Growth-focused portfolio with strong US bias and emphasis on dividend and momentum ETFs

Report created on Aug 1, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

3/5
Moderately Diversified
Less diversification More diversification

Positions

The portfolio is heavily weighted towards US equities, comprising 70% of the allocation, with a significant emphasis on growth, dividend-paying stocks, and momentum strategies. This structure suggests a focus on capital appreciation combined with income generation. The inclusion of international ETFs adds a degree of global exposure, though it's somewhat limited. The portfolio's diversification is moderate, with a concentration in technology and financial services sectors, reflecting a typical growth-oriented investment approach. However, the lack of asset classes beyond stocks, such as bonds or real estate, indicates a higher risk profile and less buffer against market volatility.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 17.30% and a maximum drawdown of -33.16%, the portfolio has demonstrated strong growth potential alongside significant volatility. The days contributing to 90% of returns highlight the portfolio's dependence on short-term gains, which may not be sustainable in different market conditions. Comparing these figures against benchmarks could provide further insight into performance, but the high growth rate suggests that the portfolio has capitalized well on bullish market trends, albeit with the risk of sharp downturns.

Projection Info

Monte Carlo simulations, which use historical data to forecast a range of possible future outcomes, show a wide dispersion in potential portfolio values, indicating both high growth potential and risk. With 994 out of 1,000 simulations yielding positive returns, the outlook seems optimistic. However, the wide range between the 5th and 67th percentiles underscores the uncertainty and risk inherent in the portfolio's current configuration. Investors should consider these projections as one of many tools, acknowledging their reliance on past trends that may not predict future movements accurately.

Asset classes Info

  • Stocks
    100%

The portfolio's exclusive allocation to stocks, without any bonds, cash, or alternative investments, aligns with its growth-oriented risk profile but limits diversification benefits. This allocation strategy enhances potential returns but also increases susceptibility to market fluctuations. Diversifying across different asset classes can provide a buffer against stock market volatility, potentially smoothing out returns over time without significantly compromising growth objectives.

Sectors Info

  • Technology
    26%
  • Financials
    16%
  • Consumer Discretionary
    11%
  • Health Care
    9%
  • Telecommunications
    9%
  • Industrials
    9%
  • Consumer Staples
    8%
  • Energy
    6%
  • Basic Materials
    2%
  • Utilities
    2%
  • Real Estate
    1%

Sector allocation is heavily skewed towards technology and financial services, which are known for their growth potential but also for their volatility. The presence of consumer cyclicals, healthcare, and industrials provides some balance, yet the portfolio might be exposed to sector-specific risks. Given the rapid pace of change in the technology sector and the cyclical nature of financial services, investors may face significant fluctuations in portfolio value in response to market or economic shifts.

Regions Info

  • North America
    81%
  • Europe Developed
    10%
  • Japan
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Asia Emerging
    1%
  • Africa/Middle East
    1%

The portfolio's geographic allocation is predominantly in North America (81%), with modest exposure to developed European markets and minimal allocations to Japan, Asia, and other regions. This US-centric approach has likely contributed to the portfolio's strong performance, given the robust US equity markets in recent years. However, this concentration also introduces geographic risk, potentially limiting opportunities for diversification and exposure to growth in emerging and other developed markets.

Market capitalization Info

  • Mega-cap
    42%
  • Large-cap
    37%
  • Mid-cap
    18%
  • Small-cap
    2%

The focus on mega and big-cap stocks (79% combined) is consistent with the portfolio's growth and dividend strategy, as these companies often offer more stability and consistent dividends than smaller firms. However, the limited exposure to medium, small, and micro-cap stocks could mean missing out on higher growth potential offered by smaller companies, which can sometimes offer more significant returns albeit with higher risk.

Redundant positions Info

  • Schwab International Equity ETF
    Vanguard International High Dividend Yield Index Fund ETF Shares
    High correlation
  • Schwab U.S. Large-Cap Growth ETF
    SPDR® Portfolio S&P 500 ETF
    High correlation

The portfolio contains highly correlated assets, particularly among US equity ETFs and international equity ETFs, which could limit diversification benefits. This redundancy suggests that the portfolio might not be as diversified as intended, as similar assets tend to move in tandem, especially during market downturns. Reducing overlap by reallocating investments into less correlated assets could enhance the portfolio's resilience against market volatility.

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 the portfolio involves addressing the identified issues of correlated assets and limited diversification across asset classes and geographies. By reallocating funds from overlapping ETFs to underrepresented areas, the portfolio can achieve a more balanced risk-return profile. This process should aim to maintain the growth focus while enhancing stability through broader diversification, potentially moving closer to the Efficient Frontier, where the portfolio's risk-return ratio is optimized.

Dividends Info

  • Schwab U.S. Dividend Equity ETF 3.90%
  • Schwab International Equity ETF 2.60%
  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • SPDR® Portfolio S&P 500 ETF 1.20%
  • Invesco S&P 500® Momentum ETF 0.60%
  • Vanguard International High Dividend Yield Index Fund ETF Shares 4.20%
  • Weighted yield (per year) 1.96%

The dividend yields across various ETFs contribute to the portfolio's total yield of 1.96%, providing a steady income stream that complements capital appreciation. This strategy is particularly beneficial in volatile or declining markets, where dividend income can offset lower price returns. However, focusing too heavily on dividend yield might lead to overlooking growth opportunities in non-dividend-paying sectors or companies.

Ongoing product costs Info

  • Schwab U.S. Dividend Equity ETF 0.06%
  • Schwab International Equity ETF 0.06%
  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • SPDR® Portfolio S&P 500 ETF 0.02%
  • Invesco S&P 500® Momentum ETF 0.13%
  • Vanguard International High Dividend Yield Index Fund ETF Shares 0.22%
  • Weighted costs total (per year) 0.07%

The portfolio's overall expense ratio of 0.07% is impressively low, enhancing net returns to the investor. Keeping costs low is crucial for long-term investment success, as even small differences in fees can compound into significant impacts over time. This efficient cost structure is a strong aspect of the portfolio, supporting better performance without unnecessary drag from high fees.

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