A conservative portfolio with a strong bond foundation and selective equity exposure

Report created on Jul 19, 2025

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.

Positions

This portfolio is structured with a heavy emphasis on short-term treasury bonds, represented by a significant allocation to the iShares $ Treasury Bond 1-3yr UCITS ETF EUR Hedged (Acc), making up over half of the portfolio. The Vanguard FTSE All-World UCITS ETF USD Accumulation and a single stock position in Lockheed Martin Corporation provide equity exposure, while a smaller allocation to the Franklin Libertyshares ICAV - Franklin Ftse China UCITS ETF offers targeted exposure to Chinese equities. This composition suggests a conservative approach, prioritizing capital preservation while seeking modest growth through selected equity investments.

Growth Info

Historically, the portfolio has delivered a Compound Annual Growth Rate (CAGR) of 3.67%, with a maximum drawdown of -8.96%. This performance reflects the conservative nature of the portfolio, with the heavy bond allocation dampening volatility and drawdowns. The days contributing most to returns highlight the impact of specific market events on performance. When compared to more aggressive portfolios, this conservative approach has likely resulted in lower volatility, at the expense of potentially higher returns.

Projection Info

Monte Carlo simulations, using historical data to project future outcomes, suggest a wide range of potential performances, with a median annualized return of 4.66%. The simulations indicate a majority of outcomes (706 out of 1,000) result in positive returns, aligning with the conservative risk profile of the portfolio. However, the 5th percentile outcome at -56.4% underscores the importance of recognizing that risk, albeit low, still exists even in conservative strategies.

Asset classes Info

  • Bonds
    58%
  • Stocks
    42%

The portfolio's asset class distribution, with 58% in bonds and 42% in stocks, underscores its conservative stance. This allocation provides a balance between income generation and capital growth potential. The absence of alternative asset classes such as real estate or commodities limits diversification benefits but aligns with the conservative risk profile and objective of capital preservation.

Sectors Info

  • Industrials
    13%
  • Technology
    8%
  • Financials
    6%
  • Consumer Discretionary
    4%
  • Telecommunications
    3%
  • Health Care
    3%
  • Consumer Staples
    2%
  • Energy
    1%
  • Basic Materials
    1%
  • Utilities
    1%
  • Real Estate
    1%

Sectoral allocation reveals a focus on industrials, technology, and financial services, with industrials being overweight due to the Lockheed Martin position. This sectoral spread provides a moderate level of diversification within the equity component of the portfolio. However, the heavy weighting towards a single stock in the industrials sector introduces specific company risk which could be mitigated through broader diversification.

Regions Info

  • North America
    28%
  • Asia Emerging
    5%
  • Europe Developed
    4%
  • Japan
    2%
  • Asia Developed
    1%
  • Australasia
    1%

Geographically, the portfolio is predominantly exposed to North America and has limited exposure to emerging and developed markets outside of this region. This geographic distribution reflects a conservative approach, favoring the perceived stability of North American markets. However, this concentration also exposes the portfolio to regional economic and political risks, potentially limiting diversification benefits.

Market capitalization Info

  • Large-cap
    20%
  • Mega-cap
    16%
  • Mid-cap
    5%

The market capitalization exposure, with a focus on big and mega-cap companies, aligns with the portfolio's conservative risk profile. These companies are typically more stable and less volatile than their smaller counterparts. However, the limited exposure to medium, small, and micro-cap stocks restricts potential growth opportunities and diversification benefits.

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.

Considering the Efficient Frontier, this portfolio may already be optimized for its current risk-return profile. However, exploring slight adjustments in asset allocation could potentially enhance returns without significantly increasing risk. This might involve diversifying the equity component further or adjusting the bond-to-equity ratio based on changing risk tolerance and market conditions.

Ongoing product costs Info

  • iShares $ Treasury Bond 1-3yr UCITS ETF EUR Hedged (Acc) 0.10%
  • Franklin Libertyshares ICAV - Franklin Ftse China Ucits ETF 0.19%
  • Vanguard FTSE All-World UCITS ETF USD Accumulation 0.22%
  • Weighted costs total (per year) 0.13%

The total expense ratio (TER) of 0.13% is impressively low, enhancing long-term return potential by minimizing cost drag. This cost efficiency is crucial in a conservative portfolio where expected returns are modest, ensuring that a larger portion of investment returns is retained by the investor.

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