Balanced and highly diversified portfolio with a strong emphasis on stocks and ETFs

Risk profile

  • Secure
    Speculative

The risk profile, derived from past market volatility, reflects the level of risk the portfolio is exposed to. This assessment helps align your investments with your financial goals and comfort with market fluctuations.

Diversification profile

  • Focused
    Diversified

The diversification assessment evaluates the spread of investments across asset classes, regions, and sectors. This ensures a balanced mix, reducing risk and maximizing returns by not concentrating in any single area.

What type of investor this portfolio is suitable for

Balanced Investors

This portfolio suits an investor seeking balanced growth with a moderate risk tolerance and a long-term investment horizon. It's designed for individuals who appreciate the stability offered by large-cap stocks and the growth potential of international markets, while also valuing income through dividends. This investor type is comfortable with some exposure to market fluctuations, understanding that a diversified, globally-oriented portfolio can offer attractive returns over time.

Positions

  • Vanguard S&P 500 ETF
    VOO - US9229083632
    45.00%
  • Vanguard Total International Stock Index Fund ETF Shares
    VXUS - US9219097683
    20.00%
  • iShares® 0-3 Month Treasury Bond ETF
    SGOV - US46436E7186
    13.00%
  • Schwab U.S. Dividend Equity ETF
    SCHD - US8085247976
    10.00%
  • Vanguard Real Estate Index Fund ETF Shares
    VNQ - US9229085538
    7.00%
  • Invesco QQQ Trust
    QQQ - US46090E1038
    5.00%

This portfolio is characterized by a significant allocation to stocks (79%), primarily through ETFs that track major indexes and sectors, complemented by a strategic presence in real estate (7%) and cash equivalents (13%). The major components include large allocations to the Vanguard S&P 500 ETF and the Vanguard Total International Stock Index Fund ETF, indicating a balanced approach between U.S. and international equities. The inclusion of short-term treasury and dividend-focused ETFs suggests an effort to mitigate volatility and generate income, respectively.

Growth Info

Historical performance shows a Compound Annual Growth Rate (CAGR) of 13.62%, with a maximum drawdown of -22.97%. This indicates a strong return profile relative to the risk taken, as evidenced by the portfolio's balanced risk score of 4 out of 7. The days contributing to 90% of returns highlight the impact of significant market movements on portfolio performance, underscoring the importance of staying invested through market cycles for long-term growth.

Projection Info

Monte Carlo simulations, based on 1,000 iterations, project a wide range of outcomes with a median portfolio growth of 395%. This analysis helps in understanding the potential variability in future returns, emphasizing the importance of maintaining a diversified and balanced portfolio to navigate uncertainties. However, it's crucial to remember that these projections are based on historical data, which is not a guarantee of future performance.

Asset classes Info

  • Stocks
    79%
  • Cash
    13%
  • Real Estate
    7%
  • Bonds
    0%
  • Other
    0%
  • No data
    0%

The portfolio's asset class distribution, with a heavy emphasis on stocks and a smaller allocation to real estate and cash, is designed for growth while maintaining liquidity through the inclusion of short-term treasury bonds. This allocation supports a balanced risk-return profile, suitable for investors with a moderate risk tolerance. Adjusting the balance between these asset classes can further tailor the portfolio to specific risk preferences or investment horizons.

Sectors Info

  • Technology
    21%
  • Financials
    12%
  • Consumer Discretionary
    9%
  • Real Estate
    8%
  • Industrials
    8%
  • Health Care
    8%
  • Telecommunications
    7%
  • Consumer Staples
    6%
  • Energy
    4%
  • Basic Materials
    2%
  • Utilities
    2%

Sectoral allocation reveals a diversified approach, with technology (21%) and financial services (12%) leading the composition. This sector spread aligns with a growth-oriented strategy but also exposes the portfolio to sector-specific risks, such as regulatory changes or economic cycles affecting tech and finance industries. Diversification across sectors can help mitigate these risks, ensuring more stable long-term performance.

Regions Info

  • North America
    68%
  • Europe Developed
    8%
  • Asia Emerging
    3%
  • Japan
    3%
  • Asia Developed
    2%
  • Australasia
    1%
  • Africa/Middle East
    1%
  • Latin America
    0%
  • Europe Emerging
    0%

Geographic diversification is achieved through a mix of North American (68%) and international stocks (32%), including developed and emerging markets. This global exposure enhances the portfolio's growth potential by tapping into different economic cycles and opportunities worldwide. However, it also introduces geopolitical and currency risks, which can be managed through periodic rebalancing and monitoring of international allocations.

Market capitalization Info

  • Mega-cap
    33%
  • Large-cap
    31%
  • Mid-cap
    19%
  • Small-cap
    3%
  • Micro-cap
    1%

The portfolio's market capitalization breakdown shows a balanced approach, with a focus on mega (33%) and big (31%) cap stocks, complemented by medium (19%), small (3%), and micro (1%) caps. This distribution suggests a bias towards stability and lower volatility associated with larger companies, while still capturing the growth potential of smaller firms. Adjusting this mix can influence the portfolio's risk and return characteristics.

Dividends Info

  • Invesco QQQ Trust 0.50%
  • Schwab U.S. Dividend Equity ETF 3.70%
  • iShares® 0-3 Month Treasury Bond ETF 4.40%
  • Vanguard Real Estate Index Fund ETF Shares 3.80%
  • Vanguard S&P 500 ETF 1.20%
  • Vanguard Total International Stock Index Fund ETF Shares 2.70%
  • Weighted yield (per year) 2.31%

The portfolio's dividend yield stands at 2.31%, contributed by holdings in dividend-paying ETFs. This yield provides an income stream, which can be particularly appealing for investors seeking regular returns in addition to capital appreciation. Balancing high-yield investments with growth-focused assets can optimize the income-generation potential while maintaining a focus on long-term capital gains.

Ongoing product costs Info

  • Invesco QQQ Trust 0.20%
  • Schwab U.S. Dividend Equity ETF 0.06%
  • iShares® 0-3 Month Treasury Bond ETF 0.07%
  • Vanguard Real Estate Index Fund ETF Shares 0.12%
  • Vanguard S&P 500 ETF 0.03%
  • Vanguard Total International Stock Index Fund ETF Shares 0.05%
  • Weighted costs total (per year) 0.06%

With a total expense ratio (TER) of 0.06%, the portfolio is cost-efficient, enhancing net returns over time. Lower costs are crucial for long-term investment success, as they compound and can significantly impact total returns. Investors should continue to monitor fund expenses and consider cost as one factor in their investment decisions.

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.

The portfolio's current allocation demonstrates an efficient risk-return profile, as indicated by its alignment with the Efficient Frontier. This suggests that the portfolio is well-positioned to achieve the highest possible return for the given level of risk. However, continuous monitoring and rebalancing are essential to maintain this efficiency, especially as market conditions change.

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