Chris & Paul October 2025 Q&A

Paul Merriman and Chris Pedersen tackle your biggest questions—from simplifying portfolios and picking best-in-class ETFs to understanding equal-weighted funds, tax efficiency, and how much small-cap value to own. They dig into factor investing (size, value, quality, profitability, momentum), why reversion to the mean matters, and how to think like an owner—not a speculator. Plus: mentors, work-life balance, and the real risk investors face. Chapters 00:00 – Intro & Mentors 05:07 – Portfolio Simplification 10:13 – Work-Life Balance 11:39 – Which ETFs will outperform? 20:15 – Importance of Quality 22:45 – Equal-Weighted Funds 26:14 – History: how long is enough? 29:58 – Cost of public indexing 33:30 – Equal-weight fund tax vs. ETF 35:21 – How much small-cap value? 39:47 – Why three EM ETFs? 42:28 – “All Avantis” risk? 49:45 – Technology sector history & mean reversion 53:00 – Be an owner, not a speculator 55:27 – Outro Key Takeaways “Best” ETF ≠ next year’s top performer—seek consistent factor exposure, low costs, broad holdings, and tax efficiency. Equal-weighting boosts small/value exposure but can increase turnover and tax drag; pairing large-cap blend with small-cap value can be more efficient. Decide small-cap value allocation by temperament (common range: 10–50% of equities when pairing with S&P 500/target date). Index approach vs. index label: DFA/Avantis are systematic and rules-based without telegraphing rebalances. Think like an owner: over decades, earnings—not sentiment—drive returns. Resources • Best-in-Class ETF Recommendations (2025): https://www.paulmerriman.com/best-in-... • Sound Investing Portfolios, Returns & Risks: https://www.paulmerriman.com/sound-in... • “Tune Out the Noise” (DFA Documentary):    • Tune Out the Noise | Documentary Film