Concentrated small cap value and momentum equity portfolio with strong global diversification and higher risk
Report created on Apr 4, 2026Risk profile
- Secure Speculative
The risk profile, derived from past market volatility, reflects the level of risk the portfolio is exposed to. This assessment helps align your investments with your financial goals and comfort with market fluctuations.
Diversification profile
- Focused Diversified
The diversification assessment evaluates the spread of investments across asset classes, regions, and sectors. This ensures a balanced mix, reducing risk and maximizing returns by not concentrating in any single area.
Positions
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AV Avantis® International Small Cap Value ETF
AVDV - US0250728021 25.00% -
AV Avantis® U.S. Small Cap Value ETF
AVUV - US0250728773 25.00% -
IM Alpha Architect International Quantitative Momentum ETF
IMOM - US02072L3006 25.00% -
QM Alpha Architect U.S. Quantitative Momentum ETF
QMOM - US02072L4095 25.00%
This portfolio is a clean, four‑fund setup split evenly across all holdings, with 100% in stocks. Two funds target small cap value shares and two target quantitative momentum, each split 50/50 between U.S. and international markets. That makes the structure very simple and easy to understand, but also very “all‑in” on one asset class and a couple of very specific strategies. A setup like this leans heavily on equity growth and factor premiums rather than safety assets. The main takeaway is that this works best for someone comfortable with big market swings and who doesn’t need bonds or cash buffers inside the portfolio itself.
Growth
From late 2019 to early 2026, $1,000 grew to about $2,303, which is a compound annual growth rate (CAGR) of 13.73%. CAGR is like your average speed on a road trip, smoothing out bumps along the way. The portfolio slightly lagged the U.S. market but beat the global market, showing that its factor tilts have been competitive worldwide. The tradeoff is a deep max drawdown of about -41%, worse than both benchmarks. That kind of drop is emotionally hard to sit through, so this setup fits investors who can stay invested during ugly but temporary downturns.
Projection
The Monte Carlo projection uses past returns and volatility to simulate many possible 15‑year paths for $1,000, like running thousands of “what if” futures. The median outcome is about $2,602, with most scenarios (middle 50%) landing between roughly $1,700 and $4,100. There’s about a 72% chance of a positive result, and the average simulated annual return is 7.89%. These numbers illustrate both upside potential and the real risk of disappointing outcomes, including ending near or even below the starting value. It’s important to remember simulations depend on history; markets can behave differently in the future.
Asset classes
- Stocks 100%
All of the money here sits in equities, with zero allocation to bonds, cash, or alternatives. That’s very consistent with a Growth risk profile and creates strong long‑term return potential, but it also means no built‑in cushion when markets fall. Equities historically grow more over decades than safer assets, but they’re also much bumpier year to year. This kind of asset mix generally suits someone who has other sources of safety outside the portfolio, like stable income or separate cash savings, and who is genuinely focused on long‑term growth rather than near‑term stability.
Sectors
- Industrials 28%
- Basic Materials 14%
- Technology 11%
- Financials 11%
- Consumer Discretionary 11%
- Energy 9%
- Health Care 5%
- Utilities 4%
- Telecommunications 3%
- Consumer Staples 2%
- Real Estate 1%
Sector exposure is nicely spread out, with the largest slice in industrials and meaningful positions in basic materials, technology, financials, consumer discretionary, and energy. No single sector dominates the way tech often does in broad benchmarks, which is a strength: it reduces reliance on one theme or story. This kind of industrials‑ and cyclicals‑tilted mix can be more sensitive to the economic cycle, often doing well in expansions but feeling recessions more. The balanced spread across ten sectors lines up well with good diversification practice, helping avoid a “one‑bet” portfolio.
Regions
- North America 52%
- Europe Developed 20%
- Japan 12%
- Australasia 7%
- Africa/Middle East 6%
- Asia Developed 2%
- Latin America 1%
- Asia Emerging 1%
Geographically, about half the portfolio sits in North America, with the rest spread across developed Europe, Japan, Australasia, and smaller allocations to other regions. That’s actually quite close to global equity market patterns and is impressively diversified for a factor‑heavy portfolio. Being this global means returns won’t depend on the fate of a single country or currency, which is a real positive. At the same time, international small caps can behave differently from large, familiar names, so currency moves and local economic shocks will show up more in performance than in a purely domestic portfolio.
Market capitalization
- Mid-cap 43%
- Small-cap 31%
- Micro-cap 12%
- Large-cap 11%
- Mega-cap 2%
Market cap exposure is strongly tilted toward the smaller end: mid caps dominate, followed by small caps and even a decent slice of micro caps. Large and mega caps are only a small portion. Smaller companies tend to be more volatile and more sensitive to economic conditions, but historically they’ve offered higher expected returns over long periods. This size tilt is very intentional given the chosen funds. The big implication is that performance will often look quite different from broad large‑cap indexes — sometimes much better, sometimes noticeably worse — so tracking big headline indices isn’t a useful yardstick month to month.
True holdings
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FI Five Below Inc 0.80%
Part of fund(s):- Alpha Architect U.S. Quantitative Momentum ETF
- Avantis® U.S. Small Cap Value ETF
-
TS Tower Semiconductor Ltd 0.73%
Part of fund(s):- Alpha Architect International Quantitative Momentum ETF
-
ES Elbit Systems Ltd 0.65%
Part of fund(s):- Alpha Architect International Quantitative Momentum ETF
-
LY Lynas Rare EARTHS Ltd 0.64%
Part of fund(s):- Alpha Architect International Quantitative Momentum ETF
-
MI Millicom International Cellular S.A 0.63%
Part of fund(s):- Alpha Architect International Quantitative Momentum ETF
-
MT MasTec Inc 0.60%
Part of fund(s):- Alpha Architect U.S. Quantitative Momentum ETF
-
SA EchoStar Corporation 0.59%
Part of fund(s):- Alpha Architect U.S. Quantitative Momentum ETF
-
BB BridgeBio Pharma Inc 0.59%
Part of fund(s):- Alpha Architect U.S. Quantitative Momentum ETF
-
RW RWE AG 0.58%
Part of fund(s):- Alpha Architect International Quantitative Momentum ETF
-
IN Insmed Inc 0.58%
Part of fund(s):- Alpha Architect U.S. Quantitative Momentum ETF
- Top 10 total 6.40%
Looking through ETF top holdings, no single stock dominates overall exposure: the largest underlying names are each well under 1% of the portfolio. That’s a nice sign of stock‑level diversification, especially given the small and micro cap focus. At the same time, the coverage here is only about 16% of total ETF holdings, so overlap between funds is probably higher than it looks. It’s likely that some companies appear in both value and momentum funds, which can quietly concentrate risk in certain names. The key point is that diversification comes from owning many small positions rather than a few big ones.
Factors
Factor exposures are estimated using statistical models based on historical data and measure systematic (market-relative) tilts, not absolute portfolio characteristics. Results may vary depending on the analysis period, data availability, and currency of the underlying assets.
Factor exposure is where this portfolio is most distinctive. Value and size are both high, meaning a strong tilt toward cheaper, smaller companies. Momentum is also high, so there’s a preference for stocks that have been trending well. Together, these three factors create a very “factor‑intense” profile that can shine in certain regimes but also go through painful stretches when these styles fall out of favor. Quality is relatively low, so the holdings on average may have more business or balance‑sheet risk. The big takeaway: expect performance to be very “boom and bust” versus a plain market index, even over multi‑year periods.
Risk contribution
-
Alpha Architect U.S. Quantitative Momentum ETF
Weight: 25.00% 29.1% -
Avantis® U.S. Small Cap Value ETF
Weight: 25.00% 28.4% -
Alpha Architect International Quantitative Momentum ETF
Weight: 25.00% 22.2% -
Avantis® International Small Cap Value ETF
Weight: 25.00% 20.3%
Risk contribution shows how much each holding drives the overall ups and downs, which isn’t always the same as its weight. Here, the U.S. momentum and U.S. small value funds each contribute a bit more risk than their 25% allocation, while the international funds contribute a bit less. Overall, the top three holdings generate about 80% of total portfolio risk, even though they’re just 75% by weight. That’s still reasonably balanced, and it’s good news that no single fund is a runaway risk driver. If someone wanted to dial risk slightly down, they could look first at trimming the higher risk‑per‑weight positions.
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.
On the risk‑return chart, the current portfolio sits right on or very close to the efficient frontier. The efficient frontier is the curve of best possible returns for each risk level using just these holdings in different mixes. A Sharpe ratio of 0.54 for the current mix is lower than the 0.76 at the optimal point, but that optimal and the minimum‑variance portfolio both have similar expected returns with slightly less risk. The encouraging takeaway is that this lineup of funds is already very efficiently combined; only small tweaks to weights could further improve risk‑adjusted returns if desired, without adding anything new.
Dividends
- Avantis® International Small Cap Value ETF 3.00%
- Avantis® U.S. Small Cap Value ETF 1.40%
- Alpha Architect International Quantitative Momentum ETF 2.40%
- Alpha Architect U.S. Quantitative Momentum ETF 0.50%
- Weighted yield (per year) 1.82%
The overall dividend yield is about 1.82%, with individual funds ranging from roughly 0.5% to 3%. That’s on the lower‑to‑moderate side for an equity portfolio, which makes sense given the focus on small caps and momentum — these types of companies often reinvest profits instead of paying high dividends. Dividends can be a nice source of steady return and help soften drawdowns, but here they’re clearly a secondary feature rather than the main event. This structure is better suited to investors aiming for growth through price appreciation rather than meaningful current income.
Ongoing product costs
- Avantis® International Small Cap Value ETF 0.36%
- Avantis® U.S. Small Cap Value ETF 0.25%
- Alpha Architect International Quantitative Momentum ETF 0.39%
- Alpha Architect U.S. Quantitative Momentum ETF 0.29%
- Weighted costs total (per year) 0.32%
The total expense ratio (TER) for the portfolio is around 0.32%, with individual funds between 0.25% and 0.39%. TER is the annual fee the funds charge, taken out of returns behind the scenes. For actively managed, factor‑focused ETFs, this cost level is impressively low and a real strength. Keeping costs down is one of the few things investors can reliably control, and shaving even a few tenths of a percent compounds meaningfully over decades. In this case, the fees look well justified by the specialized strategies, and they support rather than drag on long‑term performance.
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