A conservative yet highly diversified portfolio with a global reach and a focus on ETFs
Report created on May 9, 2025Risk profile
2/7
Diversification profile
5/5
Positions
-
SX iShares Core S&P 500 UCITS ETF USD (Acc)
SXR8 - IE00B5BMR087 30.05% -
IB iShares iBonds Dec 2026 Term € Corp UCITS ETF EUR Inc
IB26 - IE000SIZJ2B2 25.47% -
IS iShares Core MSCI Emerging Markets IMI UCITS
IS3N - IE00BKM4GZ66 24.28% -
TR VanEck Vectors ETFs N.V. - VanEck Vectors Global Real Estate UCITS ETF
TRET - NL0009690239 20.20%
This portfolio is structured around a core of diversified ETFs, focusing on large, stable markets and sectors with a conservative risk profile. It includes significant allocations to the S&P 500, corporate bonds with a specific maturity, emerging markets, and global real estate. The diversification across asset classes—stocks and bonds—alongside a geographical spread from North America to emerging Asian markets, underpins its conservative risk classification. This composition aligns well with a strategy aiming to mitigate volatility while seeking steady growth.
Growth
Historically, the portfolio has demonstrated a Compound Annual Growth Rate (CAGR) of 9.37%, with a maximum drawdown of -15.67%. This performance suggests resilience during market downturns and an ability to capitalize on growth opportunities, particularly impressive given the conservative risk profile. The days contributing most significantly to returns highlight the importance of staying invested over the long term, as key gains often come from a few critical days in the market.
Projection
Monte Carlo simulations, which project future performance based on historical data, show a wide range of outcomes with a median increase of 230.5%. While past performance is not indicative of future results, such projections are useful for understanding potential volatility and reward. The simulations suggest a high probability of positive returns, aligning with the portfolio's conservative risk approach.
Asset classes
- Stocks 74%
- Bonds 25%
The allocation across asset classes is well-balanced for a conservative portfolio, with a 74% investment in stocks and 25% in bonds. This mix supports growth potential through equities while using bonds to provide income and reduce volatility. The absence of cash or alternative investments might indicate a full commitment to market participation, which is appropriate given the long-term horizon typical of conservative strategies.
Sectors
- Real Estate 21%
- Technology 15%
- Financials 10%
- Consumer Discretionary 6%
- Telecommunications 5%
- Industrials 4%
- Health Care 4%
- Consumer Staples 3%
- Basic Materials 2%
- Energy 2%
- Utilities 1%
Sector allocation reveals a focus on real estate, technology, and financial services, which offers a mix of stability and growth potential. Real estate, in particular, can provide steady income through dividends, while technology and financial services sectors offer growth opportunities. The spread across other sectors, including consumer cyclicals and healthcare, further diversifies risk.
Regions
- North America 44%
- Asia Emerging 13%
- Asia Developed 7%
- Europe Developed 3%
- Africa/Middle East 3%
- Japan 2%
- Latin America 2%
- Australasia 1%
- Europe Emerging 1%
Geographic distribution emphasizes a strong North American presence with significant exposure to emerging Asian markets. This global reach enhances diversification, reducing the impact of regional downturns on portfolio performance. However, the modest allocations to Europe, both developed and emerging, and other regions suggest potential areas for increased diversification.
Market capitalization
- Mega-cap 26%
- Large-cap 24%
- Mid-cap 21%
- Small-cap 3%
The market capitalization breakdown—focusing on mega, big, and medium companies—reinforces the portfolio's conservative stance. Larger companies typically offer stability and resilience during market fluctuations, which is aligned with the portfolio's risk profile. The minimal exposure to small and micro-cap stocks limits vulnerability to the higher volatility often associated with these segments.
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.
Optimization analysis suggests that adjusting the current allocation could potentially increase the expected return to 4.96% while slightly reducing the risk level. This finding indicates room for improvement in the risk-return profile without deviating from the conservative strategy. Such adjustments could involve rebalancing asset classes or geographic exposures to align more closely with the optimal portfolio.
Dividends
- VanEck Vectors ETFs N.V. - VanEck Vectors Global Real Estate UCITS ETF 2.90%
- Weighted yield (per year) 0.59%
The focus on dividend-yielding investments, particularly through the global real estate ETF, contributes to the portfolio's income generation capabilities. A total yield of 0.59% might seem modest but is consistent with a conservative strategy prioritizing steady income and risk reduction over high-growth, high-volatility options.
Ongoing product costs
- iShares Core MSCI Emerging Markets IMI UCITS 0.18%
- iShares Core S&P 500 UCITS ETF USD (Acc) 0.12%
- VanEck Vectors ETFs N.V. - VanEck Vectors Global Real Estate UCITS ETF 0.25%
- Weighted costs total (per year) 0.13%
The portfolio's overall cost, represented by a Total Expense Ratio (TER) of 0.13%, is impressively low, enhancing its attractiveness for long-term investment. Lower costs directly translate to higher net returns for investors, a crucial factor in building wealth over time.
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