Staying the Course — Insights on Reasonable & Unreasonable Portfolios, Quilt Charts & 2025 Returns

7 snips

Nov 5, 2025

Discover the importance of staying disciplined in long-term investing, even when short-term results are surprising. Learn about the differences between reasonable and unreasonable portfolios from industry leaders. Explore performance trends of various ETF strategies and how international markets are making a comeback. Unpack the challenges of implementing effective investment strategies in real life, especially with small-cap value investments. Dive into the benefits of non-traditional index funds and how they can outperform traditional options.

Ask episode

AI Snips

Chapters

Transcript

Episode notes

INSIGHT

Discipline Trumps Forecasting

Staying the course beats trying to predict short-term market winners and losers.
Reasonable portfolios typically deliver good long-term results if you remain disciplined.

ANECDOTE

Lunch With Bill Bernstein

Paul had lunch with Bill Bernstein and discussed investor challenges in staying disciplined.
Their conversation reinforced that sticking to a plan is investors' biggest lifelong challenge.

INSIGHT

Short-Term Deviations Are Normal

Individual equity asset classes will often deviate from expectations in the short term.
Such deviations are normal and don't invalidate a diversified strategy.

Get the Snipd Podcast app to discover more snips from this episode

Get the app

In this episode, Paul dives into one of the most important themes in long-term investing: staying the course, even when individual asset classes deliver unexpected short-term results. Whether you’re a seasoned DIY investor or still building confidence, Paul shares timely lessons to help you make better decisions—and support others who rely on your guidance.

Paul also previews his upcoming presentation for the AAII Puget Sound Chapter, where he’ll take one of the deepest dives yet into Daryl Balls’ latest quilt charts, the Sound Investing portfolios, and the vital differences between traditional and non-traditional index funds.

You’ll hear Paul discuss insights from two of the industry’s leading “truth tellers”:
• Jim Dahle (The White Coat Investor) and his Bogleheads presentation on reasonable vs. unreasonable portfolios
• Dr. Bill Bernstein, and why staying disciplined may be investors’ greatest lifelong challenge

Along the way, Paul reviews 10-month, year-to-date performance for the Best-in-Class ETF portfolios—including the 10-fund, 4-fund, and 2-fund strategies—and explains why the surprising 2025 return patterns are completely normal.

Key topics include:

Why some equity asset classes “disappoint” this year—and why that’s expected
The resurgence of international value, small international, and emerging markets
How Chris Pedersen’s 4-Fund Worldwide strategy kept pace with the 10-Fund
The powerful role of non-traditional index funds (DFA & Avantis)
Why small-cap value’s recent struggles shouldn’t discourage long-term investors
How to access DFA-style factor premiums through today’s ETFs
The importance of keeping an investing approach simple, reasonable, and durable
Why staying the course—not forecasting—is the true key to long-term success

Paul also shares personal updates about moving back to Bainbridge Island and reflects on what it means to serve a community of dedicated DIY investors.

If you know someone who would benefit from this work, please share this episode. And don’t miss the links in the show notes—including Jim Dahle’s video, portfolio references, quilt charts, and upcoming AAII registration details.

Thank you for listening—and all the best to you and your family.