Growth-focused portfolio with heavy US large-cap and tech sector exposure

Report created on Jun 13, 2025

Risk profile Info

5/7
Growth
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

This portfolio is predominantly invested in U.S. large-cap stocks, with a significant concentration in technology and communication services. The allocation is heavily skewed towards ETFs and index funds that track major U.S. stock indices, alongside a notable direct investment in Alphabet Inc. The minimal international exposure and the concentration in similar asset types and sectors suggest a low diversification level, which could increase volatility and risk.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 16.81% and a maximum drawdown of -33.01%, the portfolio has demonstrated strong historical performance. However, the days contributing to 90% of returns being concentrated in just 32 days indicates high volatility. While past performance is impressive, it's important to remember that it doesn't guarantee future results, and the significant drawdown highlights potential risk during market downturns.

Projection Info

Monte Carlo simulations project a wide range of outcomes, with the median increase suggesting significant growth potential. However, the reliance on historical data in these simulations means they cannot predict unforeseen market shifts or changes in economic conditions. The high number of simulations with positive returns is encouraging, but investors should remain cautious and not assume past trends will always predict future performance.

Asset classes Info

  • Stocks
    100%

The portfolio's allocation is entirely in stocks, with no diversification into bonds, real estate, or alternative investments. This singular focus on equities enhances growth potential but also increases susceptibility to market volatility. Diversifying across different asset classes can provide a buffer against stock market fluctuations and reduce overall portfolio risk.

Sectors Info

  • Technology
    32%
  • Telecommunications
    18%
  • Financials
    11%
  • Health Care
    9%
  • Consumer Discretionary
    7%
  • Industrials
    6%
  • Consumer Staples
    5%
  • Energy
    3%
  • Consumer Discretionary
    3%
  • Basic Materials
    2%
  • Utilities
    2%
  • Real Estate
    1%

The sectoral allocation shows a heavy emphasis on technology and communication services, reflecting a growth-oriented strategy. While these sectors have historically provided high returns, they can also be more volatile and sensitive to interest rate changes. Balancing with investments in less volatile sectors or those with counter-cyclical characteristics could mitigate risk without significantly compromising growth potential.

Regions Info

  • North America
    97%
  • Europe Developed
    1%

With 97% of assets allocated to North America, primarily the U.S., the portfolio's geographic exposure is highly concentrated. This focus has likely contributed to its strong performance, given the robust U.S. market. However, increasing global diversification could reduce vulnerability to regional economic downturns and offer exposure to emerging market growth.

Market capitalization Info

  • Mega-cap
    55%
  • Large-cap
    28%
  • Mid-cap
    15%
  • Small-cap
    1%

The emphasis on mega and big-cap stocks aligns with the portfolio's growth and risk profile, leveraging the stability and potential of large corporations. However, incorporating medium, small, or even micro-cap stocks could enhance diversification and potentially tap into higher growth rates of smaller companies, albeit with increased risk.

Redundant positions Info

  • Fidelity 500 Index Fund
    Vanguard S&P 500 ETF
    Schwab U.S. Large-Cap Growth ETF
    High correlation

The high correlation among the major ETFs and index funds in the portfolio indicates significant overlap in holdings, particularly within the U.S. large-cap space. This redundancy limits diversification benefits and exposes the portfolio to heightened sector-specific and market risks. Reducing overlap by reallocating assets could enhance diversification without drastically altering the portfolio's growth orientation.

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 portfolio's current configuration suggests room for optimization, particularly in reducing correlated assets to enhance diversification. Employing the Efficient Frontier concept could identify a mix of assets that maximizes returns for a given level of risk. This process might involve diversifying into different asset classes, sectors, and geographies to achieve a more balanced risk-return profile.

Dividends Info

  • FIDELITY TOTAL INTERNATIONAL INDEX FUND INSTITUTIONAL PREMIUM CLASS 2.50%
  • Fidelity 500 Index Fund 1.20%
  • Alphabet Inc Class A 0.30%
  • Schwab U.S. Dividend Equity ETF 3.80%
  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • Vanguard S&P 500 ETF 1.30%
  • Weighted yield (per year) 1.08%

The portfolio's overall dividend yield is moderate, reflecting its growth focus over income generation. However, dividends contribute to total returns and can provide a steady income stream, particularly in volatile markets. Considering slightly higher dividend-yielding investments within the growth strategy could offer a balance between income and capital appreciation.

Ongoing product costs Info

  • FIDELITY TOTAL INTERNATIONAL INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.06%
  • Fidelity 500 Index Fund 0.02%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.03%

The portfolio's total expense ratio (TER) is impressively low, which is beneficial for long-term growth as costs can significantly impact net returns over time. Keeping investment costs minimal is a prudent strategy, particularly when investing in index funds and ETFs, where lower costs are often associated with better performance relative to peers.

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