edited 2 yr. ago. Investment expert Paul Merriman joins us to discuss the two-fund portfolio, a mix of one target date fund and one small cap value fund. Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. Check the Paul Merriman Ultimate Buy and Hold Strategy Portfolio, and find out the current dividend yield. Do your own research before selecting an index fund for your portfolio. Portfolio S&P 500 WW UBH WW 4-Fund US 4-Fund WW All Value US All Value WW All SCV US All SCV US 2-Fund S&P 500 1000/0 US LCV US SCB US scv 1000/0 REIT Intl LCB Intl LCV Intl SCB Intl SCV Em Mrkt Education (0 2022 The Merriman Financial Foundation . For more information about Vanguard funds, visit advisors.vanguard.com or call 800-997-2798 to obtain a prospectus or, if available, a summary prospectus. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. The recommended portfolio invests 6% in VNQ, All told, the Paul Merriman Ultimate Buy-and-Hold Portfolio has stood the test of time, with plenty of investors using it as their path to wealth. Think about starting retirement and withdrawing 4-5% in 2007 and 2008, and combine that with what happened to the markets then. Being in the EU myself I would not consider investing in a single countries economy a sensible idea so I hold a market cap weighted all-world, all-cap portfolio with a slight small-cap value tilt which would be somewhere between the 4 fund and the value fund design presented here. This #1 portfolio would grow at an annualized compound return of 9.3% (after accounting for 1% in fees). Two other Vanguard balanced funds are worth considering. Merriman founded an investment advisory firm in Seattle in 1983, from which he has since retired. You could lose money by investing in the Fund. The insights Paul provides about this strategy are priceless. Vanguard S&P 500 ETF (VOO): To lay the foundation of your Vanguard ETF portfolio, a low-cost S&P 500 index ETF like VOO is a smart choice. Paul Merriman 4 Fund Portfolio Review & M1 Finance ETF Pie (2022) The 4 Best Blockchain ETFS for 2022; M1 Finance vs. You're not going to find low-cost mutual funds at Fidelity to implement all of Merriman's UB&H. 15% Vanguard Total International Stock Index Admiral Shares (VTIAX): Foreign stocks 3. 40% Fixed Income. An 80% stock / 20% bond version of the core 4 portfolios proposed by Rick Ferri. Final Thoughts. The asset allocation is as follows: -target date fund it's 1.5 multiplied by your age. They are simple and well diversified. The dividend yield is 2.76%. Two other Vanguard balanced funds are worth considering. 5% Emerging Markets. VTI 206.36-0.8%: VXUS 56.71 0.1%: BND 76.68-0.6%: BNDX 50.45-0.7% Articles. Feb. 7, 2019 at 9:33 a.m. Over the previous 5, 10, and 20 year time horizons, it hasn't done as well. The result would turn a $100,000 investment into more than $6.5 million. The first thing you should know is that there is rarely ONE best ETF or fund. If your holding period was 15 years, your success rate would have been 75%. For the past 10 years, the Paul Merrimans Ultimate Portfolio has returned 10.79 with a standard deviation of 17.2. VOO vs. VTI Vanguard S&P 500 or Total Stock Market ETF? It is a high-risk portfolio. All articles: Investing Outlook: May 2022 Do your own research before selecting an index fund for your portfolio. PaulMerriman - @NWRunner My wife and I use Vanguards Short Term Investment Grade Bond Fund for our emergency money, as well as our source of monthly income that we set aside once a year. Expense Ratio: 0.04%, or $4 per $10,000 invested annually. 2 Funds For Life; Target Date Funds; 4 Fund Combo; All Value Equity Portfolio; All About Small-Cap Value; Turn $3,000 into $50 million; 90 Years of Performance; Portfolios. 0.26%. The 3-fund portfolio is an easy, diversified and low-cost way to invest. Jun 03 2022. Podcast How to build the best comeback portfolio Article Market got you down? Returns assume continuous rebalancing. Do your own research before selecting an index fund for your portfolio. This post was inspired by Paul Merriman who has for many years recommended ETFs and mutual funds to implement his portfolio strategies. I came across Paul Merrimans recommendation for the 4-fund portfolio and found it interesting. Vanguard Balanced Index Fund VBIAX, +0.21% is index driven, holding about 60% of its portfolio in 3,300 U.S. mostly growth-oriented stocks and the rest in about 10,700 bonds. Check historical data and build your income strategy. Portfolio 139-142: Vanguard Target Retirement Portfolio. He offers free portfolio recommendations for Vanguard, Fidelity, Schwab, TD Ameritrade and T. Rowe Price mutual funds and exchange-traded funds (ETF). The Four Fund Combo is built on four index funds (or exchange-traded funds) that include the most basic U.S. equity asset classes: large-cap blend stocks (the S&P 500 SPX, +0.27%, in other words), large-cap value stocks, small-cap blend stocks, and small-cap value stocks. Details. Note, however, that it comes with more risk. Using Merriman's best-in-class ETFs, this would look something like: 25% VTI. M1 Finance is a great choice of broker to implement the Paul Merriman 4 Fund Portfolio because it makes regular rebalancing seamless and easy, has zero transaction fees, and incorporates dynamic rebalancing for new deposits.I wrote a comprehensive review of M1 Finance here.. Jonathan Mendonsa & Brad Barrett. Chris Pederson. VXUS 40%. Paul is a proponent of the Ultimate Buy and Hold strategy and a legend in this space. Paul Merriman is a contributing editor to the AAII Journal. were used where a portfolio calls for US equities, emerging market equities, etc. Paul Merriman. I was analyzing a hypothetical 4 fund portfolio and would like your views if this is a good strategy or not. Before you go and implement the full ultimate buy & hold, I'd take a look at this forum thread. Merriman recommends allocating 6% of the portfolios assets to the FNDC fund, which includes smaller international companies. This is yet another fund whose inclusion shows how much Merriman values small-cap opportunities over large-cap plays. 6% in Avantis International Small-Cap Value ETF (AVDV). Information and historical annual returns including dividends for Paul Merriman Four Fund Portfolio. Think about starting retirement and withdrawing 4-5% in 2007 and 2008, and combine that with what happened to the markets then. But Roths idea of keeping it simple applies to everyone. Vanguard has 5.1 Trillion dollars under management. -then the rest get's put into a US small cap value index. 10% Large Cap Value. Investing. The Ultimate Buy and Hold Portfolio 7 was developed by Paul Merriman and profiled on his website. I wanted to hear what other Bogleheads think regarding having a small-cap value tilt such as this as an additional investing strategy. We have expanded on the Best In Class concept to include many more asset classes. The Bogleheads 3 Fund Portfolio is arguably the most popular lazy portfolio. 25% FNDC. He is a strong supporter of value stocks and Portfolio 7 is a global portfolio with 40% value leaning ETFs. The asset allocation is as follows: -target date fund it's 1.5 multiplied by your age. His topic is: Were Talking Millions!. "Paul Merriman 4 Fund Portfolio Review," OptimizedPortfolio, March 24, 2021. -then the rest get's put into a US small cap value index. 1/3 Vanguard Total Stock Market Fund 1/3 Vanguard Total International Stock Market Fund 1/3 Vanguard Total Bond Market Fund We do not endorse Vanguard or receive any compensation from them. His reasoning is that historically (over 90+ years), small-caps have provided superior returns compared to the S&P 500. The Paul Merriman Ultimate Buy and Hold Strategy Portfolio granted a 2.79% dividend yield in 2021. The portfolio is incredibly simple to create and manage due to its limited need for multiple assets. 6% in Vanguard Real Estate Index Fund ETF (VNQ). Vanguard index funds like VTI, VWO, etc. Asset Allocation For 60% Stocks/40% Bonds. This is Vanguards stab at target-date retirement funds. Podcast #170 Show Notes: Rick Ferri vs Paul Merriman Part 2. While it has had a very fine long term return, for a very low risk investment, it did lose 4.7% in 2008, but was up over 14% in 2009. Vanguard; Fidelity; T.Rowe Price; Schwab; ETFs. Today, on our joint Talking Real Money/Sound Investing podcast, Don and Paul Merriman discuss index funds and why they are the only way to build a decent portfolio. Information and historical annual returns including dividends for Vanguard Target Retirement 2025 Fund. Note: Historical performance This portfolio is not unlike Paul Merrimans 4 Fund Portfolio, but this one more meticulously avoids small cap growth stocks and goes beyond U.S. borders. Over the 30 years ending December 31, 2019 the total market fund beat the S&P 500 10% vs. 10.2%. A number of readers have asked me what I think about Paul Merrimans Ultimate Buy-and-Hold Portfolio. were used where a portfolio calls for US equities, emerging market equities, etc. Portfolio and ETF Returns. Ally Invest Brokerage Comparison (2022) Bogleheads 3 Fund Portfolio Review and Vanguard ETFs To Use. It consists of: 25% SP 500 fund (VFIAX) 25% Large-cap value (VVIAX) 1. Paul and Don show you: * The best indexes to own based on science. Vanguard; Fidelity; T.Rowe Price; Schwab; ETFs. It may not even happen every five years. The goal is to contrast the Simple Path to Wealth Approach with the Ultimate Buy and Hold Portfolio.. VTI 205.00-0.7%: VXUS 56.16-1.0%: BND 76.19-0.6%: BNDX 50.28-0.3% Articles. The Bogleheads Forum houses an exchange of knowledge surrounding Bogles principles. It consists of: 25% SP 500 fund (VFIAX) 25% Large-cap value (VVIAX) He describes why this could be the ultimate portfolio for buy-and-hold investors who want to boost their returns, without excessive complexity or risk. For example I am 30 years old so (1.5 x 30= 45) so my asset allocation would be: 45% Target date fund. The four-fund portfolio that Vanguard is now employing consists of the following broad asset class index funds: 1 Total U.S. stock market index fund 2 Total international stock index fund 3 Total U.S. bond index fund 4 Total international bond index fund More Weve grown significantly since then, and have also come to realize that investment advice is only a small piece of the puzzle. Using mostly low-cost Portfolio returns are calculated in USD, assuming: No fees or capital gain taxes. All articles: Investing Outlook: May 2022 Vanguard index funds like VTI, VWO, etc. were used where a portfolio calls for US equities, emerging market equities, etc. We are providing a huge list of ETF Portfolios that suit your needs. The Paul Merriman Ultimate Buy and Hold Strategy Portfolio guaranteed the following returns. The Best Vanguard Dividend Funds 4 Popular ETFs; VIG vs. VYM Comparing Vanguards 2 Popular Dividend ETFs; 8 Reasons Why Im Not a Dividend Income Investor; Paul Merriman Ultimate Buy and Hold Portfolio Review, M1 Pie (2022) Lowest Margin Rates Brokers (2022 Comparison) Obviously Mr. Merriman has either too much money himself, which would allow him to be 100% in stocks (50% in international), or he has never advised real-life, ordinary investors. were used where a portfolio calls for US equities, emerging market equities, etc. Based off Paul Merriman's tables, although a bit more complex than the simple 3 fund portfolio, it's still pretty straightforward and based on the past it seems like having portfolio #8 vs just investing in 1 or 2 funds made a BIG BIG difference that it investing in that plan is worth the the time and effort. ET by Mark Hulbert All (since Jan 1992) Bogleheads Three Funds Portfolio: an investment of 1000$, since May 1992, now would be worth 10321.59$, with a total return of 932.16% ( 8.09% annualized ). Obviously Mr. Merriman has either too much money himself, which would allow him to be 100% in stocks (50% in international), or he has never advised real-life, ordinary investors. June 2022. Paul Merriman is founder and director of Merriman Berkman Next, a money management firm with over $1.4 billion in assets under management. A Sample Portfolio. There are other providers of analogous index funds. Merrimans 4 Fund Portfolio was meant to provide the ultimate level of simplicity, built as a 4-fund combo, with each fund in the portfolio receiving equal allocation at 25%. This fee will cost you nothing extra and helps support our financial education work. Here is the breakdown of their Vanguard balanced buy-and-hold portfolio. Merrimans 4 Fund Portfolio was meant to provide the ultimate level of simplicity, built as a 4-fund combo, with each fund in the portfolio receiving equal allocation at 25%. Information and historical annual returns including dividends for Bogleheads 3 Fund Portfolio. 4 Fund Combo; Target Date Funds; 2 Funds For Life; M1 Finance; Mutual Funds. Allan Roths Second Grader Portfolio. We can look at an example that serves as a model, now that we have a smart design for our portfolio of Vanguard funds: 35% Vanguard 500 Index Admiral Shares (VFIAX): Large-cap U.S. stocks 2. Listen on Apple Podcasts. Our five Vanguard ETF portfolio needs a great base, and that base comes from a Paul Merrimans Ultimate Portfolio can be built with 10 ETFs. Jack founded Vanguard and pioneered indexed mutual funds. He stresses that this may not be the right portfolio for you, but many take it as a starting point for a well-balanced portfolio. ET by Paul A. Merriman Opinion This 50-year-old Vanguard mutual fund is holding its own against younger rivals Sep. 5, 2020 at 8:44 a.m. 15% U.S. Large Cap Value. Investment Portfolios. He offers free portfolio recommendations for Vanguard, Fidelity, Schwab, TD Ameritrade and T. Rowe Price mutual funds and exchange-traded funds (ETF). Basically he uses a target date fund (such as vanguard) and a US small cap value index. Paul Merriman is a financial advisor and educator who is extremely popular in the financial blogosphere for his assessments on index investing and asset allocation in relation to long-term buy-and-hold investing strategies. Most contain a small number of low-cost funds that are easy to rebalance.They are "lazy" in that the investor can maintain the same asset allocation for an extended period of time, as they generally contain 30-40% bonds, suitable for most pre-retirement investors.. Lazy portfolios are designed to perform well in most market conditions. Bogleheads are followers of the advice and path of the famous Jack Bogle, founder of Vanguard and considered the father of index investing. The Vigorous Value Portfolio looks like this: 15% U.S. Large Cap Stocks. if I had invested 100k in 2014 in the following 4 funds, I would have 174k today. Returns assume dividend reinvestment. Pauls Mutual Fund Recommendations For Vanguard Updated January 4, 2021 Vanguard Tax Deferred Portfolios FUND SYMBOL AGGRESSIVE MODERATE CONSERVATIVE Vanguard 500 Index Admiral Shares VFIAX 11% 6% 4% Vanguard Value Index Admiral Shares VVIAX 11% 7% 5% Vanguard Tax-Managed Small-Cap Admiral Shares * VTMSX 11% 7% 4% He also writes at FundAdvice.com, which has a lot of interesting articles about investing in no-load mutual funds, with and without market timing. Portfolio Einstein is currently tracking over 800 portfolios! In this presentation Paul discusses the advantages of Vanguard, best cash management fund, best equity fund, best balanced funds, best bond funds and more at Vanguard. The good news is you don't need all of the categories Merriman lists, you can implement his strategy with just 4 funds, and it tracks almost perfectly. It's exposed for 80% on the Stock Market. Vanguard; Fidelity; T.Rowe Price; Schwab; ETFs. It sure does have a nice ring to it (placing the word ultimate before anything tends to have that effect). Bogleheads Four Funds Portfolio: an investment of 1000$, since May 1992, now would be worth 10731.65$, with a total return of 973.17% (8.23% annualized).. Paul Merriman Ultimate Buy and Hold Strategy Portfolio: an investment of 1000$, since May 1992, now would be worth 13055.22$, with a total return of 1205.52% (8.94% annualized). Paul Merriman 4 Fund Portfolio ETF Pie for M1 Finance. 10% Large Cap Blend. We recommend Vanguard for stock purchases and Bittrex for crypto Bitcoin price nears record high. This week we have Rick Ferri and Paul Merriman on the WCI podcast at the same time for a lively debate on the pros and cons of factor investing. In the last 30 Years, the Bogleheads Four Funds Portfolio obtained a 8.15% compound annual return, with a 11.95% standard deviation. Paul Merriman has a simple two funds for life approach that offsets a conservative target-date fund with an all-equity fund. Over the very long haul, we believe that our suggested DFA all-equity portfolio will produce returns that average 1 to 2 percent a year higher than those of a similar portfolio at Vanguard. Paul Merriman also runs his own money management firm. ET. Even beyond that, it's only outperformed alternatives for 1 year. Vanguard index funds like VTI, VWO, etc. The cryptocurrencies are exceptions (no reputable diversified fund exists), but we include only the two most reputable cryptocurrencies. 25% SLYV. Due to the buy-and-hold nature of the portfolio, its not only simple to set up, but extremely easy to manage. The Core series of Vanguard ETF strategic model portfolios is suitable as a hub to build around, holding four U.S. and international equity and fixed income Vanguard ETFs. You create a three fund portfolio by investing in a U.S. stock index fund, and international stock index fund and a U.S. bond index fund. We keep adding great portfolios! Vanguard Balanced Index Fund is index driven, holding about 60% of its portfolio in 3,300 He also explains how retirees can buy a pension for the rest of their life and make more than 7% a year, most of it tax free. Lots of combinations. It tilts towards value and small caps. This is 1-1/2 hour presentation followed by a 30 min open Q & A session. Portfolio 26: The Three-Fund Portfolio. He describes why this could be the ultimate portfolio for buy-and-hold investors who want to boost their returns, without excessive complexity or risk. 3. 0:00 / 1:58:00 . We just added 295 portfolios along with dividends and expense ratios. As its name suggests, the Bogleheads Four-Fund Portfolio was developed by John C. Bogle, also known as Jack Bogle, the founder of the Bogleheads forum at bogleheads.org. Check the Paul Merriman Ultimate Buy and Hold Strategy Portfolio, and find out the current dividend yield. This is part 2 of the lively debate between Rick Ferri and Paul Merriman, where we continue the discussion on the pros and cons of factor investing. All articles: Investing Outlook: May 2022 Vanguard index funds like VTI, VWO, etc. Due to the buy-and-hold nature of the portfolio, its not only simple to set up, but extremely easy to manage. Paul Merriman responds: VTI was chosen to increase the number of companies represented in the portfolio as there are only 4 funds in the portfolio. There are other providers of analogous index funds. Check historical data and build your income strategy. VTI 195.32-0.4%: VXUS 54.54 1.1%: BND 76.09 0.2%: BNDX 50.70-0.0% Articles. The portfolio allocation suggests that 6% of your investment dollars should be invested in this fund. As an affiliate of M-1 Finance, offering direct access to our recommended portfolios, The Merriman Financial Education Foundation may receive a small fee if you fund an account over $1,000. 2 Funds For Life; Target Date Funds; 4 Fund Combo; All Value Equity Portfolio; All About Small-Cap Value; Turn $3,000 into $50 million; 90 Years of Performance; Portfolios. Bitcoin bottom: In 2018? Sound Investing. Find Paul A. Merriman's email address, contact information, LinkedIn, Twitter, other social media and more. I wanted to hear what other Bogleheads think regarding having a small-cap value tilt such as this as an additional investing strategy. It's almost impossible to beat the market, so just be the market. Over all the 10-year periods, your success rate would have risen to 61%. Live. And in any 25-year period, your success rate in beating the S&P 500 with this four-fund combo would have been 100%. Target Date Funds; 4 Fund Combo; All Value Equity Portfolio; All About Small-Cap Value; Turn $3,000 into $50 million; 90 Years of Performance; Portfolios. ET by Howard Gold Paul Merriman Portfolio. Today, on our joint Talking Real Money/Sound Investing podcast, Don and Paul Merriman discuss index funds and why they are the only way to build a decent portfolio. The portfolio invests 90% in equities and 10% in REITs. It is exposed to 100% equities. Vanguard; Fidelity; T.Rowe Price; Schwab; ETFs. In my view, it should constitute the core of any portfolio, if not the entire portfolio. The Paul Merriman Ultimate Buy and Hold Portfolio, as the name suggests, is a lazy portfolio designed by Paul Merriman for a buy-and-hold investing strategy. It probably has the longest name of all the lazy portfolios, but thats okay with me. 25% EFV. Chris Pedersen and Paul Merriman are fans of a two-fund approach, which is basically a target date retirement fund plus a small value fund. Merriman is an author, financial educator, and founder of Merriman, LLC. Portfolio 211-213: Paul Merriman 2-Fund-Value, 4-Fund-Value, 5-Fund-Value Portfolio. The third episode in the Local Chapters Getting Started series of virtual meetings is with Paul Merriman, a well-known financial writer and popular speaker. The Paul Merriman 4 Fund Portfolio is a simple, equal-weighted equities portfolio that tilts toward small caps and Value stocks. Here well take a look at its components, performance, and the best ETFs to use in its implementation. Interested in more Lazy Portfolios? As you can see in the chart below (click the image to enlarge it), the portfolio has trounced the S&P 500 over the last 50 years. Target Date Funds; 4 Fund Combo; All Value Equity Portfolio; All About Small-Cap Value; Turn $3,000 into $50 million; 90 Years of Performance; Portfolios. The 7 Best International ETFs; The 8 Best Small Cap ETFs (4 From Vanguard) The 5 Best REIT ETFs; The 5 Best EV ETFs Electric Vehicles ETFs; VIG vs. VYM Comparing Vanguards 2 Popular Dividend ETFs; The Best Vanguard Dividend Funds 4 Popular ETFs; The 5 Best Tech ETFs In any 20-year period, you had an 86% chance of outperforming the S&P 500. The 30-year return is 9.35%. When you hold a fund like VOO, you get access to roughly 500 stocks of the largest U.S. companies like Apple (AAPL), Amazon (AMZN), and Microsoft (MSFT). Home; Markets; Portfolios. I plan to mirror this portfolio for my Roth IRA. The Bogleheads Four Funds Portfolio is a Very High Risk portfolio and can be implemented with 4 ETFs. VTI 40%. Dec. 18, 2020 at 10:01 a.m. * Keeping costs low. and B9 (U.S. 4 Fund Portfolio) as the return series and look at 4 tables in each series. You can replicate the performance of the full UB&H portfolio with only 4 funds (Large Blend, Small Value, Int'l Large Value, Int'l Small Blend). Improving 4-Fund Portfolio. [] Jonathan and Brad talk to Paul Merriman. I came across Paul Merrimans recommendation for the 4-fund portfolio and found it interesting. Rick Ferri Core Four Portfolio: an investment of 1000$, since May 1992, now would be worth 11338.98$, with a total return of 1033.90% ( 8.43% annualized ). You own shares of Apple, Amazon, Tesla. You own shares of Apple, Amazon, Tesla. I am one. From 1928 through 2020 the Merriman 4-fund portfolio earned an average annual return of 11.7% versus the S&P 500 average return of 10.00%. Paul Merriman's advice vs. Mr. Bogle's: On 12-31-96 Mr. Hulbert started tracking eight additional Merriman funds: 4.3% Emergency Funds Portfolio 6.5% Vanguard Monthly Income Portfolio 7.3% Fidelity Balanced Portfolio 8.3% Fidelity Equity Portfolio 7.4% Vanguard Balanced Portfolio 7.5% Schwab Balanced Portfolio The 15 year compound rate of return was 3.6%. We know this wont happen every month, every quarter or every year. The main reason Paul Merriman's portfolio has outperformed a 4 fund is because it's 100% equities. The original cryptocurrency with a fixed limit of 21 million coins. Basically he uses a target date fund (such as vanguard) and a US small cap value index. Which Is the Best 1-, 2-, 3- and 4-Fund Strategy? Data was last updated on June 1, 2021 at 08:29 a.m. The 80/20 mix is a very aggressive / high risk portfolio only aimed at investors able to weather big losses. 4 Fund Portfolios - Paul Merriman. Investment expert Paul Merriman joins us to discuss the two-fund portfolio, a mix of one target date fund and one small cap value fund. I came across Paul Merriman's 4-fund portfolio in which he recommends tilting towards value, more specifically small-cap value. For example I am 30 years old so (1.5 x 30= 45) so my asset allocation would be: 45% Target date fund. The big question is how Merrimans Ultimate Buy and Hold portfolio has performed. The portfolio has returned 12.4% annually compared to 10.7% for the S&P 500. Podcast #169 Show Notes: Rick Ferri versus Paul Merriman on Factor Investing.