A balanced portfolio with strong healthcare focus and impressive historical performance

Report created on Dec 24, 2024

Risk profile Info

4/7
Balanced
Less risk More risk

Diversification profile Info

2/5
Low Diversity
Less diversification More diversification

Positions

The portfolio is heavily weighted towards common stock, comprising approximately 98% of the assets. This allocation is typical for a balanced portfolio but leans heavily towards equities, which can increase volatility. Compared to common benchmarks, this portfolio is less diversified across asset classes. To enhance diversification, consider incorporating a mix of bonds or alternative investments. This can help mitigate risk and provide more stability during market downturns, aligning the portfolio with a balanced risk profile.

Growth Info

Historically, the portfolio has delivered a strong Compound Annual Growth Rate (CAGR) of 12.6%, outperforming many benchmarks. However, it experienced a maximum drawdown of -17.18%, indicating significant volatility during downturns. While past performance is not a guarantee of future results, this historical trend suggests a robust growth potential. To maintain this performance, continue monitoring market conditions and adjust allocations as necessary to manage risk effectively and capitalize on growth opportunities.

Projection Info

Monte Carlo simulations, which use historical data to predict future outcomes, project a median return of 543.76% for this portfolio. However, remember that these simulations have limitations; past performance doesn't guarantee future results. With an annualized return of 15.49% across simulations, the portfolio shows potential for substantial growth. To capitalize on this, maintain a flexible approach, adjusting allocations in response to changing market conditions while considering potential risks and rewards.

Asset classes Info

  • Stocks
    98%
  • No data
    2%

With nearly 98% allocated to stocks, the portfolio lacks diversification across asset classes. This concentration can lead to higher volatility and risk. Benchmarks typically suggest a more balanced approach, incorporating bonds or other asset classes. To enhance diversification, consider adding fixed-income securities, which can provide stability and income. This adjustment can help reduce overall risk and align the portfolio with a balanced investment strategy, offering a smoother ride through market fluctuations.

Sectors Info

  • Health Care
    40%
  • Technology
    20%
  • Consumer Staples
    9%
  • Financials
    7%
  • Telecommunications
    5%
  • Industrials
    5%
  • Consumer Discretionary
    4%
  • Consumer Discretionary
    4%
  • Energy
    2%
  • Utilities
    1%
  • Real Estate
    1%
  • Basic Materials
    1%

The portfolio is heavily concentrated in healthcare, representing 40% of the total allocation. This focus can lead to sector-specific risks, especially if healthcare faces regulatory or market challenges. While technology and consumer defensive sectors provide some balance, the overall sector diversity is limited. To reduce concentration risk, consider reallocating some funds towards underrepresented sectors. This can help achieve a more balanced sector exposure, potentially enhancing risk-adjusted returns.

Regions Info

  • North America
    99%
  • Europe Developed
    1%

The portfolio has a significant geographic concentration in North America, comprising over 99% of the holdings. While this focus can benefit from the stability of developed markets, it limits exposure to global growth opportunities. Common benchmarks often include more international diversification. To broaden geographic exposure, consider adding investments in Europe, Asia, or emerging markets. This can enhance diversification and offer potential growth from different economic regions, balancing the portfolio's risk and return profile.

Redundant positions Info

  • Fidelity 500 Index Fund
    Vanguard S&P 500 ETF
    High correlation

The portfolio includes highly correlated assets, such as the Fidelity 500 Index Fund and Vanguard S&P 500 ETF. High correlation means these assets tend to move together, reducing diversification benefits. To enhance diversification, consider replacing one of these funds with an asset that has a lower correlation to the existing holdings. This can help mitigate risk during market downturns and improve the overall risk-return profile of the portfolio, aligning with diversification goals.

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.

Optimizing the portfolio using the Efficient Frontier suggests an expected return of 13.91% with a risk level of 11.54%. This optimization focuses on achieving the best possible risk-return ratio with current assets. To reach this optimal state, consider removing highly correlated assets and reallocating funds to improve diversification. This strategic adjustment can enhance the portfolio's efficiency, providing a better balance between risk and return without significantly altering the overall investment strategy.

Dividends Info

  • Fidelity® MSCI Consumer Staples Index ETF 1.90%
  • Fidelity 500 Index Fund 0.90%
  • JPMorgan Equity Premium Income ETF 7.30%
  • Johnson & Johnson 3.40%
  • Schwab U.S. Dividend Equity ETF 3.60%
  • Vanguard S&P 500 ETF 0.90%
  • Weighted yield (per year) 2.69%

The portfolio's average dividend yield is 2.69%, providing a moderate income stream. With significant contributions from Johnson & Johnson and Schwab U.S. Dividend Equity ETF, dividends play a role in total returns. For income-focused investors, maintaining or increasing dividend-paying assets can enhance income stability. However, ensure that dividend stocks align with overall investment goals and risk tolerance. Balancing growth and income can optimize the portfolio for long-term wealth accumulation.

Ongoing product costs Info

  • FIDELITY LARGE CAP GROWTH INDEX FUND INSTITUTIONAL PREMIUM CLASS 0.04%
  • Fidelity® MSCI Consumer Staples Index ETF 0.08%
  • Fidelity 500 Index Fund 0.02%
  • JPMorgan Equity Premium Income ETF 0.35%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.07%

The portfolio's total expense ratio (TER) is impressively low at 0.07%, which is beneficial for long-term performance. Low costs mean more of your investment returns stay in your pocket, enhancing compounding over time. This cost efficiency aligns with best practices in portfolio management. To maintain this advantage, continue evaluating fund fees and consider lower-cost alternatives if available. This proactive approach can help maximize net returns and support the portfolio's growth objectives.

What next?

Ready to invest in this portfolio?

Select a broker that fits your needs and watch for low fees to maximize your returns.

Select broker

Create your own report?

Analyze your portfolio

Join our community!

Join Discord

The information provided on this platform is for informational purposes only and should not be considered as financial or investment advice. Insightfolio does not provide investment advice, personalized recommendations, or guidance regarding the purchase, holding, or sale of financial assets. The tools and content are intended for educational purposes only and are not tailored to individual circumstances, financial needs, or objectives.

Insightfolio assumes no liability for the accuracy, completeness, or reliability of the information presented. Users are solely responsible for verifying the information and making independent decisions based on their own research and careful consideration. Use of the platform should not replace consultation with qualified financial professionals.

Investments involve risks. Users should be aware that the value of investments may fluctuate and that past performance is not an indicator of future results. Investment decisions should be based on personal financial goals, risk tolerance, and independent evaluation of relevant information.

Insightfolio does not endorse or guarantee the suitability of any particular financial product, security, or strategy. Any projections, forecasts, or hypothetical scenarios presented on the platform are for illustrative purposes only and are not guarantees of future outcomes.

By accessing the services, information, or content offered by Insightfolio, users acknowledge and agree to these terms of the disclaimer. If you do not agree to these terms, please do not use our platform.

Instrument logos provided by Elbstream.

Help us improve Insightfolio

Your feedback makes a difference! Share your thoughts in our quick survey. Take the survey