A balanced approach to diversification with a cautious profile and a global reach

Report created on Nov 4, 2025

Risk profile Info

3/7
Cautious
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

The portfolio presents a well-thought-out composition, blending 77% stocks with 20% bonds, and a small allocation to real estate and cash. This mix underlines a strategy geared towards growth while mitigating risk through fixed-income securities. The heavy weighting towards ETFs, particularly in U.S. equity and developed markets, suggests a preference for diversified, low-cost index investing. The allocation across various sectors and geographic regions enhances diversification, reducing the portfolio's exposure to sector-specific or regional downturns. However, the relatively low allocation to emerging markets and real estate might limit exposure to high-growth opportunities.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 15.80% and a maximum drawdown of -13.34%, the portfolio has demonstrated strong performance with relatively moderate volatility. The days contributing most to returns indicate significant gains can occur in short periods, emphasizing the importance of staying invested over the long term. Comparing these figures to benchmarks could provide further insight into the portfolio's relative performance, considering its cautious risk profile.

Projection Info

Monte Carlo simulations, using historical data to forecast potential future outcomes, suggest a wide range of performance possibilities. With all simulations showing positive returns and a median projected growth of 576%, the portfolio appears well-positioned for future growth. However, it's essential to remember that these projections are not guarantees and depend heavily on past market behaviors, which may not repeat in the future.

Asset classes Info

  • Stocks
    77%
  • Bonds
    20%
  • Real Estate
    2%
  • Cash
    1%

The allocation across asset classes indicates a balanced approach, leaning towards equities for growth while using bonds and real estate to provide income and reduce volatility. This structure is suitable for a cautious investor looking for steady growth with a moderate level of risk. Comparing the asset class weights to those of a typical cautious investor's portfolio might suggest this allocation is on target, particularly given the portfolio's diversification score.

Sectors Info

  • Technology
    17%
  • Financials
    14%
  • Industrials
    10%
  • Consumer Discretionary
    10%
  • Telecommunications
    6%
  • Health Care
    6%
  • Energy
    4%
  • Consumer Staples
    4%
  • Basic Materials
    4%
  • Real Estate
    3%
  • Utilities
    2%

Sector allocation reveals a diversified yet focused investment strategy, with significant positions in technology and financial services. This sectoral spread supports the portfolio's growth objectives while mitigating risks associated with overexposure to any single sector. However, given the rapid evolution of sectors like technology, staying informed on sectoral shifts is crucial to maintaining a balanced risk-reward ratio.

Regions Info

  • North America
    51%
  • Europe Developed
    12%
  • Japan
    5%
  • Asia Emerging
    5%
  • Asia Developed
    4%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%

The geographic distribution is heavily weighted towards North America, with meaningful exposure to developed Europe and a modest allocation to emerging markets. This geographic spread supports diversification and reduces risk by not over-relying on any single region's economic performance. Increasing exposure to emerging markets could offer higher growth potential, albeit with increased risk.

Market capitalization Info

  • Mega-cap
    29%
  • Large-cap
    22%
  • Mid-cap
    17%
  • Small-cap
    7%
  • Micro-cap
    3%

The market capitalization breakdown shows a preference for larger companies, which are typically more stable but offer lower growth potential compared to smaller firms. This allocation aligns with the portfolio's cautious risk profile. However, incorporating a slightly higher proportion of small and micro-cap stocks could enhance growth prospects without significantly increasing overall risk.

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.

Considering the Efficient Frontier, the portfolio appears well-optimized for a cautious risk profile, aiming for the best possible return for its level of risk. While it's well-diversified and cost-efficient, there's always room for minor adjustments to enhance returns or reduce risk further. Regularly reviewing the allocation and adjusting in response to changing market conditions can help maintain this optimization.

Dividends Info

  • American Century ETF Trust 2.10%
  • Dimensional U.S. Equity ETF 1.00%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 2.80%
  • Vanguard Intermediate-Term Treasury Index Fund ETF Shares 3.50%
  • Vanguard Real Estate Index Fund ETF Shares 4.00%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 2.80%
  • Weighted yield (per year) 2.21%

The portfolio's dividend yield of 2.21% contributes to its total return, providing a steady income stream in addition to capital appreciation. This yield is particularly appealing for cautious investors seeking regular income. However, balancing the pursuit of high dividends with the goal of capital growth is essential to ensure a well-rounded return profile.

Ongoing product costs Info

  • American Century ETF Trust 0.26%
  • Dimensional U.S. Equity ETF 0.09%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
  • Vanguard Intermediate-Term Treasury Index Fund ETF Shares 0.04%
  • Vanguard Real Estate Index Fund ETF Shares 0.12%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.11%

With a Total Expense Ratio (TER) of 0.11%, the portfolio benefits from relatively low costs, which can significantly enhance long-term returns. Keeping costs low is a fundamental principle of successful investing, and this portfolio aligns well with that strategy. Periodic reviews of fund costs and performance can ensure continued cost efficiency.

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