A growth-focused portfolio with high exposure to Rocket Lab USA and diversified fund investments

Report created on Jul 9, 2025

Risk profile Info

6/7
Aggressive
Less risk More risk

Diversification profile Info

3/5
Moderately Diversified
Less diversification More diversification

Positions

The portfolio is heavily weighted towards Rocket Lab USA Inc., constituting over a third of the total investment, alongside significant allocations in various Fidelity funds, including the Contrafund, 500 Index Fund, and international and bond funds. This composition indicates a strong tilt towards equities, particularly in the industrials and technology sectors, with a moderate diversification across asset classes and geographic regions. The heavy reliance on a single stock alongside fund investments suggests a strategy that balances aggressive growth ambitions with a foundation in broader market indices and international exposure.

Growth Info

Historically, the portfolio has exhibited a remarkable Compound Annual Growth Rate (CAGR) of 28.24%, albeit with a significant maximum drawdown of -52.60%. This volatility is reflective of the aggressive risk profile and the high concentration in Rocket Lab USA Inc. The days contributing to 90% of returns being limited to 10 days highlight the portfolio's dependency on short-term gains, which can be both a risk and an opportunity, depending on market conditions.

Projection Info

Monte Carlo simulations, based on historical data, project a wide range of outcomes, with a median potential growth of 419.7%. However, it's crucial to understand that these projections are inherently uncertain and rely on past market behavior, which may not predict future performance. The significant variance in simulation outcomes underscores the portfolio's high-risk, high-reward nature, suitable for investors comfortable with potential large swings in portfolio value.

Asset classes Info

  • Stocks
    91%
  • Bonds
    8%
  • Cash
    1%
  • Other
    1%

With 91% of the portfolio in stocks, 8% in bonds, and the remainder in cash and other classifications, the asset allocation leans heavily towards equities. This aligns with the portfolio's aggressive risk profile but may expose the investor to higher volatility. The bond allocation offers some cushion against stock market fluctuations, but the overall effectiveness of this buffer is limited by the portfolio's stock concentration.

Sectors Info

  • Industrials
    42%
  • Technology
    12%
  • Financials
    10%
  • Telecommunications
    8%
  • Health Care
    6%
  • Consumer Discretionary
    5%
  • Consumer Staples
    3%
  • Basic Materials
    2%
  • Energy
    1%
  • Utilities
    1%
  • Real Estate
    1%

The sectoral allocation reveals a strong emphasis on industrials, driven by the significant investment in Rocket Lab USA Inc., and a notable presence in technology and financial services. This sector distribution reflects a growth-oriented strategy but also exposes the portfolio to sector-specific risks, such as regulatory changes or economic downturns affecting these industries disproportionately.

Regions Info

  • North America
    84%
  • Europe Developed
    10%
  • Japan
    3%
  • Australasia
    1%
  • Latin America
    1%
  • Asia Developed
    1%

Geographic exposure is predominantly in North America, with modest allocations to developed European markets and Japan. This geographic distribution supports the portfolio's growth objectives while providing some level of international diversification. However, the limited exposure to emerging markets and other regions may mean missing out on potential growth opportunities outside of developed markets.

Market capitalization Info

  • Large-cap
    51%
  • Mega-cap
    30%
  • Mid-cap
    6%
  • Small-cap
    3%
  • Micro-cap
    1%

The market capitalization breakdown shows a preference for big and mega-cap stocks, which typically offer more stability and lower volatility than smaller companies. This focus on larger companies is a prudent choice for maintaining some level of risk management within an aggressive portfolio. However, the inclusion of small and micro-cap exposures, like the Conestoga Small Cap Fund, introduces additional growth potential and diversification benefits.

Redundant positions Info

  • Fidelity 500 Index Fund
    Fidelity Contrafund
    High correlation

The high correlation between the Fidelity 500 Index Fund and the Fidelity Contrafund suggests overlapping investments that may not provide the diversification benefits expected from holding multiple funds. This redundancy can amplify risks during market downturns, as these correlated assets are likely to move in the same direction.

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 involves addressing the high correlation between certain assets to enhance diversification benefits. By reducing overlap and potentially reallocating some of the heavy concentration in Rocket Lab USA Inc., the portfolio can achieve a more balanced risk-return profile. This reallocation should consider the investor's risk tolerance, investment horizon, and financial goals, aiming for an asset mix that aligns with the Efficient Frontier for optimal risk-adjusted returns.

Dividends Info

  • Fidelity Contrafund 4.50%
  • FIDELITY INTERNATIONAL INDEX FUND INSTITUTIONAL PREMIUM CLASS 2.40%
  • FIDELITY TOTAL BOND FUND FIDELITY TOTAL BOND FUND 4.10%
  • Fidelity 500 Index Fund 0.90%
  • Weighted yield (per year) 1.80%

Dividend yields from the funds add a component of income generation to the portfolio, with the Fidelity Contrafund and the Fidelity Total Bond Fund offering higher yields. This income can provide a buffer against volatility and contribute to total returns, balancing the growth focus with a steady income stream.

Ongoing product costs Info

  • CONESTOGA SMALL CAP FUND INVESTORS CLASS 1.10%
  • Fidelity Contrafund 0.63%
  • FIDELITY INTERNATIONAL INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.04%
  • FIDELITY TOTAL BOND FUND FIDELITY TOTAL BOND FUND 0.44%
  • Fidelity 500 Index Fund 0.02%
  • Weighted costs total (per year) 0.22%

The Total Expense Ratio (TER) across the portfolio averages to 0.22%, which is relatively low, enhancing net returns over time. The varying costs of the individual funds, from the low-cost Fidelity 500 Index Fund to the higher-cost Conestoga Small Cap Fund, highlight the importance of cost consideration in fund selection to optimize for both growth and efficiency.

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