Scenario
Recession shock — Broad risk-off on growth fears; the S&P (SPY) falls over a quarter.
Portfolio impact
A portfolio with this exposure would have an estimated move of -24.3% under this scenario (driver: SPY -20% (scenario assumption), applied via each holding's downside beta to SPY).
Contributions
| Holding | Weight | Beta-implied shock | Contribution |
|---|---|---|---|
| SMH | 30% | -26.4% | -7.9% |
| QQQ | 30% | -21.7% | -6.5% |
| SOXX | 20% | -27.2% | -5.4% |
| IGV | 20% | -22.0% | -4.4% |
Vulnerabilities
Largest negative contributors: SMH (-7.9%), QQQ (-6.5%), SOXX (-5.4%). Concentration: QQQ is 30% of the book; SMH is 30% of the book.
Possible adjustments
Common ways investors reduce exposure to a recession shock include trimming the highest-beta names and adding lower-beta or defensive exposure. Position sizing and any changes remain the investor's own decision.
Reality check
A single-factor, downside-beta estimate with a scenario-assumption shock — directional only, not a prediction or personalized advice. Betas and shock sizes shift across regimes.