Balanced portfolio leaning heavily on US equities with a focus on major sectors

Report created on Oct 10, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is predominantly invested in US equities, with a significant portion allocated to the Vanguard S&P 500 ETF, reflecting a strong bias towards large-cap US stocks. The inclusion of the Vanguard Total International Stock Index Fund ETF Shares and Vanguard Total World Stock Index Fund ETF Shares introduces international diversification, though the overall exposure remains heavily skewed towards the US market. The singular stock position in Quanta Services Inc suggests a targeted bet on the industrial sector, adding a layer of active management to an otherwise passive portfolio strategy.

Growth Info

Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 14.55%, with a maximum drawdown of -34.09%. These figures indicate a robust performance, especially in light of the significant downturns that can impact heavily weighted equity portfolios. The days contributing to 90% of returns highlight the portfolio's sensitivity to market highs and the importance of staying invested during these critical periods for maximizing growth.

Projection Info

Monte Carlo simulations, which project future performance based on historical data, suggest a wide range of outcomes for this portfolio. With a median projected increase of 794.9% and a high percentile reaching over 1,166.8%, the analysis underscores the potential for substantial growth. However, it's crucial to remember that such simulations carry limitations, notably the assumption that past performance patterns will continue, which may not always hold true.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio's allocation is nearly entirely in stocks (99%), with a minimal cash reserve (1%). This allocation underscores a growth-oriented strategy, leveraging the potential higher returns of equities over the long term. However, the lack of diversification into other asset classes, like bonds or real estate, may increase volatility and risk, particularly in down markets.

Sectors Info

  • Technology
    29%
  • Financials
    15%
  • Industrials
    13%
  • Consumer Discretionary
    10%
  • Telecommunications
    9%
  • Health Care
    8%
  • Consumer Staples
    5%
  • Energy
    3%
  • Basic Materials
    3%
  • Utilities
    3%
  • Real Estate
    2%

Sectoral allocation is concentrated in technology, financial services, and industrials, reflecting common trends in large-cap indices. This concentration in high-growth and cyclical sectors can enhance returns during economic expansions but may also increase susceptibility to market corrections. The portfolio's sectoral spread mirrors the broader market composition, aligning with its heavy S&P 500 ETF weighting.

Regions Info

  • North America
    77%
  • Europe Developed
    9%
  • Asia Emerging
    4%
  • Japan
    4%
  • Asia Developed
    3%
  • Australasia
    1%
  • Africa/Middle East
    1%

With 77% of assets in North America, the portfolio's geographic distribution is heavily skewed towards the US, complemented by modest allocations to developed Europe and emerging Asian markets. This US-centric approach capitalizes on the historical strength of American corporations but may limit exposure to potential growth in emerging markets and diversification benefits from global equities.

Market capitalization Info

  • Mega-cap
    45%
  • Large-cap
    35%
  • Mid-cap
    17%
  • Small-cap
    2%

The portfolio's market capitalization exposure is heavily tilted towards mega and large-cap companies, which tend to be more stable and have lower volatility than their smaller counterparts. This focus aligns with the portfolio's balanced risk profile, leveraging the growth potential of large-cap stocks while maintaining a degree of resilience against market fluctuations.

Redundant positions Info

  • Vanguard S&P 500 ETF
    Vanguard Total World Stock Index Fund ETF Shares
    High correlation

The high correlation between the Vanguard S&P 500 ETF and Vanguard Total World Stock Index Fund ETF Shares indicates overlapping exposures, which could diminish the diversification benefits of holding both assets. This redundancy suggests an opportunity to streamline the portfolio by reallocating assets to reduce overlap and potentially enhance risk-adjusted 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.

Optimizing this portfolio involves addressing the high correlation between certain assets to enhance diversification. By reallocating from overlapping investments, the portfolio can achieve a more efficient risk-return profile, potentially moving closer to the Efficient Frontier. This optimization process focuses on adjusting the current asset allocation to improve the portfolio's overall performance without necessarily increasing risk.

Dividends Info

  • Quanta Services Inc 0.10%
  • Vanguard S&P 500 ETF 1.10%
  • Vanguard Total World Stock Index Fund ETF Shares 1.70%
  • Vanguard Total International Stock Index Fund ETF Shares 2.80%
  • Weighted yield (per year) 1.48%

Dividend yields across the portfolio contribute to its total return, with the Vanguard Total International Stock Index Fund ETF Shares offering the highest yield. While dividends provide a steady income stream and can help cushion volatility, the portfolio's overall yield reflects a balanced approach between income generation and capital appreciation.

Ongoing product costs Info

  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total World Stock Index Fund ETF Shares 0.07%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.04%

The portfolio's low total expense ratio (TER) of 0.04% is impressively efficient, minimizing the drag on returns from management fees. This cost-effectiveness is a significant advantage for long-term growth, ensuring that a greater portion of investment returns is retained by the investor rather than being consumed by expenses.

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