A balanced portfolio with strong technology focus and minimal geographic diversity

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 suits an investor with a balanced risk tolerance seeking growth with moderate income potential. It favors equity exposure, making it ideal for individuals focused on capital appreciation over a medium to long-term horizon. The investor should be comfortable with market volatility and willing to accept short-term fluctuations for potential long-term gains. This portfolio is best for those who prioritize growth while maintaining some level of income through dividends.

Positions

  • Vanguard Total World Stock Index Fund ETF Shares
    VT - US9220427424
    40.00%
  • Schwab U.S. Large-Cap Growth ETF
    SCHG - US8085243009
    25.00%
  • Vanguard S&P 500 ETF
    VOO - US9229083632
    25.00%
  • Schwab U.S. Dividend Equity ETF
    SCHD - US8085247976
    10.00%

This portfolio is primarily composed of ETFs with a 40% allocation to the Vanguard Total World Stock Index Fund, complemented by 25% each in Schwab U.S. Large-Cap Growth and Vanguard S&P 500 ETFs. A smaller 10% is in Schwab U.S. Dividend Equity ETF. This composition leans heavily towards equities, with minimal cash or other asset classes. Compared to common balanced portfolios, this one is heavily equity-centric, which may not suit investors seeking fixed income or alternative asset exposure. Consider adding bonds or other asset classes to balance risk and improve diversification.

Growth Info

Historically, the portfolio has performed well with a Compound Annual Growth Rate (CAGR) of 13.54%, though it experienced a significant maximum drawdown of -33.46%. Such performance indicates strong growth potential but also highlights the risk of substantial losses during market downturns. When compared to benchmarks, this performance aligns with typical equity-heavy portfolios. To mitigate drawdown risk, consider incorporating assets with lower volatility or exploring hedging strategies.

Projection Info

The Monte Carlo simulation, which uses historical data to project future outcomes, suggests a wide range of potential portfolio values. The median (50th percentile) projection is a 490.86% increase, with 997 out of 1,000 simulations showing positive returns. However, it's important to remember that these simulations are based on historical trends and do not guarantee future results. Regularly reassess the portfolio's risk exposure and adjust allocations to align with changing market conditions and personal risk tolerance.

Asset classes Info

  • Stocks
    99%
  • Cash
    1%
  • Other
    0%
  • No data
    0%

The portfolio is overwhelmingly allocated to stocks at 99.46%, with negligible amounts in cash and other categories. This concentration in equities can offer high growth potential but also increases vulnerability to market fluctuations. In comparison to diversified portfolios, this allocation lacks balance across asset classes. To enhance stability, consider integrating fixed income or alternative investments, which can provide a counterbalance to equity volatility and reduce overall portfolio risk.

Sectors Info

  • Technology
    31%
  • Financials
    13%
  • Consumer Discretionary
    11%
  • Health Care
    11%
  • Telecommunications
    9%
  • Industrials
    8%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    3%
  • Utilities
    2%
  • Real Estate
    2%

The portfolio is heavily weighted towards technology at 31.08%, followed by financial services and consumer cyclicals. This sectoral concentration can drive growth but also exposes the portfolio to sector-specific risks, such as regulatory changes or tech market volatility. Compared to sector benchmarks, this allocation is more concentrated. Diversifying into underrepresented sectors like utilities or real estate could reduce sector-specific risks and enhance resilience against market shifts.

Regions Info

  • North America
    86%
  • Europe Developed
    6%
  • Asia Emerging
    2%
  • Japan
    2%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    0%
  • Europe Emerging
    0%

The portfolio is predominantly concentrated in North America at 86.02%, with limited exposure to other global regions. This geographic bias can lead to missed opportunities in emerging markets or regions with different growth dynamics. Compared to global benchmarks, this allocation is less diversified. To improve geographic diversification, consider increasing exposure to Europe, Asia, or other underrepresented regions, which can help mitigate regional economic risks and capture global growth opportunities.

Redundant positions Info

  • Schwab U.S. Large-Cap Growth ETF
    Vanguard Total World Stock Index Fund ETF Shares
    Vanguard S&P 500 ETF
    High correlation

The portfolio's assets are highly correlated, particularly among the Schwab U.S. Large-Cap Growth, Vanguard Total World Stock Index Fund, and Vanguard S&P 500 ETFs. High correlation means these assets tend to move together, which can limit diversification benefits during market downturns. To reduce this risk, consider replacing some correlated assets with those that have lower correlation, thereby enhancing the portfolio's ability to withstand market volatility and achieve more stable returns.

Dividends Info

  • Schwab U.S. Dividend Equity ETF 3.60%
  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • Vanguard S&P 500 ETF 1.20%
  • Vanguard Total World Stock Index Fund ETF Shares 2.00%
  • Weighted yield (per year) 1.56%

With a total yield of 1.56%, the portfolio provides moderate income through dividends, primarily from the Schwab U.S. Dividend Equity ETF. While this yield is beneficial for income-focused investors, it may not be sufficient for those relying on dividends for significant cash flow. Compared to income-focused portfolios, this yield is relatively low. To boost dividend income, consider increasing allocation to high-yielding assets or funds that focus on dividend growth, ensuring they align with overall investment objectives.

Ongoing product costs Info

  • Schwab U.S. Dividend Equity ETF 0.06%
  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total World Stock Index Fund ETF Shares 0.07%
  • Weighted costs total (per year) 0.05%

The portfolio's total expense ratio (TER) is impressively low at 0.05%, indicating cost efficiency. Low costs are beneficial for long-term performance as they minimize the drag on returns. When compared to industry averages, these costs are competitive and align well with best practices for cost-effective investing. Maintaining low costs is crucial, so continue to monitor expense ratios and evaluate whether there are opportunities to reduce them further without compromising on quality or 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.

The portfolio could potentially be optimized using the Efficient Frontier, which aims to achieve the best possible risk-return ratio. However, before optimizing, focus on reducing the overlap of highly correlated assets, as they offer limited diversification benefits. Efficient Frontier optimization involves reallocating existing assets to achieve a more balanced risk-return profile, but it doesn't address the need for broader diversification across asset classes or geographies, which are also important for long-term stability.

What next?

Ready to invest in this portfolio?

Select a broker that fits your needs and watch for low fees to maximize your returns.

Select broker

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.