A globally diversified ETF portfolio with a balanced risk profile and strong growth potential

Risk profile

  • Secure
    Speculative

The risk profile, derived from past market volatility, reflects the level of risk the portfolio is exposed to. This assessment helps align your investments with your financial goals and comfort with market fluctuations.

Diversification profile

  • Focused
    Diversified

The diversification assessment evaluates the spread of investments across asset classes, regions, and sectors. This ensures a balanced mix, reducing risk and maximizing returns by not concentrating in any single area.

What type of investor this portfolio is suitable for

Balanced Investors

This portfolio is well-suited for investors with a balanced risk tolerance and a long-term investment horizon. It caters to individuals seeking capital growth through global equity exposure while maintaining a diversified approach. The portfolio's reliance on a single ETF simplifies management, making it ideal for those who prefer a hands-off investment strategy. Investors should be comfortable with market volatility and prepared for potential fluctuations in value. This portfolio is best for those aiming to grow their wealth steadily over time, with a focus on global economic trends.

Positions

  • Vanguard FTSE All-World UCITS ETF USD Accumulation
    VWCE - IE00BK5BQT80
    100.00%

The portfolio consists solely of the Vanguard FTSE All-World UCITS ETF, an exchange-traded fund (ETF) that offers exposure to a wide range of global equities. This single ETF provides broad diversification across various sectors and regions, making it a simple yet effective investment choice. The portfolio's structure is heavily weighted in stocks, with minimal allocations to other asset classes like cash or non-classified assets. This composition indicates a focus on growth through equity investments, which can be beneficial for long-term capital appreciation. To enhance diversification further, considering additional asset classes like bonds or real estate could provide more stability during market downturns.

Growth Info

Historically, the portfolio has demonstrated a compound annual growth rate (CAGR) of 13.18%, which signifies strong performance over time. However, it has also faced a maximum drawdown of -33.45%, indicating periods of significant volatility. This performance reflects the inherent risk and reward dynamic of equity investments. While past performance is not indicative of future results, understanding these trends can help set realistic expectations. Investors should be prepared for potential fluctuations and consider strategies to mitigate risks, such as rebalancing or diversifying into less volatile assets.

Projection Info

The Monte Carlo simulation, which uses historical data to model potential future outcomes, shows a wide range of possibilities for this portfolio. With 1,000 simulations, the portfolio's end values range from a 5th percentile return of 92.89% to a 67th percentile return of 636.29%. The median projection stands at 456.98%, indicating a favorable outlook. However, it's important to note that these projections are based on historical data, which may not account for future market changes. Investors should use these insights as a guide rather than a guarantee, and regularly review their portfolio to align with evolving financial goals.

Asset classes Info

  • Stocks
    100%
  • Other
    0%
  • Cash
    0%
  • No data
    0%

The asset allocation is heavily skewed towards stocks, comprising nearly 100% of the portfolio. This concentration in equities suggests a high potential for growth but also exposes the portfolio to market volatility. Diversifying across multiple asset classes, such as bonds or real estate, can help reduce risk and provide more stable returns. While the current allocation aligns with a growth-oriented strategy, introducing other asset classes could enhance the portfolio's resilience against market fluctuations and economic downturns.

Sectors Info

  • Technology
    25%
  • Financials
    16%
  • Health Care
    11%
  • Consumer Discretionary
    11%
  • Industrials
    10%
  • Telecommunications
    8%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    4%
  • Utilities
    3%
  • Real Estate
    2%

Sector allocation within the portfolio is diverse, with notable concentrations in technology (25.29%), financial services (16.10%), and healthcare (10.83%). This distribution reflects a balanced approach to capturing growth opportunities across various industries. However, the heavy weighting in technology could increase vulnerability to sector-specific risks. To mitigate these risks, investors might consider adjusting the sector balance over time or incorporating additional sectors with lower correlations to technology. This strategy can help maintain diversification and manage potential volatility.

Regions Info

  • North America
    65%
  • Europe Developed
    15%
  • Asia Emerging
    6%
  • Japan
    6%
  • Asia Developed
    4%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%
  • Europe Emerging
    0%

The portfolio's geographic exposure is predominantly in North America (64.56%), followed by Europe Developed (15.01%) and Asia Emerging (6.22%). This allocation provides a strong foundation in established markets while offering some exposure to emerging economies. The heavy reliance on North American markets could pose risks if regional economic conditions deteriorate. Investors may benefit from increasing allocations to other regions, such as Asia or Latin America, to enhance diversification and capture growth potential in less correlated markets.

Ongoing product costs Info

  • Vanguard FTSE All-World UCITS ETF USD Accumulation 0.22%
  • Weighted costs total (per year) 0.22%

The total expense ratio (TER) of 0.22% for the Vanguard FTSE All-World UCITS ETF is relatively low, making it a cost-effective choice for investors. Keeping investment costs low is crucial for maximizing returns over the long term. While this fee is competitive, investors should remain vigilant about any additional costs that may arise, such as transaction fees or taxes. Regularly reviewing and minimizing these expenses can enhance net returns, allowing the portfolio to grow more efficiently over time.

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