HOLDINGS

QQQ (Invesco QQQ Trust)

Including QQQ in a Growth ETF Model Portfolio offers concentrated exposure to high-growth, innovative companies primarily in the technology sector. Its historical outperformance, liquidity, and alignment with growth investment objectives make it a cornerstone holding for investors seeking capital appreciation through growth stocks.

• Technology and Growth Focus: QQQ tracks the Nasdaq-100, which is heavily weighted toward technology and growth-oriented companies.
• High Growth Potential: Includes many innovative, high-growth firms that can deliver outsized returns but with higher volatility.
• Aggressive Growth Tilt: Adds a growth-oriented, sector-concentrated element to the portfolio, boosting upside potential.

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VO (Vanguard Mid-Cap ETF)

Including the Vanguard Mid-Cap ETF (VO) in a Growth ETF Model Portfolio enhances growth potential by adding diversified mid-cap exposure, balancing growth and stability, and broadening sector and market-cap coverage. This helps the portfolio capture growth opportunities across the size spectrum while managing risk through diversification.

• • Mid-Cap Growth Exposure: Mid-cap stocks generally offer a balance between the stability of large caps and the growth potential of small caps.
  • Higher Growth Potential: Mid caps often have more room to grow than large caps, fitting an aggressive growth strategy.
  • Diversification within U.S. Equities: Adds breadth to U.S. equity exposure by including companies in a different market capitalization segment.

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 VEA (iShares MSCI EAFE ETF)

Including the Vanguard FTSE Developed Markets ETF (VEA) in a Growth ETF Model Portfolio adds important international diversification and access to developed market growth opportunities outside the U.S. This broadens the portfolio’s growth potential, reduces home-country risk, and supports more balanced long-term capital appreciation consistent with a growth investment strategy.

• Diversification Beyond U.S. Markets: Even in a conservative portfolio, some international exposure can reduce concentration risk tied to the U.S. economy and currency. VEA provides access to developed international markets, helping diversify geopolitical and economic risk.
• Moderate Growth Potential: While conservative portfolios prioritize stability, a small allocation to VEA can provide incremental growth opportunities from established foreign markets without excessive volatility.
• Currency Exposure: VEA introduces currency diversification, which may help hedge against U.S. dollar depreciation, supporting portfolio resilience.

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VOO (Vanguard S&P 500 ETF)

Including the Vanguard S&P 500 ETF (VOO) in a growth model portfolio provides broad, diversified exposure to large-cap U.S. companies with meaningful growth characteristics. It offers a stable core holding that balances risk and return, complements more concentrated growth ETFs, and supports the portfolio’s objective of long-term capital appreciation.

• Core Equity Exposure: VOO offers broad exposure to large-cap U.S. companies, which tend to be more stable and financially strong compared to smaller stocks. This makes it a relatively lower-risk equity option within the stock portion of a conservative portfolio.
• Inflation Hedge and Growth: Even conservative portfolios need some growth to outpace inflation over time. VOO’s exposure to the largest U.S. companies provides potential for steady capital appreciation and dividend income.
• Liquidity and Cost Efficiency: VOO’s liquidity and low expense ratio make it a practical choice for the equity sleeve of a conservative portfolio, minimizing costs and allowing easy rebalancing.

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VB (Vanguard Small-Cap ETF)

Including the Vanguard Small-Cap ETF (VB) in a Growth ETF Model Portfolio enhances growth potential by adding diversified small-cap exposure, capturing the small-cap premium, and broadening sector and market-cap coverage. This supports the portfolio’s objective of maximizing long-term capital appreciation through diversified growth opportunities across the U.S. equity market.

• Small-Cap Growth Focus: Small-cap stocks typically have the highest growth potential but also the highest volatility.
• Aggressive Growth Driver: Including small caps increases the portfolio’s return potential over the long term.
• Diversification: Adds exposure to emerging companies and niche markets within the U.S. equity space.

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IAU (iShares Gold Trust)

While iShares Gold Trust (IAU) does not directly contribute to capital appreciation, including it in a Growth ETF Model Portfolio offers valuable diversification, inflation protection, and downside risk mitigation. This can enhance the portfolio’s resilience and support more consistent long-term growth by smoothing volatility and preserving capital during adverse market conditions.

• Inflation Hedge: Gold is traditionally seen as a store of value and a hedge against inflation and currency devaluation.
• Diversification: Gold has low correlation with stocks and bonds, providing portfolio diversification and reducing overall risk.
• Safe Haven Asset: In times of market stress or geopolitical uncertainty, gold can help preserve wealth.
• Conservative Risk Role: While gold can be volatile, a small allocation in a conservative portfolio can enhance risk-adjusted returns by mitigating downside risks.

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BND (Vanguard Total Bond Market ETF)

Including the Vanguard Total Bond Market ETF (BND) in a Growth ETF Model Portfolio provides important risk management benefits by reducing volatility, preserving capital during equity downturns, and adding diversification through broad fixed income exposure. While it may slightly temper overall return potential, its role in smoothing portfolio performance and protecting against downside risk supports more consistent long-term growth aligned with a prudent growth investment strategy.

• Portfolio Rebalancing Anchor: BND serves as a stable anchor that facilitates systematic rebalancing. When equities outperform, selling some equity exposure to buy more BND helps maintain the moderate growth allocation and enforces disciplined portfolio management.

• Diversification: BND provides broad exposure to the U.S. investment-grade bond market, including government, corporate, and securitized bonds. This diversification reduces overall portfolio volatility by balancing equity risk with fixed income stability.

• Capital Preservation: While equities focus on growth, bonds emphasize capital preservation. BND helps protect the portfolio’s principal value, aligning with the moderate risk tolerance of investors seeking growth but with some downside protection.
• Risk Mitigation: Bonds generally have lower volatility and tend to perform differently than equities, especially during equity market downturns. Including BND helps cushion portfolio losses during periods of stock market stress, preserving capital.

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