A balanced and highly diversified portfolio with a strategic mix of global equities and bonds

Report created on Aug 10, 2025

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

5/5
Highly Diversified
Less diversification More diversification

Positions

The portfolio showcases a strategic composition, emphasizing global equities with a significant allocation towards international, small-cap, and S&P 500 ETFs. This diversified mix not only spans various asset classes but also integrates a blend of high-yield and short-term bond ETFs, alongside niche sectors like global carbon, highlighting a balanced approach to risk and return. Compared to typical balanced portfolios, this one leans slightly more towards equities, suggesting a moderate risk tolerance while aiming for growth.

Growth Info

Historically, the portfolio has demonstrated a Compound Annual Growth Rate (CAGR) of 11.47%, with a maximum drawdown of -24.55%. These figures suggest resilience and the potential for strong returns over time. However, it's crucial to remember that past performance is not indicative of future results. The days contributing most to returns highlight the portfolio's vulnerability to market volatility, underscoring the importance of a long-term investment horizon to mitigate short-term fluctuations.

Projection Info

Monte Carlo simulations offer a forward-looking perspective based on historical data, projecting a wide range of potential outcomes. With the majority of simulations indicating positive returns, the portfolio appears well-positioned for future growth. However, these projections come with limitations, as they cannot account for unforeseen market developments. Investors should view these findings as one of many tools in making informed decisions, not a guaranteed forecast.

Asset classes Info

  • Stocks
    84%
  • Bonds
    12%
  • Cash
    4%
  • Real Estate
    1%

The portfolio's allocation across stocks, bonds, cash, and a minimal real estate presence aligns with a balanced investor profile. The heavy tilt towards equities at 84% drives growth potential, while the 12% in bonds and 4% in cash provide a cushion against market downturns. This asset class distribution supports a medium to long-term investment horizon, balancing the pursuit of higher returns with the need for stability.

Sectors Info

  • Technology
    16%
  • Financials
    16%
  • Industrials
    12%
  • Consumer Discretionary
    9%
  • Health Care
    8%
  • Telecommunications
    8%
  • Consumer Staples
    5%
  • Basic Materials
    4%
  • Real Estate
    4%
  • Energy
    3%
  • Utilities
    2%

Sectoral allocation reveals a broad exposure with significant investments in technology and financial services, followed by industrials and consumer cyclicals. This sector diversity supports risk management by not overly depending on a single industry's performance. However, the tech and financial sectors' volatility warrants monitoring, especially during economic shifts, suggesting a periodic review to maintain alignment with risk tolerance.

Regions Info

  • North America
    51%
  • Europe Developed
    17%
  • Japan
    6%
  • Asia Developed
    5%
  • Asia Emerging
    5%
  • Australasia
    2%
  • Africa/Middle East
    1%
  • Latin America
    1%

Geographic diversification enhances the portfolio's resilience, with over half allocated to North America and substantial positions in developed European markets and emerging regions. This global spread not only captures growth in various economies but also mitigates risks associated with geopolitical events and currency fluctuations. However, investors should remain vigilant about overexposure to any single region, considering rebalancing to maintain a global balance.

Market capitalization Info

  • Mega-cap
    30%
  • Large-cap
    22%
  • Mid-cap
    16%
  • Small-cap
    12%
  • Micro-cap
    3%

The market capitalization breakdown, with a mix of mega, big, medium, small, and micro-cap stocks, underscores the portfolio's comprehensive approach to diversification. This variety ensures participation in the growth potential of smaller companies while relying on the stability of larger firms. It's a balanced strategy that caters to investors looking for growth with a moderated risk profile.

Redundant positions Info

  • Vanguard Dividend Appreciation Index Fund ETF Shares
    iShares Core Dividend Growth ETF
    High correlation
  • iShares Core MSCI Emerging Markets ETF
    Vanguard FTSE Emerging Markets Index Fund ETF Shares
    High correlation
  • Schwab International Equity ETF
    Vanguard FTSE Developed Markets Index Fund ETF Shares
    High correlation
  • iShares 0-5 Year High Yield Corporate Bond ETF
    SPDR® Bloomberg Short Term High Yield Bond ETF
    iShares Broad USD High Yield Corporate Bond ETF
    High correlation
  • Vanguard Small-Cap Index Fund ETF Shares
    Vanguard Extended Market Index Fund ETF Shares
    High correlation
  • Vanguard S&P 500 ETF
    Vanguard Large-Cap Index Fund ETF Shares
    Vanguard Total Stock Market Index Fund ETF Shares
    High correlation

The analysis of asset correlation within the portfolio highlights several highly correlated groups, suggesting redundancy that may not contribute to diversification. Reducing overlap among similar ETFs could enhance the portfolio’s efficiency by eliminating redundancies, thereby potentially improving the risk-return profile. Investors should consider diversifying further or reallocating assets to reduce these correlations.

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.

Before optimizing, the portfolio could benefit from addressing the identified highly correlated assets. Reducing overlap can sharpen the portfolio’s focus, potentially enhancing its performance by ensuring that each holding contributes uniquely to diversification and risk management. This step is crucial for maintaining a balanced and efficient investment strategy.

Dividends Info

  • iShares Core Dividend Growth ETF 2.20%
  • VanEck Investment Grade Floating Rate ETF 5.30%
  • iShares Core MSCI Emerging Markets ETF 3.00%
  • JPMorgan Equity Premium Income ETF 8.60%
  • KraneShares Global Carbon ETF 6.70%
  • iShares National Muni Bond ETF 3.20%
  • Schwab International Equity ETF 2.50%
  • Schwab Short-Term U.S. Treasury ETF 4.20%
  • iShares® 0-3 Month Treasury Bond ETF 4.40%
  • iShares Short Treasury Bond ETF 4.50%
  • iShares 0-5 Year High Yield Corporate Bond ETF 7.10%
  • SPDR® Bloomberg Short Term High Yield Bond ETF 7.30%
  • iShares Broad USD High Yield Corporate Bond ETF 6.80%
  • Vanguard Small-Cap Index Fund ETF Shares 1.40%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 2.70%
  • Vanguard Dividend Appreciation Index Fund ETF Shares 1.70%
  • Vanguard Real Estate Index Fund ETF Shares 3.90%
  • Vanguard S&P 500 ETF 1.20%
  • Vanguard Total Stock Market Index Fund ETF Shares 1.20%
  • Vanguard Large-Cap Index Fund ETF Shares 1.20%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 2.70%
  • Vanguard Extended Market Index Fund ETF Shares 1.10%
  • Weighted yield (per year) 2.71%

The portfolio's dividend yield averages at 2.71%, contributing to its total return. High-yield ETFs provide income, which can be particularly attractive in volatile markets or for investors seeking steady cash flow. While dividends are an essential component of total returns, the focus should remain on the overall portfolio balance between growth potential and income generation, adjusting as necessary to align with investment goals.

Ongoing product costs Info

  • iShares Core Dividend Growth ETF 0.08%
  • VanEck Investment Grade Floating Rate ETF 0.14%
  • iShares Core MSCI Emerging Markets ETF 0.09%
  • JPMorgan Equity Premium Income ETF 0.35%
  • KraneShares Global Carbon ETF 0.79%
  • iShares National Muni Bond ETF 0.05%
  • Schwab International Equity ETF 0.06%
  • Schwab Short-Term U.S. Treasury ETF 0.03%
  • iShares® 0-3 Month Treasury Bond ETF 0.07%
  • iShares Short Treasury Bond ETF 0.15%
  • iShares 0-5 Year High Yield Corporate Bond ETF 0.30%
  • SPDR® Bloomberg Short Term High Yield Bond ETF 0.40%
  • iShares Broad USD High Yield Corporate Bond ETF 0.08%
  • Vanguard Small-Cap Index Fund ETF Shares 0.05%
  • Vanguard FTSE Developed Markets Index Fund ETF Shares 0.05%
  • Vanguard Dividend Appreciation Index Fund ETF Shares 0.06%
  • Vanguard Real Estate Index Fund ETF Shares 0.12%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total Stock Market Index Fund ETF Shares 0.03%
  • Vanguard Large-Cap Index Fund ETF Shares 0.04%
  • Vanguard FTSE Emerging Markets Index Fund ETF Shares 0.08%
  • Vanguard Extended Market Index Fund ETF Shares 0.06%
  • Weighted costs total (per year) 0.10%

With an average Total Expense Ratio (TER) of 0.10%, the portfolio is efficiently managed in terms of costs. Lower costs directly translate to higher net returns over time, making this an attractive feature of the portfolio. Investors should continue to monitor fees, as even small reductions can have a significant impact on long-term growth.

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