Concentrated healthcare growth portfolio with strong low volatility tilt and room for efficiency gains
Report created on Jul 22, 2024Risk profile
5/7
Diversification profile
2/5
Positions
-
IH iShares U.S. Medical Devices ETF
IHI - US4642888105 25.00% -
NV Novo Nordisk A/S
NVO - US6701002056 25.00% -
SC Schwab U.S. Broad Market ETF
SCHB - US8085241029 25.00% -
ZT Zoetis Inc
ZTS - US98978V1035 25.00%
The portfolio is very simple and very concentrated: four positions at 25% each, all in equities. Two are single-company holdings and two are broad and sector ETFs, giving a mix of targeted bets and diversified baskets. This kind of structure makes the big drivers of risk and return very clear, which can be appealing if someone has strong conviction about a few themes. The flip side is that setbacks in any one name or niche can meaningfully move the total portfolio. A practical takeaway is that ongoing conviction checks on each of the four pillars matter more here than in a portfolio with dozens of smaller positions.
Growth
Historically, $1,000 grew to about $2,657 over ten years, a compound annual growth rate (CAGR) of 10.29%. CAGR is the “average yearly speed” of growth over the whole journey. This trailed the US market by about 3.5 percentage points a year and the global market by about 1 percentage point, so the reward side has been a bit weaker than broad indexes. Max drawdown, or worst peak‑to‑trough fall, reached about -36.5%, slightly deeper than the benchmarks. That level of downside lines up with a growth‑oriented risk profile, but shows this mix has not been “safer” than broad markets historically despite its low‑volatility tilt. Past performance still can’t guarantee anything going forward.
Asset classes
- Stocks 100%
All assets are in stocks, with no bonds, cash, or alternatives. That 100% equity allocation aligns with a growth‑oriented profile and long time horizon, because equities historically have offered higher returns but larger swings than bonds. Compared with typical “balanced” portfolios that might hold 40–60% in bonds, this structure accepts more volatility in exchange for higher potential growth. The absence of defensive assets means there’s little built‑in cushion during sharp market sell‑offs. For many investors, that’s workable when the time horizon is long and there’s emotional tolerance for large temporary drawdowns, but it also means there’s no automatic stabilizer if a prolonged downturn hits.
Sectors
- Health Care 77%
- Technology 8%
- Financials 3%
- Consumer Discretionary 3%
- Industrials 2%
- Telecommunications 2%
- Consumer Staples 1%
- Energy 1%
- Utilities 1%
- Real Estate 1%
- Basic Materials 1%
Sector exposure is dominated by healthcare at about 77%, with relatively small allocations spread across technology, financials, consumer areas, and other sectors. That heavy tilt is a clear thematic bet: outcomes will be strongly tied to healthcare regulation, drug/device pipelines, reimbursement trends, and innovation cycles. The tech and other minor slices mainly come via the broad US ETF and play a secondary role in driving returns. Compared with broad market benchmarks that are more balanced across multiple sectors, this is a distinctly concentrated stance. A key implication is that sector‑specific headline risk—like policy changes, pricing pressures, or litigation—can impact the whole portfolio at once rather than just a small slice.
Regions
- North America 75%
- Europe Developed 25%
Geographically, about 75% of exposure is to North America and 25% to developed Europe, with no meaningful allocation elsewhere. That split is actually fairly close to many global equity benchmarks, which lean heavily toward North America. The positive here is that the regional mix is not extreme; it balances dominant US markets with a substantial European component anchored by Novo Nordisk. However, there’s minimal exposure to emerging markets or other regions, so the portfolio doesn’t fully capture global diversification potential. In practice, that means outcomes will track the fortunes of US and European economies and currencies, with less benefit from any strong cycles in regions like Asia or Latin America.
Market capitalization
- Large-cap 71%
- Mid-cap 14%
- Mega-cap 10%
- Small-cap 3%
- Micro-cap 1%
Most holdings are large‑cap and mega‑cap, with about 81% in those segments and modest exposure to mid, small, and micro‑caps. Large and mega companies tend to have more diversified revenue, stronger balance sheets, and better access to capital, often resulting in somewhat lower individual risk than small firms. The small slice in smaller caps adds a bit of growth potential and diversification but won’t dominate performance. Compared to a pure small‑cap or micro‑cap tilt, this structure is more stable and benchmark‑like in its size profile. The trade‑off is potentially less explosive upside but also fewer extreme single‑stock collapses from tiny, speculative names.
True holdings
-
-
-
AB Abbott Laboratories 4.24%
Part of fund(s):- iShares U.S. Medical Devices ETF
-
IS Intuitive Surgical Inc 3.93%
Part of fund(s):- iShares U.S. Medical Devices ETF
-
SY Stryker Corporation 2.65%
Part of fund(s):- iShares U.S. Medical Devices ETF
-
NV NVIDIA Corporation 1.68%
Part of fund(s):- Schwab U.S. Broad Market ETF
-
AA Apple Inc 1.45%
Part of fund(s):- Schwab U.S. Broad Market ETF
-
BS Boston Scientific Corp 1.15%
Part of fund(s):- iShares U.S. Medical Devices ETF
-
MD Medtronic PLC 1.14%
Part of fund(s):- iShares U.S. Medical Devices ETF
-
EW Edwards Lifesciences Corp 1.12%
Part of fund(s):- iShares U.S. Medical Devices ETF
- Top 10 total 67.36%
Looking through the ETFs, exposure is heavily dominated by Novo Nordisk and Zoetis as direct 25% positions each, with no additional overlap via the funds. The ETF sleeves bring in large healthcare names like Abbott, Intuitive Surgical, and Stryker, plus mega‑cap growth names such as NVIDIA and Apple, but each of these sits at only 1–4% total exposure. Because only top‑10 ETF holdings are captured, true overlap across the full ETF baskets is likely somewhat higher than shown. Hidden concentration risk mainly comes from the two single‑stock positions, not duplication in the ETFs, meaning idiosyncratic company risk is a key driver rather than broad market risk.
Factors
Factor exposure shows a notable tilt toward low volatility at 67%, meaning holdings are skewed toward stocks that historically have had smaller price swings than the market. Factor exposure is like checking what “personality traits” your stocks share—here, calmer behavior is a shared trait. Value exposure is low at 32%, suggesting a mild lean away from classic cheap‑on‑fundamentals names and toward more expensive growth or quality franchises. Other factors—size, momentum, quality, and yield—are all neutral, which is nicely balanced. In strong growth markets, low‑volatility portfolios can lag somewhat but may hold up better in severe downturns. That’s consistent with a growth investor who still wants some smoothing of the ride.
Risk contribution
-
Novo Nordisk A/S
Weight: 25.00% 30.5% -
Zoetis Inc
Weight: 25.00% 27.7% -
iShares U.S. Medical Devices ETF
Weight: 25.00% 21.8% -
Schwab U.S. Broad Market ETF
Weight: 25.00% 20.0%
Risk contribution shows how much each position drives overall ups and downs, which can differ from simple weight. Novo Nordisk and Zoetis each hold 25% weights but together contribute almost 60% of total portfolio risk, meaning their individual volatility and correlations dominate. The sector ETF and the broad market ETF, also at 25% each, together contribute just over 40% of total risk. When three holdings contribute about 80% of risk, the portfolio behaves more like a focused bet than a diversified basket. Adjusting position sizes—rather than changing what’s owned—can meaningfully shift this risk mix and bring single‑stock contributions closer in line with the diversified ETF sleeves.
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.
On the risk‑return chart, the current portfolio has a Sharpe ratio of 0.56, below both the optimal portfolio at 0.73 and the minimum‑variance portfolio at 0.69. The Sharpe ratio measures return per unit of volatility—the higher, the more “efficient” the ride. At its current risk level, the portfolio sits about 1.78 percentage points below the efficient frontier, meaning there’s room to improve expected return without increasing risk, or reduce risk without sacrificing expected return, just by reweighting existing holdings. The encouraging part is that no new products are needed: simply shifting the mix among the four positions toward the optimal or minimum‑variance weights could meaningfully improve the risk/return tradeoff.
Dividends
- iShares U.S. Medical Devices ETF 0.40%
- Novo Nordisk A/S 4.60%
- Schwab U.S. Broad Market ETF 0.90%
- Zoetis Inc 1.80%
- Weighted yield (per year) 1.92%
The overall dividend yield of about 1.92% is modest but not negligible, combining a low yield from the medical devices ETF, a higher payout from Novo Nordisk, and moderate yields from the broad market ETF and Zoetis. Dividend yield is the cash paid out each year as a percentage of current price, and it can help smooth returns even when prices are flat. For a growth‑oriented, equity‑only mix, this yield level is reasonable and signals a focus on total return more than income. Investors primarily seeking cash flow might want higher payouts, but for long‑term growth, reinvesting these dividends can quietly add to compounding over time.
Ongoing product costs
- iShares U.S. Medical Devices ETF 0.40%
- Schwab U.S. Broad Market ETF 0.03%
- Weighted costs total (per year) 0.11%
Total estimated ongoing fund costs (TER) are impressively low at about 0.11%, thanks to the very cheap Schwab US Broad Market ETF offsetting the pricier sector ETF. TER is like a small annual “membership fee” charged by funds; the lower it is, the less return gets eaten by costs each year. This cost level is well below typical active funds and aligns with best practice for long‑term equity investing. Over decades, even a 0.3–0.5 percentage point difference per year can add up to thousands of dollars on a sizable portfolio. Keeping costs this low is a real strength and supports better long‑run compounding.
What next?
Ready to invest in this portfolio?
Select a broker that fits your needs and watch for low fees to maximize your returns.
Create your own report?
Join our community!
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.
Instrument logos provided by Elbstream.
Help us improve Insightfolio
Your feedback makes a difference! Share your thoughts in our quick survey. Take the survey