A balanced focus on North American equities with significant tech exposure

Report created on Jul 23, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

3/5
Moderately Diversified
Less diversification More diversification

Positions

The portfolio is predominantly invested in North American equities, with a heavy emphasis on the technology sector. The composition is straightforward, featuring two major ETFs that provide broad market exposure, alongside a direct investment in a tech heavyweight. This structure leverages the growth potential of the tech industry while maintaining a degree of diversification through the ETFs. However, the concentration in North America and technology sectors suggests a moderate to high risk level, despite the portfolio's balanced risk classification.

Growth Info

Historical performance showcases a robust Compound Annual Growth Rate (CAGR) of 18.17%, indicating strong past returns. The maximum drawdown of -21.38% reflects the portfolio's vulnerability to market volatility, particularly within the tech sector. Notably, a significant portion of returns came from a few critical days, underscoring the impact of market timing and the importance of remaining invested during volatile periods for optimal performance.

Projection Info

Monte Carlo simulations, which use historical data to forecast a range of potential future outcomes, suggest a wide dispersion in potential portfolio values. With 998 out of 1,000 simulations yielding positive returns, the median outcome indicates substantial growth potential. However, the wide range between the 5th and 67th percentiles highlights the inherent uncertainty in these projections, emphasizing the need for risk tolerance in long-term investment strategies.

Asset classes Info

  • US Equity
    66%
  • Stocks
    14%
  • Stocks
    8%

The asset class distribution, heavily skewed towards US equity, aligns with the portfolio's growth orientation but limits diversification benefits. While equities are known for their growth potential, they come with higher volatility compared to bonds or alternative investments. Expanding into other asset classes could provide a buffer against market downturns and reduce overall portfolio volatility.

Sectors Info

  • Technology
    31%
  • Financials
    17%
  • Industrials
    9%
  • Consumer Discretionary
    9%
  • Health Care
    8%
  • Telecommunications
    7%
  • Consumer Staples
    5%
  • Energy
    5%
  • Basic Materials
    4%
  • Utilities
    3%
  • Real Estate
    2%

The sector allocation reveals a significant tilt towards technology, which can drive growth but also increases sensitivity to sector-specific downturns. Financial services and industrials complement the tech exposure, offering some diversification. However, the concentration in a few sectors increases risk and highlights the potential for rebalancing towards underrepresented areas to achieve a more balanced sector exposure.

Regions Info

  • North America
    88%
  • Europe Developed
    5%
  • Japan
    2%
  • Asia Emerging
    2%
  • Asia Developed
    1%
  • Australasia
    1%

With 88% of assets allocated to North America, the portfolio shows a strong home bias, which could limit exposure to global growth opportunities and increase vulnerability to regional economic fluctuations. Diversifying geographically, especially into emerging markets or developed regions outside North America, could enhance returns and reduce risks associated with regional economic cycles.

Market capitalization Info

  • Mega-cap
    49%
  • Large-cap
    31%
  • Mid-cap
    17%
  • Small-cap
    3%
  • Micro-cap
    1%

The focus on mega and big cap stocks underscores the portfolio's preference for established, large-scale companies, likely contributing to its historical performance. While these companies typically offer stability and consistent dividends, incorporating more medium or small-cap stocks could enhance growth potential and diversification, albeit with increased risk.

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.

Utilizing the Efficient Frontier could identify opportunities to adjust asset allocation for a better risk-return trade-off. Although the current setup is growth-focused, there might be room to optimize by balancing the portfolio across different asset classes, sectors, and geographies, potentially enhancing returns for the same level of risk.

Dividends Info

  • Vanguard All-Equity ETF Portfolio 1.50%
  • Vanguard S&P 500 Index ETF 0.80%
  • Weighted yield (per year) 1.06%

The overall dividend yield of the portfolio is modest, reflecting its growth-oriented strategy. While dividends contribute to total returns, especially in volatile or bear markets, the current yield aligns with the portfolio's focus on capital appreciation. Investors seeking income in addition to growth might consider increasing allocations to higher-yielding assets.

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