Why Does Anyone Listen To Paul Merriman?

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FIREGuy88
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Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

I'm not sure I understand the allure of this guy. It looks like the "Ultimate Buy and Hold" portfolio has been [taking a beating --admin LadyGeek] since 2015.

"Past performance is not indicative of..." I get it. But the 3-fund portfolio seems infinitely easier to manage and is starting to blow the doors off of Merriman's small cap value strategy.

Why do people still listen to this guy?
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Soon2BXProgrammer »

FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pm I'm not sure I understand the allure of this guy. It looks like the "Ultimate Buy and Hold" portfolio has been [taking a beating --admin LadyGeek] since 2015.

"Past performance is not indicative of..." I get it. But the 3-fund portfolio seems infinitely easier to manage and is starting to blow the doors off of Merriman's small cap value strategy.

Why do people still listen to this guy?
Small and Value in the past outperformed over the very long run, and its outperformance are "bunched" typically into a few years.

I'm not saying that the strategy will or will not work. just if you go that way, you need to commit for 20+ years.
Earned 43 (and counting) credit hours of financial planning related education from a regionally accredited university, but I am not your advisor.
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Metsfan91
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Metsfan91 »

FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pm I'm not sure I understand the allure of this guy. It looks like the "Ultimate Buy and Hold" portfolio has been [taking a beating --admin LadyGeek] since 2015.

"Past performance is not indicative of..." I get it. But the 3-fund portfolio seems infinitely easier to manage and is starting to blow the doors off of Merriman's small cap value strategy.

Why do people still listen to this guy?
When you listen to Mr. Merriman, what do you hear? Is he promoting Ultimate Buy and Hold for new investors? Or, is he recommending Target Date Fund with a small value tilt?

Why do I listen to Mr. Merriman's podcast? He reminds again and again to
  • Tune out the noise
  • Have and follow an investment strategy (be it 100% equity or 60/40 or target date fund)
  • Not time the market
  • Buy and Hold
  • Not panic sell
These few come to mind. I am sure there are more.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by JBTX »

FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pm I'm not sure I understand the allure of this guy. It looks like the "Ultimate Buy and Hold" portfolio has been [taking a beating --admin LadyGeek] since 2015.

"Past performance is not indicative of..." I get it. But the 3-fund portfolio seems infinitely easier to manage and is starting to blow the doors off of Merriman's small cap value strategy.

Why do people still listen to this guy?
Why do people still listen to Bogle, when Bitcoin, Telsa, Gamestop and ARKK have blown the doors off of index funds recently?
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Re: Why Does Anyone Listen To Paul Merriman?

Post by AerialWombat »

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This post is a work of fiction. Any similarity to real financial advice is purely coincidental.
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Ocean77
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Ocean77 »

And it sure is infinitely easier to decide on an investment that has has performed well in the past, than to stick with something that did not do well recently.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by dru808 »

Metsfan91 wrote: Wed Apr 14, 2021 11:13 pm
FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pm I'm not sure I understand the allure of this guy. It looks like the "Ultimate Buy and Hold" portfolio has been [taking a beating --admin LadyGeek] since 2015.

"Past performance is not indicative of..." I get it. But the 3-fund portfolio seems infinitely easier to manage and is starting to blow the doors off of Merriman's small cap value strategy.

Why do people still listen to this guy?
When you listen to Mr. Merriman, what do you hear? Is he promoting Ultimate Buy and Hold for new investors? Or, is he recommending Target Date Fund with a small value tilt?

Why do I listen to Mr. Merriman's podcast? He reminds again and again to
  • Tune out the noise
  • Have and follow an investment strategy (be it 100% equity or 60/40 or target date fund)
  • Not time the market
  • Buy and Hold
  • Not panic sell
These few come to mind. I am sure there are more.

Spot on

OP, Since 2015? A simple 1 fund qqq portfolio beat the pants off of the simple 3 fund, why not go all qqq or all Tesla?
1 fund
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Re: Why Does Anyone Listen To Paul Merriman?

Post by AlohaJoe »

FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pm Why do people still listen to this guy?
Because asset allocation is one of the least important things in investing for retirement and he talks about things other than asset allocation?
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Re: Why Does Anyone Listen To Paul Merriman?

Post by JustinR »

Really good marketing for the Ultimate Busywork Portfolio
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Beensabu »

Funnily enough, I found this place because I found Paul Merriman and his Ultimate Buy and Hold Portfolio (which I did not buy -- I bought into REITs for awhile though... oops but not so terribly terrible in the end). And then I found the 3-fund portfolio, which I really wanted to believe in and totally would if I made enough money, but I don't, so... Then I threw my IPS away and said "I do what I want!" and that's pretty much where I am now. :cool:

I almost went with: Some people probably listen to Paul Merriman because he actually makes sense in most of what he says and his UBH thingy probably won't be terrible at all long-term, and also they'll likely be better off than if they just decided to do whatever they want because they want to because 'stuff'.

But really, I'm actually going to go with: If people listen to Paul Merriman and think about what he is saying and why he recommends his UBH thingy and go learn some more stuff, maybe they might actually learn how to think about things in a way that allows them to understand why they are making the investment decisions that they are making rather than following his (or anyone else's) recommendations blindly.

So yeah. He's not dumb. And he helps people think.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by bradshaw1965 »

You could do much worse. He's an interesting guy with a reasonable message. There is just not that much to say about sound investing and when you are a public figure you say the same things over and over.

Bill Bernstein is the most interesting investment adjacent guy I know, I listen to every interview he does and I do it even though I know all of the anecdotes he'll use because I know there will be a good tidbit in there.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by BackToSchoolDad »

I learned a lot from Paul, even though I don't strictly follow his recommendations. The ETF recommendations on his site were invaluable when I was first investing and had no idea what to do. I still listen every week, he seems like a genuinely great person.

Most of what he says is very in line with most Bogleheads as mentioned. My portfolio is essentially a TDF with some SCV and emerging markets for a slight tilt partly thanks to him.

The only real fault I have with Paul is that he isn't clear about how much of a tilt he's recommending and how much tracking error there may be.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by livesoft »

Small-cap value is a top performing asset class for 2021 so far. SCV funds have been up more the 30% in the first 3 months of 2021.

Perhaps it is time to rebalance OUT of SCV? :twisted:
Last edited by livesoft on Thu Apr 15, 2021 7:48 am, edited 1 time in total.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by 3funder »

His advice isn't special, but I don't see anything wrong with it.
Global stocks, US bonds, and time.
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DWesterb2iz2
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Re: Why Does Anyone Listen To Paul Merriman?

Post by DWesterb2iz2 »

He’s very thoughtful and kind, and I love the way he says “value.” And he says “value” a lot.

I’d love to hear how these accounts for his grandkids are doing.

https://www.deseret.com/1994/10/30/1913 ... 20-million
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Re: Why Does Anyone Listen To Paul Merriman?

Post by rascott »

FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pm I'm not sure I understand the allure of this guy. It looks like the "Ultimate Buy and Hold" portfolio has been [taking a beating --admin LadyGeek] since 2015.

"Past performance is not indicative of..." I get it. But the 3-fund portfolio seems infinitely easier to manage and is starting to blow the doors off of Merriman's small cap value strategy.

Why do people still listen to this guy?
What's the actual difference since 2015 and now between the UBH and 50/50 VTI/VXUS?

I know the UBH is 50% international.... with a small and value tilt. But 50% in VXUS hasn't been exactly gangbusters.

Everyone knows that growth has whipped value in recent years. So of course a value tilted portfolio is going to have trailed.

Paul seems a good guy and has a very long outlook. 5 years is just noise
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Re: Why Does Anyone Listen To Paul Merriman?

Post by thenextguy »

DWesterb2iz2 wrote: Thu Apr 15, 2021 7:50 am He’s very thoughtful and kind, and I love the way he says “value.” And he says “value” a lot.
VAL-yoo. :D
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Bluce »

FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pm I'm not sure I understand the allure of this guy. It looks like the "Ultimate Buy and Hold" portfolio has been [taking a beating --admin LadyGeek] since 2015.

"Past performance is not indicative of..." I get it. But the 3-fund portfolio seems infinitely easier to manage and is starting to blow the doors off of Merriman's small cap value strategy.

Why do people still listen to this guy?
I don't listen to nor read any guru stuff.

I have an all-weather portfolio that I mostly ignore. I do watch the markets daily, but just for fun -- I never act on what they may or may not be doing.

YMMV.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by CyclingDuo »

FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pmI'm not sure I understand the allure of this guy. It looks like the "Ultimate Buy and Hold" portfolio has been [taking a beating --admin LadyGeek] since 2015.

"Past performance is not indicative of..." I get it. But the 3-fund portfolio seems infinitely easier to manage and is starting to blow the doors off of Merriman's small cap value strategy.

Why do people still listen to this guy?
Whoa, whoa, whoa...

These forums are designed to be the sharing of ideas, as we can all learn something from each other - including other investment strategies - Paul Merriman's ideas included. I don't see the point in trashing Paul and it goes against why these forums were established. At least that is my view.

Rick Ferri had a nice interview with Paul on the Boglehead podcast series on February 1, 2020:

https://bogleheads.podbean.com/e/episod ... ick-ferri/

The three fund portfolio is just one of many lazy portfolios, as is the Ultimate Buy & Hold. Picking a strategy and sticking to it with regular contributions throughout your working career is key. You have chosen a period of less than 6 years (2015 to end of Q1 2021). Is that enough time to allow a strategy to play out and give precise data? Who knows what the results will be at the end of a 30 to 40 year working career and investment period? Do you or any of us know which will outperform over the coming decades?

Based on many previous threads such as this one, I began an experiment in the summer of 2018 with two 70/30 equity to bond allocation pies at M1 Finance for my own edification. One is the Vanguard Three Funder (same percentages of domestic vs. international as the Merriman) and the other is Merriman's Ultimate Buy and Hold.

Merriman had a link to set up the pie in the appropriate asset allocation of one's choosing at his website, and the three funder was easy to set up to match. I also set up a third pie at the time with a basket of 54 individual stocks that I chose. One was purchased (Red Hat by IBM), so the proceeds of the sale were deployed into the rest of the portfolio. Initial funding was the same dollar amount in each pie, and subsequent contributions have been exactly equal in the pies (all made on the same day at the same time). So it gives me a running look at three different investment strategies that are running concurrently for the longer haul.

The initial reason was to deploy some of my unemployment income at the time in 2018 after a layoff while I was seeking out replacement income from employment. Beyond that, the money that has been added comes from a part-time job I have held the past three years. These are small accounts for me, but a way to save nonetheless and run an experiment at the same time. I have two more pies with other investing strategies that were started later. This year, I shovel $25 a week into each pie from one of my part-time jobs and the contributions are set up on automatic pilot.

All dividends reinvested, no manual rebalancing as M1 does a nice job of purchasing the pieces of the pie that have dropped below their intended allocation first so it is self-rebalancing on its own. The individual stock portfolio has also not been rebalanced, but due to the rise in two of the individual share prices (Tesla and Nvidia), they are the only stocks that are really materially out of balance than the rest. If one did need to manually rebalance, there is a quick and dirty Rebalance button to click on that brings the entire portfolio immediately back into the original AA.

Ultimate Buy & Hold Portfolio 70/30 equity to bond

Image

Funding history of the Ultimate:
Image

Vanguard Three Fund Portfolio 70/30 equity to bond

Image

Funding history of the Three Fund:
Image

Individual Stock Portfolio 54 stocks chosen (53 remaining after Red Hat was purchased by IBM)

Image

Funding history of the Individual Stock Basket Pie:
Image

That is rather short term performance (June 13/2018 - April 15, 2021), so it is pointless to base anything on such a duration. Does it make any sense for me to say the individual stock basket is kicking the backside of both the three funder and the ultimate? No. 100% equities to the other two pies that are 70/30 doesn't make sense to compare and the time frame is way too short to even draw any comparisons. Likewise, the make up of the Ultimate is different than the make up of the Three Fund Portfolio, so it is not a complete 100% apples to apples comparison.

Granted mine is an experiment with three different strategies shown, but the longer duration of a few decades will be interesting as I plan on riding this experiment out with these pies while I contribute additional money into each on an equal dollar amount basis on the same days.

How will the Ultimate perform over those coming decades? How about the Three Funder? What about the basket of individual stocks?

The strategy of the Ultimate Buy & Hold portfolio is based on academic research and time will tell if it lives up to that research. Pick a strategy and stick with it. But don't trash the sharing of ideas and investment strategies if they don't match your own. :beer

CyclingDuo

Edits: I wanted to come back and post where I got the link to the M1 Finance Ultimate Buy & Hold Portfolio from Paul Merriman. It was on the page at the link below that I clicked on the 70/30 version to open the pie at M1 shown above.

https://paulmerriman.com/m1-finance/

As I pointed out above, the utility of rebalancing so many ETFs could not be easier between the M1 Finance structure of always rebalancing as you go with additional contributions and the Rebalance button. Prior threads here at BH always commented on how the three funder was so much easier to track and rebalance, but the M1 Feature makes it a piece of cake for the Ultimate portfolio and removes the complexity of rebalancing.
Last edited by CyclingDuo on Fri Sep 03, 2021 9:16 am, edited 3 times in total.
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Leesbro63
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Leesbro63 »

AlohaJoe wrote: Thu Apr 15, 2021 12:53 am
FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pm Why do people still listen to this guy?
Because asset allocation is one of the least important things in investing for retirement and he talks about things other than asset allocation?
Asset allocation is one of the LEAST important things in investing in retirement?????
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Sagefemme »

CyclingDuo wrote: Thu Apr 15, 2021 8:58 am
Based on many previous threads such as this one, I began an experiment in the summer of 2018 with two 70/30 equity to bond allocation pies at M1 Finance for my own edification. One is the Vanguard Three Funder (same percentages of domestic vs. international as the Merriman) and the other is Merriman's Ultimate Buy and Hold.

CyclingDuo
This is off the thread topic but I'm wondering Cycling Duo how do you like M1? The screenshots you post look simple, effective, and visually appealing. Sounds like rebalancing is easy. Far cry from the *@%$! graphics one gets on the Charles Schwab site..........
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Re: Why Does Anyone Listen To Paul Merriman?

Post by wander »

Paul Merriman gives advice and does not try to sell any service to his listeners. As always, for any advice, it's your own decision that drives your portfolio, not anyone else.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by hicabob »

Paul has the calmest, smoothest voice ever! I've listened to a couple of his podcasts and they seem a little repetitious but then so are most buy and hold long term index fund type strategies.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by JD2775 »

I really enjoyed the interview Rick Ferri did with him, and the interview that White Coat Investor did with him "vs" Rick Ferri. Seems like a really nice, knowledgeable guy. That said, I don't really follow his advice and stick to total market for simplicity purposes.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by TonyDAntonio »

I got to Bogleheads via Paul Merriman. I started the UBH back in 2008. Yah, bad timing but I've done ok. He seems like a good guy. I have no problem with him. And like livesoft said, time (finally) to rebalance out of SCV. Hooray!!
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Jack FFR1846 »

I like that Paul approaches investing like engineering. Lots of documented research and transparent calculations leading to his recommendations. As an engineer, I appreciate that. But as an engineer, I've always said that the circuit is smarter than I am, so I measure to get the actual results. And sometimes, despite rigorous calculation and confirming simulations, we're wrong and the circuit does something different. I've seen that Paul's recommendations often underperform other barely researched strategies. I'll stick with the 3 fund and realize that the funds are smarter than I am.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by asif408 »

hicabob wrote: Thu Apr 15, 2021 9:42 am Paul has the calmest, smoothest voice ever!
I agree, his voice has done an excellent job in curing my insomnia.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by TropikThunder »

FIREGuy88 wrote: Wed Apr 14, 2021 10:23 pm I'm not sure I understand the allure of this guy. It looks like the "Ultimate Buy and Hold" portfolio has been [taking a beating --admin LadyGeek] since 2015.

"Past performance is not indicative of..." I get it. But the 3-fund portfolio seems infinitely easier to manage and is starting to blow the doors off of Merriman's small cap value strategy.

Why do people still listen to this guy?
Might help your credibility if you show your work. What have the results been for the UBH since 2015? And don’t be lazy and say “go look it up”, you started the thread. Also, 3-fund at what allocation? 80/20 with 20% of equities in Int’l? 60/40? Saying “3-fund is better” is like saying “ice cream is better”. There are dozens of flavors.

Ice cream is better though as long as it’s chocolate.
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FIREGuy88
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

Metsfan91 wrote: Wed Apr 14, 2021 11:13 pm When you listen to Mr. Merriman, what do you hear? Is he promoting Ultimate Buy and Hold for new investors? Or, is he recommending Target Date Fund with a small value tilt?
Is he? On Portfolio Visualizer, they list his strategy as 11 different funds with differing allocations: https://www.portfoliovisualizer.com/backtest-portfolio

Image

This looks like the opposite of a simple Vanguard TDF.

Which is it? If he's promoting a TDF, then I take it back. But that's not at all what I'm seeing or hearing.

[Disrespectful comment removed by admin LadyGeek]
Last edited by FIREGuy88 on Thu Apr 15, 2021 2:39 pm, edited 2 times in total.
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FIREGuy88
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

JBTX wrote: Wed Apr 14, 2021 11:50 pm
Why do people still listen to Bogle, when Bitcoin, Telsa, Gamestop and ARKK have blown the doors off of index funds recently?
Laughably weak straw man argument. No one's suggesting to invest in meme stocks.

Merriman's strategy seems to be "index investing, except more complicated, more opportunities for investor behavioral mistakes, and worse returns".

Merriman vs 3-fund portfolio vs 60/40 since 2006:

Image

[Disrespectful comment removed by Moderator Misenplace]
Last edited by FIREGuy88 on Thu Apr 15, 2021 2:39 pm, edited 2 times in total.
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FIREGuy88
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

AerialWombat wrote: Thu Apr 15, 2021 12:42 am A target date fund + small cap value fund is a two-fund portfolio. That's even easier to manage than that cumbersome, archaic three-fund portfolio. :mrgreen:
Where are you seeing this mythical two-fund portfolio you speak of? I'm seeing a portfolio of 11 funds with lots of required rebalancing:

Image

[Disrespectful comment removed by Moderator Misenplace]
Last edited by FIREGuy88 on Thu Apr 15, 2021 2:40 pm, edited 1 time in total.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

Ocean77 wrote: Thu Apr 15, 2021 12:49 am And it sure is infinitely easier to decide on an investment that has has performed well in the past, than to stick with something that did not do well recently.
I am comparing Merriman to the market average, not a flash-in-the-pan strategy that's just recently working.

[Disrespectful comment removed by Moderator Misenplace]
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FIREGuy88
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

dru808 wrote: Thu Apr 15, 2021 12:52 am Spot on

OP, Since 2015? A simple 1 fund qqq portfolio beat the pants off of the simple 3 fund, why not go all qqq or all Tesla?
Straw man argument. UBH is under-performing the market average, costs more, takes more time and requires more discipline. UBH can be bad and index investing can be good at the same time. I am not suggesting buying meme stocks, you are.

[Disrespectful comment removed by Moderator Misenplace]
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FIREGuy88
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

I'm going to let your own words do the roasting for me here.

AlohaJoe wrote: Thu Apr 15, 2021 12:53 am Because asset allocation is one of the least important things in investing for retirement and he talks about things other than asset allocation?

[Disrespectful comment removed by Moderator Misenplace.]
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FIREGuy88
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

JustinR wrote: Thu Apr 15, 2021 12:54 am Really good marketing for the Ultimate Busywork Portfolio
☝️
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

Beensabu wrote: Thu Apr 15, 2021 1:25 am
He's not dumb. And he helps people think.
Kay 👌 Best argument I've heard so far I guess.
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FIREGuy88
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

JD2775 wrote: Thu Apr 15, 2021 9:45 am I really enjoyed the interview Rick Ferri did with him, and the interview that White Coat Investor did with him "vs" Rick Ferri. Seems like a really nice, knowledgeable guy. That said, I don't really follow his advice and stick to total market for simplicity purposes.
Same. I liked that interview a lot. What I don't understand is why his strategy is regarded as superior. Most people posting that have been following UBH seem to be miserable and can't wait to sell out of it.
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FIREGuy88
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Re: Why Does Anyone Listen To Paul Merriman?

Post by FIREGuy88 »

TropikThunder wrote: Thu Apr 15, 2021 1:04 pm
Might help your credibility if you show your work. What have the results been for the UBH since 2015? And don’t be lazy and say “go look it up”, you started the thread. Also, 3-fund at what allocation? 80/20 with 20% of equities in Int’l? 60/40? Saying “3-fund is better” is like saying “ice cream is better”. There are dozens of flavors.

Ice cream is better though as long as it’s chocolate.
What credibility? I have zero credibility.

Image

Higher expenses, more rebalancing, more room for error and worse returns.

Can you please explain to me why you support this strategy? Might help your credibility if you show your work.

[Disrespectful comment removed by Moderator Misenplace.]
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Jags4186 »

Woah woah woah I don’t understand why anyone would trash Paul Merriman. The guy is a super nice, super engaged with his listeners, and is just trying to help. Last I checked, he does everything for free.

As a long time listener of Paul, I’ll clear up a couple of misconceptions

1) When Merriman developed the UBH portfolio he was working at his financial advisory firm. The portfolio was developed not for the individual investor to manage, but for a financial advisor to manage. It’s a lot less complicated when you don’t have to do anything.

2) Paul has long been promoting a 4-Fund portfolio and a 2-Fund portfolio which will get very close to the performance of the UBH portfolio without all the fussing around for the individual investor.

3) Paul recommends a financial advisor if any of this stuff is overwhelming to you.

Paul thinks you have the best chance to get the best performance from the 10 fund portfolio. But he also acknowledges you can get awfully close, or better, by going with simpler options. It’s up to the individual investor to decide what’s best for himself.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by whereskyle »

Paul makes a good point. Total market index funds are dominated by megacap companies. Sure, they hold all the stocks, but 3000 of the stocks don't really have any effect on performance. Apple, Amazon and Facebook sure as heck do though. I am extremely happy with my 97% total market index portfolio, but I'm slowly building up a 20% mid/small tilt to diversify away from large cap growth and take a bit more risk while I'm young.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle
alankirkendall
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Re: Why Does Anyone Listen To Paul Merriman?

Post by alankirkendall »

The Ultimate Buy and Hold is an attempt to replicate a value tilted index strategy as implimented by Dimensional Funds. Most of the DFA funds are only available to those with a DFA affiliated advisor. Said advisor will incur a ca. 1% fee and require a relatively high portfolio balance. ($1 Million?) Any value strategy is simply a bet that over a long period (30 to 40 years) small and value will outperform. As UB&H involves 10 equity asset classes and rebalancing it will not interest those who want simplicity or don't want to bet on such long term trends.
For that reason, Paul advocates a simpler strategy of a Target Date Fund plus one small value fund. Hence the confusion as to whether he is advocating a 2 Fund or a 10 Fund strategy.
Most of his podcasts involve common sense familiar to Bogleheads such as save more, save early, invest for a lifetime, and ignore short or even medium term trends.
DB2
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Re: Why Does Anyone Listen To Paul Merriman?

Post by DB2 »

I think Paul offers very good advice especially for the 'average' investor who might not give a lot of thought to his/her 401K selection, etc. I've watched his more recent videos on Youtube. He makes a lot of great points. I think a Vanguard Target Date fund is great for most (or holding Total World VT for 100% equity)...and one could do add a small cap value tilt (10-20%?) if they wanted although I am agnostic on it. I do think you have to be a bit careful about backtesting too much, but it might say something that is metaphysical about investing (regarding small cap value).
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Laurizas »

FIREGuy88 wrote: Thu Apr 15, 2021 2:34 pm What I don't understand is why his strategy is regarded as superior.
Past performance.
Triple digit golfer
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Re: Why Does Anyone Listen To Paul Merriman?

Post by Triple digit golfer »

Since all the way back to 2015? My goodness, a 6 year period of underperformance?

Show me where Merriman has recommended this portfolio for a 6 year time frame.

This is designed to be a long-term portfolio. Think 30 years. I don't even follow Merriman and am a strong believer in the 3 fund portfolio, but your logic is nothing more than "it hasn't performed well lately." Clearly, then, you're not a good candidate for a Merriman portfolio and should join me in holding a 3 fund portfolio or target date fund.

[Reply to disrespectful comment removed by Moderator Misenplace.]
DB2
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Re: Why Does Anyone Listen To Paul Merriman?

Post by DB2 »

He has some videos out there going back to data from 1926 if I recall and looking at 20-year periods of performances at multiple points. What kind of surprised me was how many 15-20 year periods where the S&P 500 was basically flat (and how many people would have only been able to own that fund alone if it existed at that time?). Adding even a bit of small cap value could have significantly helped a portfolio during those times.
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imbogled
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Re: Why Does Anyone Listen To Paul Merriman?

Post by imbogled »

I listen to his podcasts and appreciate his efforts to clearly explain the investing world.
Last edited by imbogled on Thu Apr 15, 2021 11:18 pm, edited 1 time in total.
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Re: Why Does Anyone Listen To Paul Merriman?

Post by AerialWombat »

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This post is a work of fiction. Any similarity to real financial advice is purely coincidental.
JBTX
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Re: Why Does Anyone Listen To Paul Merriman?

Post by JBTX »

FIREGuy88 wrote: Thu Apr 15, 2021 2:20 pm
JBTX wrote: Wed Apr 14, 2021 11:50 pm
Why do people still listen to Bogle, when Bitcoin, Telsa, Gamestop and ARKK have blown the doors off of index funds recently?
Laughably weak straw man argument. No one's suggesting to invest in meme stocks.

Merriman's strategy seems to be "index investing, except more complicated, more opportunities for investor behavioral mistakes, and worse returns".

Merriman vs 3-fund portfolio vs 60/40 since 2006:

Image

[Disrespectful comment removed by Moderator Misenplace]
[Reply to disrespectful comment removed by Moderator Misenplace] Really?

So the ultimate arbiter of superiority is some subset of returns that includes recent SCV underperformance? Substitute QQQ ETF for total stock market in 3 fund, boom roasted.

I make no assertion as to potential SCV future performance. In an age of low interest rates, oligopoly and high tech SCV has suffered.

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palaheel
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Re: Why Does Anyone Listen To Paul Merriman?

Post by palaheel »

Why the fixation with 2015 and 2006?

Are you suggesting those periods are long enough to analyze investing strategy?

It's not hard to go back further. Merriman's site has data going back to 1970 (https://paulmerriman.com/wp-content/upl ... 0-2020.pdf). Have you looked at it? Merriman's table shows that since 1970, UBH has returned an annualized average of 12.1% versus 10.7% for the S&P 500.

There are certainly times when the S&P won big, like 2018 (UBH -13.5%, S&P -4.4%), 2019 (UBH 22.3%, S&P 31.4%) and 2020 (UBH 5.3%, S&P 18.4%). Is it your contention that the last 3 years answers the "How to invest?" question completely and forever?

Portfolio visualizer's asset class allocation can, by removing UBH's TIPS and adding that 8% to Intermediate Term Treasuries (making the ITTs 28%), go back to 1995 (https://www.portfoliovisualizer.com/bac ... ion15_3=15). The link compares UBH (blue) with a 30/30/40 US/Global/TBM (red) and a 45/15/40 (yellow) The past 3 years in US markets resulted in the 45/15/40 portfolio turning in the best performance. But it was hardly the "boom roasted" win you claim, unless you want to ignore that pesky 2005 - 2018 period.
Nothing to say, really.
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crystalbank
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Re: Why Does Anyone Listen To Paul Merriman?

Post by crystalbank »

I listened to Paul's podcast and learned a lot from him. I don't strictly follow his portfolio advice but there's still a lot of wisdom from his decades long investing experience. He's also candid about his market timing failures and the effect of multiple divorces on his personal wealth.

Also, I don't know if his choice of AA (TDF + SCV) will underperform/overperform the market decades from now but it's far from terrible.
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