A growth-focused portfolio with a strong tilt towards US equities and technology sector

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

Growth Investors

This portfolio suits an investor with a growth-oriented profile, comfortable with higher levels of risk for the potential of higher returns. It's ideal for those with a long investment horizon who can withstand significant market fluctuations. The investor likely prioritizes capital appreciation over income and is prepared to remain invested through volatile market periods for the sake of achieving substantial long-term growth.

Positions

  • SPDR® Portfolio S&P 1500 Composite Stock Market ETF
    SPTM - US78464A8053
    40.00%
  • Schwab U.S. Large-Cap Growth ETF
    SCHG - US8085243009
    30.00%
  • Avantis® International Equity ETF
    AVDE - US0250727031
    20.00%
  • Avantis® U.S. Small Cap Value ETF
    AVUV - US0250728773
    10.00%

This portfolio is composed of four ETFs, focusing heavily on the US stock market, with a significant allocation towards large-cap growth and the overall S&P 1500 Composite. It's moderately diversified across sectors and geographies, though it leans heavily towards North America and technology, with a total exposure to stocks at 100%. This composition suggests a growth-oriented strategy, prioritizing potential for high returns over minimizing volatility or risk.

Growth Info

Historically, this portfolio has shown a Compound Annual Growth Rate (CAGR) of 17.28%, with a maximum drawdown of -35.12%. These figures indicate a strong performance, albeit with significant volatility, as evidenced by the steep maximum drawdown. The days contributing to 90% of returns being concentrated in just 19 days highlight the portfolio's reliance on short, sharp gains, which is typical for growth-focused investments.

Projection Info

Monte Carlo simulations suggest a wide range of outcomes, with the median scenario projecting a 656% return, indicating strong growth potential. However, the significant spread between the 5th and 67th percentiles (87.9% to 1,011.5%) underscores the high level of uncertainty and risk involved. These projections, while useful, rely on historical data and cannot guarantee future performance.

Asset classes Info

  • Stocks
    100%
  • Other
    0%
  • Cash
    0%
  • Bonds
    0%
  • No data
    0%

The portfolio's asset allocation is entirely in stocks, with no diversification into bonds, cash, or other asset classes. This allocation supports the portfolio's growth objectives but increases susceptibility to market volatility. A more diversified asset class mix could provide a buffer during market downturns.

Sectors Info

  • Technology
    31%
  • Financials
    15%
  • Consumer Discretionary
    12%
  • Industrials
    11%
  • Telecommunications
    9%
  • Health Care
    8%
  • Consumer Staples
    4%
  • Energy
    4%
  • Basic Materials
    4%
  • Utilities
    2%
  • Real Estate
    2%

With a heavy tilt towards technology (31%), followed by financial services and consumer cyclicals, the sector allocation reflects a typical growth strategy. However, this concentration increases risk, particularly from sector-specific downturns. Diversifying into underrepresented sectors could reduce volatility without significantly compromising growth potential.

Regions Info

  • North America
    81%
  • Europe Developed
    11%
  • Japan
    5%
  • Australasia
    1%
  • Asia Developed
    1%
  • Africa/Middle East
    0%
  • Latin America
    0%
  • Asia Emerging
    0%
  • Europe Emerging
    0%

The geographic allocation is predominantly in North America (81%), with minimal exposure to developed markets outside of North America and almost no presence in emerging markets. This geographic concentration enhances exposure to US market performance but limits global diversification benefits.

Market capitalization Info

  • Mega-cap
    42%
  • Large-cap
    25%
  • Mid-cap
    15%
  • Small-cap
    9%
  • Micro-cap
    6%

The market capitalization breakdown shows a preference for mega (42%) and big (25%) cap stocks, aligning with the portfolio's growth and stability objectives. However, the presence of small (9%) and micro (6%) cap stocks introduces higher volatility and potential for growth, balancing the portfolio's risk and return profile.

Dividends Info

  • Avantis® International Equity ETF 2.70%
  • Avantis® U.S. Small Cap Value ETF 1.70%
  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • SPDR® Portfolio S&P 1500 Composite Stock Market ETF 1.20%
  • Weighted yield (per year) 1.31%

The overall dividend yield of 1.31% is modest, reflecting the portfolio's growth orientation, which typically prioritizes reinvestment over immediate income. While not a primary focus, dividends contribute to total returns and provide a small income stream, which can be reinvested for compound growth.

Ongoing product costs Info

  • Avantis® International Equity ETF 0.23%
  • Avantis® U.S. Small Cap Value ETF 0.25%
  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • SPDR® Portfolio S&P 1500 Composite Stock Market ETF 0.03%
  • Weighted costs total (per year) 0.10%

The portfolio's total expense ratio (TER) of 0.10% is impressively low, maximizing the potential for net returns. Keeping costs low is crucial for long-term growth, as even small differences in fees can have a significant impact on wealth accumulation over time.

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.

Considering the Efficient Frontier, this portfolio appears to be positioned for high returns at a higher level of risk. While it's optimized within its current asset allocation for growth, there's room to improve the risk-return profile by diversifying across more asset classes and geographies without necessarily sacrificing growth potential.

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