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Paul Merriman Financial Education for Every Stage of Life

Paul Merriman

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Paul and Chris answer 10 listener questions in one hour — covering asset allocation, investor behavior, funds, indexes, and fund management. They also dig into Daryl Bahls' hot-off-the-press alternative portfolio analysis.

CHAPTERS
00:00 Intro
01:11 Funds vs. their indexes
06:04 Which asset can I drop?
10:50 Buy and hold for a lifetime?
16:04 Tracking errors
20:24 How many years to trust a strategy?
27:05 The impact of 10% cash
28:18 What's a "good enough" return?
31:57 The new worldwide 4-fund portfolio
42:29 Too old for small-cap value?
44:56 Avantis and DFA
48:27 AVES for emerging markets value
54:04 Outro

LINKS & FILES
Sound Investing Quilt Charts: https://irp.cdn-website.com/6b78c197/...
Callan Periodic Table of Investment Returns: https://novelinvestor.com/asset-class...
Two Funds for Life Calculator: https://www.paulmerriman.com/two-fund...
Lifetime Investment Calculator: https://www.paulmerriman.com/merriman...
Daryl's 4-Fund Portfolio Analysis (WW 4-Fund): https://irp.cdn-website.com/6b78c197/...
Other Fine Tuning Tables (50/50): https://irp.cdn-website.com/6b78c197/...
2FFL Fine Tuning Table — Allocations: https://irp.cdn-website.com/6b78c197/...

14 Comments

@aLittleStrengthRev38 3 months ago

I concur. Having an interview with Avantis, or DFA as well as with Ben Felix would be great. I am really looking forward to that. You guys are the best.

@dlg5485 3 months ago

I'd love to see you guys have group conversations with analysts from Avantis and Dimensional. Please set that up!

@amirsinno5833 3 months ago

Thank you for answering my question. Always appreciated.

@DF-by7gy 3 months ago

Good questions and great answers. Thank you!

@rick_vv7754 3 months ago

What a good year for AVUV.

@JS-cg6cv 3 months ago

Thank you!

@FE1tube 2 months ago

Congratulations on a truly outstanding episode! Thank you so much for taking the time to share your health of knowledge. I would love to see the updated WW 4-fund but with a higher US tilt of 70% US (35% LCB and 35% SCV) 30% International (15% LCB and 15% SCV). It would be amazing to upload these on your website too. Again, thank you so much!

@johnrogers9065 3 months ago

Could the Vanguard Total World Index (VT) serve as the ultimate buy and hold investment?

@bigtuna4037 3 months ago

Many of the indexes will now be top heavy in SpaceX. Mr Musk counted on pricing it high enough there would be guaranteed buying.

@JenMockensturm-i1v 3 months ago

My problem with target date funds is that the final allocation is too conservative for me. My husband and I will each have a pension. I might be ok with 70/30, or even 60/40, but target date funds seem to have way too much bond allocation. Due to the fact that our pensions are so large, and that when we get social security at 70, we will likely not even need to touch the portfolio, we are almost all in equities 8 years from retirement. We have about 6% of our retirement in the TSP G fund. We may increase that a bit as we get closer to retirement, but I tend to doubt it will be much.

@UNOyay 3 months ago

Could I make a recommendation? Some of this analysis of data can seem theoretical in nature. Would there be individuals who have invested in one of the portfolios and how it went. Perhaps someone younger, and perhaps someone who retired with these portfolios and their experience. They may not want to divulge actual numbers but how did they feel in 2022? What percentage was their drawdown? Did they adjust at any point? How do they generate withdrawals in retirement? Has their return been what they expected, percentage wise? Personalize it. Thank you gentlemen for these videos!

@BruceKaplan 3 months ago

On the 10 cash percent question - maybe that’s not quite the right question. Perhaps the question should be what does holding 10 percent cash do to your safe withdrawal rate or sequence of returns risk? Is there a benefit that pests the decreased return.

@samuelfeguer 3 months ago

I'm using your portfolio configurator tool and in the section for tax status you only have taxable and tax deferred. Aren't you missing tax free? Where should I put my Roth IRA dollars?