Balanced and broadly diversified portfolio with a strong tilt towards technology and US markets

Risk profile

  • Secure
    Speculative

The risk profile, derived from past market volatility, reflects the level of risk the portfolio is exposed to. This assessment helps align your investments with your financial goals and comfort with market fluctuations.

Diversification profile

  • Focused
    Diversified

The diversification assessment evaluates the spread of investments across asset classes, regions, and sectors. This ensures a balanced mix, reducing risk and maximizing returns by not concentrating in any single area.

What type of investor this portfolio is suitable for

Balanced Investors

This portfolio is well-suited for an investor with a balanced risk tolerance, looking for growth while being mindful of volatility. The investor likely has a medium to long-term investment horizon, valuing both capital appreciation and income generation. The significant allocation to technology and large-cap stocks indicates a confidence in these sectors' long-term prospects, while the presence of international and bond ETFs reflects a degree of caution and a desire for diversification.

Positions

  • Invesco NASDAQ 100 ETF
    QQQM - US46138G6492
    24.00%
  • Vanguard Growth Index Fund ETF Shares
    VUG - US9229087369
    24.00%
  • Vanguard S&P 500 ETF
    VOO - US9229083632
    20.00%
  • Vanguard Total International Stock Index Fund ETF Shares
    VXUS - US9219097683
    16.00%
  • Fidelity® High Dividend ETF
    FDVV - US3160928400
    10.00%
  • Vanguard Total Bond Market Index Fund ETF Shares
    BND - US9219378356
    6.00%

This portfolio showcases a significant concentration in technology through its heavy allocation in ETFs like the Invesco NASDAQ 100 and Vanguard Growth Index Fund ETF Shares, making up nearly half of the portfolio. The presence of the Vanguard S&P 500 ETF broadens exposure to the overall US market, while the Vanguard Total International Stock Index Fund ETF Shares and Fidelity® High Dividend ETF introduce international diversification and income-focused strategies, respectively. The Vanguard Total Bond Market Index Fund ETF Shares add a conservative element, balancing the portfolio's overall risk profile.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 14.47% and a maximum drawdown of -28.77%, the portfolio has demonstrated strong growth with a moderate level of risk. The days contributing to 90% of returns being limited to 19 indicates that the portfolio's performance has been driven by significant market events or rallies. This historical performance, while impressive, should be viewed with the understanding that past results do not guarantee future success.

Projection Info

Monte Carlo simulations, using historical data to project future outcomes, suggest a wide range of possible performances for this portfolio. With 991 out of 1,000 simulations showing positive returns and a median projected increase of 396.4%, the forward-looking outlook remains optimistic. However, investors should consider the inherent uncertainty in these projections, as they are based on past market behavior which cannot predict future market movements with certainty.

Asset classes Info

  • Stocks
    93%
  • Bonds
    6%
  • Cash
    1%
  • No data
    0%

The portfolio's asset allocation is heavily weighted towards stocks (93%), with a minor allocation in bonds (6%) and a negligible cash position (1%). This distribution aligns with a growth-oriented strategy but may exhibit higher volatility. Diversifying further into bonds or other asset classes could provide additional stability during market downturns.

Sectors Info

  • Technology
    37%
  • Consumer Discretionary
    11%
  • Telecommunications
    10%
  • Financials
    10%
  • Industrials
    6%
  • Health Care
    6%
  • Consumer Staples
    5%
  • Energy
    2%
  • Real Estate
    2%
  • Utilities
    2%
  • Basic Materials
    2%

Sector allocation heavily favors technology, consumer cyclicals, and communication services, reflecting a growth-focused strategy. However, this concentration increases susceptibility to sector-specific risks. Diversifying across a broader range of sectors could mitigate this risk, potentially smoothing out returns over time.

Regions Info

  • North America
    78%
  • Europe Developed
    7%
  • Asia Emerging
    3%
  • Japan
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    0%
  • Europe Emerging
    0%

Geographically, the portfolio is predominantly invested in North America (78%), with modest exposure to developed Europe and emerging markets. This regional distribution supports robust growth potential but may benefit from increased exposure to emerging markets and other developed regions to enhance diversification and capture global growth opportunities.

Market capitalization Info

  • Mega-cap
    49%
  • Large-cap
    29%
  • Mid-cap
    13%
  • Small-cap
    2%
  • Micro-cap
    0%

The market capitalization breakdown shows a preference for mega (49%) and big (29%) cap stocks, indicating a focus on established, large companies. While this can offer stability, incorporating more medium and small-cap stocks might provide higher growth potential and further diversification benefits.

Redundant positions Info

  • Vanguard S&P 500 ETF
    Vanguard Growth Index Fund ETF Shares
    Invesco NASDAQ 100 ETF
    High correlation

The high correlation observed among the Vanguard S&P 500 ETF, Vanguard Growth Index Fund ETF Shares, and Invesco NASDAQ 100 ETF suggests overlapping investments that may not contribute significantly to diversification. Reducing exposure to similar assets could enhance the portfolio's risk-adjusted returns by broadening its diversification.

Dividends Info

  • Vanguard Total Bond Market Index Fund ETF Shares 3.80%
  • Fidelity® High Dividend ETF 3.00%
  • Invesco NASDAQ 100 ETF 0.50%
  • Vanguard S&P 500 ETF 1.20%
  • Vanguard Growth Index Fund ETF Shares 0.40%
  • Vanguard Total International Stock Index Fund ETF Shares 2.80%
  • Weighted yield (per year) 1.43%

The portfolio's dividend yield stands at 1.43%, with contributions from both equity and bond ETFs. While not the primary focus, dividends offer a supplementary income stream and a potential buffer in volatile markets. Rebalancing to include higher-yielding assets could increase income without significantly raising risk.

Ongoing product costs Info

  • Vanguard Total Bond Market Index Fund ETF Shares 0.03%
  • Fidelity® High Dividend ETF 0.15%
  • Invesco NASDAQ 100 ETF 0.15%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Growth Index Fund ETF Shares 0.04%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.08%

The portfolio's total expense ratio (TER) of 0.08% is impressively low, minimizing the impact of costs on returns. This efficiency is crucial for long-term growth, as even small differences in fees can compound into significant variations in portfolio value over time.

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.

The current asset allocation, while strong in historical performance, shows room for optimization. Specifically, addressing the overlap in highly correlated ETFs could improve the portfolio's diversification and risk profile. Utilizing the Efficient Frontier model to rebalance towards a mix that offers the best possible risk-return trade-off could enhance overall portfolio efficiency.

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