This portfolio has only about 10 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.

Balanced Broadly Diversified Portfolio with Strong Historical Performance and Low Costs

Report created on Jul 26, 2024

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The portfolio is composed of two primary ETFs: Vanguard S&P 500 ETF (70%) and Vanguard Total International Stock Index Fund ETF Shares (30%). This composition suggests a strong focus on equity investments with a substantial allocation to U.S. stocks and a significant portion dedicated to international markets. This broad diversification helps mitigate risks associated with specific regions or sectors.

Growth Info

Historically, the portfolio has shown a Compound Annual Growth Rate (CAGR) of 10.66%, which is quite impressive. However, it also experienced a maximum drawdown of -33.86%, indicating significant volatility during market downturns. The 26 days that make up 90% of the returns highlight the importance of being invested during key market movements. This performance suggests that the portfolio is well-suited for long-term growth but requires a tolerance for occasional significant drops.

Projection Info

Using a Monte Carlo simulation with 1,000 iterations, the portfolio's future performance was projected. Assuming a hypothetical initial investment, the simulations show a median (50th percentile) end value of 215.03%, with a 67th percentile value of 327.19%. The 5th percentile, which represents a more pessimistic scenario, still shows a positive return of 4.57%. With 956 out of 1,000 simulations yielding positive returns, the portfolio demonstrates a high probability of achieving positive outcomes over the long term.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The portfolio is heavily weighted in stocks, with 99.02% allocated to equities, a small cash position of 0.93%, and other minor allocations. This high equity exposure is appropriate for growth but comes with increased risk. For a balanced portfolio, it might be beneficial to consider adding other asset classes like bonds to reduce volatility and provide more stability during market downturns.

Sectors Info

  • Technology
    25%
  • Financials
    15%
  • Health Care
    11%
  • Consumer Discretionary
    11%
  • Industrials
    10%
  • Telecommunications
    8%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    4%
  • Real Estate
    3%
  • Utilities
    2%

The sector allocation is diverse, with the largest allocations in Technology (25.50%), Financial Services (14.83%), and Healthcare (11.40%). This diversification across sectors helps to reduce sector-specific risks. However, it's essential to periodically review sector performance and adjust allocations to ensure they align with long-term market trends and personal investment goals.

Regions Info

  • North America
    72%
  • Europe Developed
    12%
  • Japan
    5%
  • Asia Emerging
    4%
  • Asia Developed
    3%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographically, the portfolio is predominantly invested in North America (71.94%), with additional exposure to Europe Developed (12.22%) and Japan (4.96%). This geographical diversification helps mitigate risks associated with any single region's economic performance. However, the heavy weighting in North America suggests a reliance on the U.S. market, which could be balanced with increased exposure to other regions.

Dividends Info

  • Vanguard S&P 500 ETF 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 3.10%
  • Weighted yield (per year) 1.84%

The portfolio's dividend yield is not specified, but given the ETFs involved, it likely provides a modest income stream. Dividends can be an essential part of total returns, especially during periods of market stagnation. Reinvesting dividends can also help compound growth over time. Regularly reviewing the yield and ensuring it aligns with income needs is recommended.

Ongoing product costs Info

  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.08%
  • Weighted costs total (per year) 0.04%

The portfolio's total expense ratio (TER) is impressively low at 0.04%, with the Vanguard S&P 500 ETF costing 0.03% and the Vanguard Total International Stock Index Fund ETF Shares at 0.08%. Low costs are crucial for maximizing net returns over time. This cost-efficiency makes the portfolio attractive for long-term investors looking to minimize fees and enhance overall performance.

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