Paul Merriman Ultimate Buy and Hold Portfolio: A Diversified Investment Strategy
The Paul Merriman Ultimate Buy and Hold Portfolio is a well-diversified, high-return investment strategy designed by **Paul Merriman**, a financial educator and investment expert. This portfolio is based on **factor investing**, which aims to maximize returns by allocating across multiple stock asset classes.
The Ultimate Buy and Hold Portfolio Allocation
- 10% Large-Cap Blend (S&P 500)
- 10% Large-Cap Value
- 10% Small-Cap Blend
- 10% Small-Cap Value
- 10% U.S. REITs (Real Estate Investment Trusts)
- 10% International Large-Cap Blend
- 10% International Large-Cap Value
- 10% International Small-Cap Blend
- 10% International Small-Cap Value
- 10% Emerging Markets
Why Choose the Ultimate Buy and Hold Portfolio?
✅ High Diversification: Covers U.S., international, small-cap, large-cap, and value stocks.
✅ Factor-Based Investing: Focuses on value and small-cap stocks for historically higher returns.
✅ Long-Term Performance: Optimized for long-term investors seeking above-market returns.
✅ Lower Risk Than 100% Stocks: Diversification reduces portfolio volatility.
Best Funds for the Ultimate Buy and Hold Portfolio
1️⃣ Large-Cap Blend (S&P 500) – 10%
- Vanguard S&P 500 ETF (VOO) – Expense Ratio: 0.03%
- iShares Core S&P 500 ETF (IVV) – Expense Ratio: 0.03%
- Schwab U.S. Large-Cap ETF (SCHX) – Expense Ratio: 0.03%
2️⃣ Large-Cap Value – 10%
- Vanguard Value ETF (VTV) – Expense Ratio: 0.04%
- iShares Russell 1000 Value ETF (IWD) – Expense Ratio: 0.19%
3️⃣ Small-Cap Blend – 10%
- Vanguard Small-Cap ETF (VB) – Expense Ratio: 0.05%
- iShares Russell 2000 ETF (IWM) – Expense Ratio: 0.19%
4️⃣ Small-Cap Value – 10%
- Vanguard Small-Cap Value ETF (VBR) – Expense Ratio: 0.07%
- iShares Russell 2000 Value ETF (IWN) – Expense Ratio: 0.23%
5️⃣ U.S. REITs – 10%
- Vanguard Real Estate ETF (VNQ) – Expense Ratio: 0.12%
- Schwab U.S. REIT ETF (SCHH) – Expense Ratio: 0.07%
6️⃣ International Large-Cap Blend – 10%
- Vanguard Total International Stock ETF (VXUS) – Expense Ratio: 0.07%
- iShares Core MSCI Total International Stock ETF (IXUS) – Expense Ratio: 0.07%
7️⃣ Emerging Markets – 10%
- Vanguard FTSE Emerging Markets ETF (VWO) – Expense Ratio: 0.08%
- iShares MSCI Emerging Markets ETF (EEM) – Expense Ratio: 0.69%
Historical Performance
The Ultimate Buy and Hold Portfolio has historically averaged ~10-12% annual returns due to its factor-based investment strategy.
Who Should Use the Ultimate Buy and Hold Portfolio?
✅ Long-term investors seeking **high diversification and strong returns**.
✅ Investors comfortable with volatility** from small-cap and value stocks.
✅ Those who believe in factor investing** for maximizing growth.
Potential Drawbacks
⚠️ More Complex Than Simpler Portfolios: Requires managing multiple asset classes.
⚠️ Higher Volatility: Heavy exposure to small-cap and value stocks.
Final Thoughts
The Paul Merriman Ultimate Buy and Hold Portfolio is a **powerful, factor-based strategy** for long-term investors seeking **above-market returns**. With a **globally diversified** and **small-cap/value tilt**, this portfolio provides **higher potential growth** but requires discipline during market volatility. If you’re looking for an optimized investment approach, this portfolio is a great choice!