A growth-focused portfolio with a strong emphasis on US equities and low management costs

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

Growth Investors

This portfolio is best suited for an investor with a growth-oriented profile, comfortable with higher risk for the potential of higher returns. The focus on equities, particularly in the technology and financial sectors, aligns with those seeking significant capital appreciation over the long term. The investor likely has a medium to long investment horizon, allowing them to weather short-term market volatility. A moderate to high risk tolerance is necessary, given the portfolio's exposure to market fluctuations and sector-specific risks.

Positions

  • VANGUARD 500 INDEX FUND ADMIRAL SHARES
    VFIAX - US9229087104
    60.00%
  • FIDELITY GLOBAL EX U.S. INDEX FUND INSTITUTIONAL PREMIUM CLASS
    FSGGX - US3161463159
    20.00%
  • VANGUARD EXTENDED MARKET INDEX FUND ADMIRAL SHARES
    VEXAX - US9229086940
    20.00%

This portfolio is heavily weighted towards US equities, represented by the Vanguard 500 Index Fund Admiral Shares, making up 60% of the total allocation. The inclusion of the Fidelity Global ex U.S. Index Fund Institutional Premium Class and Vanguard Extended Market Index Fund Admiral Shares, each constituting 20%, enhances diversification by adding international exposure and access to smaller, potentially faster-growing companies. This structure suggests a strategic emphasis on growth through a mix of large-cap, mid-cap, and international stocks, aligning with a growth-oriented risk profile.

Growth Info

Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 12.40%, with a maximum drawdown of -35.10%. These figures indicate a strong performance, albeit with significant volatility, as evidenced by the substantial drawdown. The days contributing to 90% of returns being concentrated in just 27.0 days highlight the portfolio’s susceptibility to short-term market movements. Benchmarking this performance against a diversified growth fund could provide further context on its relative strength.

Projection Info

Using Monte Carlo simulations, the portfolio projects a wide range of outcomes, with a median increase of 284.2%. This method, which forecasts future performance based on historical data, suggests a high likelihood of positive returns, as 970 out of 1,000 simulations resulted in gains. However, it's crucial to remember that these projections are speculative and depend on past market behaviors, which are not guaranteed to repeat.

Asset classes Info

  • Stocks
    100%
  • Cash
    0%
  • Other
    0%

The portfolio is entirely invested in stocks, with no allocation to cash or other asset classes. This singular focus on equities is typical for growth-oriented portfolios but comes with higher volatility and risk. Diversifying across different asset classes, such as bonds or real estate, could provide a buffer against stock market fluctuations, potentially reducing volatility without significantly compromising growth prospects.

Sectors Info

  • Technology
    26%
  • Financials
    16%
  • Industrials
    11%
  • Consumer Discretionary
    11%
  • Health Care
    10%
  • Telecommunications
    8%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    3%
  • Real Estate
    3%
  • Utilities
    2%

Sector allocation is concentrated in technology, financial services, industrials, and consumer cyclical sectors, which are known for their growth potential. However, this concentration also exposes the portfolio to sector-specific risks. A more balanced approach, including sectors like utilities or consumer defensive, might offer stability during market downturns, as these sectors tend to be less volatile.

Regions Info

  • North America
    81%
  • Europe Developed
    9%
  • Asia Emerging
    3%
  • Japan
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%
  • Europe Emerging
    0%

The geographic distribution is heavily skewed towards North America, with 81% of assets allocated there. While this concentration benefits from the robust performance of US markets, it also limits exposure to potential growth in emerging markets and developed markets outside the US. Increasing allocations to underrepresented regions could enhance global diversification and reduce geographic risk.

Market capitalization Info

  • Mega-cap
    39%
  • Large-cap
    29%
  • Mid-cap
    19%
  • Small-cap
    10%
  • Micro-cap
    4%

The market capitalization breakdown shows a preference for mega and big-cap stocks, which are typically less volatile than smaller companies but might offer lower growth potential. Including a greater proportion of medium, small, and micro-cap stocks could introduce higher growth opportunities, albeit with increased risk.

Dividends Info

  • FIDELITY GLOBAL EX U.S. INDEX FUND INSTITUTIONAL PREMIUM CLASS 2.50%
  • VANGUARD EXTENDED MARKET INDEX FUND ADMIRAL SHARES 0.80%
  • VANGUARD 500 INDEX FUND ADMIRAL SHARES 0.90%
  • Weighted yield (per year) 1.20%

The overall dividend yield of the portfolio is 1.20%, with the Fidelity Global ex U.S. Index Fund providing the highest yield. While dividends contribute to total returns, the focus on growth equities means yield is not the primary objective. Investors seeking income in addition to growth might consider reallocating a portion towards higher-yielding assets.

Ongoing product costs Info

  • FIDELITY GLOBAL EX U.S. INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.06%
  • VANGUARD EXTENDED MARKET INDEX FUND ADMIRAL SHARES 0.05%
  • VANGUARD 500 INDEX FUND ADMIRAL SHARES 0.04%
  • Weighted costs total (per year) 0.05%

The portfolio benefits from exceptionally low management costs, with a total expense ratio (TER) of 0.05%. This efficiency supports long-term growth by minimizing the drag on performance due to fees. Maintaining focus on low-cost funds will continue to be advantageous, especially in a growth-oriented strategy.

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.

Considering the Efficient Frontier, this portfolio appears to be positioned for growth, but there may be room for optimization to achieve a better risk-return balance. Adjustments in asset allocation, diversification across sectors, and geographic exposure could enhance performance without proportionately increasing risk. However, any optimization should align with the investor's risk tolerance and investment horizon.

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