Balanced global exposure with a strong emphasis on international markets

Report created on Jun 13, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

This portfolio is characterized by a significant allocation to international stocks, represented by 70% in the Vanguard Total International Stock Index Fund ETF Shares, while the remaining 30% is invested in the Vanguard Total Stock Market Index Fund ETF Shares. This composition suggests a deliberate strategy to capture global market growth, with a heavier emphasis on markets outside the United States. Such a structure is beneficial for diversification, reducing the impact of regional volatility on the overall portfolio performance.

Growth Info

Historically, the portfolio has shown a Compound Annual Growth Rate (CAGR) of 9.27%, with a maximum drawdown of -34.46%. This performance indicates a strong recovery capability from downturns, highlighting resilience. However, it's crucial to remember that past performance is not always indicative of future results. The days contributing most to returns are relatively few, emphasizing the importance of staying invested over the long term to capture these gains.

Projection Info

Using Monte Carlo simulations, which project future outcomes based on historical data, the portfolio shows a wide range of potential future performances. Key percentiles indicate that in the worst-case scenario (5th percentile), the growth could be as low as 16.7%, while the median (50th percentile) could see growth up to 276.9%. This underscores the inherent uncertainties in investing and the value of maintaining a long-term perspective.

Asset classes Info

  • Stocks
    98%
  • Cash
    2%

The portfolio's assets are almost entirely in stocks (98%), with a small cash holding (2%). This stock-heavy allocation aligns with the portfolio's balanced risk profile, aiming for growth while accepting moderate levels of volatility. The minimal cash position ensures liquidity and provides a buffer against market fluctuations without significantly detracting from the growth potential.

Sectors Info

  • Financials
    20%
  • Technology
    18%
  • Industrials
    13%
  • Consumer Discretionary
    11%
  • Health Care
    9%
  • Telecommunications
    7%
  • Consumer Staples
    6%
  • Basic Materials
    5%
  • Energy
    5%
  • Real Estate
    3%
  • Utilities
    3%

The sector allocation spans financial services, technology, industrials, consumer cyclicals, and healthcare as the top sectors. This diversified sector exposure mitigates risks associated with overconcentration in any single sector. However, the technology and financial services sectors, making up 38% of the portfolio, may introduce higher volatility, reflecting their sensitivity to economic cycles and interest rate changes.

Regions Info

  • North America
    35%
  • Europe Developed
    27%
  • Asia Emerging
    12%
  • Japan
    11%
  • Asia Developed
    7%
  • Australasia
    3%
  • Africa/Middle East
    3%
  • Latin America
    1%
  • Europe Emerging
    1%

Geographic allocation is well-diversified across developed and emerging markets, with a notable tilt towards North America (35%) and Europe (27%). The presence in emerging markets of Asia and Latin America, although smaller, is crucial for tapping into high-growth economies. This global spread helps in mitigating risks associated with geopolitical events and regional economic downturns.

Market capitalization Info

  • Mega-cap
    43%
  • Large-cap
    30%
  • Mid-cap
    18%
  • Small-cap
    5%
  • Micro-cap
    1%

The portfolio's market capitalization breakdown shows a preference for mega (43%) and big (30%) cap stocks, which are typically more stable and less volatile than their smaller counterparts. Medium, small, and micro caps, although constituting a smaller portion of the portfolio, are essential for growth potential, offering a balanced approach to risk and return.

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 demonstrates a well-considered balance between risk and return, as indicated by its historical performance and Monte Carlo projections. While already optimized within its current asset classes, exploring additional diversification into alternative assets or fixed income could further enhance the risk-return profile, aligning with the principles of the Efficient Frontier.

Dividends Info

  • Vanguard Total Stock Market Index Fund ETF Shares 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 2.80%
  • Weighted yield (per year) 2.35%

The portfolio's dividend yield stands at an attractive 2.35%, combining the higher yield from international stocks (2.80%) with the lower yield from the total stock market index (1.30%). This dividend income can provide a steady cash flow, which is beneficial for reinvestment or as a buffer during market volatility, contributing to the portfolio's overall return.

Ongoing product costs Info

  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.04%

With an overall Total Expense Ratio (TER) of 0.04%, the portfolio benefits from exceptionally low costs, which is crucial for enhancing long-term returns. Low costs ensure that a larger portion of the investment returns contributes to portfolio growth rather than being eroded by fees.

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