Growth-focused portfolio with heavy emphasis on technology and semiconductor sectors

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 high risk, and looking for substantial returns over a long-term horizon. It's tailored for individuals who are less concerned with short-term volatility and more focused on capital appreciation. The investor likely has a strong belief in the potential of the technology and semiconductor sectors and is prepared to weather market fluctuations for the prospect of higher returns.

Positions

  • Schwab U.S. Large-Cap Growth ETF
    SCHG - US8085243009
    76.92%
  • VanEck Semiconductor ETF
    SMH - US92189F6768
    23.08%

This portfolio is characterized by a significant concentration in the technology and semiconductor sectors, with the Schwab U.S. Large-Cap Growth ETF and the VanEck Semiconductor ETF making up nearly the entire portfolio. The allocation leans heavily towards large-cap stocks, which suggests a preference for established companies within the growth domain. This composition reflects a strategy aimed at capitalizing on the growth potential of these sectors, albeit with a moderate level of diversification across sectors and geographic regions.

Growth Info

Historically, this portfolio has demonstrated a high Compound Annual Growth Rate (CAGR) of 20.61%, with a maximum drawdown of -38.45%. These figures indicate a strong performance, albeit with significant volatility. The days contributing most to the returns highlight the portfolio's susceptibility to short-term market movements, which is typical for growth-oriented investments in the tech sector. This performance, while impressive, underscores the portfolio's risk level and the need for investors to be comfortable with potential short-term losses.

Projection Info

The Monte Carlo analysis, using 1,000 simulations, predicts a wide range of potential outcomes, with a median increase of 1,730.3% in portfolio value. This suggests a strong growth potential but also underscores the high level of uncertainty and risk associated with this portfolio. The analysis shows a very high likelihood of positive returns, which is encouraging, yet it's important to remember that such projections are based on historical data and cannot guarantee future performance.

Asset classes Info

  • Stocks
    100%
  • Cash
    0%

The portfolio's assets are entirely in stocks, with no allocation to bonds, cash, or other asset classes. This singular focus on equities enhances growth potential but also increases risk, particularly in market downturns. Diversifying across different asset classes can help mitigate this risk by reducing portfolio volatility and providing a buffer against stock market fluctuations.

Sectors Info

  • Technology
    60%
  • Telecommunications
    11%
  • Consumer Discretionary
    10%
  • Health Care
    7%
  • Financials
    6%
  • Industrials
    3%
  • Consumer Staples
    1%
  • Basic Materials
    1%
  • Energy
    1%
  • Real Estate
    0%
  • Utilities
    0%

With a heavy emphasis on technology (60%) and a significant investment in the semiconductor sector, this portfolio is poised to benefit from the growth and innovation within these industries. However, this concentration also exposes the portfolio to sector-specific risks, such as regulatory changes or technological disruptions. Diversifying across a broader range of sectors could help manage these risks.

Regions Info

  • North America
    96%
  • Asia Developed
    3%
  • Europe Developed
    2%

The geographic allocation is predominantly in North America (96%), with minimal exposure to Asia Developed and Europe Developed regions. This geographic concentration in developed markets, particularly the U.S., aligns with the portfolio's growth focus but limits global diversification. Expanding geographic exposure, especially to emerging markets, could offer additional growth opportunities and risk diversification.

Market capitalization Info

  • Mega-cap
    60%
  • Large-cap
    28%
  • Mid-cap
    11%
  • Small-cap
    1%
  • Micro-cap
    0%

The portfolio's focus on mega (60%) and big (28%) cap stocks suggests a preference for stability and growth potential associated with larger companies. While this can offer some protection during market volatility, the limited exposure to medium, small, and micro-cap stocks may restrict opportunities for higher returns that these segments can offer, albeit with higher risk.

Dividends Info

  • Schwab U.S. Large-Cap Growth ETF 0.40%
  • VanEck Semiconductor ETF 0.40%
  • Weighted yield (per year) 0.40%

The portfolio has a modest dividend yield of 0.40%, which is consistent with its growth orientation. For investors seeking income, this yield may be low. However, for those prioritizing capital appreciation, reinvesting these dividends can compound growth. Considering the portfolio's focus, the current dividend strategy appears appropriate, though investors needing income might look for additional sources.

Ongoing product costs Info

  • Schwab U.S. Large-Cap Growth ETF 0.04%
  • VanEck Semiconductor ETF 0.35%
  • Weighted costs total (per year) 0.11%

The total expense ratio (TER) of 0.11% is impressively low, especially for a portfolio focused on specialized sectors. This cost efficiency supports better long-term performance by minimizing the drag on returns. Keeping costs low is crucial for maximizing investment growth, and this portfolio exemplifies effective cost management.

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, the portfolio could potentially be optimized for a better risk-return ratio by diversifying across more asset classes and sectors. While the current allocation has shown strong growth, there's room to enhance returns or reduce risk without sacrificing potential gains. This involves balancing the portfolio more evenly across different investments to achieve an optimal mix.

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