A focused growth portfolio with a strong emphasis on US equities and dividends

Report created on Jul 22, 2025

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.

Positions

This portfolio is highly concentrated in two ETFs: the Vanguard S&P 500 ETF and the Schwab U.S. Dividend Equity ETF, with a 66% and 34% allocation, respectively. This composition indicates a strong focus on U.S. equities, particularly those within the S&P 500, and a preference for dividend-paying stocks. The portfolio's diversification is low, with all investments tied to a single asset class (stocks) and predominantly to one geographic region (North America). This concentration enhances exposure to market movements within the U.S. but limits global diversification and exposure to different asset classes that could mitigate risk.

Growth Info

With a Compound Annual Growth Rate (CAGR) of 13.87% and a maximum drawdown of -33.59%, the portfolio has demonstrated strong historical performance. The days contributing to 90% of returns being concentrated in just 30 days highlight the portfolio's reliance on significant market movements for gains. This performance, while impressive, comes with considerable volatility, as indicated by the substantial drawdown, suggesting that the portfolio may experience significant short-term fluctuations in value.

Projection Info

The Monte Carlo simulation, using 1,000 iterations, projects a wide range of outcomes with a median increase of 460.8% and a noteworthy 992 out of 1,000 simulations resulting in positive returns. This analysis suggests a high likelihood of future gains but also underscores the variability of potential outcomes, reflecting the inherent risks of a stock-focused strategy. It's important to remember that these projections, while useful for planning, are based on historical data and cannot guarantee future performance.

Asset classes Info

  • Stocks
    100%

The portfolio's allocation is entirely in stocks, offering no cushion against market volatility through bonds or other less volatile asset classes. While this allocation can lead to higher long-term returns, it also increases the portfolio's sensitivity to market downturns. Diversifying across different asset classes could provide a more balanced risk-return profile, especially important for investors with a lower risk tolerance or those nearing the need to withdraw their investments.

Sectors Info

  • Technology
    25%
  • Financials
    12%
  • Health Care
    12%
  • Consumer Discretionary
    11%
  • Consumer Staples
    10%
  • Industrials
    9%
  • Energy
    9%
  • Telecommunications
    8%
  • Basic Materials
    2%
  • Utilities
    2%
  • Real Estate
    1%

Sector allocation is diversified across technology, financial services, healthcare, consumer cyclicals, and other sectors, mirroring the broad market composition of the S&P 500. This sectoral spread can mitigate some risks associated with individual sector downturns. However, the heavy emphasis on technology (25%) may increase volatility, as tech stocks can be more susceptible to market swings and valuation adjustments.

Regions Info

  • North America
    99%
  • Europe Developed
    1%

The geographic allocation is heavily skewed towards North America (99%), with minimal exposure to developed markets in Europe (1%) and no presence in emerging markets or other developed regions. This concentration benefits from the robust performance of the U.S. market but limits potential gains from global diversification. Exposure to a broader range of economies could reduce risk and tap into growth opportunities elsewhere.

Market capitalization Info

  • Large-cap
    43%
  • Mega-cap
    31%
  • Mid-cap
    23%
  • Small-cap
    3%

The portfolio's market capitalization breakdown shows a balanced exposure across big (43%), mega (31%), and medium (23%) cap stocks, with a small allocation to small caps (3%). This distribution suggests a conservative approach, favoring more stable, established companies over the potentially higher growth but riskier small and micro-cap stocks. While this can reduce volatility, it may also limit opportunities for outsized gains from smaller, faster-growing companies.

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.

Considering the portfolio's current structure, there may be room for optimization towards the Efficient Frontier, which could offer a better risk-return balance. Adjusting the allocation between the two ETFs or introducing new asset classes and geographic diversifications could potentially enhance returns for the same level of risk, or reduce risk for the same level of expected returns. This approach requires a careful analysis of the correlation between potential investments and the existing portfolio components.

Dividends Info

  • Schwab U.S. Dividend Equity ETF 3.80%
  • Vanguard S&P 500 ETF 1.20%
  • Weighted yield (per year) 2.08%

The portfolio's dividend yield stands at 2.08%, combining a higher yield from the Schwab U.S. Dividend Equity ETF (3.80%) and a lower yield from the Vanguard S&P 500 ETF (1.20%). This focus on dividend-paying stocks can provide a steady income stream and potentially offer a cushion during market dips, as companies that consistently pay dividends are often financially stable. However, an overemphasis on dividend yield should not detract from the importance of total return, considering both income and capital appreciation.

Ongoing product costs Info

  • Schwab U.S. Dividend Equity ETF 0.06%
  • Vanguard S&P 500 ETF 0.03%
  • Weighted costs total (per year) 0.04%

The portfolio benefits from low costs, with a Total Expense Ratio (TER) of 0.04%, which is impressively low and supports better long-term performance by minimizing the drag on returns. Keeping costs low is crucial in maximizing investment returns, especially in a low-diversity portfolio where the impact of fees is more pronounced on the limited number of holdings.

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