A comprehensive analysis of a diversified growth-focused fund with an emphasis on technology and financial sectors

Report created on Jul 16, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

The CAPITAL GROWTH FUND is entirely invested in a single fund, indicating a focused investment strategy rather than a diversified portfolio across different asset types. This fund is broadly diversified within the stock asset class, covering a range of sectors and geographic regions. The heavy allocation towards stocks (99%) suggests a growth-oriented approach, while the minimal cash holding (1%) is typical for such strategies. Despite the fund's claim of broad diversification, the singular focus on one investment vehicle presents certain risks and limits exposure to potential opportunities in other asset classes.

Growth Info

Historically, the fund has demonstrated a Compound Annual Growth Rate (CAGR) of 10.30%, with a maximum drawdown of -35.32%. This performance suggests the fund has navigated market fluctuations with resilience, offering solid returns. However, the substantial drawdown indicates periods of significant value decline, which is a critical consideration for investors concerned about volatility. The fact that 90% of returns came from just 19 days highlights the unpredictability and the importance of remaining invested through market cycles.

Projection Info

Monte Carlo simulations, which forecast future performance by analyzing historical data, show a wide range of outcomes for this fund. With a median projection of a 245.8% increase and 969 out of 1,000 simulations predicting positive returns, the outlook seems optimistic. However, the broad spread from the 5th percentile (20.9% increase) to the 67th percentile (391.6% increase) underscores the inherent uncertainty in such projections, emphasizing the need for investors to consider a range of possible outcomes.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%

The fund's allocation is almost entirely in stocks, with a marginal cash reserve. This composition is typical of growth-oriented funds aiming for higher returns, albeit at the expense of higher risk. The absence of bonds or alternative investments means the portfolio may lack cushioning during stock market downturns. For investors seeking balanced growth, incorporating a mix of asset classes could provide better risk-adjusted returns by mitigating volatility.

Sectors Info

  • Technology
    21%
  • Financials
    16%
  • Health Care
    13%
  • Industrials
    11%
  • Consumer Discretionary
    9%
  • Telecommunications
    9%
  • Consumer Staples
    9%
  • Basic Materials
    4%
  • Energy
    3%
  • Real Estate
    3%
  • Utilities
    2%

The sectoral allocation of the fund shows a strong preference for technology and financial services, followed by healthcare and industrials. This concentration in sectors known for growth and innovation aligns with the fund's objective. However, the significant weight in technology and financial services increases susceptibility to sector-specific risks. Diversifying across more sectors or reducing concentration in any one sector could help manage this risk.

Regions Info

  • North America
    63%
  • Europe Developed
    22%
  • Japan
    7%
  • Asia Emerging
    2%
  • Australasia
    2%
  • Asia Developed
    2%

Geographically, the fund is heavily weighted towards North America and developed European markets, with minimal exposure to emerging markets in Asia and no investment in Latin America or Africa/Middle East. This conservative geographic distribution may limit exposure to volatility from less stable regions but also restricts potential high-growth opportunities in emerging markets. Considering a modest increase in emerging market exposure could enhance growth prospects and diversification.

Market capitalization Info

  • Mega-cap
    39%
  • Mid-cap
    30%
  • Large-cap
    26%
  • Small-cap
    4%

The market capitalization breakdown shows a balanced mix between mega, big, and medium-sized companies, with a small allocation to small caps. This distribution suggests a balanced approach, leaning towards the stability of large companies while still seeking growth from medium and small caps. However, the low exposure to small and micro-cap stocks means potentially missing out on high-growth opportunities in these segments.

Dividends Info

  • CAPITAL GROWTH FUND CAPITAL GROWTH FUND 11.60%
  • Weighted yield (per year) 11.60%

With an 11.60% dividend yield, the fund stands out for its income-generating potential, a notable feature for investors seeking regular income alongside capital growth. This high yield could be particularly attractive in volatile or bear markets, providing a steady income stream. However, investors should also consider the sustainability of such high yields, as they may reflect higher risk or a temporary situation.

Ongoing product costs Info

  • CAPITAL GROWTH FUND CAPITAL GROWTH FUND 1.13%
  • Weighted costs total (per year) 1.13%

The Total Expense Ratio (TER) of 1.13% is within the typical range for actively managed funds, though it can impact net returns over time. Investors should weigh the fund's performance and potential for future returns against these costs, considering whether the active management justifies the expense. Lower-cost alternatives, such as index funds, could be considered for part of the investment to reduce overall costs.

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