A high-dividend yield portfolio with an emphasis on income generation and moderate risk

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 steady income through dividends with a moderate tolerance for risk. The focus on high-dividend-yielding ETFs appeals to those prioritizing income generation over capital growth. It's well-suited for individuals with a medium to long-term investment horizon, who are comfortable with the level of volatility inherent in a stock-heavy, sector-diverse, and geographically concentrated portfolio. This investor likely values the potential for higher returns associated with equity investments and is prepared to withstand market fluctuations to achieve their income objectives.

Positions

  • SHP ETF Trust - NEOS S&P 500 High Income ETF
    SPYI - US78433H3030
    12.00%
  • Amplify CWP Enhanced Dividend Income ETF
    DIVO - US0321084099
    11.00%
  • Pacer Funds Trust - Metaurus US Large Cap Target Dividend 400 ETF
    QDPL - US69374H4368
    11.00%
  • NEOS Nasdaq 100 High Income ETF
    QQQI - US78433H6751
    11.00%
  • NEOS Russell 2000 High Income ETF
    IWMI
    11.00%
  • NEOS ETF Trust NEOS Real Estate
    IYRI
    11.00%
  • Ultimus Managers Trust
    MDST
    11.00%
  • Amplify ETF Trust
    QDVO
    11.00%
  • Pacer Metarus Nasdaq 100 Dividend Multiplier 600 ETF
    QSIX
    11.00%

This portfolio is heavily weighted towards ETFs that focus on high dividend yields, with a notable emphasis on U.S. stocks across various sectors. The uniform allocation across these ETFs suggests a strategy aimed at maximizing income through dividends. However, the portfolio's diversification is low, primarily due to its concentrated exposure to the U.S. market and a singular focus on stocks. This approach aligns with income-generating objectives but may limit growth potential and increase vulnerability to market volatility in specific sectors or geographies.

Warning Historical data is limited for this portfolio, which reduces the confidence in the calculated values.

Growth Info

The portfolio has demonstrated a robust Compound Annual Growth Rate (CAGR) of 16.36%, with a maximum drawdown matching this figure, indicating a relatively high risk-reward ratio. The days contributing to 90% of returns being minimal suggests that the portfolio's performance is significantly impacted by specific high-gain days, which may not be consistent over time. This performance, while impressive, should be evaluated with caution as past success does not guarantee future returns, especially in volatile or changing market conditions.

Warning Due to limited historical data, this may show extreme values that are not realistic.

Projection Info

Monte Carlo simulations, which forecast potential outcomes by varying historical data, suggest a wide range of future performance scenarios for this portfolio. With 997 out of 1,000 simulations showing positive returns, the median projection indicates substantial growth potential. However, the reliance on historical data means these projections cannot account for unforeseen market shifts. Investors should consider this uncertainty and the inherent limitations of predictive modeling when planning long-term investment strategies.

Asset classes Info

  • Stocks
    87%
  • Cash
    1%
  • Bonds
    1%

The portfolio's asset allocation leans heavily towards stocks (87%), with minimal positions in cash and bonds. This stock-centric composition is geared towards high income through dividends but comes with higher volatility and risk compared to more diversified portfolios that include larger allocations to bonds or alternative assets. While this strategy may suit those with a higher risk tolerance and a focus on income, it may not be ideal for investors seeking capital preservation or lower volatility.

Sectors Info

  • Technology
    28%
  • Energy
    13%
  • Consumer Discretionary
    10%
  • Telecommunications
    9%
  • Financials
    9%
  • Industrials
    6%
  • Health Care
    6%
  • Consumer Staples
    4%
  • Basic Materials
    2%
  • Utilities
    2%
  • Real Estate
    1%

Sector allocation is broad, with technology, energy, and consumer cyclicals leading the composition. This sector spread can offer a balance between growth (technology) and value (energy, consumer cyclicals) investing styles. However, the heavy weighting towards technology, a sector known for its volatility, may increase the portfolio's sensitivity to market fluctuations. Investors should consider if the current sector balance aligns with their risk tolerance and investment horizon.

Regions Info

  • North America
    88%
  • Europe Developed
    0%
  • Latin America
    0%
  • Asia Emerging
    0%
  • Asia Developed
    0%
  • Africa/Middle East
    0%
  • Australasia
    0%
  • Japan
    0%

The geographic allocation is overwhelmingly focused on North America (88%), with no exposure to emerging markets or other developed regions. This concentration enhances exposure to the U.S. economy's performance but limits global diversification benefits. Diversifying geographically can reduce risk by spreading exposure across different economic cycles and opportunities outside the U.S.

Market capitalization Info

  • Mega-cap
    34%
  • Large-cap
    27%
  • Mid-cap
    13%
  • Small-cap
    7%
  • Micro-cap
    6%

The market capitalization breakdown reveals a tilt towards mega and big-cap stocks, which are generally considered less volatile than their smaller counterparts. This alignment can provide stability and resilience during market downturns but may also limit growth potential compared to more aggressive allocations towards mid, small, or micro-cap stocks. Balancing market cap exposure can enhance diversification and potential for growth.

Redundant positions Info

  • Pacer Metarus Nasdaq 100 Dividend Multiplier 600 ETF
    Pacer Funds Trust - Metaurus US Large Cap Target Dividend 400 ETF
    NEOS Nasdaq 100 High Income ETF
    SHP ETF Trust - NEOS S&P 500 High Income ETF
    Amplify ETF Trust
    High correlation

The high correlation among several ETFs, particularly those focusing on the Nasdaq 100 and S&P 500, indicates overlapping exposures that may not provide the intended diversification benefits. This redundancy can amplify risks associated with specific market movements. Reducing overlap by reallocating investments into less correlated assets could enhance portfolio diversification and resilience.

Dividends Info

  • Amplify CWP Enhanced Dividend Income ETF 4.50%
  • Pacer Funds Trust - Metaurus US Large Cap Target Dividend 400 ETF 4.90%
  • NEOS Nasdaq 100 High Income ETF 13.50%
  • SHP ETF Trust - NEOS S&P 500 High Income ETF 11.70%
  • NEOS Russell 2000 High Income ETF 14.20%
  • NEOS ETF Trust NEOS Real Estate 5.00%
  • Ultimus Managers Trust 10.20%
  • Amplify ETF Trust 9.20%
  • Pacer Metarus Nasdaq 100 Dividend Multiplier 600 ETF 3.20%
  • Weighted yield (per year) 8.52%

The portfolio's emphasis on high dividend yields, averaging 8.52% across the selected ETFs, aligns with an income-focused investment strategy. While attractive, high yields can sometimes signal underlying risks or unsustainable payout ratios. Investors should balance the pursuit of high dividends with the stability and growth potential of the underlying assets to ensure long-term income sustainability.

Ongoing product costs Info

  • Amplify CWP Enhanced Dividend Income ETF 0.56%
  • Pacer Funds Trust - Metaurus US Large Cap Target Dividend 400 ETF 0.60%
  • NEOS Nasdaq 100 High Income ETF 0.68%
  • SHP ETF Trust - NEOS S&P 500 High Income ETF 0.68%
  • NEOS Russell 2000 High Income ETF 0.68%
  • Ultimus Managers Trust 0.80%
  • Weighted costs total (per year) 0.45%

The Total Expense Ratios (TERs) for the ETFs in this portfolio range from 0.56% to 0.80%, with an aggregate cost of 0.45%. These costs, while not exorbitant, can accumulate over time, affecting net returns. Investors should weigh these costs against the performance and benefits of each ETF, considering lower-cost alternatives if available without compromising on strategic fit or performance expectations.

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.

Optimizing the portfolio for a more efficient risk-return ratio suggests a potential increase in expected return to 18.74% without elevating the risk level significantly. This improvement underscores the importance of diversification and the strategic selection of assets. By addressing the identified overlaps and incorporating assets with lower correlation, the portfolio can achieve a better balance between risk and return.

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