I've recently been intrigued by Paul Metromans’ 2025 best-in-class portfolio recommendations for taxable brokerage accounts. In particular, his tables suggest that a 70% US / 30% International split, modeled after the World-Wide All Value portfolio, presents a healthy balance between returns and standard deviation which beats the S&P500 and the 50/50 US/Int mix considerably. I am considering going long on this portfolio, slowly moving away from Prof. G 33 split Foundational/Dividend/Growth portfolio (which is essentially all LCB anyways, criticism aside - I did not know better at the time).
A few questions for the community:
1. What do you think of Merriman's 2025 recommendations across asset classes? He breaks it down into LCB/LCV and SCB/SCV, as well as EM and international developed markets. He seems to have a strong preference for Avantis funds — what’s your take on their structure and tax efficiency?
2. While his argumentation makes sense—especially the balancing of LCB/LCV with SCB/SCV over time—when I try to backtest these mixes using PortfolioVisualizer, I’m not seeing his portfolios consistently beating the S&P 500 Index over the long term. Anyone know where he's pulling his data from or if he's using a different methodology?
3. While SCV has historically outperformed LCV, small-cap growth has lagged lately. With the rise of Tech and AI — largely concentrated in large-cap — is it time to rethink the tilt toward small-cap? Or does it make more sense to stay the course and diversify broadly regardless of short-term trends? I've read people argue that this is just a small dip in an otherwise longer trend favoring small-cap.
Curious what others think. Not leaning towards one to two fund portfolios so do not give me that VT/VTI+VXUS all the way spiel.