A predominantly value-focused portfolio with limited geographic diversity and low-cost structure

Report created on Dec 23, 2024

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

The portfolio is heavily weighted towards the Vanguard Value Index Fund ETF Shares, making up 75.1% of the total. The SPDR® Portfolio S&P 500 ETF and Invesco NASDAQ 100 ETF comprise 22.36% and 2.55%, respectively. This composition is highly concentrated in a single fund, which can limit diversification. While value-focused, it lacks the balance typically seen in a diversified portfolio. Considering adding other asset classes or funds could enhance diversification and potentially stabilize returns.

Growth Info

Historically, the portfolio has performed well, with a Compound Annual Growth Rate (CAGR) of 14.53%. This strong performance, however, comes with a maximum drawdown of -18.23%, indicating potential volatility. The portfolio's ability to recover from downturns is notable, but past performance is not an indicator of future results. Comparing these figures to benchmarks can help gauge performance consistency. Monitoring performance regularly can ensure alignment with your financial goals.

Projection Info

The forward projection, based on Monte Carlo simulations, suggests robust potential outcomes. With an annualized return of 16.78% across 1,000 simulations, the portfolio shows promising growth prospects. Monte Carlo analysis uses historical data to predict future performance, but it's important to note that these are estimates, not guarantees. Regularly reviewing projections can help in adjusting strategies to meet future financial objectives.

Asset classes Info

  • Stocks
    100%

The portfolio is overwhelmingly allocated to stocks, with a staggering 99.86% in equities and a mere 0.15% in cash. This concentration in a single asset class can increase risk, particularly during market downturns. Diversifying into bonds or other asset classes could reduce risk and provide more stability. A balanced mix of asset classes can help cushion against market volatility and enhance long-term returns.

Sectors Info

  • Financials
    20%
  • Technology
    17%
  • Health Care
    15%
  • Industrials
    12%
  • Consumer Staples
    9%
  • Consumer Discretionary
    7%
  • Energy
    6%
  • Telecommunications
    5%
  • Utilities
    5%
  • Real Estate
    3%
  • Basic Materials
    2%

Sector allocation shows a significant concentration in financial services (19.77%), technology (17.20%), and healthcare (15.46%). While these sectors are well-represented, the portfolio's focus on a few sectors could lead to increased risk if those sectors underperform. Diversifying across more sectors can help mitigate sector-specific risks and align the portfolio more closely with broader market benchmarks.

Regions Info

  • North America
    99%
  • Europe Developed
    1%

The portfolio's geographic allocation is heavily skewed towards North America, with 99.20% exposure. This lack of international diversification may limit potential growth opportunities in global markets. Consider increasing exposure to other regions, such as Europe or Asia, to enhance diversification and reduce region-specific risks. A more balanced geographic allocation can provide a buffer against local economic downturns.

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.

The portfolio's risk-return profile could be optimized using the Efficient Frontier, which seeks the best possible risk-return ratio. Adjusting the allocation between existing assets may enhance efficiency. However, it's important to note that this optimization focuses solely on current assets and doesn't account for other investment goals like diversification or income. Regularly reassessing your asset mix can help maintain an optimal balance.

Dividends Info

  • Invesco NASDAQ 100 ETF 0.50%
  • SPDR® Portfolio S&P 500 ETF 0.90%
  • Vanguard Value Index Fund ETF Shares 1.70%
  • Weighted yield (per year) 1.49%

The portfolio's dividend yield stands at 1.49%, with the Vanguard Value Index Fund ETF Shares contributing the most at 1.7%. Dividends can provide a steady income stream, which is beneficial for income-focused investors. However, the yield is relatively modest, so exploring higher-yielding investments could enhance income potential. Balancing growth and income can optimize the portfolio for both capital appreciation and cash flow.

Ongoing product costs Info

  • Invesco NASDAQ 100 ETF 0.15%
  • SPDR® Portfolio S&P 500 ETF 0.02%
  • Vanguard Value Index Fund ETF Shares 0.04%
  • Weighted costs total (per year) 0.04%

The portfolio's costs are impressively low, with a Total Expense Ratio (TER) of 0.04%. Low costs are advantageous as they enhance net returns over time. Keeping expenses down is crucial for maximizing investment growth. Regularly reviewing and comparing costs with other investment options can ensure you maintain a cost-effective strategy, contributing to better long-term performance.

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