A balanced portfolio with significant US exposure and focus on technology and global diversification.

Report created on Dec 6, 2024

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

4/5
Broadly Diversified
Less diversification More diversification

Positions

This portfolio consists of two major ETFs, each holding a 38% stake, and a single stock, Palantir Technologies, at 15%. Additionally, it includes a physical gold ETF at 9%. The portfolio is structured to provide broad exposure while maintaining a focus on equities. The balance between ETFs and a single stock offers diversification, although the concentration in Palantir could introduce volatility. A broad exposure to various asset types like stocks and gold can help balance risk and return. Consider maintaining a diversified asset allocation to hedge against market fluctuations.

Growth Info

Historically, this portfolio has demonstrated strong growth, with a compound annual growth rate (CAGR) of 20.37%. However, it also experienced a significant maximum drawdown of -20.84%. This indicates that while the portfolio has performed well, it is not immune to market downturns. Understanding past performance helps in setting realistic expectations, though past results do not guarantee future outcomes. To mitigate potential downturns, consider maintaining a diversified portfolio and regularly reviewing asset allocation to align with your risk tolerance.

Projection Info

Forward projections using Monte Carlo simulations indicate a wide range of potential outcomes for this portfolio. With 1,000 simulations, the 5th percentile suggests a return of 89.03%, while the 50th percentile shows 1,418.43%. Monte Carlo simulations use historical data to model future performance, offering a probabilistic view rather than a guarantee. This range highlights the uncertainty in future returns. To manage this uncertainty, consider adjusting your portfolio based on changing market conditions and personal financial goals.

Asset classes Info

  • Stocks
    91%
  • Other
    9%

The portfolio is heavily weighted towards stocks, making up over 90% of the allocation, with a small portion in gold. This allocation suggests a focus on capital appreciation through equities, with gold providing a hedge against inflation and market volatility. While equities can offer significant growth potential, they also carry higher risk. To enhance diversification, consider incorporating other asset classes, such as bonds or real estate, to reduce overall portfolio risk.

Sectors Info

  • Technology
    37%
  • Financials
    11%
  • Health Care
    8%
  • Consumer Discretionary
    8%
  • Industrials
    7%
  • Telecommunications
    6%
  • Consumer Staples
    5%
  • Energy
    3%
  • Basic Materials
    2%
  • Utilities
    2%
  • Real Estate
    2%

Technology dominates the sectoral allocation at 37.16%, followed by financial services and healthcare. This concentration in technology reflects a growth-oriented strategy but also increases exposure to sector-specific risks. Diversifying across sectors can help manage risk and capture opportunities in various market conditions. Consider evaluating sector performance and rebalancing to ensure alignment with your investment goals and risk tolerance.

Regions Info

  • North America
    77%
  • Europe Developed
    6%
  • Asia Emerging
    2%
  • Japan
    2%
  • Asia Developed
    1%
  • Australasia
    1%

The portfolio is heavily concentrated in North America, accounting for over 77% of geographic exposure. This significant US exposure can benefit from the country's economic strength but also increases vulnerability to regional risks. Diversifying geographically can help mitigate these risks and capture growth opportunities in emerging markets. Consider gradually increasing exposure to other regions to enhance diversification and reduce reliance on a single market.

Redundant positions Info

  • Vanguard S&P 500 UCITS Acc
    Vanguard FTSE All-World UCITS ETF USD Accumulation
    High correlation

The Vanguard S&P 500 and FTSE All-World ETFs are highly correlated, meaning they tend to move in tandem. This correlation limits diversification benefits within the portfolio. Understanding asset correlation is crucial for effective risk management, as highly correlated assets can amplify losses during downturns. Consider replacing one of these ETFs with a less correlated asset to improve diversification and reduce portfolio risk.

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.

Portfolio optimization suggests focusing on the Efficient Frontier, which aims to achieve the best possible risk-return ratio. However, the current high correlation between assets limits diversification benefits. Optimization involves adjusting asset allocations to improve efficiency based on existing holdings. Consider diversifying further by introducing non-correlated assets to achieve a more balanced and efficient portfolio.

Ongoing product costs Info

  • Vanguard S&P 500 UCITS Acc 0.07%
  • Vanguard FTSE All-World UCITS ETF USD Accumulation 0.22%
  • Weighted costs total (per year) 0.11%

The portfolio's total expense ratio (TER) is relatively low at 0.11%, thanks to the cost-effective nature of the ETFs. Keeping costs low is essential for maximizing net returns over the long term. High fees can erode returns, so it's important to choose investments with reasonable costs. Regularly review and compare the fees of your investments to ensure they remain competitive and aligned with your financial goals.

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