A growth-focused portfolio with a strong emphasis on US large-cap stocks and low diversification
Report created on Jul 9, 2025Risk profile
5/7
Diversification profile
2/5
Positions
-
SC Schwab U.S. Large-Cap Growth ETF
SCHG - US8085243009 50.00% -
SP SPDR® Portfolio S&P 500 ETF
SPLG - US78464A8541 50.00%
This portfolio is evenly split between the Schwab U.S. Large-Cap Growth ETF and the SPDR® Portfolio S&P 500 ETF, signaling a strong focus on growth through exposure to large-cap U.S. equities. The simplicity of this two-ETF strategy offers clarity but also highlights a lack of diversification across asset classes and geographies. The concentration in just one asset class (stocks) and primarily in one region (North America) increases the portfolio's susceptibility to market volatility specific to large-cap U.S. stocks.
Growth
Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 16.04%, with a significant maximum drawdown of -33.06%. These figures suggest a high-growth trajectory but also underline the portfolio's vulnerability to sharp market declines. The days contributing to 90% of returns being so few indicates that much of the portfolio's gains are concentrated in brief periods, emphasizing the importance of staying invested through market cycles to capture these gains.
Projection
Monte Carlo simulations, which project future performance by analyzing historical data, suggest a wide range of outcomes for this portfolio. With a median projected increase of 627.8% and 997 out of 1,000 simulations showing positive returns, the forward-looking analysis underscores potential for substantial growth. However, the broad spread between the 5th and 67th percentiles (120.0% to 951.6%) also reflects significant risk.
Asset classes
- Stocks 100%
With 100% of the portfolio allocated to stocks, there's a clear growth orientation. This singular focus on equities, while potentially lucrative, lacks the risk mitigation benefits that come from diversifying across different asset classes, such as bonds or real estate. Diversification can help smooth out returns over time, reducing the impact of stock market volatility on the portfolio.
Sectors
- Technology 42%
- Telecommunications 12%
- Consumer Discretionary 12%
- Financials 10%
- Health Care 9%
- Industrials 6%
- Consumer Staples 4%
- Energy 2%
- Basic Materials 2%
- Utilities 1%
- Real Estate 1%
The sectoral allocation is heavily weighted towards technology, followed by communication services and consumer cyclicals. This tech-heavy composition may lead to higher volatility, especially during market downturns or sector-specific corrections. However, it also positions the portfolio to benefit from the growth potential of these dynamic sectors.
Regions
- North America 100%
Geographic exposure is entirely concentrated in North America, missing out on potential opportunities in developed and emerging markets outside the U.S. While this focus simplifies the investment approach and aligns with a U.S.-centric view, it also limits the portfolio's ability to capture global growth trends and reduces geographical diversification.
Market capitalization
- Mega-cap 55%
- Large-cap 28%
- Mid-cap 15%
- Small-cap 1%
The portfolio's emphasis on mega and big-cap stocks (83% combined) aligns with its growth and stability objectives, as these companies typically have more established business models and market positions. However, the minimal exposure to medium, small, and micro-cap stocks limits potential upside from emerging growth companies.
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, there may be opportunities to optimize the portfolio for a better risk-return trade-off. While the current allocation has performed well historically, diversifying into additional asset classes or geographies could potentially enhance returns or reduce volatility, or both, without significantly increasing risk.
Dividends
- Schwab U.S. Large-Cap Growth ETF 0.40%
- SPDR® Portfolio S&P 500 ETF 1.20%
- Weighted yield (per year) 0.80%
The portfolio generates a modest dividend yield of 0.80%, with a notable difference between the two ETFs. While dividends are not the primary focus of this growth-oriented strategy, they can provide a steady income stream and contribute to total returns, especially in volatile or down markets.
Ongoing product costs
- Schwab U.S. Large-Cap Growth ETF 0.04%
- SPDR® Portfolio S&P 500 ETF 0.02%
- Weighted costs total (per year) 0.03%
The portfolio benefits from exceptionally low costs, with a Total Expense Ratio (TER) of just 0.03%. These low costs are advantageous for long-term growth, as they minimize the drag on performance, allowing more of the investment returns to compound over time.
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