A balanced portfolio with significant US exposure and a strong focus on large-cap stocks

Report created on Mar 17, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio consists mainly of ETFs, with a heavy emphasis on the Vanguard S&P 500 ETF at 60%. This suggests a strong focus on large-cap US equities, offering stability and growth potential. The remaining allocations include 20% in international stocks, 10% in US small-cap value, and 10% in the NASDAQ 100. Compared to a typical balanced benchmark, this portfolio is more concentrated in US equities, which could limit exposure to global growth opportunities. Consider diversifying further to include more international assets to reduce regional concentration risk.

Growth Info

With a historical CAGR of 13.04%, this portfolio has delivered robust returns. The max drawdown of -24.93% indicates moderate volatility, which aligns with the balanced risk profile. Compared to typical benchmarks, the performance is impressive, showing effective asset selection. However, past performance does not guarantee future results. To maintain strong returns, regularly review asset allocations and market conditions, ensuring they align with your investment goals and risk tolerance.

Projection Info

Monte Carlo simulations, which use historical data to project potential outcomes, show a wide range of future returns. With a median projected return of 421.5% and a high probability of positive returns, the outlook appears promising. However, these projections are based on historical trends and may not account for future market changes. It's crucial to monitor economic indicators and adjust allocations as needed to align with evolving market conditions.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio is heavily weighted towards stocks, with 99% in equities and 1% in cash. This allocation provides significant growth potential but also increases exposure to market volatility. Compared to a balanced benchmark, this portfolio may benefit from incorporating more fixed income or alternative assets to enhance diversification and reduce risk. Consider adding bonds or other asset classes to align more closely with a balanced investment strategy.

Sectors Info

  • Technology
    29%
  • Financials
    15%
  • Consumer Discretionary
    12%
  • Industrials
    10%
  • Health Care
    9%
  • Telecommunications
    9%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    3%
  • Utilities
    2%
  • Real Estate
    2%

Technology dominates the sector allocation at 29%, followed by financial services and consumer cyclicals. This concentration in tech could lead to increased volatility, especially during tech market downturns. Compared to common benchmarks, the sector allocation is skewed towards growth-oriented industries. To mitigate risk, consider diversifying across more defensive sectors, such as utilities or consumer staples, which can provide stability during market fluctuations.

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%

The portfolio's geographic allocation is heavily skewed towards North America at 81%, with limited exposure to other regions. This concentration can limit diversification benefits and increase vulnerability to US market downturns. Compared to global benchmarks, the portfolio underrepresents emerging markets, which could offer higher growth potential. Consider increasing exposure to international markets to enhance diversification and capture global growth opportunities.

Market capitalization Info

  • Mega-cap
    42%
  • Large-cap
    30%
  • Mid-cap
    15%
  • Small-cap
    6%
  • Micro-cap
    5%

The portfolio is predominantly invested in large-cap stocks, with 42% in mega-cap and 30% in big-cap companies. This focus on large-cap equities offers stability and lower volatility but may limit exposure to higher-growth opportunities found in smaller companies. Compared to a balanced benchmark, the portfolio could benefit from a more diversified market cap allocation. Consider increasing exposure to small and mid-cap stocks to enhance growth potential.

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, which balances risk and return for a given asset mix. By adjusting allocations among existing assets, you can achieve a more favorable risk-return ratio. However, this optimization is based solely on current holdings and does not account for other factors like diversification goals. Regularly review and adjust the portfolio to ensure it remains aligned with your risk tolerance and investment objectives.

Dividends Info

  • Avantis® U.S. Small Cap Value ETF 1.80%
  • Invesco NASDAQ 100 ETF 0.60%
  • Vanguard S&P 500 ETF 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 2.80%
  • Weighted yield (per year) 1.58%

The portfolio's dividend yield stands at 1.58%, contributing to overall returns. While not the primary focus, dividends provide a steady income stream and can enhance long-term performance. Compared to typical benchmarks, the yield is modest, reflecting the growth-oriented nature of the portfolio. For income-focused investors, consider increasing exposure to higher-yielding assets to boost income potential without significantly altering the portfolio's growth focus.

Ongoing product costs Info

  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Invesco NASDAQ 100 ETF 0.15%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.07%

With a total expense ratio (TER) of 0.07%, the portfolio is cost-efficient, supporting better long-term returns. Low costs are crucial for maximizing net returns, especially over extended investment horizons. Compared to industry averages, the portfolio's costs are impressively low, indicating effective cost management. Continue to monitor expense ratios and seek low-cost investment options to maintain cost efficiency and enhance overall performance.

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