AutoWealth Plus+ Growth & Momentum portfolio

January 26

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AutoWealth Plus+ Growth & Momentum portfolio

In this article, I provide a detailed breakdown on Growth & Momentum, one of the portfolios that AutoWealth is offering in their AutoWealth Plus+ product. You will also learn about all the Exchange Traded Funds (ETFs) that this portfolio will be investing in.

AutoWealth Plus+ charges an annual performance fee of 8% on the profits at the end of each calendar year, based on the portfolio value at the beginning and the end of the calendar year net of all fund deposits and withdrawals in USD terms throughout the calendar year.

I have also included a simulation of this portfolio based on a starting investment of $10,000 (minimum amount to start) and a monthly investment of $500 (minimum top-up amount) into the portfolio.

Please remember that the information presented is accurate as of the time of this post and past performance is not an indicator of future results.

Enjoy $20 direct top-up into your account when you sign up

Here's a sweet deal that the folks from AutoWealth has specially extended for my readers. Sign up with AutoWealth using referral code get20jan2018 and receive a $20 direct top-up into your account after it's created.

PS: When you sign up using my referral code, I will also receive a $20 direct top-up into my AutoWealth account.

Portfolio Objective

The Growth & Momentum Portfolio is suitable for investors looking to capitalise on companies with favourable multi-factor characteristics as backed by rigorous & well-established empirical studies. The Growth & Momentum Portfolio aims to provide above- market returns through its allocation to growth & momentum companies and some defensiveness against economic contraction & market volatility through its diversification in minimum volatility companies. Growth factor identifies companies with above-average earnings growth & profitability than comparable companies. Momentum factor identifies companies with persistent risk-adjusted excess returns. Minimum volatility companies exhibit relatively lower volatility & drawdowns than comparable companies and are relatively more defensive against economic contraction & market volatility.

Portfolio summary

  • Min to Invest: $10,000
  • Total Holdings: > 500 stocks
  • Dividend Yield: 0.89%
  • Annual Fees: 8% on profits
  • Geographic: U.S.
  • Risk Rating: High
  • Overall Rating: 4 out of 5 stars

Annual performance fees on USD profits, no fee will be charged if there is no profit for the calendar year.

Asset allocation

  • Vanguard Russell 1000 Growth ETF (60%)
  • iShares MSCI USA Momentum Factor ETF (30%)
  • iShares MSCI USA Min Vol Factor ETF (10%)

Risk statistics

  • Annualized Volatility: 24.18%
  • Maximum Temporary Drawdown: -32.51%
  • Sharpe Ratio: 0.48
  • Recommended Investment Horizon: > 5 years

In view of the higher portfolio volatility, this portfolio is only recommended for users with idle cash and unwavering holding power.

Portfolio exposure

Here's a look on this portfolio's asset allocation, market capitalization and sector exposures. 

Asset allocation

Market capitalization

Sectors

Portfolio growth

Below is a simulation of AutoWealth Plus+ Growth & Momentum portfolio from 2014 to 2021, assuming a starting investment of $10,000 and a monthly investment of $500 into the portfolio.

Annual returns

Here are the annual returns and trailing returns based on the simulation above.

Header

Annualized Return

Annualized Volatility

Name

3 Month

1 year

3 year

5 year

Full

3 year

5 year

Growth & Momentum

10.46%

32.18%

20.07%

19.37%

16.65%

18.70%

15.25%

AutoWealth Plus+ performance-based fees

As an AutoWealth Plus+ portfolio, an annual performance fee of 8% on the profits in USD terms at the end of each calendar year, based on the portfolio value at the beginning and the end of the calendar year net of all fund deposits and withdrawals in USD terms throughout the calendar year. In the event the AutoWealth Plus+ portfolio is not in a profit position at the end of the calendar year, there will be no fees & charges for the calendar year. AutoWealth absorbs all brokerage fees, exchange clearing fees and custody fees irregardless.

Here's what the annual performance fees look like based on the simulation above.

Year

Return

Portfolio Balance

Annual Fees

2014

13.79%

$17,678

$146

2015

6.58%

$24,878

$104

2016

6.82%

$32,665

$155

2017

31.08%

$48,692

$872

2018

-1.24%

$53,657

$0

2019

32.58%

$76,338

$1,451

2020

32.18%

$106,143

$2,070

Cell
Cell

Total

$4,798

Portfolio breakdown

Here is a breakdown of all the ETFs in AutoWealth Plus+ Growth & Momentum portfolio.

Vanguard Russell 1000 Growth ETF (VONG)

Total annual fund operating expenses: 0.08%

The Fund employs an indexing investment approach designed to track the performance of the Russell 1000® Growth Index. The Index is designed to measure the performance of large-capitalization growth stocks in the United States. The Fund attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the Index, holding each stock in approximately the same proportion as its weighting in the Index. The Fund may become nondiversified, as defined under the Investment Company Act of 1940, solely as a result of a change in relative market capitalization or index weighting of one or more constituents of the Index

Top 10 holdings (as of 31 Dec 2020)

Holdings

Weight (%)

Apple Inc.

11.64%

Microsoft Corp

9.06%

Amazon.com Inc.

7.51%

Facebook Inc. A

3.57%

Tesla Inc.

2.90%

Alphabet Inc. A

2.22%

Alphabet Inc. Class C

2.15%

Visa Inc. Class A

2.01%

Mastercard Inc. A

1.71%

NVIDIA Corp

1.68%

Click here to learn out more about Vanguard Russell 1000 Growth ETF.

iShares MSCI USA Momentum Factor ETF (MTUM)

Total annual fund operating expenses: 0.15%

The Fund seeks to track the investment results of the MSCI USA Momentum SR Variant Index (the “Underlying Index”), which consists of stocks exhibiting relatively higher momentum characteristics from the traditional market capitalization-weighted parent index, the MSCI USA Index (the “Parent Index”), as determined by MSCI Inc. (the “Index Provider” or “MSCI”). The Parent Index includes U.S. large- and mid-capitalization stocks, as defined by MSCI.

The Underlying Index is designed to measure the performance of an equity momentum strategy by emphasizing stocks with high price momentum, while maintaining reasonably high trading liquidity, investment capacity and moderate index turnover, each as determined by the Index Provider.

Top 10 holdings (as of 21 Jan 2021)

Holdings

Weight (%)

Tesla Inc.

7.55%

Apple Inc.

5.05%

Microsoft Corp

4.64%

Amazon.com Inc.

4.63%

Nvidia Corp

4.49%

PayPal Holdings Inc.

3.95%

Thermo Fisher Scientific Inc.

2.95%

Adobe Inc.

2.71%

Alphabet Inc. Class C

2.36%

Alphabet Inc. Class A

2.35%

Click here to learn out more about iShares MSCI USA Momentum Factor ETF.

iShares MSCI USA Min Vol Factor ETF (USMV)

Total annual fund operating expenses: 0.15%

The Fund seeks to track the investment results of the MSCI USA Minimum Volatility (USD) Index (the “Underlying Index”), which has been developed by MSCI Inc. (the “Index Provider” or “MSCI”) to measure the performance of large and mid-capitalization equity securities listed on stock exchanges in the U.S. that, in the aggregate, have lower volatility relative to the large- and mid-cap U.S. equity market.

In constructing the Underlying Index, MSCI uses a rules-based methodology to select securities from the MSCI USA Index (the “Parent Index”), which is a capitalization-weighted index, and to determine the weightings of such securities in the Underlying Index.

Under the rules-based methodology, securities and weightings of the Underlying Index are established based on pre-established parameters and discretionary factors are not relied on.

Top 10 holdings (as of 21 Jan 2021)

Holdings

Weight (%)

NextEra Energy Inc.

1.62%

Vertex Pharmaceuticals Inc.

1.62%

Johnson & Johnson

1.61%

Eli Lilly

1.57%

Microsoft Corp

1.54%

Gilead Sciences Inc.

1.5%

T-Mobile US Inc.

1.5%

Newmont

1.48%

Merck & Co. Inc.

1.48%

Accenture plc Class A

1.48%

Click here to learn out more about iShares MSCI USA Min Vol Factor ETF.

What do you think about this portfolio?

What do you like or dislike about this portfolio? Share your opinion with me in the comment section.

Photo by Nadir sYzYgY on Unsplash

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About the author 

Mickey J

Mickey is your typical white-collar Singaporean who works regular hours in a job with a strong passion on personal finance. He writes mostly about personal finance, investing, insurance and retirement planning. He also embraces the Financial Independence and Retire Early movement (FIRE), tweaking the FIRE concept to his lifestyle.

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