Balanced portfolio with a strong foundation in global stocks and a hedge in gold
Report created on Oct 26, 2025Risk profile
4/7
Diversification profile
5/5
Positions
-
VT Vanguard Total Stock Market Index Fund ETF Shares
VTI - US9229087690 70.00% -
VX Vanguard Total International Stock Index Fund ETF Shares
VXUS - US9219097683 25.00% -
IA iShares Gold Trust
IAU - US4642852044 5.00%
This portfolio is predominantly invested in global equities through two major ETFs, with a 70% allocation to the Vanguard Total Stock Market Index Fund ETF Shares and a 25% allocation to the Vanguard Total International Stock Index Fund ETF Shares. A 5% allocation to the iShares Gold Trust provides a hedge against inflation and market volatility. The heavy emphasis on stocks positions the portfolio for growth, while the inclusion of gold and international exposure adds a layer of diversification to mitigate risk.
Growth
Historically, this portfolio has demonstrated a Compound Annual Growth Rate (CAGR) of 13.32%, with a maximum drawdown of -33.33%. These figures suggest a resilient performance during various market conditions, with the ability to recover from downturns. The concentration of days that contribute to 90% of returns indicates that timing the market is less important than time in the market for this portfolio.
Projection
Monte Carlo simulations, using 1,000 iterations, project a wide range of outcomes with a median increase of 405.9% in portfolio value. This analysis underscores the potential for significant growth while also highlighting the uncertainty inherent in investing. It's important to remember that these projections are based on historical data, and future market conditions may vary.
Asset classes
- Stocks 94%
- Other 5%
- Cash 1%
With 94% of the portfolio allocated to stocks and the remainder in gold and cash, the asset class distribution underscores a growth-oriented strategy. This high allocation to equities is typical for balanced portfolios seeking long-term capital appreciation, though it carries a higher risk compared to more conservative allocations.
Sectors
- Technology 27%
- Financials 15%
- Industrials 10%
- Consumer Discretionary 10%
- Health Care 9%
- Telecommunications 8%
- Consumer Staples 5%
- Energy 3%
- Basic Materials 3%
- Real Estate 2%
- Utilities 2%
The sector allocation within this portfolio is heavily weighted towards technology and financial services, which are sectors known for their growth potential. However, these sectors can also be volatile, reflecting broader market trends. The diversification across 11 sectors helps to mitigate this risk, though investors should be mindful of sector-specific downturns.
Regions
- North America 72%
- Europe Developed 10%
- Asia Emerging 4%
- Japan 4%
- Asia Developed 3%
- Australasia 1%
- Africa/Middle East 1%
- Latin America 1%
The geographic allocation shows a strong bias towards North American equities, complemented by diversified international exposure. This global footprint enhances the portfolio's growth potential by tapping into different economic cycles and opportunities, though it also introduces currency and geopolitical risks.
Market capitalization
- Mega-cap 40%
- Large-cap 29%
- Mid-cap 18%
- Small-cap 5%
- No data 5%
- Micro-cap 2%
The portfolio's market capitalization breakdown, favoring mega and large-cap stocks, suggests a focus on established, financially robust companies. This strategy can provide stability and resilience during market fluctuations, though it may limit exposure to the high-growth potential of smaller companies.
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.
The current portfolio is positioned near the Efficient Frontier, indicating an optimal balance between risk and return. However, the analysis suggests a potential for a slight increase in expected return to 14.12% with a comparable risk level. Investors might consider this when reviewing their investment strategy, although it's essential to recognize that higher returns usually come with increased risk.
Dividends
- Vanguard Total Stock Market Index Fund ETF Shares 1.10%
- Vanguard Total International Stock Index Fund ETF Shares 2.70%
- Weighted yield (per year) 1.44%
The dividend yields from the ETFs contribute to the portfolio's total income, offering a modest but steady income stream. This can be particularly beneficial during market downturns or for investors seeking regular income. The balance between growth and income reflects the portfolio's balanced approach.
Ongoing product costs
- iShares Gold Trust 0.25%
- Vanguard Total Stock Market Index Fund ETF Shares 0.03%
- Vanguard Total International Stock Index Fund ETF Shares 0.05%
- Weighted costs total (per year) 0.05%
The portfolio's total expense ratio (TER) is impressively low, maximizing the potential return for investors. Low costs are crucial for long-term investment success, as they compound over time, significantly impacting net returns. This portfolio exemplifies efficient cost management, a key factor in its favorable performance outlook.
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