Growth-oriented portfolio with a strong tech focus and moderate international exposure

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.

What type of investor this portfolio is suitable for

Growth Investors

This portfolio suits an investor with a growth-oriented profile, comfortable with higher levels of risk for the potential of greater returns. The investor likely has a medium to long-term investment horizon, allowing them to weather short-term market volatility in pursuit of long-term gains. The focus on technology and large-cap stocks indicates a confidence in these sectors' continued growth and resilience, making this portfolio ideal for those optimistic about market trends and technological innovation.

Positions

  • Vanguard S&P 500 ETF
    VOO - US9229083632
    50.00%
  • Invesco QQQ Trust
    QQQ - US46090E1038
    30.00%
  • Schwab U.S. Dividend Equity ETF
    SCHD - US8085247976
    10.00%
  • Vanguard Total International Stock Index Fund ETF Shares
    VXUS - US9219097683
    10.00%

The portfolio is heavily weighted towards equities, with a significant emphasis on the technology sector through its major allocations in Vanguard S&P 500 ETF and Invesco QQQ Trust, comprising 80% of the portfolio. The remaining 20% is split between Schwab U.S. Dividend Equity ETF and Vanguard Total International Stock Index Fund ETF Shares, providing some dividend income and international diversification. This composition suggests a growth-oriented strategy with a moderate level of diversification across sectors and geographies, though it leans heavily towards the US market.

Growth Info

Historically, this portfolio has achieved a Compound Annual Growth Rate (CAGR) of 14.17%, with a maximum drawdown of -31.59%. The performance is notably influenced by days that contributed to 90% of returns, highlighting the impact of significant market movements on portfolio value. This level of performance, alongside the drawdown, indicates a higher risk-reward profile, aligning with the portfolio's growth-focused strategy. It's important to note that past performance is not always indicative of future results.

Projection Info

Monte Carlo simulations, which use historical data to project a range of possible future outcomes, suggest a wide range of potential returns for this portfolio. With 980 out of 1,000 simulations showing positive returns, the projections are generally optimistic. However, the significant spread between the 5th and 67th percentiles underscores the portfolio's risk level. These projections are valuable for understanding potential volatility but should be viewed as one of many tools in decision-making.

Asset classes Info

  • Stocks
    100%
  • Cash
    0%
  • Other
    0%
  • No data
    0%

The portfolio is exclusively invested in stocks, eschewing other asset classes like bonds or real estate. This allocation supports its growth orientation but also increases its volatility and risk, particularly in market downturns. Diversifying across different asset classes could reduce risk without necessarily compromising long-term growth potential.

Sectors Info

  • Technology
    34%
  • Consumer Discretionary
    11%
  • Telecommunications
    11%
  • Financials
    10%
  • Health Care
    9%
  • Industrials
    8%
  • Consumer Staples
    7%
  • Energy
    4%
  • Basic Materials
    2%
  • Utilities
    2%
  • Real Estate
    1%

With 34% in technology, followed by consumer cyclicals and communication services, the portfolio is positioned to benefit from growth in these sectors. However, this concentration also exposes it to sector-specific risks, such as regulatory changes or market sentiment shifts. Balancing sector exposure could mitigate these risks while still capturing growth opportunities.

Regions Info

  • North America
    90%
  • Europe Developed
    5%
  • Asia Emerging
    2%
  • Japan
    2%
  • Asia Developed
    1%
  • Australasia
    0%
  • Latin America
    0%
  • Africa/Middle East
    0%
  • Europe Emerging
    0%

The portfolio's geographic allocation is heavily skewed towards North America (90%), with minimal exposure to international markets. This concentration enhances exposure to US market performance but limits potential gains from global diversification. Increasing international exposure could provide a buffer against regional economic downturns and tap into growth in emerging markets.

Market capitalization Info

  • Mega-cap
    44%
  • Large-cap
    36%
  • Mid-cap
    17%
  • Small-cap
    1%
  • Micro-cap
    0%

A focus on mega and big-cap stocks (80% combined) aligns with the portfolio's growth and stability objectives, as these companies are typically more resilient during market fluctuations. However, the minimal exposure to small and micro-cap stocks limits potential high-growth opportunities in these segments. A slight increase in allocation to smaller-cap stocks could enhance return potential, albeit with added risk.

Dividends Info

  • Invesco QQQ Trust 0.60%
  • Schwab U.S. Dividend Equity ETF 4.00%
  • Vanguard S&P 500 ETF 1.30%
  • Vanguard Total International Stock Index Fund ETF Shares 2.90%
  • Weighted yield (per year) 1.52%

The portfolio's dividend yield stands at 1.52%, with the Schwab U.S. Dividend Equity ETF contributing significantly to this income. While growth is the primary focus, dividends offer a source of passive income and a buffer during market volatility. For investors seeking both growth and income, maintaining or slightly increasing exposure to high-dividend assets could be beneficial.

Ongoing product costs Info

  • Invesco QQQ Trust 0.20%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.09%

The portfolio benefits from relatively low costs, with a Total Expense Ratio (TER) of 0.09%. This efficiency supports better net returns over the long term, demonstrating a well-considered selection of cost-effective ETFs. Maintaining low costs is crucial for enhancing long-term investment outcomes.

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.

The portfolio's current alignment suggests a strong focus on growth, primarily through tech exposure and large-cap stocks, which is near optimal for investors with a similar risk tolerance. However, exploring diversification across more asset classes and regions could potentially offer a more efficient risk-return profile, as indicated by the Efficient Frontier theory. This theory suggests that an optimal balance of assets can achieve the highest expected return for a given level of risk.

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