Balanced portfolio with a focus on large-cap equities and moderate bond exposure

Report created on Aug 2, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

3/5
Moderately Diversified
Less diversification More diversification

Positions

This portfolio allocates 76% to stocks, 20% to bonds, and a minor 4% to cash, presenting a balanced approach with a tilt towards equities. The substantial allocation towards the Fidelity Mega Cap Stock Fund and Fidelity 500 Index Fund, each comprising 30% of the portfolio, emphasizes large-cap equities. The inclusion of mid-cap stocks and investment-grade bonds adds diversity, albeit the portfolio leans heavily on mega and large-cap stocks, which could impact volatility and growth prospects.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 10.12% and a maximum drawdown of -31.71%, the portfolio has demonstrated resilience and growth over time. The days contributing to 90% of returns being limited to 26 indicates that performance peaks are concentrated, suggesting potential volatility. Comparing these figures with benchmarks could provide insight into relative performance, especially during market downturns.

Projection Info

Monte Carlo simulations, utilizing 1,000 iterations, project a wide range of outcomes with a median increase of 205.9%. This method, while based on historical data, offers a probabilistic view of future performance, not a guarantee. The high number of simulations yielding positive returns suggests resilience, but investors should remain cautious of over-reliance on these projections due to their inherent uncertainty.

Asset classes Info

  • Stocks
    76%
  • Bonds
    20%
  • Cash
    4%
  • No data
    1%

The asset class distribution, with a heavy skew towards stocks, particularly large and mega-cap, is suitable for a balanced to growth-oriented investor. The bond allocation, primarily in investment-grade bonds, provides a cushion against stock market volatility. However, the minimal cash holding limits liquidity, which might be a concern during market corrections or for investors requiring more immediate access to their funds.

Sectors Info

  • Technology
    25%
  • Financials
    13%
  • Industrials
    13%
  • Telecommunications
    8%
  • Consumer Discretionary
    8%
  • Health Care
    7%
  • Energy
    5%
  • Consumer Staples
    4%
  • Utilities
    3%
  • Real Estate
    2%
  • Basic Materials
    2%

Sector allocations show a strong preference for technology and financial services, followed by industrials. This sectoral distribution reflects common market trends but also exposes the portfolio to sector-specific risks. For instance, technology stocks, while offering growth potential, can be volatile in response to market changes. Diversifying across more sectors or adjusting sector weights could mitigate this risk.

Regions Info

  • North America
    86%
  • No data
    10%
  • Europe Developed
    3%
  • Asia Developed
    1%

Geographically, the portfolio is heavily weighted towards North America, with minimal exposure to developed Europe and Asia, and no exposure to Latin America or emerging Asian markets. This concentration in a single region, while potentially capitalizing on the stability and growth of North American markets, limits global diversification and exposure to potentially higher growth rates in emerging markets.

Market capitalization Info

  • Mega-cap
    29%
  • Large-cap
    25%
  • Mid-cap
    19%
  • Small-cap
    4%

The market capitalization breakdown shows a predominant focus on mega and large-cap stocks, which tend to be more stable and less volatile than their smaller counterparts. However, this focus may limit growth potential compared to more diversified portfolios that include a higher percentage of mid to small-cap stocks, known for their higher growth potential albeit with increased risk.

Redundant positions Info

  • Fidelity 500 Index Fund
    FIDELITY MID CAP INDEX FUND INSTITUTIONAL PREMIUM CLASS
    High correlation

The high correlation between the Fidelity 500 Index Fund and Fidelity Mid Cap Index Fund suggests redundancy, limiting the benefits of diversification. Identifying and reducing overlap between holdings can enhance the portfolio's risk-adjusted returns by ensuring that each investment contributes uniquely to the portfolio's performance profile.

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 current allocation suggests room for optimization, particularly by addressing the high correlation between certain assets. Utilizing the Efficient Frontier concept could help in achieving the most favorable risk-return trade-off. By reallocating assets to reduce overlap and potentially incorporating more diverse asset classes or sectors, the portfolio could achieve a more efficient distribution, enhancing expected returns for the given level of risk.

Dividends Info

  • FIDELITY CAPITAL & INCOME FUND FIDELITY CAPITAL & INCOME FUND 4.00%
  • FIDELITY INVESTMENT GRADE BOND FUND FIDELITY INVESTMENT GRADE BOND FUND 3.20%
  • FIDELITY MEGA CAP STOCK FUND FIDELITY MEGA CAP STOCK FUND 0.90%
  • FIDELITY MID CAP INDEX FUND INSTITUTIONAL PREMIUM CLASS 1.10%
  • Fidelity 500 Index Fund 0.90%
  • Weighted yield (per year) 1.62%

The overall dividend yield of 1.62%, with the highest contributions from the Fidelity Capital & Income Fund, provides a steady income stream. This yield, while modest, complements the portfolio's growth strategy by offering periodic returns, which can be reinvested to compound growth or provide liquidity.

Ongoing product costs Info

  • FIDELITY CAPITAL & INCOME FUND FIDELITY CAPITAL & INCOME FUND 0.90%
  • FIDELITY INVESTMENT GRADE BOND FUND FIDELITY INVESTMENT GRADE BOND FUND 0.44%
  • FIDELITY MEGA CAP STOCK FUND FIDELITY MEGA CAP STOCK FUND 0.59%
  • FIDELITY MID CAP INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.02%
  • Fidelity 500 Index Fund 0.02%
  • Weighted costs total (per year) 0.36%

Total Expense Ratio (TER) of 0.36% is relatively low, enhancing net returns to investors. The varied cost structure across funds, from as low as 0.02% for index funds to 0.90% for more actively managed funds, reflects a balance between cost efficiency and the potential for higher returns from active management. Maintaining low investment costs is crucial for long-term growth, as even small differences in fees can significantly impact net returns over time.

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