A growth-focused portfolio with a strong tilt towards small cap and value stocks across global markets
Report created on Nov 16, 2025Risk profile
5/7
Diversification profile
4/5
Positions
-
AV Avantis® U.S. Small Cap Value ETF
AVUV - US0250728773 50.00% -
AV Avantis® International Small Cap Value ETF
AVDV - US0250728021 30.00% -
AV Avantis® Emerging Markets Equity ETF
AVEM - US0250726041 10.00% -
AV Avantis® Emerging Markets Value ETF
AVES - US0250723725 10.00%
This portfolio is notably concentrated in small-cap value stocks across various global markets, with a significant emphasis on the U.S. small cap value sector. This strategic allocation reflects a deliberate choice to pursue growth through exposure to smaller companies that are perceived to offer value. The portfolio's diversification is further enhanced by its international and emerging market components, which introduce a broader geographic exposure. While such a composition aligns with growth objectives, it also inherently carries a higher risk due to the volatility associated with small-cap and emerging market investments.
Growth
Historically, the portfolio has achieved a Compound Annual Growth Rate (CAGR) of 11.03%, with a maximum drawdown of -23.39%. This performance indicates a relatively high return potential but also underscores the level of risk involved, as evidenced by the significant drawdown. The days contributing to 90% of returns being concentrated in just 10 days further highlight the portfolio's volatility and the importance of being invested during these critical periods to capture the gains.
Projection
Monte Carlo simulations, which use historical data to project a range of possible future outcomes, suggest a wide dispersion of potential returns for this portfolio. The median outcome of a 236% return is promising, but the 5th percentile outcome of -4.2% indicates a non-negligible risk of loss. These projections, while useful for setting expectations, are inherently limited by their reliance on past performance, which is not a guaranteed indicator of future results.
Asset classes
- Stocks 100%
The portfolio's allocation is entirely in stocks, with no exposure to bonds, cash, or other asset classes. This singular focus on equities, particularly within the small cap and value segments, is designed to maximize growth potential. However, the absence of bonds or cash holdings means the portfolio lacks the buffer that these assets can provide against market downturns, making it more susceptible to short-term fluctuations.
Sectors
- Financials 20%
- Industrials 17%
- Consumer Discretionary 16%
- Energy 12%
- Basic Materials 10%
- Technology 6%
- Consumer Staples 3%
- Health Care 3%
- Telecommunications 2%
- Real Estate 1%
- Utilities 1%
Sectoral allocation shows a heavy emphasis on financial services, industrials, and consumer cyclicals, which are sectors often associated with higher growth but also increased volatility. The underweight positions in more defensive sectors like healthcare and utilities suggest a portfolio strategy that is less concerned with mitigating risk through sector diversification and more focused on capitalizing on economic growth cycles.
Regions
- North America 52%
- Japan 11%
- Europe Developed 11%
- Asia Emerging 10%
- Asia Developed 8%
- Australasia 3%
- Africa/Middle East 2%
- Latin America 2%
- Europe Emerging 1%
The geographic distribution underscores a strong preference for North America, complemented by diversified investments in developed and emerging markets across Europe, Asia, Australasia, and Latin America. This global exposure is beneficial for accessing growth opportunities worldwide but also introduces additional risks, including currency fluctuations and geopolitical uncertainties.
Market capitalization
- Small-cap 34%
- Micro-cap 28%
- Mid-cap 20%
- Large-cap 6%
- Mega-cap 6%
The portfolio's tilt towards small and micro-cap stocks is a clear indicator of its growth orientation, given these segments' potential for higher returns. However, smaller companies often face greater risks, including liquidity issues and higher sensitivity to economic downturns, which could increase the portfolio's overall volatility.
Redundant positions
-
High correlationAvantis® Emerging Markets Equity ETFAvantis® Emerging Markets Value ETF
The high correlation observed between the two emerging markets ETFs suggests a redundancy that may not contribute significantly to diversification. In periods of market stress, these assets are likely to move in tandem, thereby limiting the portfolio's ability to mitigate losses through 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 analysis suggests that the portfolio could potentially achieve a higher expected return of 13.10% with the same level of risk by optimizing asset allocation, particularly by addressing the overlap in highly correlated assets. This optimization underscores the importance of diversification not just across sectors and geographies but also in terms of asset behavior during different market conditions.
Dividends
- Avantis® International Small Cap Value ETF 3.40%
- Avantis® Emerging Markets Equity ETF 2.60%
- Avantis® Emerging Markets Value ETF 3.70%
- Avantis® U.S. Small Cap Value ETF 1.70%
- Weighted yield (per year) 2.50%
With a total dividend yield of 2.50%, the portfolio offers a modest income component, which can provide a buffer during market downturns or periods of low growth. However, the primary focus remains on capital appreciation, as evidenced by the portfolio's strategic composition favoring growth-oriented investments over higher-yielding dividend stocks.
Ongoing product costs
- Avantis® International Small Cap Value ETF 0.36%
- Avantis® Emerging Markets Equity ETF 0.33%
- Avantis® Emerging Markets Value ETF 0.36%
- Avantis® U.S. Small Cap Value ETF 0.25%
- Weighted costs total (per year) 0.30%
The portfolio's total expense ratio (TER) of 0.30% is relatively low, which is advantageous for long-term growth as it minimizes the drag on returns caused by fees. Keeping costs low is a critical component of maximizing net returns, especially in a growth-focused strategy where every percentage point of return can significantly impact the portfolio's value over time.
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