Balanced and broadly diversified portfolio emphasizing global stock market exposure

Risk 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.

What type of investor this portfolio is suitable for

Balanced Investors

This portfolio suits an investor seeking balanced growth with moderate risk tolerance and a long-term horizon. It prioritizes steady returns while maintaining exposure to global equities, making it ideal for individuals looking to build wealth over time. The investor likely values diversification and understands the importance of global market exposure in achieving a balanced risk-return profile.

Positions

  • Vanguard Total Stock Market Index Fund ETF Shares
    VTI - US9229087690
    65.00%
  • Vanguard Total International Stock Index Fund ETF Shares
    VXUS - US9219097683
    35.00%

The portfolio primarily consists of two ETFs: the Vanguard Total Stock Market Index Fund ETF Shares, making up 65% of the portfolio, and the Vanguard Total International Stock Index Fund ETF Shares, comprising the remaining 35%. This composition demonstrates a strong inclination towards equities, with a notable emphasis on both U.S. and international markets. The allocation is broadly diversified across multiple sectors and geographies, aligning with a balanced risk profile that seeks growth while mitigating risk through global diversification.

Growth Info

Over the observed period, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 10.43%, with a maximum drawdown of -34.52%. This performance indicates a resilient growth trajectory, albeit with significant volatility. The days contributing most to returns highlight the impact of short-term fluctuations on overall performance. Comparatively, the portfolio's returns are in line with typical expectations for a balanced and globally diversified equity portfolio, suggesting that the allocation strategy has effectively balanced risk and return.

Projection Info

Using a Monte Carlo simulation, which projects future performance based on historical data, the portfolio shows a wide range of potential outcomes. The 50th percentile outcome suggests a potential increase of 228.7%, demonstrating robust growth potential. However, it's essential to remember that such simulations are inherently uncertain and depend heavily on past market behavior, which may not predict future movements accurately.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%
  • Other
    0%
  • No data
    0%

The portfolio is almost entirely invested in stocks (99%), with a minimal cash holding (1%). This high equity exposure is characteristic of a growth-oriented strategy, aiming for higher returns at the expense of increased volatility. The absence of other asset classes, such as bonds or real estate, limits the portfolio's diversification benefits, potentially increasing risk during market downturns.

Sectors Info

  • Technology
    24%
  • Financials
    17%
  • Industrials
    11%
  • Consumer Discretionary
    11%
  • Health Care
    10%
  • Telecommunications
    8%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    4%
  • Real Estate
    3%
  • Utilities
    3%

Sector allocation within the portfolio is well-diversified, with technology (24%) and financial services (17%) being the most heavily weighted. This sectoral distribution reflects a balanced approach, capturing growth opportunities in tech while maintaining substantial positions in traditionally stable sectors like financials and healthcare. However, the tech-heavy focus may introduce higher volatility, especially in market conditions unfavorable to growth stocks.

Regions Info

  • North America
    67%
  • Europe Developed
    14%
  • Asia Emerging
    6%
  • Japan
    5%
  • Asia Developed
    3%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%
  • Europe Emerging
    0%

Geographic allocation shows a significant emphasis on North America (67%), followed by developed Europe (14%) and emerging Asia (6%). This distribution underscores a strong foundation in stable, developed markets while maintaining exposure to growth opportunities in emerging regions. However, the relatively low allocation to emerging markets could limit potential returns from these high-growth areas.

Market capitalization Info

  • Mega-cap
    42%
  • Large-cap
    30%
  • Mid-cap
    19%
  • Small-cap
    6%
  • Micro-cap
    2%

The portfolio's market capitalization breakdown reveals a preference for mega (42%) and big (30%) cap stocks, indicating a tilt towards larger, more established companies. This focus likely contributes to the portfolio's overall stability and resilience, as these companies tend to be less volatile than their smaller counterparts. However, the relatively smaller allocation to small (6%) and micro (2%) cap stocks may limit exposure to high-growth potential opportunities.

Dividends Info

  • Vanguard Total Stock Market Index Fund ETF Shares 1.40%
  • Vanguard Total International Stock Index Fund ETF Shares 3.10%
  • Weighted yield (per year) 2.00%

The portfolio yields a total dividend of 2.00%, with the international ETF contributing a higher yield (3.10%) compared to the domestic ETF (1.40%). This dividend income can provide a steady stream of returns, which is beneficial in both bull and bear markets. For investors seeking income, the portfolio's dividend yield, while modest, offers an additional return component on top of capital appreciation.

Ongoing product costs Info

  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.04%

The portfolio benefits from exceptionally low costs, with a Total Expense Ratio (TER) of only 0.04%. Low costs are crucial for long-term investment success, as they directly enhance net returns by reducing the drag on performance. This cost efficiency is a significant advantage, ensuring that more of the portfolio's gross returns contribute to wealth accumulation.

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.

Considering the Efficient Frontier, the current portfolio appears well-positioned for a balanced investor, offering a favorable risk-return profile. However, there may be opportunities to enhance this balance further by adjusting allocations or diversifying into additional asset classes. While the portfolio is efficient within its current framework, exploring such adjustments could potentially yield better risk-adjusted returns.

What next?

Ready to invest in this portfolio?

Select a broker that fits your needs and watch for low fees to maximize your returns.

Select broker

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.