15: Meb Faber on Building The All Seasons Portfolio

Invest Like a Boss

Sam Marks Johnny FD Derek Spartz

Business, Investing

4.8 • 518 Ratings

🗓️ 2 August 2016

⏱️ 65 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Meb Faber is one of our hero’s in Finance. A high energy straight shooter that is highly explorative and analytical. He gave up his skis to catch the surf in Manhattan Beach while co-founding his company Cambria Investments Management. Many of our listeners already follow Meb through his blog, podcasts and many books, and had to chance to catch up with him about modelling an “All Seasons Portfolio”.

Originally introduced by BridgeWater’s Ray Dalio, the investment allocation was once again hyped up in its reintroduction of Tony Robbins new book Money Master the Game. Meb has researched and compared dozens of the most coveted asset allocation models dating back to the early 1900’s and we wanted to see how the All Seasons Portfolio stacked up against others like the Perfect Portfolio, and the 60/40. This episode is perfect for anyone looking to learn how to model a buy and hold portfolio and learn more about how today’s economic environment may give clues to future investment performance.

Links for Meb:

http://mebfaber.com/
Cambria Investments
Twitter

Where are we:

Sam – Singapore
Meb – Manhattan Beach

Recommended:

Money Master The Game – Tony Robbins
The Ivy Portfolio – Meb Faber
Global Value – Meb Faber
ShareholderYield – Meb Faber
The Intelligent Asset Allocator – William Bernstein
Triumph for the optimists – Elroy Dimson, Paul Marsh, Mike Staunton
Demographic Cliff – Harry Dent

Discussed:

The Idea Farm
The All Seasons Portfolio – Ray Dalio
David Swenson
Risky Party 160% model – Global Market Portfolio
The Capitalism Distribution (Longboard)
Vanguard
Betterment

Some awesome links to Meb’s content:

Tony Robbins All Season Portfolio
Risk Parity Model (*watch the first video)
Asset Allocation Strategies (*our favorite article)
Global Asset Allocation (*get Meb’s book free)
Meb’s Podcast

Timp Stamp – Topic:
09:20 – How Meb got into finance
10:15 – Starting up Cambria
11:00 – 1500 blogs in 5 years
14:00 – Traditional investment advice vs. modern
14:45 – Modelling a portfolio for the future
16:40 – Having an appreciation for history
17:45 – The world’s investment Gurus
19:10 – Comparing 6 great portfolio models
20:45 – Why low cost fees make a huge difference
21:45 – Why buy and hold allocations don’t matter as much
22:50 – Japan’s market was flat for 2 decades
26:22 – Foreign markets are reasonable or really cheap
28:27 – What does risk parity mean?
31:30 – The simple takeaway of risk parity
32:00 – Negative interest rates
32:30 – Will bond rates continue to rise?
33:45 – Why high yield stocks are now dangerous
42:00 – Where REITs stand at the moment
35:00 – How models performed in the inflationary 70’s
36:20 – Reviewing the ALL Seasons Portfolio
37:14 – “Go enjoy your Summer”
38:25 – Being asset class agnostic
39:00 – Home country bias
40:00 – Dollar weighted vs. time weighted returns
41:33 – Advisor value, talking you out of emotional moves
42:25 – Investment timelines
43:40 – Dliving through a bear market
44:45 – Designing a model for the future (Global Market)
45:50 – The Trinity Portfolio
48:40 – What is exciting about Emerging Markets
48:00 – Small Cap growth prospective
50:00 – The capitalism distribution
51:50 – Meb’s opinion on Robo Advisors
53:50 – Robo-Advisors in bear markets
54:45 – Why it’s a great time to be an investor
55:25 – Personal finance vs. investing
56:45 – How about TIPS?
58:55 – WWIII investment planning
60:00 – Final thoughts portfolios for the futures

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Transcript

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0:00.0	Welcome to the Invest Like a Boss podcast. I'm Sam Marks and I'm Johnny FD. We're self-made entrepreneurs who invest our own money and use modern technology to invest like a boss. Join us each week for exclusive interviews with our network of modern investors, business owners and multi-millionaires to discover new ways to invest our hard-earned cash. Hey everyone. Welcome to episode 15 and invest like a boss. This is Johnny FD with Sam Marks. How you doing, buddy? Doing great, buddy.
0:24.5	How are you? Hey everyone, welcome to episode 15 and invest like a boss. This is Johnny FD with Sam Marks.
0:22.9	How you doing, buddy? Doing great, buddy. How are you? Doing fantastic. I'm so excited. This is my last
0:27.6	week here in Warsaw, Poland. And exactly one week from today, me and Sam are going to be meeting up
0:33.5	in Sofia, Bulgaria. I never thought we would ever say that or do that, but it just so happened to work out, and we're going to go overland to Kiev, Ukraine, four country tour. Don't even know how we're going to get there, but we're going to make it happen. We're going to have a lot fun doing it. But the best thing about it is it's still summer in Europe, and I firmly believe it's one of the most beautiful places in the world you can spend an entire summer and I think everyone wants to make that a goal to spend either this year or next summer wherever you want in Europe but just do it. Yeah, do it and make it happen through passive income, finance it through passive income. Some of the things that Johnny I've been working on, Johnny is doing a lot better than me, but I'm gonna get there, buddy. I'm gonna get there. Well, you know what? You got the investment capital. So it's, this is almost like a race, you know, and I think that's why a lot of people like the show is you have one guy that has a big windfall, has a lot of money in the bank to invest with. You have another guy that doesn't have nearly as much,
1:27.8	but I'm like, you know,
1:29.5	posse on every day trying to catch up.
1:32.2	So...
1:32.3	With your Johnny FD.
1:33.4	Oh, and you're Mr. Sam Marks.
1:35.9	So today we talk to Meb Faber from mebfavor.
1:39.8	And he is the co-founder of Cambria Investment Management,
1:43.9	super smart guy that writes a ton of white papers
1:46.8	and different research on all the different investment strategies
1:52.5	and portfolios out there.
1:54.4	Super smart guy.
1:55.7	What do you think, Sam?
1:57.9	Yeah, so this was a really fun episode.
1:59.8	Oh my gosh.
2:00.3	This was something I've, when we first started the podcast, whatever, several, almost a half year ago, well, not that far back, but geez, we started talking about it. One of the things that got me interested in investing was Money Master of the Game by Tony Robbins. We've talked about the book before. There's a lot of different opinions out there on it. And we'll say this in the episode as well. One of the things
2:21.4	that I loved about it is it retrained the way I thought about money and investing similar to
2:26.6	the way rich dad, poor dad originally piqued my interest in building wealth and thinking differently.
	...

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