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FWIW--anyone here familiar or just barely cognizant of Paul Merriman's name re investment strategy?
I have heard his name--seen people refer to him on sites like Boglehead forum and MarketWatch
This is a return history/schedule for sliding scale ratio of return of equities to bonds using one of his portfolio strategies
He favors value equities over growth equities
He has been in the business for decades
Currently he uses a split system for his own personal investing strategy (according to what I read on one of his blog posts)...
50% of his portfolio uses a "market timing" system--
Not really specific about that because I guess he wants you to be a client
And 50% is just straight long term buy/hold 50/50 split equities and bonds
He uses various forms of equity and fixed income funds but he does believe in value over growth, uses international/EM as well as US...
His website has more info on these strategies...
And he has podcasts you can download and listen to if you like that off your phone while walking or exercising or other activity
Very familiar with him. He's a great speaker, very knowledgeable, great podcasts. The problem is his recommended portfolios, mostly value and tilted toward small caps, have underperformed some other newsletters, per Hulbert.
The problem is his recommended portfolios, mostly value and tilted toward small caps, have underperformed some other newsletters, per Hulbert.
Small-cap has underperformed for decades; even more so, if we use volatility-adjusted metrics. Attempting to elide sophomoric allusions, I won't go into detail. But it does puzzle me, as to why the traditional saying, that smaller companies have better earnings-growth prospects, and thus better equity-appreciation prospects, has not been substantiated.
According to this source: https://portfoliocharts.com/, it's not the smallness of small companies that gives improved long-term return, but whether they are value-oriented. That is, we segregate small companies (by whatever metric?) into "growth" and "value". The "growth" batch does no better than the overall market... and may actually underperform. The "value" batch however does excel. What does Merriman have to say about that?
Small-cap has underperformed for decades; even more so, if we use volatility-adjusted metrics. Attempting to elide sophomoric allusions, I won't go into detail. But it does puzzle me, as to why the traditional saying, that smaller companies have better earnings-growth prospects, and thus better equity-appreciation prospects, has not been substantiated.
According to this source: https://portfoliocharts.com/, it's not the smallness of small companies that gives improved long-term return, but whether they are value-oriented. That is, we segregate small companies (by whatever metric?) into "growth" and "value". The "growth" batch does no better than the overall market... and may actually underperform. The "value" batch however does excel. What does Merriman have to say about that?
Merriman is a huge advocate of small cap value. I was seriously thinking about using his methodology and some of his model portfolios until I saw his performance/ranking in Hulbert.
One of the charts on his site shows 40 yr returns for various asset groups and SCV leads other equities if I remember correctly
You can refer to the link
small cap value tends to out perform small cap growth most time frames . one of the reasons total market funds barely do better than just the s&p 500 is small caps make up 10% of the total market fund but 8% of that is small cap growth and only 2% small cap value.
since over most time frames small cap growth lags the s&p 500 it weighs down any of the better gains small cap value tries to add .
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