Balanced growth-focused portfolio with strategic ETF diversification and low costs

Report created on Aug 16, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio is constructed with a clear focus on growth, leveraging a mix of ETFs that span large-cap, total stock market, momentum strategies, and small-cap value areas. The allocation is predominantly in ETFs, with a significant emphasis on the U.S. stock market, indicated by a 95% concentration in four U.S.-centric funds. The inclusion of a small-cap value ETF adds a layer of diversification, aiming to capture value-driven growth opportunities that large-cap and total market funds might miss. This structure suggests a strategy designed to balance broad market exposure with targeted growth prospects.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 23.17% and a maximum drawdown of -19.00%, the portfolio demonstrates strong historical performance with resilience during market downturns. The days contributing to 90% of returns highlight the portfolio's potential for significant gains during short periods, underscoring the importance of staying invested through market cycles. This performance, especially in comparison to benchmarks, suggests that the selected ETFs have been effective in capitalizing on growth trends while managing downside risks.

Projection Info

The Monte Carlo simulation, with 1,000 iterations, projects a wide range of outcomes, with the 50th percentile suggesting a potential 2,133.7% increase. This forward-looking analysis, while based on historical data, underscores the portfolio's growth potential but also highlights the inherent uncertainty in market movements. It's important to remember that such simulations are theoretical and actual future performance can vary significantly due to unforeseen market developments.

Asset classes Info

  • Stocks
    100%

The portfolio's allocation is solely in stocks, which aligns with its growth orientation but also carries a higher risk compared to more diversified allocations that include bonds or other asset classes. This singular focus on equities is suitable for investors with a higher risk tolerance and a long-term investment horizon, as it may experience significant volatility in the short term. Considering the inclusion of various types of equities (large-cap, total market, momentum, and small-cap value) does provide a degree of diversification within the asset class.

Sectors Info

  • Technology
    30%
  • Financials
    15%
  • Consumer Discretionary
    12%
  • Industrials
    10%
  • Telecommunications
    10%
  • Health Care
    7%
  • Consumer Staples
    5%
  • Basic Materials
    4%
  • Energy
    4%
  • Utilities
    2%
  • Real Estate
    2%

Sector allocation is diverse, with technology leading at 30%, followed by financial services and consumer cyclicals. This sector spread is indicative of a growth-focused strategy, as technology and consumer cyclicals often outperform during economic expansions. However, the heavy weighting in technology also exposes the portfolio to sector-specific risks, such as regulatory changes or market sentiment shifts. Balancing sector exposure can mitigate these risks while still capturing growth.

Regions Info

  • North America
    76%
  • Europe Developed
    10%
  • Japan
    4%
  • Asia Emerging
    4%
  • Asia Developed
    3%
  • Australasia
    1%
  • Latin America
    1%
  • Africa/Middle East
    1%

The geographic allocation heavily favors North America, with minor exposures to developed Europe, Japan, and emerging markets in Asia. This concentration in the U.S. market is consistent with the portfolio's growth strategy, given the U.S.'s significant global market presence and innovation leadership. However, this geographic focus may limit exposure to growth opportunities in emerging markets and other developed regions, potentially affecting the portfolio's diversification and risk profile.

Market capitalization Info

  • Mega-cap
    44%
  • Large-cap
    26%
  • Mid-cap
    17%
  • Small-cap
    6%
  • Micro-cap
    3%

The market capitalization breakdown shows a strategic emphasis on mega and big-cap stocks, which are typically less volatile than smaller companies. This focus aligns with the portfolio's balanced risk profile, as larger companies often have more stable earnings and dividends. However, the inclusion of medium, small, and micro-cap stocks, especially through the small-cap value ETF, introduces growth potential from smaller companies, adding a valuable dimension to the portfolio's diversification.

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 current allocation appears well-positioned on the Efficient Frontier, indicating an optimized risk-return profile based on historical data. It's important to note, however, that "optimization" is based on past performance, which is not a reliable indicator of future results. Regularly reviewing and adjusting the portfolio in response to changing market conditions and personal investment goals can help maintain this balance over time.

Dividends Info

  • American Century ETF Trust 3.00%
  • Avantis® U.S. Small Cap Value ETF 1.70%
  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • Invesco S&P 500® Momentum ETF 0.60%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.20%
  • Weighted yield (per year) 1.38%

The dividend yields across the ETFs contribute to the portfolio's total yield of 1.38%, adding a steady income stream to the growth-focused strategy. While dividends are not the primary focus, they offer a form of passive income and can provide a cushion during market downturns. Reinvesting these dividends can also compound growth over time, enhancing long-term returns.

Ongoing product costs Info

  • American Century ETF Trust 0.31%
  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • Invesco S&P 500® Momentum ETF 0.13%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Weighted costs total (per year) 0.12%

The portfolio benefits from low overall costs, with a Total Expense Ratio (TER) of 0.12%, which is impressively low for a diversified ETF portfolio. Lower costs translate directly to higher net returns for investors, making this portfolio more efficient in terms of cost-to-performance ratio. Keeping costs low while maintaining strategic diversification is crucial for maximizing long-term growth potential.

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