap
    28%
  • Mid-cap
    14%
  • Small-cap
    3%
  • Micro-cap
    1%

The portfolio's market capitalization exposure is heavily weighted towards mega (41%) and big (28%) cap stocks, indicative of a preference for large, established companies. While this can offer stability, diversifying into medium, small, or micro-cap stocks could offer higher growth potential and further diversification benefits.

Redundant positions Info

  • Vanguard S&P 500 ETF
    iShares Core Aggressive Allocation ETF
    Vanguard Total Stock Market Index Fund ETF Shares
    High correlation

The high correlation among the Vanguard S&P 500 ETF, iShares Core Aggressive Allocation ETF, and Vanguard Total Stock Market Index Fund ETF Shares indicates overlapping exposures that may limit the portfolio's diversification benefits. Reducing investment in similar assets can help achieve a more effective diversification, potentially lowering risk without sacrificing returns.

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 suggests room for optimization, particularly by addressing the overlap in highly correlated assets. Utilizing the Efficient Frontier concept could help in identifying an asset mix that offers the best possible risk-return trade-off based on historical performance, potentially enhancing the portfolio's efficiency.

Dividends Info

  • iShares Core Aggressive Allocation ETF 2.20%
  • iShares Core Total USD Bond Market ETF 4.10%
  • Invesco QQQ Trust 0.50%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 2.60%
  • Vanguard S&P 500 ETF 1.20%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.20%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 2.70%
  • Weighted yield (per year) 1.71%

The portfolio's average dividend yield of 1.71% contributes to its total return, with bond ETFs providing a higher yield relative to equity ETFs. While dividends are a valuable income source, the focus on growth-oriented ETFs naturally results in a lower overall yield. Investors seeking higher income might consider reallocating towards higher-yielding assets.

Ongoing product costs Info

  • iShares Core Aggressive Allocation ETF 0.15%
  • iShares Core Total USD Bond Market ETF 0.06%
  • Invesco QQQ Trust 0.20%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.09%

With a total Expense Ratio (TER) of 0.09%, the portfolio benefits from relatively low costs, enhancing net returns over time. Low-cost ETFs are an efficient way to gain market exposure without eroding returns through high fees. Maintaining focus on cost efficiency is crucial for long-term investment success.

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