This portfolio has only about 1.8 years of historical data, based on the youngest asset in the portfolio. Some metrics, projections, and AI insights may be less reliable and should be interpreted with caution.

A value-focused portfolio with an emphasis on small-cap equities across global markets

Report created on May 4, 2024

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 heavily weighted towards value stocks, particularly in the small-cap segment, with a 100% allocation to equities spread across three ETFs. The largest allocation is in a broad market value ETF, complemented by specific focus on U.S. and international small-cap value stocks. This composition indicates a strategy that seeks to capitalize on the potential higher returns associated with value and small-cap investments, which historically have provided significant growth opportunities but with higher volatility.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 13.01% and a maximum drawdown of -18.53%, the portfolio has demonstrated strong performance, particularly given its balanced risk profile. The days contributing to 90% of returns being limited to six highlights the portfolio's susceptibility to significant short-term gains, a characteristic of value and small-cap investing. This performance, while impressive, should be viewed in the context of the inherent risks associated with this investment style.

Projection Info

The Monte Carlo simulation suggests a wide range of potential outcomes, with a median projected growth of 473.3%. This method, which uses historical data to simulate future scenarios, helps in understanding the potential variability in returns. However, it's important to remember that these projections cannot guarantee future performance and are influenced by past market conditions which may not repeat.

Asset classes Info

  • Stocks
    100%

The portfolio's exclusive investment in stocks, without diversification into bonds or alternative assets, positions it for higher growth potential but also exposes it to greater market volatility. This asset class allocation is suitable for investors with a higher risk tolerance and a longer investment horizon, as equities can experience significant short-term fluctuations.

Sectors Info

  • Financials
    24%
  • Industrials
    18%
  • Consumer Discretionary
    17%
  • Energy
    12%
  • Basic Materials
    10%
  • Technology
    6%
  • Consumer Staples
    5%
  • Telecommunications
    4%
  • Health Care
    4%
  • Real Estate
    1%
  • Utilities
    1%

The sectoral allocation is diverse, with a notable emphasis on financial services, industrials, and consumer cyclicals. This sector distribution aligns with the value investment philosophy, as these sectors often include companies trading below their intrinsic values. However, the relatively lower allocation to technology and healthcare could mean missing out on growth opportunities in these dynamic sectors.

Regions Info

  • North America
    64%
  • Europe Developed
    16%
  • Japan
    10%
  • Asia Emerging
    3%
  • Australasia
    3%
  • Asia Developed
    3%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographic allocation is predominantly in North America and developed European markets, with modest exposure to emerging markets and Asia. This distribution suggests a conservative approach to international investing, focusing on more stable, developed economies. However, the limited exposure to faster-growing emerging markets may limit potential returns.

Market capitalization Info

  • Small-cap
    33%
  • Mid-cap
    27%
  • Micro-cap
    19%
  • Large-cap
    11%
  • Mega-cap
    8%

The focus on small to medium-sized companies is consistent with the portfolio’s value and growth-oriented strategy. Small and micro-cap stocks often offer higher growth potential but come with increased risk and volatility. The presence of big and mega-cap stocks, although minimal, helps to provide some balance to the portfolio's risk profile.

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 analysis suggests that with the same level of risk, an optimized portfolio could potentially achieve a higher expected return of 18.09%. This indicates room for improvement in the current allocation, possibly by adjusting the weighting between the existing assets or by diversifying into new asset classes or sectors to enhance the portfolio's risk-return profile.

Dividends Info

  • Avantis® International Small Cap Value ETF 3.80%
  • Avantis ALL Equity Markets Value ETF 2.30%
  • Avantis® U.S. Small Cap Value ETF 1.90%
  • Weighted yield (per year) 2.48%

The portfolio's dividend yield of 2.48% contributes to its total return, providing a steady income stream in addition to potential capital gains. This yield is particularly attractive for value-oriented investors looking for income as well as long-term growth. Regular dividend payments can also help mitigate volatility by providing returns even in flat or declining markets.

Ongoing product costs Info

  • Avantis® International Small Cap Value ETF 0.36%
  • Avantis ALL Equity Markets Value ETF 0.26%
  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Weighted costs total (per year) 0.28%

With a total expense ratio (TER) of 0.28%, the portfolio is efficiently managed in terms of costs, which is crucial for maximizing long-term returns. Lower costs mean more of the investment's return is kept by the investor, a vital consideration given the compounding effect of fees over time.

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