Ultimate Buy and Hold - Portfolio 8 by Paul Merriman
The Ultimate Buy and Hold Portfolio 8 is the broadest version of Paul Merriman's Ultimate Buy and Hold series, developed by the investing educator and founder of the Paul Merriman Foundation. Building on the seven-sleeve version, this portfolio adds an eighth equity segment — typically emerging markets or a real estate sleeve — to further diversify the sources of equity return across global markets and factor exposures. Merriman designed the series to demonstrate the long-run benefit of factor diversification as a complement or alternative to holding a single total market index fund.
Investment Philosophy
The rationale behind adding an eighth sleeve follows the same logic as the rest of the series: each additional asset class with a distinct return driver and low correlation to existing holdings has the potential to improve the portfolio's risk-adjusted returns through diversification. By the time the portfolio reaches eight sleeves, it spans US and international equities across large, small, blend, and value dimensions — and potentially includes real estate or emerging markets exposure — capturing the broadest possible set of well-documented factor premiums.
Who It's For
The eight-sleeve version is most appropriate for investors with a very long time horizon and high risk tolerance who want to build the most comprehensive factor-diversified equity portfolio possible within Merriman's buy-and-hold framework. It requires the greatest commitment to annual rebalancing and the most robust access to low-cost factor index funds of any portfolio in the series.
Pros
- Maximises factor diversification across global equity markets within the Ultimate Buy and Hold framework
- The addition of an eighth sleeve may improve diversification of return sources relative to the seven-sleeve version
- Annual rebalancing approach keeps implementation manageable despite the number of funds
Cons
- Eight distinct sleeves require careful, systematic annual rebalancing
- Marginal diversification benefit of the eighth sleeve relative to the seventh is diminishing
- Extended periods of factor underperformance can make the portfolio feel difficult to hold compared to a simple total market index
Technical Notes
See also Ultimate Buy and Hold Portfolio 7. A bond allocation can be added alongside the eight equity sleeves, with the split determined by individual risk tolerance and time horizon.
Signals are available for a curated set of tactical portfolios. This portfolio is not currently covered.
See covered portfoliosarrow_forwardTarget Allocation
Performance Snapshot
Rolling Returns
| Period | Low | Average | High |
|---|---|---|---|
| 1 Year | -48.6% | +10.7% | +66.6% |
| 3 Year | -16.9% | +8.7% | +32.3% |
| 5 Year | -4.5% | +8.3% | +23.6% |
| 10 Year | +3.1% | +8.0% | +14.1% |
Growth of $10,000
Historical Drawdown
Percentage decline from the portfolio's peak value at each point in time.
Rolling Returns
Annualised return for each rolling period ending on that date.
Annualised return for each 1Y period ending on that date.
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