A growth-focused portfolio with a strong global reach and balanced asset allocation

Report created on May 6, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

This portfolio combines a 75% allocation in a global equity ETF with a 25% stake in a global bond ETF, hedged in GBP. This structure showcases a strategic balance between growth (equity) and stability (bonds), aimed at capturing global market returns while mitigating volatility through fixed income. The equity component is diversified across major sectors and regions, with a heavier emphasis on North America and technology, reflecting a growth-oriented approach. The bond allocation provides a counterbalance, offering income and reducing overall portfolio risk.

Growth Info

Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 10.01%, with a maximum drawdown of -30.46%. These figures indicate a strong performance, with the potential for substantial gains but also notable volatility. The days contributing most to returns highlight the impact of significant market movements on performance. Comparing these metrics to benchmarks can help gauge the portfolio's risk-adjusted returns, emphasizing the importance of understanding volatility in pursuit of growth.

Projection Info

Monte Carlo simulations, which run thousands of potential outcomes based on historical data, project a wide range of future portfolio values. With a median (50th percentile) increase of 89.4% and 765 out of 1,000 simulations showing positive returns, the outlook appears generally positive. However, the 5th percentile outcome of -55.8% underscores the risk of significant losses. These projections are useful for understanding potential volatility and tail risks but should not be seen as guarantees.

Asset classes Info

  • Stocks
    75%
  • Bonds
    25%

The 75%-25% split between stocks and bonds is well-suited for a growth profile, offering a blend of potential for high returns and income generation with some downside protection. This allocation aligns with the portfolio's risk score of 5 out of 7, indicating a higher tolerance for volatility in pursuit of growth. Diversification across only two asset classes, however, might limit opportunities to further mitigate risk through exposure to alternative assets.

Sectors Info

  • Technology
    17%
  • Financials
    13%
  • Industrials
    8%
  • Consumer Discretionary
    8%
  • Health Care
    8%
  • Telecommunications
    6%
  • Consumer Staples
    4%
  • Energy
    3%
  • Basic Materials
    3%
  • Real Estate
    2%
  • Utilities
    2%

The sectoral allocation emphasizes technology, financial services, and industrials, sectors often associated with higher growth potential. This focus may increase exposure to sector-specific risks, such as regulatory changes or economic cycles. However, it also positions the portfolio to benefit from technological innovation and economic development. Balancing this with more defensive sectors like healthcare and consumer staples could offer a more stable performance during market downturns.

Regions Info

  • North America
    49%
  • Europe Developed
    11%
  • Asia Emerging
    4%
  • Japan
    4%
  • Asia Developed
    3%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    1%

With 49% exposure to North America and significant investments in developed Europe and Asia, the portfolio is well-positioned to capitalize on growth in major economies. However, the relatively low exposure to emerging markets (5%) and specific regions like Latin America and Africa/Middle East may limit potential gains from these high-growth areas. Considering the global economic shifts and emerging market potential, a slight adjustment to geographic allocation could enhance growth prospects and diversification.

Market capitalization Info

  • Mega-cap
    33%
  • Large-cap
    24%
  • Mid-cap
    13%
  • Small-cap
    4%
  • Micro-cap
    1%

The focus on mega and big cap stocks (57% combined) suggests a preference for established, large-scale companies likely to offer stability and consistent returns. However, this emphasis may limit the portfolio's ability to capture the higher growth potential of medium, small, or micro-cap companies. Diversifying across a broader range of market capitalizations could introduce more growth opportunities, albeit with increased 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.

Using the Efficient Frontier to optimize the portfolio suggests that its current asset allocation is close to offering an optimal risk-return balance for its growth profile. However, exploring slight adjustments, such as increasing exposure to emerging markets or varying market capitalizations, could potentially enhance returns without proportionately increasing risk. This approach underscores the importance of regular portfolio reviews to adapt to changing market conditions and personal financial goals.

Ongoing product costs Info

  • SPDR MSCI ACWI IMI 0.40%
  • Vanguard Global Aggregate Bond UCITS ETF GBP Hedged Accumulation 0.10%
  • Weighted costs total (per year) 0.32%

With total portfolio costs averaging 0.32%, the portfolio benefits from relatively low expenses, enhancing net returns. The cost efficiency is crucial for long-term growth, as even small differences in fees can significantly impact compounded returns. Investors should continue to monitor these costs, ensuring they remain competitive and do not erode investment gains.

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