Balanced portfolio with a strong tilt towards equity and a focus on US markets

Report created on Jul 21, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

1/5
Single-Focused
Less diversification More diversification

Positions

This portfolio is heavily weighted towards equities, with a 90% allocation split between growth and value ETFs, complemented by a 10% allocation in bonds. The substantial equity component is balanced between Vanguard's S&P 500 Growth and Value Index Fund ETF Shares, with a smaller but significant portion dedicated to dividend appreciation. This structure aims to capture the benefits of both market appreciation and income generation, though it leans more towards capital gains given the growth orientation.

Growth Info

Historically, this portfolio has demonstrated a Compound Annual Growth Rate (CAGR) of 13.50%, with a maximum drawdown of -31.10%. Such performance metrics suggest a resilient portfolio during bullish markets but also highlight potential vulnerability during market downturns. The days contributing to 90% of returns being concentrated in just 32 days indicate that performance peaks are relatively infrequent but significant when they occur, underscoring the importance of staying invested through market cycles.

Projection Info

Monte Carlo simulations, which project potential outcomes using historical data, suggest a wide range of future performance scenarios for this portfolio. With 992 out of 1,000 simulations yielding positive returns, the median outcome shows a 318.7% increase, highlighting the portfolio's potential for substantial growth. However, the spread between the 5th and 67th percentiles indicates significant volatility, emphasizing the need for risk tolerance.

Asset classes Info

  • Stocks
    90%
  • Bonds
    10%

The portfolio's asset class distribution, with 90% in stocks and 10% in bonds, positions it for growth while offering limited protection against market volatility through its bond holdings. This allocation is suitable for investors with a moderate to high-risk tolerance, seeking long-term capital appreciation. However, the absence of alternative asset classes such as real estate or commodities may limit diversification benefits.

Sectors Info

  • Technology
    26%
  • Financials
    16%
  • Health Care
    9%
  • Industrials
    9%
  • Telecommunications
    9%
  • Consumer Discretionary
    8%
  • Consumer Staples
    6%
  • Energy
    2%
  • Utilities
    2%
  • Real Estate
    2%
  • Basic Materials
    1%

Sector allocation is broadly diversified across technology, financial services, healthcare, and industrials, among others. The heavy emphasis on technology and financial services aligns with the portfolio's growth orientation but may increase susceptibility to sector-specific risks. Diversifying further into underrepresented sectors or increasing allocations to defensive sectors like consumer staples or utilities could enhance stability.

Regions Info

  • North America
    90%

Geographic exposure is predominantly North American (90%), with no allocation to developed Europe or Asia, indicating a strong home bias. This concentration enhances exposure to the US economy's growth potential but may increase vulnerability to regional economic downturns. Incorporating developed European or Asian equities could offer better global diversification and access to international growth opportunities.

Market capitalization Info

  • Mega-cap
    41%
  • Large-cap
    32%
  • Mid-cap
    16%
  • No data
    10%

The market capitalization breakdown reveals a focus on mega and big-cap stocks, which tend to be more stable than smaller companies but may offer lower growth potential. The absence of small and micro-cap stocks limits exposure to high-growth segments of the market, potentially capping overall portfolio growth in booming economic conditions.

Redundant positions Info

  • Vanguard Value Index Fund ETF Shares
    Vanguard Dividend Appreciation Index Fund ETF Shares
    High correlation

The high correlation between the Vanguard Value Index Fund and Vanguard Dividend Appreciation Index Fund ETF Shares suggests overlapping holdings that may not provide the intended diversification benefits. Reducing exposure to one of these ETFs or reallocating to less correlated assets could enhance portfolio diversification and reduce risk.

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.

Optimizing the portfolio along the Efficient Frontier could improve the risk-return ratio by adjusting asset allocations. Before optimization, addressing the overlap in highly correlated assets is essential. This process involves identifying and possibly reducing investments in assets that move in tandem, as they add redundancy without enhancing diversification.

Dividends Info

  • Fidelity® Total Bond ETF 4.60%
  • Vanguard Dividend Appreciation Index Fund ETF Shares 1.70%
  • Vanguard S&P 500 Growth Index Fund ETF Shares 0.50%
  • Vanguard Value Index Fund ETF Shares 2.20%
  • Weighted yield (per year) 1.54%

Dividend yields contribute to the portfolio's total return, with the Fidelity® Total Bond ETF offering a significant yield of 4.60%, bolstering income generation. However, the overall portfolio yield of 1.54% indicates a moderate income component, suggesting the portfolio's primary focus is on capital appreciation rather than income.

Ongoing product costs Info

  • Fidelity® Total Bond ETF 0.36%
  • Vanguard Dividend Appreciation Index Fund ETF Shares 0.06%
  • Vanguard S&P 500 Growth Index Fund ETF Shares 0.10%
  • Vanguard Value Index Fund ETF Shares 0.04%
  • Weighted costs total (per year) 0.10%

The portfolio's total expense ratio (TER) is impressively low at 0.10%, which supports better long-term performance by minimizing the drag on returns due to costs. Keeping investment costs low is a critical factor in maximizing net returns, especially over extended periods.

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