A focused growth portfolio with high exposure to technology and North American equities
Report created on May 29, 2025Risk profile
5/7
Diversification profile
2/5
Positions
-
QG WisdomTree Trust - WisdomTree U.S. Quality Growth Fund
QGRW - US97717Y4778 100.00%
The portfolio is entirely allocated to the WisdomTree U.S. Quality Growth Fund, an ETF that emphasizes growth through U.S. equities. This single-asset approach results in low diversification, focusing heavily on technology, consumer cyclicals, and communication services. Such concentration in specific sectors and a single region (North America) increases exposure to sector-specific and regional risks. The allocation across market capitalizations shows a preference for larger companies, with a significant majority in mega-cap stocks.
Growth
Historically, this portfolio has demonstrated impressive growth with a Compound Annual Growth Rate (CAGR) of 31.61%. However, it's important to note the maximum drawdown of -24.42%, indicating potential volatility and risk. The days contributing most to returns are relatively few, suggesting that the portfolio's performance can be significantly impacted by short-term market movements. This level of performance, while attractive, may not be sustainable indefinitely, and past results are not a reliable indicator of future performance.
Projection
Monte Carlo simulations provide a range of possible outcomes based on historical data, projecting an annualized return of 37.05% on average. The wide range between the 5th and 67th percentiles indicates a high degree of uncertainty and risk. While these projections are useful for understanding potential volatility and outcomes, they rely on past market behavior, which may not predict future market movements accurately.
Asset classes
- Stocks 100%
The portfolio's allocation is entirely in stocks, which can offer high growth potential but also come with increased volatility compared to more diversified portfolios that include bonds or other asset classes. This concentration in equities is suitable for investors with a higher risk tolerance and a long-term investment horizon.
Sectors
- Technology 53%
- Consumer Discretionary 15%
- Telecommunications 13%
- Financials 8%
- Health Care 6%
- Industrials 3%
- Energy 1%
- Consumer Staples 1%
With over half of the portfolio in technology and significant allocations to consumer cyclicals and communication services, the portfolio is positioned to benefit from growth in these sectors. However, this concentration increases susceptibility to sector-specific downturns. Diversifying across a broader range of sectors could mitigate some of this risk.
Regions
- North America 100%
The geographic allocation is exclusively North American, providing no exposure to international markets. This focus may limit opportunities for global diversification and reduce the portfolio's ability to capitalize on growth in other regions.
Market capitalization
- Mega-cap 64%
- Large-cap 20%
- Mid-cap 16%
The portfolio's emphasis on mega-cap stocks aligns with its growth profile, as these companies often have more established businesses and market positions. However, the limited exposure to small and mid-cap stocks could mean missing out on higher growth opportunities that these smaller companies can offer.
Dividends
- WisdomTree Trust - WisdomTree U.S. Quality Growth Fund 0.10%
- Weighted yield (per year) 0.10%
The dividend yield of 0.10% is relatively low, reflecting the growth-oriented nature of the portfolio. Investors prioritizing income alongside growth may need to consider additional sources of dividends or a more balanced approach to asset allocation.
Ongoing product costs
- WisdomTree Trust - WisdomTree U.S. Quality Growth Fund 0.28%
- Weighted costs total (per year) 0.28%
The total expense ratio (TER) of 0.28% is modest, helping to preserve returns over time. Keeping costs low is crucial for enhancing long-term investment outcomes, especially in growth-oriented portfolios where the compounding effect can significantly impact net returns.
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