Growth-oriented portfolio with a strong focus on US large-cap stocks and low diversification

Report created on Aug 3, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

This portfolio is heavily weighted towards U.S. large-cap growth and momentum stocks, with 60% in the Schwab U.S. Large-Cap Growth ETF, 20% in the Invesco S&P 500® Momentum ETF, and 20% in the Vanguard S&P 500 ETF. This composition reflects a clear growth orientation but exhibits low diversification across asset classes and geographies, concentrating entirely on North American equities. The overlap between these ETFs, particularly with the S&P 500 as a common benchmark, points to a redundancy that could limit the portfolio's diversification benefits.

Growth Info

Historically, the portfolio has demonstrated a robust Compound Annual Growth Rate (CAGR) of 21.01%, with a significant maximum drawdown of -32.44%. This performance suggests a high-risk, high-reward profile, characteristic of growth-focused investments. However, it's crucial to note that past performance, especially over short and volatile periods, may not reliably predict future results. The days contributing most to returns hint at the portfolio's sensitivity to market highs, underscoring its volatility.

Projection Info

Monte Carlo simulations project a wide range of outcomes, with the 50th percentile suggesting a potential 1,399.7% return. While this tool helps visualize possible future scenarios by using historical data, it's important to remember that these projections are speculative. They cannot account for unforeseen market shifts or black swan events, making it essential to consider them as part of a broader risk management strategy rather than guarantees.

Asset classes Info

  • Stocks
    100%

The portfolio's allocation is 100% in stocks, with no presence in other asset classes such as bonds or real estate. This singular focus on equities enhances its growth potential but also increases its risk, particularly in market downturns. Diversifying across different asset classes can help mitigate this risk, providing a buffer against stock market volatility.

Sectors Info

  • Technology
    42%
  • Telecommunications
    13%
  • Consumer Discretionary
    13%
  • Financials
    11%
  • Health Care
    7%
  • Industrials
    6%
  • Consumer Staples
    4%
  • Energy
    1%
  • Utilities
    1%
  • Basic Materials
    1%
  • Real Estate
    1%

Sector-wise, the portfolio is heavily tilted towards technology, communication services, and consumer cyclicals, which are sectors known for their growth potential. However, this concentration also exposes the portfolio to sector-specific risks, such as regulatory changes or economic cycles affecting tech and consumer discretionary spending. Balancing this with investments in more stable sectors could reduce volatility.

Regions Info

  • North America
    100%

The geographic allocation is entirely focused on North America, missing out on potential opportunities and diversification benefits from developed and emerging markets elsewhere. This concentration risks magnifying the impact of region-specific economic downturns or political events on the portfolio's performance.

Market capitalization Info

  • Mega-cap
    59%
  • Large-cap
    27%
  • Mid-cap
    13%
  • Small-cap
    1%

With a significant emphasis on mega and big-cap stocks, the portfolio is positioned to capture the growth of well-established companies. While these firms often offer stability and consistent returns, incorporating a broader range of market capitalizations could enhance return potential and reduce risk through better diversification.

Redundant positions Info

  • Vanguard S&P 500 ETF
    Schwab U.S. Large-Cap Growth ETF
    High correlation

The high correlation observed between the Vanguard S&P 500 ETF and the Schwab U.S. Large-Cap Growth ETF indicates redundancy, limiting the effectiveness of diversification within the portfolio. Diversifying into assets with lower correlation can help spread risk more evenly, potentially improving the portfolio's overall risk-adjusted performance.

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.

Given the portfolio's high correlation among assets and its concentration risk, optimization could focus on reducing overlap and enhancing diversification. The Efficient Frontier model suggests there's room to improve the risk-return ratio by rebalancing asset allocations. However, such optimization should consider the investor's risk tolerance and investment horizon.

Dividends Info

  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • Invesco S&P 500® Momentum ETF 0.60%
  • Vanguard S&P 500 ETF 1.20%
  • Weighted yield (per year) 0.60%

The portfolio's dividend yield stands at 0.60%, which is relatively modest. This yield reflects the growth orientation of the portfolio, as growth stocks typically reinvest earnings rather than distribute them as dividends. Investors seeking income in addition to growth might consider allocating a portion of their portfolio to higher-yielding assets.

Ongoing product costs Info

  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • Invesco S&P 500® Momentum ETF 0.13%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.06%

The total expense ratio (TER) of 0.06% is impressively low, which is beneficial for long-term performance as lower costs mean more of the investment's return is retained by the investor. This cost efficiency is a strong aspect of the portfolio, supporting its growth potential over time.

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