The Rational Reminder Podcast

What happens when a small group of exceptionally wealthy people holds a growing share of a country's income and wealth? And what can economics tell us about the forces behind that concentration?

In this episode, we are joined by Owen Zidar, professor of economics and public affairs at Princeton University and coauthor of the forthcoming book The Everywhere Millionaire. We explore the rise of the millionaire class, how tax policy shapes inequality, and why the geography of wealth matters when trying to understand the economic landscape.

We also discuss the role of entrepreneurship, industry-specific knowledge, and concentrated ownership in building wealth. Owen shares insights from extensive Treasury data, interviews with business owners, and research into the paths taken by millions of entrepreneurs. The conversation examines why access to capital may be less important than practical experience, how private equity can help or hurt business owners, and how local business consolidation can affect both consumers and workers.

Finally, we explore the influence of "everywhere millionaires" on public policy, the impact of interest rates on wealth valuations, and possible ways to expand access to entrepreneurial opportunities without undermining economic growth.

Sources From Today's Episode — https://zbib.org/75a6ae2e79a34ba8b5fb632f54816447 Books From Today's Episode — The Everywhere Millionaire: Who Is Really Rich in America and How They Got There by Owen Zidar

Key Points From This Episode:

(0:01:15) Why the typical wealthy American is more likely to be a business owner than a celebrity or Wall Street executive.

(0:02:12) How "everywhere millionaires" can provide a roadmap for building wealth and understanding inequality.

(0:03:33) The rise of entrepreneurial income among the top 0.1% over the past several decades.

(0:04:48) Why the inequality debate often overlooks wealth generated by private businesses.

(0:05:48) Why the typical millionaire is more likely to be found on Main Street than Wall Street.

(0:06:32) The ordinary—and sometimes unusual—industries that produce substantial wealth.

(0:08:01) Why building wealth through business ownership often takes decades.

(0:08:54) The role of concentrated ownership and the risks involved in becoming wealthy through entrepreneurship.

(0:09:51) How failed businesses can still provide valuable human capital and career opportunities.

(0:10:46) Which early-career paths may put people on track to become business owners.

(0:12:14) Why domain expertise and industry experience can matter more than access to capital.

(0:15:25) The Treasury data, tax records, research papers, interviews, and other sources behind The Everywhere Millionaire.

(0:16:54) How lower interest rates, tax cuts, deregulation, and globalization contributed to wealth accumulation.

(0:18:18) What the data suggests about academic performance, risk-taking, and entrepreneurial success.

(0:19:52) Why attending an elite university is not necessarily a prerequisite for becoming wealthy through business ownership.

(0:20:57) The importance of early labor-market experience and practical knowledge in entrepreneurship.

(0:22:17) The factors that help certain places foster upward mobility.

(0:30:14) How family businesses, inheritance, and succession can shape the distribution of wealth.

(0:38:06 How business owners can successfully exit their companies, including the role of seller financing.

(0:39:09) The potential benefits and drawbacks of private equity for business owners.

(0:41:33) How "stealth consolidation" can allow businesses to gain local market power without attracting regulatory scrutiny.

(0:42:55) The possible relationship between product-market power and labor-market power.

(0:44:33) Whether the United States is experiencing a new Gilded Age—and how today's wealthy differ from those of the past.

(0:46:07) Why local business owners can have significant economic and political influence in their communities.

(0:48:47) How interest rates affect the value of private businesses and other assets.

(0:49:49) How apprenticeships and alternative career paths could expand access to financial success.

(0:50:41) What aspiring entrepreneurs can do to reduce risk and improve their chances of success.

(0:51:45) Potential approaches to reducing inequality while preserving incentives for business growth and investment.

(0:53:48) Owen's reflections on family, personal fulfillment, and how he defines success.

Links From Today's Episode: Meet with PWL Capital: https://pwlcapital.com/ PWL Team — https://pwlcapital.com/our-team/

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/

Rational Reminder on Spotify —https://open.spotify.com/show/6RHWTH9iW7hdnA7eAg7ukO?si=fe7f60349b584026Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Owen's website - https://www.everywheremillionaire.com/

Owen's LinkedIn - https://www.linkedin.com/in/owenzidar/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we're joined by Matthew Taylor, a litigation lawyer with Sotos Class Actions in Toronto who represents retail investors and pension funds in securities class actions. We take a deep dive into what makes a successful negligence claim against a financial advisor, how courts assess fiduciary relationships in Canada, and what investors should look for when evaluating the people managing their money.

We explore the evidence that can strengthen or weaken a negligence claim, from one-size-fits-all portfolios and unexplained trades to poor communication and failures to account for changing life circumstances. Matthew also explains the distinction between suitability and fiduciary standards, the factors courts consider when determining whether a fiduciary relationship exists, and why professional affiliations and explicit fiduciary commitments can matter.

The conversation then turns to class actions, including how securities claims differ from individual negligence lawsuits, what makes a claim suitable for class proceedings, and why regulatory investigations, specialist law firms, litigation funding, and parallel U.S. proceedings can provide important signals. We also discuss pension funds, their role as plaintiffs, and why monitoring potential claims and settlements can be part of managing beneficiaries' assets.

Finally, we examine the growing retailization of private assets and the risks created by limited information, complex structures, opaque fees, illiquidity, and manager-determined valuations. Matthew explains what advisors and clients should consider before investing in private funds—and why he expects more litigation in this area. We close with the legal and regulatory challenges created by financial influencers, and how investors and advisors can build greater resilience against misleading financial content.

Key Points From This Episode:

(0:01:04) Advisor errors leading to negligence claims—KYC, KYP, suitability failures, plus warning signs like one-size-fits-all portfolios, unexplained trades, concentrated positions, churning, and double dipping.

(0:02:20) Why evidence matters: the gap between what people know and what they can prove in court.

(0:04:08) How investors can recognize poor advice—changes in communication, failure to address life circumstances, or lack of transparency.

(0:06:41) Importance of checking an advisor's regulatory history before entrusting significant assets.

(0:07:51) Investor vulnerabilities: age, education, language barriers, or sudden wealth.

(0:11:27) Steps after negligent advice—seek a second opinion, adjust the portfolio, and consider legal recourse quickly due to limitation periods.

(0:13:30) Risk capacity vs. risk tolerance, and overlooked risks such as liquidity, sequence-of-returns, and withdrawal risk.

(0:16:34) Advisors' uneven understanding of risk, shaped by firm/product-provider education and low industry entry barriers.

(0:19:48) Courts' five fiduciary factors—vulnerability, trust, reliance, discretion, and professional standards—and how fiduciary duties differ from suitability standards.

(0:28:28) Individual lawsuits vs. group/class actions, with securities class actions focusing on disclosure problems and asset-manager claims.

(0:42:45) Case studies: Sino-Forest fraud and challenges of private assets—opaque structures, layered fees, liquidity risk, and valuation issues.

(1:01:00) Regulatory challenges of finfluencers, difficulties in enforcement, and how advisors can inoculate clients against misinformation by teaching evaluation skills.

Sources From Today's Episode — https://zbib.org/71e494008bb74d18a17de20419ca0647

Links From Today's Episode: Meet with PWL Capital: https://pwlcapital.com/

PWL Team — https://pwlcapital.com/our-team/

Rational Reminder on Spotify — https://open.spotify.com/show/6RHWTH9iW7hdnA7eAg7ukO?si=fe7f60349b584026

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/ Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Matthew on LinkedIn — https://www.linkedin.com/in/matthew-w-taylor/

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Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, Ben Felix, Dan Bortolotti, and Ben Wilson take a research-driven look at the finances of marriage, from spending personalities and prenuptial agreements to wedding costs, joint accounts, financial infidelity, and household decision-making. The conversation explores how the way couples think about and manage money can affect both financial outcomes and relationship satisfaction.

We unpack the difference between being frugal and being a "tightwad," why tightwads and spendthrifts may be drawn to each other despite having more conflict later, and how simply understanding your partner's spending tendencies can improve financial conversations. We also examine the case for prenups, the role of optimism bias in avoiding them, and how couples can use legal agreements to deliberately design their financial arrangements.

The discussion then turns to wedding spending, including the marketing forces behind engagement-ring conventions and research linking higher spending on rings and weddings with greater divorce risk in some samples. Finally, we look at the evidence for managing money jointly, the risks of financial infidelity, and why both partners should be involved in household financial decisions. The central theme throughout is simple: couples tend to be better served when they approach their finances as a team and communicate openly.

The Tightwad-Spendthrift Scale Quiz — https://umich.qualtrics.com/jfe/form/SV_55xxAQrYK0WRlY2

Sources — https://zbib.org/e8fec478786b4176b5011418f27a3fa4

Key Points From This Episode:

(0:01:00) Why who you marry can be one of the most consequential financial decisions of your life.

(0:04:24) Why marriage changes both the emotional and legal nature of a couple's financial relationship.

(0:07:53) Tightwads vs. spendthrifts: the psychology of the "anticipatory pain of paying."

(0:09:52) Why spending personality has little to do with how much money someone actually spends.

(0:11:34) How understanding your spending tendencies can be useful alongside traditional financial risk questionnaires.

(0:15:42) Why some people struggle to spend money even when they clearly have the financial capacity to do so.

(0:17:09) How upbringing, identity, and social comparison can influence attitudes toward spending.

(0:18:20) Why tightwads and spendthrifts are more likely to marry each other—and why those differences can create conflict later.

(0:21:14) How recognizing different spending tendencies can create healthier conversations and compromises.

(0:23:14) Prenups and marriage contracts: understanding the legal "default" before deciding whether to create your own arrangement.

(0:24:04) Why optimism bias and the negative signaling associated with prenups can make them difficult for couples to discuss.

(0:26:51) Why a prenup may be particularly relevant when partners enter a marriage with substantially different levels of wealth.

(0:29:54) How couples can use a prenuptial agreement to deliberately design financial arrangements around their circumstances and future needs.

(0:31:08) The origins of the "two months' salary" engagement-ring convention and the marketing of diamonds.

(0:32:54) Research on wedding spending, engagement rings, and divorce risk.

(0:35:55) Why wedding planning can become an early test of how couples handle financial differences.

(0:37:49) Why more wedding guests and having a honeymoon were associated with longer marriages in the study discussed.

(0:38:44) The evidence for managing finances together—and why joint accounts may not be the only way to do it.

(0:42:04) How different spending personalities might influence whether couples prefer joint or separate accounts.

(0:45:10) Why couples should establish clear expectations around significant purchases.

(0:45:31) Financial infidelity: what it means to hide financial behavior you expect your partner would disapprove of.

(0:47:46) Why financial decision-making should involve both partners rather than defaulting to one "financial spouse."

(0:52:19) Gender norms, financial confidence, and differences in how spouses participate in investment and planning decisions.

(0:54:57) Why involving the less financially engaged spouse can bring different—and valuable—perspectives to household planning.

(0:56:09) The importance of financial continuity if the spouse who manages the finances dies or experiences cognitive decline.

(0:58:21) The common thread across the research: approach household finances as a team and keep communication open.

(0:59:52) The return of the after show, including listener reviews and a discussion of feedback on a recent special episode.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/ Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we're joined by Philippa Hann and Dr. Moira Somers, co-authors of The Fault Lines of Finance: Understanding and Preventing Financial Misconduct, for a deep dive into why good people can do bad things with other people's money. Philippa brings two decades of experience suing financial advisors, wealth managers, and banks, while Moira brings her expertise as a clinical neuropsychologist working with financial professionals, families, and the human side of money.

We explore the psychology and systems that can allow financial misconduct to happen, from financial stress, incentives, and information asymmetry to workplace culture, poor training, exhaustion, and the pressure to please. Philippa and Moira explain why ethical behavior is not simply about knowing right from wrong, and why developing "ethical health" requires understanding your own vulnerabilities, building a moral operating system, and having people you can turn to when doing the right thing becomes difficult.

We also discuss how investors can evaluate financial professionals, why complexity and exciting financial products deserve extra scrutiny, the role of regulators and insurers, and why financial sophistication doesn't necessarily protect people from being exploited. Along the way, Philippa and Moira share case studies illustrating ethical drift, confirmation bias, and the ways seemingly small decisions can compound into serious misconduct. The conversation ultimately makes the case for moral humility, strong relationships, healthy organizational cultures, and the willingness to tolerate discomfort when something doesn't feel right.

Key Points From This Episode:

(0:00:00) Introduction.

(0:02:02) What financial misconduct means and why "other people's money" matters.

(0:02:35) Philippa's 20 years in litigation and the core question: why do good people do bad things?

(0:05:02) Moving beyond harm prevention toward promoting positive change in financial services.

(0:07:36) Why financial services are especially vulnerable: access, incentives, and opportunity.

(0:09:40) Information inequality and extraordinary client trust in advisors.

(0:11:15) Even sophisticated investors can fail to ask critical questions.

(0:11:57) Misconduct isn't simply "good vs. bad people."

(0:12:45) How systems, incentives, and culture can draw well-intentioned people into misconduct.

(0:17:40) Ethical drift: how innocent mistakes can escalate into lying and misconduct.

(0:19:05) Building a personal "moral operating system" to prepare for dilemmas.

(0:20:00) Identifying vulnerabilities: people-pleasing, exhaustion, dependence, conflict avoidance.

(0:21:00) Journaling, defining non-negotiables, and developing ethical self-awareness.

(0:25:22) Importance of trusted people who can challenge your thinking.

(0:27:13) Personal strengths (confidence, ambition) can become vulnerabilities.

(0:28:38) Systems and culture can enable misconduct or make ethics easier

(0:30:10) Organizations must make it safe to surface mistakes.

(0:34:43) Developing "ethical health" alongside physical and mental health.

(0:40:15) Ethics requires more than knowing the right answer—it requires character and motivation.

(0:44:29) Why traditional ethics training often fails in real-world dilemmas.

(1:14:11) The moral operating system as an actionable framework for behavioral ethics.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we welcome back David Booth, Co-Founder of Dimensional Fund Advisors and author of Stay Calm: Learn to Embrace Uncertainty in Investing and Life. David reflects on his remarkable career at the center of the evidence-based investing revolution, from studying under Eugene Fama at the University of Chicago to helping build investment strategies around decades of financial research.

We explore what the data revealed about markets and professional money management, why implementation matters as much as great ideas, and how investors can make better decisions without trying to predict the unpredictable. David also shares his views on trust, financial advice, public versus private markets, human ingenuity, and the meaning of true wealth. Along the way, he explains why staying calm, having a process, and staying invested can matter far more than finding the next winning forecast.

Key Points From This Episode:

(0:00:04) Introducing David Booth and his new book, Stay Calm: Learn to Embrace Uncertainty in Investing and Life.

(0:01:15) What David learned as a commission-based shoe salesman: Do the right thing and be upfront with people.

(0:03:35) The gift of being an outsider and how financial science changed the investing experience for ordinary investors.

(0:05:38) Why outsiders are often willing to challenge assumptions—and how data changed the debate.

(0:06:53) David's experience arriving at the University of Chicago and studying under Eugene Fama.

(0:07:49) Inside Chicago's rigorous research culture and the lessons David learned from presenting his work.

(0:10:03) The empirical challenge behind efficient markets and why data mattered more than beliefs.

(0:11:41) How Fama and French approach research by trying to prove their own conclusions wrong.

(0:12:05) The two-fish joke and the challenge of understanding the environment we are immersed in.

(0:12:45) How Jim Lorie and Lawrence Fisher helped provide the historical market data that transformed financial research.

(0:14:18) From early mutual fund research to the question that shaped David's career: What should investors do if managers cannot consistently outguess the market?

(0:20:59) Why Dimensional distinguishes between passive investing and indexing.

(0:23:21) The origins of Dimensional's approach to small-cap investing and the importance of execution.

(0:24:45) Why David would rather be an investor today than in 1971.

(0:26:21) Jensen's alpha, risk-adjusted returns, and what Michael Jensen's research revealed about professional money managers.

(0:28:30) Why implementation is everything—and why models are tools for making decisions under uncertainty.

(0:33:47) Why the most important thing about an investment philosophy is having one you can stick with.

(0:35:46) Why David sees education as an antidote to fear and wants investors to feel more optimistic about investing.

(0:36:18) Human ingenuity as the foundation of David's optimism about markets.

(0:37:53) Why trust is the ultimate product in the investment business.

(0:39:40) Why understanding the science alone is not enough—and how advisors can help investors stay invested.

(0:40:23) What David's art collection has taught him about non-monetary returns and true worth.

(0:43:07) Why a good financial plan is a process built around trade-offs, flexibility, and adaptation.

(0:45:22) The problem with fixed goals and why David thinks many goals are inherently fuzzy.

(0:46:34) How David distinguishes between forecasts, wishes, and worries.

(0:49:44) How investors can identify and tune out noise by focusing on how markets work over the long term.

(0:51:30) David's unfiltered perspective on private markets, transparency, price discovery, and liquidity.

(0:52:38) Why true wealth begins with values, family, and the things that matter beyond money.

(0:54:57) What winning means when wealth includes both monetary and non-monetary rewards.

(0:55:39) Why David describes optimism as science-based hope.

(0:57:33) What Stay Calm means to David: Make decisions aligned with your values, build a process, and trust that you can deal with whatever comes your way.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/ Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this special episode, we are joined by Mike Sullivan, Co-Founder and Chief Growth Officer at OneDigital, and Vinay Gidwaney, OneDigital's Chief Product Officer, to discuss their new book, Workforce Intelligence: The People-First Playbook for Leading Your Company Through AI Transformation. Together, they offer a practical, pro-human framework for navigating a future where artificial intelligence becomes deeply embedded in how organizations operate.

We explore why leaders should focus on tasks rather than headcount, how AI can amplify uniquely human capabilities, and why companies may need to rethink how they manage their workforce. Mike and Vinay explain their concepts of reducible and irreducible skills, AI coworkers, workforce intelligence, collaborative AI use, and the importance of building an organizational intelligence layer. They also share practical lessons from OneDigital's own AI transformation—including why leadership activation, trust, reskilling, and a partnership between technical and non-technical leaders are essential.

This conversation offers an alternative to the prevailing narrative of AI-driven job elimination. Instead, it asks a bigger question: if AI can take on more of the work we currently do, what might humans become capable of doing next?

Key Points From This Episode:

(0:00:00) Highlights.

(0:00:25) Introduction.

(0:01:23) Why AI adoption affects employers, employees, and financial markets—and why the conversation is relevant far beyond technology.

(0:02:27) Two possible paths for companies: replacing people with AI or using AI to amplify human capabilities.

(0:03:53) How PWL is already using AI to help financial planners and portfolio managers work more strategically and serve clients better.

(0:06:22) Mike and Vinay's five-year partnership around deploying AI inside OneDigital.

(0:09:07) The "radiating red dot": Why Mike's analysis suggested that up to 25% of OneDigital's workforce could be disrupted by AI.

(0:11:09) "See faces, not headcount": The decision to pursue transformation by amplifying people rather than simply reducing jobs.

(0:12:19) Why Mike and Vinay felt a responsibility to offer a more practical, human-first narrative about AI and work.

(0:13:40) Vinay's realization that widespread access to AI makes human differentiation even more important.

(0:17:22) Mike's first experience with an AI coworker—and the endless possibilities it unlocked for curiosity and exploration.

(0:18:22) Human intelligence versus artificial intelligence: Why AI's greatest value may be its ability to help people think differently.

(0:22:19) Why the future of work should be analyzed at the task level rather than through predictions about jobs disappearing.

(0:23:58) The coming reskilling challenge—and why the allocation of work between AI and humans needs to be more deliberate.

(0:25:12) Why Vinay believes companies that discard their human talent could lose their most important competitive differentiation.

(0:26:30) Why AI transformation should be viewed as a "movie, not a snapshot," with work continually being reshaped.

(0:28:10) What "workforce intelligence" means: Managing the combined intelligence of human talent and AI talent.

(0:30:07) Why Mike and Vinay believe HR—not just IT—must play a central role in leading the transition to a blended workforce.

(0:31:54) Reducible versus irreducible skills: Letting AI handle work that can be broken into processes while humans spend more time on judgment, experience, and other "squishy" capabilities.

(0:34:10) Applying the framework to financial planning: AI for modeling and information processing, humans for judgment, relationships, and helping clients navigate life decisions.

(0:37:00) How AI can reduce meeting preparation from hours to minutes while generating insights that would otherwise be missed.

(0:37:48) The importance of trust and communication as employees try to understand what AI means for their future.

(0:39:53) The Workforce Intelligence score: Treating AI as talent and measuring the evolving mix of human and AI work.

(0:42:09) Transactional versus collaborative AI use—and why collaboration can be more amplifying for both people and organizations.

(0:45:40) Why companies need agency over their AI systems and should think carefully about intelligence lock-in.

(0:48:47) Codifying organizational intelligence: Building systems where human expertise improves AI, which in turn helps humans become more capable.

(0:50:24) What it means to become "activated" by AI—and how using AI as a coach and teacher can expand human potential.

(0:52:44) Ambient AI: Systems that continuously observe information and surface patterns when human judgment is needed.

(0:54:11) The Charlotte-Denver redundancy and the challenge of making the best organizational intelligence available to everyone.

(0:57:26) OneDigital's five-tier fluency model for developing AI capabilities across employees, advanced users, managers, and builders.

(1:00:13) Why democratized software development creates a new governance challenge—and how AI may help manage it.

(1:00:54) Why OneDigital gives AI coworkers names, faces, profiles, skill sets, and human managers.

(1:04:01) Mike's belief in the dignity of work—and why employers need to approach the AI transition with humanity and care.

(1:06:53) Vinay's belief in human potential and why the goal should be to expand what people are capable of doing.

(1:08:56) Why organizations should avoid measuring AI success solely through cost cutting and instead consider human amplification.

(1:12:41) The four questions for Monday morning: Turning big ideas about AI transformation into practical actions leaders can take immediately.

(1:13:55) Why AI transformation needs leadership from the top and a partnership between someone who understands technology and someone who deeply understands the business.

(1:15:40) Leadership activation: Why organizations are unlikely to change until their leaders personally experience how AI can transform their own work.

(1:17:44) What we still don't know about AI—and why the guests believe we are still in the very early innings of this transformation.

(1:18:55) The three-minute-mile analogy: AI may optimize human minds in ways we cannot yet imagine.

(1:20:00) A final call for a pro-humanity, blended workforce—and the need to move faster in adapting to what AI makes possible.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, Ben Felix and Dan Bortolotti take on 10 of the biggest myths in personal finance and investing. From the idea that young people should save every possible dollar to benefit from compounding, to assumptions about economic growth, dividends, index funds, valuation ratios, stock picking, bonds, gold, and homeownership, they examine the subtle details that can make conventional wisdom misleading.

Ben and Dan explore why personal finance is often about balance rather than absolute rules, why spending decisions can be just as important as saving decisions, and how investors can confuse familiar stories with useful financial principles. Along the way, they discuss consumption smoothing, marginal utility, total returns, diversification, valuation, risk, inflation, and the trade-offs between renting and owning.

They also announce a new podcast initiative: future episodes featuring PWL clients discussing their experiences and the impact that financial planning has had on their lives.

Key Points From This Episode:

(0:00:00) Highlights.

(0:00:35) Ben and Dan return to the podcast and discuss recording from PWL's Montreal office.

(0:01:09) A new podcast initiative: PWL clients will join future episodes to discuss their experiences with financial planning.

(0:01:43) A new podcast initiative: PWL clients will join future episodes to discuss their experiences with financial planning.

(0:02:18) How greater clarity about their finances can affect clients' important life decisions.

(0:05:30) Introducing the main topic: 10 of the biggest myths in personal finance.

(0:06:24) Myth #1: You should save as much as possible when you're young to maximize the benefits of compounding.

(0:08:54) Why the marginal utility of consumption may be highest when income and living standards are comparatively low.

(0:11:26) How health, skills, and experiences can also compound over time.

(0:12:31) Why aggressive saving habits can sometimes lead to an inability to spend accumulated wealth.

(0:13:37) Helping retirees identify what they actually enjoy spending money on.

(0:15:35) Why spending and saving decisions can become emotionally charged and feel irreversible.

(0:17:30) Saving as deferred consumption—and why the answer for most people is some balance between spending now and saving for later.

(0:18:50) The life-cycle model and the idea of smoothing consumption across a lifetime.

(0:20:23) Building a saving habit while also learning to spend thoughtfully.

(0:21:09) Myth #2: Economic growth is good for stock returns.

(0:21:30) Why economic headlines can influence investor psychology and investment decisions.

(0:25:12) Why strong economic growth does not necessarily translate into strong stock returns.

(0:25:12) Myth #3: Dividends explain a large percentage of historical stock market returns.

(0:27:52) Why the source of a company's return does not make one component inherently more valuable than another.

(0:30:57) Myth #4: Index funds only give investors average returns.

(0:30:57) Why an index fund can outperform most active investors.

(0:33:14) The difference between average performance and the performance of the average investor.

(0:36:31) Myth #5: Future market returns are always low when the Shiller CAPE ratio is above 40.

(0:36:31) What the Shiller cyclically adjusted price-to-earnings ratio measures.

(0:41:25) Why valuation can contain information about expected returns without providing certainty about what markets will do next.

(0:43:24) Myth #6: Warren Buffett proves that investors can beat the stock market by picking stocks.

(0:43:24) Buffett's extraordinary career, the importance of his early performance, and the difficulty of using exceptional outcomes as a general strategy.

(0:46:17) Myth #7: Bonds and cash are safe investments.

(0:46:17) Why reducing stock exposure does not eliminate investment risk.

(0:50:03) The distinction between short-term volatility and other risks, including inflation and purchasing-power risk.

(0:53:59) Myth #8: Gold is an inflation hedge.

(0:53:59) Why gold's long-term preservation of purchasing power does not necessarily make it a reliable hedge over intermediate periods.

(0:56:28) Myth #9: Gold is the one true currency.

(0:56:28) The long-running debate over what money is and who should control it.

(1:00:42) Myth #10: Renting a home is throwing money away.

(1:00:42) Why paying rent provides housing while allowing renters to retain capital for other purposes.

(1:08:04) Why simple rules of thumb can sometimes be useful even when they are not financially optimal in every situation.

(1:09:52) Wrapping up the 10 myths in personal finance.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we welcome back William Bernstein to discuss the final book of his longtime friend Jonathan Clements, Money and Me. Bill reflects on Jonathan's ideas about spending, happiness, retirement, investing, inheritance, and the psychology of financial decision-making, while sharing personal stories that bring those ideas to life.

We explore why material purchases often lose their appeal quickly, why autonomy can be one of the best things money can buy, and how worrying about money can be a greater problem than spending it. Bill also discusses the four horsemen of financial disaster—inflation, deflation, confiscation, and destruction—why diversification matters, and why investors should be skeptical of assumptions about future returns and market forecasts.

The conversation also examines what it means to "win the game" financially, why retirement should be thought of as a verb rather than a destination, and the three foundations of well-being: connection, competence, and autonomy. Bill shares Jonathan's approach to teaching children about money, the concept of "Omega" as a way to think about spending versus saving, and why the people around us can have an enormous influence on our expectations and consumption.

Key Points From This Episode:

(4:56) Why success can contain the seeds of its own destruction—and the role of competition, organizational hubris, and luck.

(6:15) Why dynastic wealth is so difficult to preserve across generations.

(8:28) A hierarchy of spending: material purchases, experiences, autonomy, and the relief from worrying about money.

(10:54) Why some people continue worrying about money no matter how much they have.

(11:44) Why we are poor at predicting what purchases and lifestyle changes will actually make us happy.

(13:36) How to pressure-test large purchases by considering their downsides and their effect on your time.

(14:20) Why the happiness generated by spending does not necessarily scale with the price of a purchase.

(15:21) The importance of gratitude and savoring small pleasures.

(16:39) The four horsemen of financial apocalypse: inflation, deflation, confiscation, and destruction.

(18:15) Why inflation is the financial risk Bill focuses on—and how investors can blunt its effects.

(19:26) Why relatively inexpensive international markets can still offer optimism for long-term investors.

(21:02) Jonathan Clements' "investment sin": slightly overbalancing when rebalancing.

(22:04) What it means to have "won the game" financially.

(24:36) Why a TIPS ladder or annuity can help defuse retirement spending needs.

(25:19) Why the math of financial planning often fails to account for human psychology.

(27:21) Why diversification matters when bad returns arrive at the same time as bad circumstances.

(28:20) The challenge of variable spending in retirement.

(29:10) Why retirement should be a verb—and why simply stopping work can leave people searching for meaning.

(30:00) The three foundations of happiness: connection, competence, and autonomy.

(32:03) Investment assumptions people should avoid, including confusing great companies with great stocks.

(33:10) Why eloquence can be an alarm bell when evaluating financial forecasts.

(34:18) Jonathan's three-pronged strategy for getting more out of your money: pause before making important decisions.

(35:01) How to audit your past spending to identify what actually made you happy.

(37:11) Hedonic versus eudaimonic happiness—and why life satisfaction can outlast momentary pleasure.

(39:05) Why enjoying your work can be more valuable than maximizing your salary.

(40:56) A different perspective on FIRE: working less and doing work you enjoy rather than simply retiring early.

(41:37) Why giving money to children while you're alive can be more useful than leaving it as an inheritance.

(42:29) How parents teach children about money by modeling their own spending behavior.

(44:13) Jonathan's practical approach to teaching children about spending and saving.

(44:49) The "Omega" concept: avoiding both YOLO spending and dying as the richest person in the graveyard.

(46:26) How social comparisons influence spending and expectations.

(48:54) Why rising markets can encourage investors to take on more risk.

(49:06) How recency and the availability heuristic shape investment beliefs.

(49:46) Bill's favorite memories of Jonathan and his remarkable outlook while facing a terminal diagnosis.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

Barry Ritholtz returns to the Rational Reminder podcast to discuss the biggest mistakes investors make—and why avoiding them may matter more than finding the next great investment. Drawing on decades of experience in markets, wealth management, and financial media, Barry explains why forecasting consistently fails, how investors can distinguish good advice from noise, and why humility, probabilistic thinking, and disciplined behavior are among the most valuable investing skills.

Throughout the conversation, Barry shares lessons from his new book, How Not to Invest, covering everything from media consumption and behavioral biases to index investing, portfolio concentration, market cycles, and choosing a financial advisor. He explains why experts are often better at providing context than making predictions, why social media amplifies poor financial advice, and how investors can build processes that help them stay disciplined through uncertainty. The discussion blends academic research, practical experience, and memorable stories into a comprehensive guide for becoming a better long-term investor.

Key Points From This Episode:

(0:04) Cameron and Ben welcome Barry Ritholtz back to the podcast and discuss his new book, How Not to Invest.

(4:12) Why successful billionaires often make poor economic forecasters and how the halo effect leads people to overestimate expertise.

(6:39) Why Wall Street professionals are generally poor at forecasting future market returns despite their domain expertise.

(7:42) What experts are actually good at: providing context, historical perspective, and nuanced analysis rather than predicting the future.

(8:47) Barry's checklist for identifying bad financial advice, including emotional appeals, false certainty, and conflicts of interest.

(10:35) How social media algorithms reward outrage and overconfidence instead of thoughtful investing.

(11:21) Why 24/7 financial news encourages unnecessary action that often hurts long-term investment returns.

(12:17) Why long-term investors are often better off ignoring financial news altogether.

(13:52) How short-form financial content on platforms like TikTok encourages misinformation and poor investing decisions.

(15:22) Gell-Mann Amnesia and why investors should remain skeptical even of trusted news sources.

(18:00) How reading books, consuming long-form content, and building a trusted information network improves decision making.

(20:21) Barry's definition of investing as making probabilistic decisions with imperfect information in an unknowable world.

(22:55) How successful investors focus on controlling savings, asset allocation, discipline, and behavior instead of unpredictable events.

(24:52) Why recognizing the limits of your own knowledge is one of investing's greatest advantages.

(26:30) How experience, losses, and continuous learning help investors become more self-aware.

(27:16) Three ideas that heavily influence Barry's investment philosophy: Sturgeon's Law, George Box's models, and William Goldman's "Nobody knows anything."

(30:18) Whether artificial intelligence changes Sturgeon's Law that "90% of everything is crap."

(31:46) Three forms of economic innumeracy that lead investors astray: denominator blindness, survivorship bias, and misunderstanding compounding.

(36:04) Why understanding secular bull and bear markets is useful psychologically—but not as a timing strategy.

(39:12) Why investors should understand market cycles without attempting to trade around them.

(40:44) What stock valuations can—and cannot—tell investors about future returns.

(42:18) How investors should respond to wars, pandemics, and other major external events.

(45:53) The biggest investing lessons from the COVID-19 market crash and why personal experience often differs from market performance.

(49:04) Why index investing remains one of the most reliable approaches to long-term wealth creation.

(50:44) Why every market forecast should be expressed probabilistically rather than with certainty.

(52:06) The lies traders tell themselves and why disciplined risk management separates successful professionals.

(56:11) What active investors need if they hope to consistently outperform.

(57:24) The biggest behavioral mistakes investors make, including lack of planning, excessive concentration, and ignoring taxes.

(59:43) Why concentrated stock positions become dangerous—even after creating substantial wealth.

(1:02:33) How sudden wealth and large financial windfalls frequently lead to costly mistakes.

(1:05:14) How to identify trustworthy financial advisors by evaluating their process, temperament, and communication.

(1:07:27) Why advisors who consistently communicate their thinking help investors avoid emotional mistakes.

(1:09:26) Barry's practical blueprint for becoming a better long-term investor: create a plan, invest consistently, define the purpose of money, and build around a diversified index portfolio.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/ Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this Ask Me Anything episode, Ben Felix, Ben Wilson, and Louai Bibi tackle a wide-ranging collection of listener questions spanning investing, retirement, family finance, and financial planning. Along the way, they combine academic research, practical experience, and thoughtful discussion to separate evidence-based decisions from intuition.

The conversation explores everything from teaching children healthy money habits and the long-term behavioral challenges of value investing to sequence of returns risk, retirement spending strategies, and global portfolio construction. The episode concludes with an in-depth discussion of Louai Bibi's National Financial Planning Award-winning financial plan, highlighting the importance of holistic advice, evidence-based planning, and continuous improvement through client feedback.

Key Points From This Episode:

(00:00:00) Introduction

(0:05:30) Advice for aspiring financial planners: Building skills, credentials, networks, and mentorship early in your career.

(0:07:35) Why young advisors should be "a sponge" and learn from both good and bad professional experiences.

(0:09:41) Ben Felix on completing the CFA, CIM, and CFP early—and why creating content accelerated his learning.

(0:11:51) Why getting large numbers of client-facing "reps" can dramatically improve an advisor's ability to communicate advice.

(0:15:44) Choosing the right firm, team, and mentors—and how networking helped Ben Felix ultimately join PWL.

(0:18:53) Should a young physician borrow from a professional line of credit to invest?

(0:24:55) Robert Merton's perspective on leverage for young investors and the risks of implementing leverage through margin borrowing.

(0:28:21) Why the psychological experience of investing borrowed money can be very different from owning an unleveraged portfolio.

(0:30:35) How much leverage is needed before it meaningfully changes a long-term financial plan.

(0:31:36) Should investors increase their equity allocation before considering leverage?

(0:33:39) Louai's experience working with physicians and why becoming debt-free can change how people feel about borrowing to invest.

(0:36:00) Louai and Ben Felix share their own experiences with leverage.

(0:36:59) How to teach children about money, scarcity, saving, generosity, and spending.

(0:38:26) Ben Wilson's approach: Save 50%, give 10%, and let his kids decide what to do with the remaining 40%.

(0:40:02) Using wealth for memorable family experiences rather than simply giving children more money.

(0:42:51) Why anticipating an experience can be an important part of the enjoyment it creates.

(0:43:42) Is the value premium worth the behavioral challenge of potentially enduring years of underperformance?

(0:44:11) Ben Felix explains why the difficulty of sticking with value may itself contribute to the premium.

(0:45:47) Can having a sufficiently large portfolio eliminate sequence-of-returns concerns?

(0:49:41) Reframing "sequence of returns" as "sequence of withdrawals"—and why flexible spending matters.

(0:51:21) Separating retirement expenses into fixed needs and flexible spending.

(0:52:47) The purchases that have delivered the best personal ROI for Ben, Ben, and Louai.

(0:53:08) Ben Felix on his indoor basketball hoop, family travel, sauna, and prepared meal delivery.

(0:56:56) Ben Wilson on family vacations, skiing, cycling, and why his family chose a pool over a cottage or boat.

(0:58:27) Louai on his 49-inch monitor, his dog, and investing in health and fitness.

(1:00:42) How should investors geographically weight a global small-cap value portfolio?

(1:05:13) Why a globally diversified portfolio that an investor can actually stick with matters more than finding a theoretically perfect country allocation.

(1:07:19) What should investors approaching retirement or FIRE do about sequence-of-returns risk?

(1:09:00) Research comparing declining, rising, and static equity allocations during retirement.

(1:13:38) Why risk tolerance, time horizon, spending needs, and financial-plan resilience should drive retirement asset allocation.

(1:15:07) The National Financial Planning Awards, the judging process, and the sponsorship conflict disclosure surrounding Louai's award.

(1:18:37) Inside Louai's 47-page award-winning financial plan and the range of planning issues it addressed.

(1:20:06) What Louai believes actually distinguished the submission: Not one clever strategy, but a holistic decision-making process.

(1:21:39) Why Louai sought feedback from planners outside PWL and how the award process can improve the broader team.

(1:23:26) Why Louai believes financial-planning knowledge and feedback should be shared rather than "gatekept."

(1:23:56) How feedback from the Rational Reminder community changed Louai's thinking about investment risk.

(1:24:40) Why defining risk purely as short-term volatility can overlook the bigger risk of failing to achieve financial goals.

(1:27:59) How public feedback through the podcast creates a powerful learning loop for the PWL team.

(1:28:29) A PWL client review on the value of planning, professional experience, and advice that puts the client's interests first.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/ Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Jean-Pierre Aubry, Associate Director of Retirement Plans and Finance at the Center for Retirement Research at Boston College, for a research-driven conversation about retirement investing, financial advice, pension fund management, and inflation. Drawing from years of empirical research, Jean-Pierre shares insights into how households actually invest, how financial advisors shape portfolio decisions, and why investors often hold asset allocations that differ from their own stated preferences.

We also examine the investment strategies of public pension plans, why their increasing reliance on alternative assets has largely failed to deliver superior performance, and the institutional forces driving those decisions. Finally, Jean-Pierre explains how inflation disproportionately affects retirees, why many households overreact during inflationary periods, and why understanding retirement risks—from market volatility to sequence of returns—is critical for long-term financial security.

Key Points From This Episode:

(0:06) Introduction to Jean-Pierre Aubry and the Center for Retirement Research at Boston College.

(6:29) The Center's mission: producing objective, accessible retirement policy research.

(7:03) Why investors' actual stock allocations are higher than their stated ideal allocations.

(9:31) Defaults and target-date funds may explain the gap between desired and actual portfolios.

(10:46) Investors tend to underestimate long-term stock returns and overestimate market risk.

(11:22) Financial advisors generally encourage higher equity allocations by reducing investor pessimism.

(12:06) How advisor compensation can create incentives to recommend higher stock exposure.

(13:42) Research showing advisor recommendations vary more across advisors than across client profiles.

(16:56) The "advisor fixed effect": advisors largely recommend portfolios consistent with their own philosophy.

(18:57) Why working with an advisor often leads investors to hold more equities.

(20:26) How target-date funds work and why auto-enrollment is reshaping retirement investing.

(22:57) Why advisors and target-date funds are generally improving retirement security.

(23:57) The evolution of public pension investing from bonds to equities and then alternative assets.

(30:12) The growing influence of consultants and peer effects on public pension investment decisions.

(31:14) Why pension plans with greater allocations to alternatives have generally underperformed peers.

(32:23) Comparing public pension performance against a simple 60/40 index benchmark.

(36:43) Whether indexing may be a better long-term solution for public pension investing.

(39:35) Concerns about adding private assets to default retirement plan options.

(40:15) Maintaining objectivity while researching politically sensitive retirement issues.

(42:58) Why investment policy remains the "final frontier" for improving public pension systems.

(46:45) Why retirees are especially vulnerable to inflation.

(50:06) How inflation affects retirees differently across age and wealth levels.

(51:52) Why households tend to overspend during inflationary periods.

(53:38) How financial advisors adjust recommendations when inflation and interest rates rise.

(54:11) Why inflation ultimately reduces retirement security for many households.

(54:42) Which retirees face the greatest market risk.

(55:35) Why most retirees have little understanding of sequence of returns risk.

(55:56) Advisors understand sequence risk, but that knowledge doesn't appear to transfer to clients.

(57:23) Why declining equity exposure over time remains the canonical life-cycle investing approach.

(58:25) Jean-Pierre's definition of success: purpose, meaningful relationships, and financial security.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this AMA episode, Ben Felix, Dan Bortolotti, and Ben Wilson tackle a wide range of practical investing questions submitted by listeners. They begin by discussing one of the most common investing mistakes—market timing—and explain why getting back into the market is often harder than getting out. From there, they explore the evidence behind lump sum investing versus dollar-cost averaging, why high valuations rarely justify sitting in cash, and how your discomfort with investing may reveal a mismatch between your portfolio and your true risk tolerance.

The conversation also pulls back the curtain on PWL Capital's investment committee, detailing how new investment products are evaluated, how due diligence is conducted, and why even seemingly simple index funds require ongoing scrutiny. They then examine whether any recent Canadian ETF innovations are genuinely useful, discuss retirement-focused T-Series asset allocation ETFs, debate whether gamified trading creates opportunities for active management, and respond to questions about inflation, currency debasement, and the real drivers of long-term stock returns. As always, the episode closes with a lighter listener question before reading a review from the audience.

Key Points From This Episode:

(0:04) Introduction and why AMA episodes continue to resonate with listeners.

(0:55) A listener asks how to reinvest after selling half their portfolio over bubble concerns.

(2:00) Why successful market timing requires being right twice.

(3:04) Why all-time market highs are normal and poor signals for investment decisions.

(4:00) What market valuations can—and cannot—tell us about future returns.

(5:00) The evidence comparing lump sum investing with dollar-cost averaging.

(6:34) Why even the worst historical entry points rarely favor dollar-cost averaging.

(9:07) How investment anxiety often points to an overly aggressive asset allocation.

(11:37) The psychology of buying after market crashes and why investors rarely do.

(13:20) Why the best strategy is often whichever gets you invested and keeps you there.

(16:14) A behind-the-scenes look at PWL Capital's investment committee.

(17:23) How new securities are researched, reviewed, and approved.

(19:10) How acquisitions have changed the firm's investment oversight process.

(20:15) Annual due diligence on ETF providers and fund managers.

(21:55) Why even plain-vanilla index funds require performance monitoring.

(25:17) Are there any genuinely innovative new Canadian ETFs?

(26:27) Why most ETF innovation is driven by investor demand rather than better investing.

(28:19) Avantis ETFs and discount bond ETFs as notable recent developments.

(33:52) Why ETF issuers tend to launch products after investment themes become popular.

(33:52) Where investors should spend their planning time when wealth is still relatively small.

(35:00) Why growing human capital often has a greater impact than optimizing investments.

(37:59) Budgeting, saving, and account selection early in an investing journey.

(39:14) BMO's new T-Series asset allocation ETFs and how they generate retirement income.

(41:56) Understanding managed distributions and return of capital.

(44:08) Why these retirement ETFs may suit DIY investors but not every retiree.

(48:31) Whether gamified trading and meme stocks create opportunities for active managers.

(50:08) What the evidence says about active management in small-cap growth stocks.

(53:39) Why market competition limits persistent opportunities from retail speculation.

(53:39) Do stocks only rise because governments debase currencies?

(55:59) Inflation measurement, currency debasement, and common misconceptions.

(58:10) Why productive businesses—not money printing alone—drive long-term stock returns.

(59:53) Ben answers a listener's basketball shoe question.

(1:02:02) A listener review from Switzerland and closing remarks.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Dollar Cost Averaging vs Lump Sum Investing - https://pwlcapital.com/wp-content/uploads/2024/08/Dollar-Cost-Averaging-vs-Lump-Sum-Investing.pdf Buy The Dip - https://pwlcapital.com/wp-content/uploads/2024/08/PWL-Felix-Warwick-Buy-The-Dip_A.pdf

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Dr. Paul Kaplan, economist, CFA charterholder, former Director of Research at Morningstar Canada, and co-author of Lifetime Financial Advice, for a fascinating exploration of life cycle finance. Drawing on decades of research in economics, portfolio construction, and asset allocation, Paul explains how financial planning should be grounded in optimizing lifetime consumption rather than relying on disconnected rules of thumb.

We explore how life cycle finance integrates consumption, saving, investing, and retirement spending into a single framework, why risk tolerance and risk capacity are fundamentally different concepts, and how human capital should be treated as part of an investor's balance sheet. Paul also walks through the life cycle model he and Tom Idzorek developed, explains why traditional retirement rules like the 4% rule lack theoretical foundations, and demonstrates an open-source spreadsheet that allows anyone to experiment with the model for themselves. This conversation brings together economics, portfolio theory, and financial planning into a practical framework for making better lifetime financial decisions.

Key Points From This Episode:

(0:04) Introduction to Dr. Paul Kaplan and the topic of life cycle finance.

(4:38) What life cycle finance is and why consumption smoothing is its central objective.

(5:20) How life cycle models optimize saving, investing, retirement spending, insurance, and annuities.

(6:36) Linking life cycle finance with Harry Markowitz's mean-variance optimization.

(8:38) Why consumption—not wealth accumulation—is the true focus of financial planning.

(9:56) The concept of an economic balance sheet: financial assets, human capital, liabilities, and net worth.

(10:59) Holistic investor profiling beyond traditional risk tolerance questionnaires.

(13:23) Why risk tolerance and risk capacity should never be combined into a single score.

(16:48) Assessing the risk characteristics of human capital.

(17:36) Applying utility theory behind the scenes in financial planning software.

(19:15) Sample profiling questions that measure lifetime consumption preferences.

(20:54) Why maximizing lifetime utility ultimately means optimizing consumption.

(22:55) How preferences, needs, and circumstances shape lifetime financial plans.

(24:13) The primary outputs of a life cycle model: consumption and asset allocation.

(25:01) The roles of life insurance and annuities in lifetime financial planning.

(27:44) How uncertain investment returns influence both spending and asset allocation.

(28:19) Why longevity assumptions are critical in retirement planning.

(29:37) Simplifying complex life cycle optimization into practical formulas.

(30:27) Why life cycle finance challenges rules of thumb like the 4% withdrawal rule.

(31:12) Flexible retirement spending versus fixed withdrawal strategies.

(34:01) Why consumption should be treated as an output rather than an input.

(36:05) The importance of asset location and after-tax portfolio construction.

(37:04) Why asset allocation and asset location should be solved simultaneously.

(38:19) Harry Markowitz on why asset allocation became the foundation of modern investing.

(40:06) The need for financial planning software built on life cycle theory.

(41:55) A walkthrough of Paul's open-source life cycle finance spreadsheet.

(46:58) Understanding economic balance sheets and asset mix visualizations.

(49:17) Which investor characteristics have the greatest influence on optimal asset allocation.

(50:52) Why Nobel Prize-winning life cycle finance research has yet to become mainstream practice.

(51:37) The evolving role of financial advisors in helping clients make rational financial decisions.

(52:50) How Paul's own investment philosophy emphasizes indexing and asset allocation.

(54:13) Factor investing, popularity theory, and connecting behavioral finance with asset pricing.

(56:42) Paul's definition of success: applying first principles with rigor and integrity throughout his career.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Dr. Paul Kaplan: https://www.paulkaplan.com/

Lifetime Financial Advice (CFA Institute Research Foundation): Lifetime Financial Advice| Research Foundation

Life Cycle Finance Spreadsheet (Paul Kaplan's website): https://www.paulkaplan.com/lifetime-financial-advice *Disclosure: Links to third-party materials are provided for your convenience and do not constitute an endorsement or recommendation of the products or services offered therein.

Frontiers of Modern Asset Allocation (Wiley): https://www.wiley.com/en-us/Frontiers+of+Modern+Asset+Allocation-p-9781118029689

Popularity: A Bridge Between Classical and Behavioral Finance (CFA Institute Research Foundation): https://rpc.cfainstitute.org/research/foundation/2021/popularity-a-bridge-between-classical-and-behavioral-finance

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this AMA episode, Benjamin Felix, Dan Bortolotti, and Ben Wilson tackle a wide range of listener questions covering portfolio construction, diversification, active management, pensions, fiduciary duty, and short-term investing decisions. They examine whether breaking apart all-in-one ETFs is worth the complexity, why global diversification remains the default despite long stretches of underperformance, and how investors should think about risk when they have defined benefit pensions or short-term financial goals. Along the way, they discuss the limits of active management, why simplicity often beats optimization, and even reveal their favorite board games.

Key Points From This Episode:

(0:01:12) Whether investors should replace asset allocation ETFs with individual component ETFs to save on management fees.

(0:01:40) Why simplicity has real economic value—and how small fee savings compare to behavioral costs.

(0:05:38) Portfolio drift, rebalancing discipline, and the hidden costs of managing multiple ETFs.

(0:06:08) How recent fee reductions narrowed the cost gap between VEQT and its component funds.

(0:06:51) When using individual ETF components may make sense for larger portfolios or asset location strategies.

(0:11:16) The hosts share their favorite board games—and why poker has surprising parallels to investing.

(0:15:01) What true diversification actually means beyond simply owning the S&P 500.

(0:16:07) Why the global market portfolio remains the logical starting point for most investors.

(0:19:46) Addressing claims that modern index funds have become "too concentrated."

(0:21:52) Why active managers tend to lose their edge as assets under management grow.

(0:22:15) Diminishing returns to scale and the efficient market for manager skill.

(0:27:03) How defined benefit pensions should factor into portfolio construction and risk capacity.

(0:33:53) Understanding fiduciary duty for Canadian portfolio managers and financial advisors.

(0:37:17) Why publicly holding yourself out as a fiduciary carries legal and ethical implications.

(0:39:22) Can individual investors outperform active funds by picking stocks themselves?

(0:42:32) Why time, effort, and research alone rarely translate into market-beating performance.

(0:45:04) Why international stocks have lagged U.S. equities—and why diversification still matters.

(0:47:10) The role of valuation expansion in explaining decades of U.S. outperformance.

(0:50:05) How to invest money earmarked for a home down payment over a three-to-five-year horizon.

(0:53:31) Applying the same time-horizon framework to RESP investing and education savings.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Shannon Lee Simmons—Certified Financial Planner, Chartered Investment Manager, bestselling author, and founder of the New School of Finance—for a wide-ranging conversation about the emotional side of money. Drawing on more than two decades of working directly with Canadians, Shannon explains why financial stress has become so pervasive, how social comparison shapes spending habits, and why a well-built financial plan can be one of the most powerful antidotes to money anxiety.

We also explore decision-making during financial crises, the psychology of regret, why traditional budgeting often fails, and how couples navigate money differently—particularly in retirement. Shannon shares practical frameworks for aligning spending with personal values, avoiding emotional financial mistakes, and helping households make confident decisions through life's biggest transitions.

(0:03:56) Why people worry about money—and why financial uncertainty often feels like uncertainty about life itself.

(0:04:24) Why so many middle- and upper-income Canadians still feel broke despite earning good incomes.

(0:05:18) The importance of having a financial plan and reducing harmful social comparison.

(0:06:55) How social media fuels overspending, comparison, and "financial dysmorphia."

(0:08:35) Why cashless spending has fundamentally changed our relationship with money.

(0:11:52) How perceived life milestones—especially home ownership—shape financial decisions and expectations.

(0:13:36) Practical ways to manage financial stress, restore confidence, and build resilience.

(0:15:55) The growing "spending arms race" and how rising expectations have redefined what's considered normal.

(0:18:09) Why Shannon dislikes traditional budgeting—and what to do instead.

(0:20:32) Her four-bucket framework for worry-free spending and maintaining financial flexibility.

(0:22:35) A practical test for deciding whether a large purchase is truly affordable.

(0:25:01) Aligning spending decisions with personal values using an "emotional return on investment."

(0:28:12) Helping couples navigate different financial priorities without turning disagreements into conflict.

(0:30:28) Separating good decisions from bad outcomes to overcome financial regret.

(0:33:48) The major financial decision crises people commonly face—from divorce to illness to retirement.

(0:35:16) Using "micro financial plans," guardrails, and scenario planning during periods of uncertainty.

(0:37:45) The three phases of a financial decision crisis and how planners can help through each stage.

(0:41:41) Why retirement often reveals differences in couples' relationships with money that never surfaced while saving.

(0:45:19) The psychological challenge of withdrawing from investment portfolios after decades of accumulation.

(0:46:41) Using cash wedges and realistic retirement projections to reduce anxiety around spending in retirement.

(0:49:42) How saver-versus-spender dynamics can evolve into power struggles during retirement.

(0:53:12) The question almost every client is really asking: "Am I going to be okay?"

(0:54:41) Why planners should ask about clients' hidden DIY investment accounts.

(0:56:21) The risks of becoming emotionally attached to concentrated investment gains.

(0:57:16) The most impactful parts of a financial plan: realistic spending projections and actionable next steps.

(0:58:25) How often financial plans should be updated—and when life events require immediate revisions.

(1:01:08) Who benefits most from fee-only planning and who may be better served with ongoing advice.

(1:07:00) Why implementation—not recommendations—is often the hardest part of financial planning.

(1:10:00) The strengths and trade-offs of fee-only planning versus assets-under-management advice models.

(1:15:05) Shannon's advice for improving financial well-being: build a plan, focus on your own values, and stop comparing yourself to everyone else.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Shannon Lee Simmons – https://shannonleesimmons.com/

New School of Finance – https://www.newschooloffinance.com/

Worry-Free Money – https://www.amazon.ca/Worry-Free-Money-guilt-free-approach-managing/dp/1443454451

Making Bank: Money Skills for Real Life – https://www.amazon.ca/Making-Bank-Money-Skills-Real/dp/1443469815

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, Ben Felix and Ben Wilson tackle a wide range of listener questions covering portfolio construction, home-country bias, currency exposure, ETF selection, retirement decumulation, leasing versus buying a car, discounted cash flow valuations, and the real work of portfolio management. Along the way, they revisit the Rational Reminder model portfolios, discuss how new products like CAGE have changed the DIY investing landscape, and explore whether Warren Buffett's long-term record still provides evidence that active management can outperform.

The conversation also offers a behind-the-scenes look at PWL Capital's planning-centric approach to wealth management and why helping clients make better financial decisions often matters more than portfolio construction itself.

Key Points From This Episode:

(0:28) Why AMA episodes have become less frequent despite hundreds of listener questions waiting to be answered.

(2:07) Ben shares observations from PWL's growing institutional investment business and why low-cost, planning-focused institutional advice remains surprisingly rare.

(6:37) Revisiting the original Rational Reminder model portfolios and how newer products have simplified implementation.

(10:09) Should U.S. investors underweight the U.S. market relative to global market-cap weights?

(11:07) Research, home-country bias, and Ken French's arguments for overweighting domestic stocks.

(18:11) Asset-allocation ETFs in retirement: Is there any benefit to separating stocks and bonds during withdrawals?

(21:03) Leasing versus buying a vehicle, opportunity costs, depreciation, and convenience.

(26:13) Currency exposure, RRSPs, withholding taxes, and common misconceptions about USD-denominated ETFs.

(30:30) If Dimensional funds were unavailable, what would Ben choose instead?

(31:26) Are there any popular ETFs investors should avoid? A look at Canada's largest ETF holdings.

(38:28) Why discounted cash flow models often produce wildly different valuation estimates.

(41:47) What portfolio managers at PWL actually do when they are not trying to beat the market.

(45:57) Concentrated stock positions, client coaching, and helping investors make better long-term decisions.

(50:02) Why financial planning questions are often portfolio management questions—and vice versa.

(52:53) Helping clients navigate the transition from wealth accumulation to wealth preservation and spending.

(58:06) Revisiting Berkshire Hathaway's long-term performance versus broad-market index funds.

(1:02:35) The challenges of active management as assets under management grow larger.

(1:04:22) Aftershow: Ben reflects on his experience appearing on Diary of a CEO with Steven Bartlett.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Morley Conn, Director of Sales and Strategy, ETF Services at Scotia Global Banking and Markets, for a deep dive into the mechanics of the ETF ecosystem. With more than 30 years of experience across equities, foreign exchange, and money markets, Morley pulls back the curtain on the creation and redemption process, ETF liquidity, block trading, market making, and the often-overlooked infrastructure that allows ETFs to trade efficiently every day.

We explore how authorized participants and market makers facilitate liquidity, why ETF liquidity is driven by the underlying holdings rather than trading volume, and how large institutional ETF trades are executed. Morley also explains the differences between Canadian and U.S. ETF markets, discusses common misconceptions investors have about ETF trading, and shares practical advice for retail investors seeking better execution. This conversation offers a rare look at the operational machinery behind one of the most important innovations in modern investing.

Key Points From This Episode:

(0:04) Introduction to Morley Conn and his role in ETF market making.

(4:29) The key participants in the ETF ecosystem: issuers, custodians, market makers, advisors, and dealers.

(5:53) What market makers and authorized participants actually do.

(7:03) How ETF creation and redemption works and why it matters for liquidity.

(10:58) How ETF portfolio management differs from traditional mutual fund management.

(12:44) Why ETF trading volume often greatly exceeds primary-market creations and redemptions.

(13:35) The capital gains refund mechanism and its relationship to ETF trading activity.

(16:04) What happens when ETF market prices diverge from net asset value (NAV).

(18:24) Lessons from the March 2020 bond ETF dislocations and what they revealed about market pricing.

(19:16) How market makers price ETFs when underlying securities are illiquid or difficult to value.

(20:38) Managing ETF market-making risk when underlying markets are closed.

(21:35) The major factors that influence ETF bid-ask spreads.

(23:26) Why market makers prioritize trading volume and investor experience over wide spreads.

(26:45) How large ETF block trades are executed and hedged behind the scenes.

(29:26) Why ETF liquidity is determined by the underlying holdings rather than visible trading volume.

(30:43) The difference between NAV trades and at-risk trades.

(32:46) How market makers contribute to the development of new ETF products.

(34:20) Best practices for retail investors when trading ETFs.

(37:34) Factors that determine when block trades make sense.

(38:46) Why pricing ETF blocks is both an art and a science.

(43:14) What happens when an ETF is shut down and how investors are affected.

(46:22) The balance between retail and institutional participation in the Canadian ETF market.

(48:27) How institutions and retail investors use ETFs differently.

(51:23) Key differences between Canadian and U.S. ETF markets.

(54:56) ETF tax efficiency in Canada versus the United States.

(56:23) Common misconceptions investors have about ETF liquidity and assets under management.

(1:00:13) How CRM3 total cost reporting could influence ETF adoption in Canada.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Ben Carlson, Director of Institutional Asset Management at Ritholtz Wealth Management and author of Risk & Reward, for a wide-ranging conversation about market history, investor psychology, and the realities of long-term investing. Ben brings his trademark blend of data-driven thinking and plainspoken storytelling to topics like market crashes, inflation, diversification, and why investors are so tempted to time the market.

We explore the lessons from Japan's historic asset bubble, the lingering impact of the Great Depression, and why diversification remains one of the few true free lunches in investing. Ben also explains the difference between volatility and risk, why the stock market is not the economy, and how investor behavior—not market performance—is often the biggest determinant of success. Along the way, we discuss inflation hedges, lost decades, speculative behavior, and the psychological challenge of staying invested through inevitable downturns.

Key Points From This Episode:

(0:00:20) Introducing Ben Carlson, his new book Risk & Reward, and his long-running blog A Wealth of Common Sense.

(0:03:16) Why investors shouldn't panic about investing at all-time highs.

(0:03:58) The Japanese bubble and crash as one of history's biggest market anomalies.

(0:05:39) Why Japan's long-term returns look very different when viewed over 50 years.

(0:06:27) Lessons from the Great Depression and the worst stock market crash in U.S. history.

(0:07:43) Why the best long-term returns often follow the worst crashes.

(0:08:53) The role of diversification and self-awareness in managing portfolio risk.

(0:09:55) Defining investment success by achieving personal goals—not beating benchmarks.

(0:10:42) Why inflation feels so painful psychologically for investors and households.

(0:11:42) Ben's three favorite long-term inflation hedges: human capital, housing, and stocks.

(0:13:47) Why market timing is psychologically seductive—and so difficult to execute successfully.

(0:15:00) Why handling losses is the single most important skill in investing.

(0:16:13) How devastating the economic side of the Great Depression really was.

(0:18:49) What policymakers learned from the Great Depression and 2008.

(0:20:39) The difference between recessionary and non-recessionary bear markets.

(0:21:52) Why the biggest up days and down days tend to cluster together in bear markets.

(0:23:18) Preparing for inevitable bear markets with a durable long-term plan.

(0:25:07) Why the stock market and the economy can diverge dramatically.

(0:28:10) The difference between volatility and risk—and why risk is often personal.

(0:29:37) Why comparing the stock market to a casino is fundamentally wrong.

(0:31:55) How modern investing platforms encourage speculative behavior.

(0:33:18) How extreme Japan's 1980s asset bubble became before collapsing.

(0:35:43) The most important diversification lessons from Japan's lost decades.

(0:37:39) How common "lost decades" actually are in stock market history.

(0:40:58) Three dimensions of diversification: geography, asset class, and strategy.

(0:41:53) Why there is no perfect portfolio—only the right portfolio for you.

(0:42:52) Common ways investors lose money in markets.

(0:44:03) Why investors should be skeptical of billionaire market predictions.

(0:45:57) Ben's evolving definition of success and raising good, kind children.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, Ben Felix and Braden Warwick unpack the surprisingly complex world of expected return modeling and why it matters so much for retirement projections, portfolio construction, and financial advice. They explain how PWL Capital currently estimates expected returns across asset classes, why traditional Monte Carlo methods relying on Gaussian distributions may miss important market behaviors, and how new research could improve the realism of long-term financial planning simulations.

The conversation also explores a fascinating collaboration between PWL and Columbia Engineering student John Yang, who worked with Professor Michael Robbins on a project to build more realistic synthetic return data for financial planning. John explains how his team used empirical distributions, t-copulas, and Extreme Value Theory to better capture market crashes, fat tails, and asset co-movements during periods of stress. Ben and Braden then analyze how these improved simulation methods affect financial planning outcomes, sustainable spending estimates, and projections for long-term wealth accumulation.

Key Points From This Episode:

(0:00:00) Introduction to expected return modeling and why it matters for financial planning.

(0:00:25) The importance of volatility, correlations, distribution shape, and time-series behavior in portfolio projections.

(0:01:26) How Scott Cederburg's research on block bootstrapping influenced PWL's thinking on simulations.

(0:02:03) Introduction to Columbia Engineering student John Yang and the industry research collaboration.

(0:03:30) How Conquest Planning allows PWL to upload custom return simulations.

(0:04:05) A new PWL client's detailed reasoning for moving from DIY investing to working with an advisor.

(0:06:22) Why financial planning and Monte Carlo simulations were central to the client's decision.

(0:07:22) Cross-border financial complexity and the value of professional advice.

(0:08:03) Estate planning, cognitive decline, and the role of trusted financial relationships.

(0:10:02) Research on cognitive decline and its impact on financial decision-making.

(0:12:00) Delegation, accountability, and reducing mental overhead through advisory relationships.

(0:13:47) Why the client chose PWL specifically and the appeal of evidence-based investing.

(0:15:25) Ben and Braden discuss the perceived disconnect between online discourse and demand for AUM advisors.

(0:16:12) Overview of PWL's methodology for estimating expected returns across asset classes.

(0:17:05) How PWL combines historical returns with market-implied expected returns.

(0:18:07) The use of factor premiums and expected return composition in taxable projections.

(0:18:48) Why PWL previously relied on Gaussian multivariate normal distributions for simulations.

(0:19:41) Arithmetic vs. geometric mean returns and why the distinction matters.

(0:21:01) A simple example illustrating volatility drag.

(0:23:29) Why diversification benefits must be incorporated into expected portfolio returns.

(0:25:15) How correcting portfolio math improved expected return estimates by 20–30 basis points.

(0:27:12) Transition to John Yang's interview and introduction to synthetic data generation.

(0:30:07) John explains the limitations of Gaussian return assumptions.

(0:31:04) Why realistic sequences of returns matter for retirement planning.

(0:32:16) Empirical evidence that returns are not truly random.

(0:33:25) The three modeling challenges: unique asset behavior, realistic co-movement, and tail risk.

(0:37:49) Separating marginal distributions from dependency structures in the modeling process.

(0:38:48) Using a t-copula to better model asset co-movement during market stress.

(0:39:39) Why historical data alone struggles to capture rare crisis events.

(0:40:06) Applying Extreme Value Theory and Generalized Pareto Distributions to model tail risk.

(0:42:15) How Monte Carlo simulations generate many realistic future return paths.

(0:43:00) Imposing forward-looking expected returns and volatility assumptions onto the simulations.

(0:44:56) How the new framework better preserves skewness and kurtosis.

(0:46:38) Evaluating the new model using marginal shape, tail behavior, and co-movement scores.

(0:48:10) Why the new model significantly improved tail realism without sacrificing correlations.

(0:49:05) Future extensions including dynamic correlations and volatility clustering.

(0:50:28) Potential future use of GANs and machine learning for synthetic financial data.

(0:52:02) Key takeaway: financial planning requires realistic return paths, not just summary statistics.

(0:53:41) Braden analyzes how the new simulation framework affects financial advice.

(0:55:04) Why monthly index data produced fatter tails than long-term annual DMS data.

(0:58:47) The new model improved Monte Carlo success rates by roughly 2–3%.

(1:00:25) Sustainable spending estimates changed only modestly under the new simulations.

(1:02:27) Why the improved methodology matters more for alternative asset classes.

(1:04:25) The surprising finding that median wealth outcomes increased while mean outcomes decreased.

(1:05:47) Why Gaussian simulations can create unrealistic runaway wealth scenarios.

(1:07:20) The practical implications for estate planning and multi-generational wealth projections.

(1:08:30) Why better simulation methods are especially important for concentrated and alternative investments.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/ Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Shelly Antoniewicz, Chief Economist at the Investment Company Institute (ICI), for a data-rich exploration of the modern fund industry. Shelly walks us through the staggering scale of global regulated funds, how ETFs and mutual funds shape capital allocation, and why the rise of indexing may not be as disruptive as critics fear.

We discuss the growth of ETFs versus mutual funds, increasing concentration among large fund sponsors, and how financial advisors are reshaping portfolios around low-cost investment products. Shelly also explains why fund fees keep falling, how 401(k) plans have democratized investing for middle-class households, and why investor choice remains central to healthy capital markets. Along the way, we unpack active ETFs, intraday liquidity, interval funds, private credit exposure, and the evolving role of retail investors in financial markets.

Key Points From This Episode:

(0:00:00) Introducing Shelly Antoniewicz and the role of the Investment Company Institute.

(0:01:14) The Investment Company Fact Book and why it has become a foundational resource for fund industry data.

(0:03:31) Regulated funds globally now account for roughly $88 trillion in assets.

(0:04:47) The U.S. market contains nearly 17,000 investment companies across mutual funds, ETFs, and related structures.

(0:05:40) U.S. equity funds alone hold roughly $27 trillion in assets.

(0:06:52) More than half of mutual fund and ETF assets are now in index strategies.

(0:07:40) Why index funds still represent only a minority share of the overall U.S. stock market.

(0:09:48) What academic research says about indexing's impact on price discovery and market efficiency.

(0:13:10) There are nearly 770 fund sponsors in the U.S., though industry concentration continues to rise.

(0:13:42) ETF sponsors experienced enormous inflows in 2025, with 90% receiving net new cash.

(0:15:23) Why the largest fund complexes now control a much larger share of industry assets.

(0:16:06) Compliance costs and regulation as drivers of industry consolidation.

(0:17:31) Falling expense ratios as evidence that the industry remains highly competitive.

(0:19:28) How investor flows often reflect rebalancing behavior rather than performance chasing.

(0:22:32) Why ETF investors highly value intraday liquidity, even if most do not actively trade.

(0:23:27) Research on ETF trading behavior among younger investors and retail participants.

(0:27:11) The massive shift from actively managed U.S. equity mutual funds toward indexed products.

(0:27:51) How financial advisors increasingly use model portfolios built around ETFs.

(0:31:20) Why active ETFs exploded in popularity after the ETF rule streamlined launches.

(0:32:31) The growing distinction between ETF wrappers and investment strategies themselves.

(0:33:05) Leveraged and niche ETF products, investor choice, and financial education.

(0:35:48) More than half of U.S. households now own regulated investment funds.

(0:36:41) How 401(k) plans dramatically increased middle-class participation in capital markets.

(0:39:16) Households remain the dominant owners of mutual fund assets.

(0:40:28) The demographic profile of the typical mutual fund-owning household.

(0:41:16) ETF-owning households tend to skew younger, wealthier, and more risk tolerant.

(0:42:03) Mutual fund assets continue to grow despite persistent outflows toward ETFs.

(0:43:39) How investor risk tolerance changes with age and market conditions.

(0:46:22) Economies of scale and the continued decline in fund fees.

(0:47:51) Interval funds, BDCs, and the rise of regulated private credit products.

(0:49:36) Redemption caps and liquidity management inside interval funds.

(0:52:51) Shelly reflects on the enduring popularity of the Investment Company Fact Book.

(0:55:05) Shelly's definition of success: raising children who tell you they love you.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/ Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Jeff Hooke, former investment banking, private equity, and private debt executive turned academic critic of alternative investments, for a rigorous and provocative examination of private equity, private credit, and institutional investing. Jeff draws on decades of experience in finance and years of academic research to challenge many of the assumptions driving institutional and retail allocations to private markets. We discuss why pension plans and endowments continue pouring capital into alternatives despite evidence of underperformance, how private market valuations can obscure true risk, and why the fee structures embedded in private funds create enormous hurdles for investors. Jeff explains the methodological challenges of benchmarking private investments, the role of investment consultants and industry incentives, and why illiquidity and opaque reporting make private assets especially difficult for retail investors to evaluate. Along the way, we explore survivorship bias, public market equivalents, unrealized valuations, and the growing push to bring private assets into retirement portfolios. This conversation is an in-depth look at the incentives, risks, and realities shaping the modern alternatives industry.

Key Points From This Episode:

(0:00:18) Introduction to Jeff Hooke and the focus on private equity, private credit, and alternative investments.

(0:04:21) Why institutions and retail investors continue allocating heavily to alternatives.

(0:04:33) What institutional investors are and how pension plans and endowments operate.

(0:05:52) Why institutional staff may prefer complexity over simple index investing.

(0:07:55) How early private equity outperformance fueled lasting enthusiasm for alternatives.

(0:08:47) Why trustees often rely heavily on staff and consultants for investment decisions.

(0:09:29) The social and psychological appeal of "exotic" investments.

(0:10:28) Why institutional investors often resist criticism of private markets.

(0:11:56) The CalPERS example: underperforming a simple 60/40 index despite complexity.

(0:13:28) The role investment consultants play as institutional "gatekeepers."

(0:15:42) Why many pension plans and endowments may have underperformed due to alternatives.

(0:17:26) Findings from The Grand Experiment and research on private equity fund performance.

(0:18:30) Why institutions struggled to replicate Yale's endowment success under David Swensen.

(0:20:57) Gross versus net performance in private equity—and the impact of fees.

(0:21:30) The extreme dispersion between top- and bottom-performing private equity funds.

(0:23:26) The weak persistence of private equity manager outperformance.

(0:25:27) Why private investments expanded rapidly after the Global Financial Crisis.

(0:25:54) The illusion of smoother returns in private markets due to subjective valuations.

(0:28:13) Why benchmarking private equity performance is methodologically difficult.

(0:31:13) How private market data can support conflicting performance narratives.

(0:33:41) Why public market equivalent (PME) is one of the best benchmarking approaches.

(0:36:59) Survivorship bias and non-reporting funds in private market databases.

(0:40:09) The rise of private credit and its role in financing leveraged buyouts.

(0:42:29) Findings from Jeff's private credit research: no evidence of outperformance versus public ETFs.

(0:45:15) Jeff's response to Cliffwater's critique of his private credit paper.

(0:47:15) Why retail investors may underestimate the risks and costs of private alternatives.

(0:49:14) Conflicts of interest and fee incentives in wealth management distribution.

(0:51:03) The impact of unrealized valuations and unsold holdings on reported returns.

(0:53:15) Why many private equity funds still hold large unrealized positions after a decade.

(0:56:05) Whether private equity ownership actually improves company operations.

(0:57:42) The major liquidity risks facing retail investors in private funds.

(0:59:20) Canadian private real estate funds, gating, and redemption problems.

(1:02:01) Comparing private market fees to ultra-low-cost public index funds.

(1:06:46) The long-term impact of bringing private assets into retail retirement accounts.

(1:08:17) How much "play money" investors should allocate to speculative alternatives.

(1:10:49) Why leverage layered on top of private funds creates additional risk.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Elroy Dimson, Professor of Finance at Cambridge Judge Business School and co-creator of the Dimson-Marsh-Staunton (DMS) dataset, for a sweeping and deeply insightful conversation on financial history, market behavior, and the evolution of global investing. Elroy walks us through the origins of the groundbreaking Triumph of the Optimists, the challenges of assembling over 100 years of global return data, and the critical biases that once shaped our understanding of markets. We explore how expanding beyond U.S.-centric data reshaped expectations for the equity risk premium, why economic growth doesn't necessarily translate into higher stock returns, and what history reveals about diversification, factor investing, and investor behavior. Elroy also shares lessons from his work with major institutions like Norway's sovereign wealth fund, discusses the surprising long-term outperformance of railways, and offers a grounded perspective on future expected returns. This episode is a masterclass in using history to inform better financial decisions.

Key Points From This Episode:

(0:04:00) Introduction to Elroy Dimson and the significance of the DMS dataset.

(0:05:07) Why understanding financial history is essential for thinking about the future.

(0:05:24) The origin story of Triumph of the Optimists and assembling global return data.

(0:09:06) How long-term datasets are built from academic and commercial sources.

(0:11:33) Survivorship bias in historical indices and why it matters.

(0:13:35) "Easy data bias" and how it leads to overstated historical returns.

(0:15:32) Accounting for failed markets and geopolitical disruptions in global data.

(0:18:33) How global data changed expectations for the equity risk premium.

(0:21:09) Why 20th-century equity returns were a "pleasant surprise."

(0:22:17) U.S. market dominance and the challenge of extrapolating its success.

(0:24:11) Market composition in 1900 and the dominance of railway stocks.

(0:25:52) Why railways outperformed despite shrinking market share.

(0:29:03) The surprising disconnect between economic growth and stock returns.

(0:31:28) Why investing in recovering markets requires extreme patience and conviction.

(0:33:32) Value investing: historical success and recent struggles.

(0:35:00) Why economic growth benefits many—but not necessarily stock investors.

(0:35:59) The long-term benefits of global diversification.

(0:40:01) Why diversification reduces risk—but doesn't create returns for everyone.

(0:42:29) Explaining persistent home country bias among investors.

(0:47:46) Industry diversification becoming more important over time.

(0:49:50) The rise and evolution of size, value, and momentum factors.

(0:54:17) Why factor premiums should be monitored—not blindly followed.

(0:57:27) The equity risk premium: why it's crucial—and uncertain.

(1:00:15) A realistic estimate: ~3% equity risk premium going forward.

(1:02:33) Translating that into ~5% real expected equity returns.

(1:05:10) Staying optimistic: invest long-term and live modestly.

(1:05:58) The risk of pessimism: losing purchasing power in safe assets.

(1:08:06) The evolving role of bonds as diversifiers.

(1:09:55) Why market timing is a losing strategy.

(1:11:00) Elroy's definition of success: happy children and grandchildren.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Benjamin Warwick on LinkedIn - https://www.linkedin.com/in/braden-warwick-a40b48a3

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Michael Kothakota for a deeply technical and thought-provoking conversation on interdependent integrative financial planning theory. Drawing from his background in academic research and real-world advisory practice, Michael introduces a mathematical framework designed to capture the full complexity of financial planning—where decisions across domains like taxes, investments, and estate planning are interconnected and constantly evolving.

We explore why traditional economic models fall short in capturing the individualized and multi-dimensional nature of financial planning, and how Michael's approach uses tools like multi-objective optimization and dynamic programming to better reflect reality. He explains how client preferences, time-varying priorities, and uncertainty all interact within the model—and why even identical financial situations can lead to very different optimal decisions. This episode is a deep dive into the mechanics of financial advice, offering a new lens on how planners can create value by integrating decisions across domains and aligning them with what clients truly care about.

Key Points From This Episode:

(0:04:00) Introduction to the episode and why this topic leans heavily into financial planning complexity.

(1:04:00) The core takeaway: integrating all financial planning domains leads to better outcomes than siloed advice.

(5:35:00) What interdependent integrative financial planning theory is—and why interdependencies matter.

(7:16:00) Why traditional economic theories like portfolio optimization and consumption smoothing fall short.

(9:37:00) The central insight: financial planning must account for structure, preferences, and time.

(12:12:00) Modeling financial planning as a complex, preference-weighted system over time.

(14:25:00) Why identical financial situations can still lead to different optimal advice.

(17:50:00) Multi-objective optimization and the competing goals within financial planning.

(21:09:00) The role of dynamic programming in solving sequential financial decisions.

(23:42:00) Evidence on whether financial planners improve client outcomes—and the limitations of existing data.

(26:58:00) The architecture of the model: structural tensor, priority weights, and discount matrix.

(30:31:00) Why financial planning is "non-smooth" and filled with constraints and trade-offs.

(33:57:00) How changing strategies over time are captured through evolving "strategy spaces."

(36:50:00) The six financial planning domains and their respective objective functions.

(42:35:00) The priority matrix: quantifying what clients actually care about.

(44:41:00) Discount rates and urgency—how priorities shift over time and with life events.

(47:58:00) Why financial planning must account for uncertainty and changing preferences.

(49:53:00) The role of financial planners in shaping and educating client priorities.

(51:07:00) The four-tier architecture that combines structure, preferences, and urgency.

(52:47:00) Capturing uncertainty: endogenous vs. exogenous risks and planning for shocks.

(55:39:00) Theoretical results: integration premium and value loss from misaligned advice.

(58:09:00) Practical takeaway: always consider cross-domain effects when giving advice.

(1:02:24) Real-world example of value destruction from siloed expert advice.

(1:06:34) Why the value of integration scales with complexity—not just wealth.

(1:07:42) The enduring importance of human financial planners in navigating complexity.

Links:

Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, the Rational Reminder team unpacks the mechanics and implications of mega IPOs like SpaceX, OpenAI, and Anthropic potentially entering public indices. They explore how index funds handle IPO inclusion, why newly public stocks tend to underperform, and how structural features of indexing can lead to systematically buying high and selling low. The conversation dives into academic research on IPO returns, the role of free float in index construction, and how evolving market dynamics are forcing index providers to reconsider long-standing rules. They also examine alternative approaches from firms like Dimensional and Avantis, and whether investors are truly missing out by not accessing private markets. This episode blends market structure, empirical evidence, and investor behaviour into a nuanced look at one of the most talked-about investing topics today.

Key Points From This Episode:

(0:00:04) Introduction to the Rational Reminder Podcast and hosts.

(0:00:19) PWL Capital expands to Vancouver through partnership with Macdonald Shymko & Company.

(0:03:45) Main topic: "Mega IPOs" and concerns about index fund exposure.

(0:05:00) Why large private companies going public matters for index investors.

(0:06:55) Index funds aim to represent markets—not optimize returns.

(0:08:41) Massive scale of index funds and implications for IPO demand.

(0:10:19) Why IPOs tend to have low expected returns.

(0:12:39) How index inclusion rules differ (S&P 500 vs total market indices).

(0:15:53) Research on "fast-track" IPO inclusion and front-running effects.

(0:18:59) Why mega IPOs may amplify existing inefficiencies.

(0:20:39) Important reminder: indexing trade-offs are small and structural—not fatal.

(0:21:29) Potential solutions like pre-allocating IPO shares to index funds.

(0:23:24) The role of free float in determining index weight.

(0:25:00) NASDAQ rule changes and implications for low-float mega IPOs.

(0:27:40) Conflict of interest concerns in index rule changes.

(0:32:43) Why index providers may need to evolve with changing markets.

(0:35:27) Historical changes to index methodology (e.g., float adjustment).

(0:37:21) Why IPOs are historically poor investments ("new issues puzzle").

(0:40:28) Evidence from Dimensional on IPO underperformance.

(0:41:14) IPOs behave like "junk" stocks (small, unprofitable, high growth).

(0:43:04) Low-float IPOs and extreme underperformance data.

(0:46:00) High valuations (price-to-sales) linked to worse IPO outcomes.

(0:48:00) Index rebalancing as systematic "bad market timing."

(0:50:03) Dimensional vs Avantis approaches to IPO inclusion.

(0:52:56) Trade-offs and tracking error across different strategies.

(0:54:16) Importance of investor discipline amid changing narratives.

(0:56:00) Are investors missing out on private markets?

(0:58:00) Risks and costs of accessing private shares (SPVs, fees, fraud).

(1:00:15) Indirect exposure to private companies through public equities.

(1:02:52) Final takeaway: index investing already captures most opportunities.

(1:03:25) Wrap-up: IPOs are a known cost—not a reason to abandon indexing.

Links:

Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Ben Wilson on LinkedIn — https://ca.linkedin.com/in/ben-wilson

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

What if the decades-long debate between active and passive investing wasn't really a debate—but a data problem?

In this episode, Ben Felix and Cameron Passmore are joined by Tim Edwards, Managing Director and Global Head of Index Investment Strategy at S&P Dow Jones Indices, for a deep dive into the SPIVA Scorecard—the industry's most enduring and data-driven comparison of active versus passive investing.

Tim explains how SPIVA has evolved over 25 years, why survivorship bias matters more than most investors realize, and what the data consistently shows across markets: most active funds underperform their benchmarks—especially over longer time horizons.

The conversation goes beyond the headline results, exploring persistence (or lack thereof) in manager performance, why bond funds don't escape the same fate, and whether combining active funds improves outcomes (spoiler: not really). They also tackle common critiques of indexing, including index rebalancing costs, IPO inclusion concerns, and the role of index funds in market concentration.

Key Points From This Episode:

(0:00:17) Introduction to the SPIVA report and its long-standing role in the indexing vs. active debate (0:01:18) Overview of the episode: SPIVA, index behavior, IPOs, and market concentration (0:03:30) What SPIVA is and how it measures active fund performance versus benchmarks (0:04:14) Why SPIVA was created: to inform—not settle—the active vs. passive debate (0:05:20) How SPIVA has evolved across regions, asset classes, and research dimensions (0:06:59) Controlling for survivorship bias and why it materially affects results (0:08:57) Real-world survivorship rates: ~50–60% of funds survive over 10 years (0:10:12) Core finding: most active funds underperform, especially over longer horizons (0:10:57) Comparison of equity vs. bond funds: slightly better outcomes in bonds, but still mostly underperformance (0:13:44) Structural differences in equity vs. bond markets (e.g., skewness, dispersion) (0:15:06) Typical survivorship rates across markets and how crises affect fund closures (0:16:02) Persistence analysis: past winners rarely remain winners (0:18:16) Global variation: some markets (e.g., international small caps) show slightly better active results (0:20:41) "Better" doesn't mean good: even in stronger categories, most funds still underperform (0:21:31) Do active funds perform better in down markets? Not consistently (0:23:37) Multi-asset portfolios of active funds: 97% underperform over 10 years (0:25:10) Selecting top-quartile funds improves outcomes slightly—but not meaningfully (0:26:46) Surprising findings in SPIVA and how market dynamics shape results (0:27:45) Impact of SPIVA on industry behavior and investor education (0:29:03) Ben shares how SPIVA influenced his own career path toward indexing (0:30:08) The "index effect" and whether index rebalancing creates performance drag (0:31:30) Why the index effect has largely diminished due to market competition and liquidity (0:34:05) Research on IPO inclusion and whether index rules create systematic return drag (0:36:57) How S&P handles IPO inclusion (e.g., 12-month seasoning rule for S&P 500) (0:39:58) Whether index methodology could evolve due to larger modern IPOs (0:42:36) Addressing concerns about large IPOs entering index funds (0:43:52) Historical perspective on market concentration and today's top-heavy indices (0:45:29) What happened to past top-10 companies: many declined, but markets still thrived (0:47:10) Creative destruction: why markets can succeed even when leaders fail (0:49:15) Weak relationship between market concentration and future returns (0:50:55) None of today's top companies were top companies in the 1960s (0:52:16) Key takeaway: markets evolve, and cap-weighted indices adapt automatically (0:53:58) Concerns about index fund growth and its impact on market function (0:54:30) Benefits of indexing: lower fees and often better investor outcomes (0:56:15) Timing the market: why waiting for a bigger drop tends to hurt returns (0:58:52) "Time in the market" vs. "timing the market" (0:59:09) Tim's favorite index: the DSPX dispersion index (1:00:53) Defining success: why happiness is the ultimate metric

Links:

Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

What if the way we think about investing—and expected returns—was fundamentally incomplete?

In this episode, Ben Felix and Dan Bortolotti take a deep dive into one of the most influential papers in financial economics: Fama and French (1993). With nearly 15,000 citations, this research reshaped how we understand asset pricing by showing that market beta alone isn't enough to explain returns. Instead, multiple factors—specifically size and value—play a critical role.

Ben and Dan unpack how this paper challenged the dominance of CAPM, introduced the now-famous Three-Factor Model, and laid the foundation for decades of empirical asset pricing research. They explore how factor investing evolved, why anomalies may not be anomalies at all, and what this means for evaluating portfolios and active managers today.

The conversation also connects theory to practice—highlighting how modern fund providers implement factor strategies and what it means for investors trying to improve expected returns without abandoning diversification.

Key Points From This Episode:

(0:00:00) Introduction to the episode and why this is a long-awaited deep dive into factor investing.

(0:01:12) Overview of Fama and French (1993) and its massive impact on finance and portfolio management.

(0:03:55) Origins of factor investing and how it connects to index investing and academic research.

(0:04:46) Core premise: multiple factors drive expected returns and asset prices.

(0:06:08) He explains why different assets can have different expected returns, and why that matters for investors.

(0:07:24) Ben introduces the CAPM as the dominant model that linked expected return to market beta.

(0:08:53) Dan reflects on how revolutionary CAPM and portfolio theory were when they were first introduced.

(0:10:51) Ben describes today as a "golden age of investing," where theory and implementation tools are widely accessible.

(0:11:17) He explains how anomalies emerged that CAPM could not explain.

(0:12:10) Ben introduces the joint hypothesis problem: we cannot cleanly separate market efficiency from model accuracy.

(0:13:47) He identifies the three big issues with CAPM: size, value, and the weak relationship between beta and returns.

(0:15:29) Ben introduces the three-factor model: market, size (SMB), and value (HML).

(0:17:37) He explains that these factors are built as long-short portfolios designed to capture systematic return variation.

(0:18:02) Dan notes that the model did not really address the low-volatility anomaly.

(0:18:36) Ben agrees and explains that later work, including the five-factor model, went further on that front.

(0:19:03) Ben describes how Fama and French formed 25 portfolios sorted by size and book-to-market.

(0:20:00) He explains their use of time-series regression to test how well the model explained portfolio returns.

(0:21:12) Ben walks through factor loadings, alpha, and R-squared, and why those outputs matter.

(0:23:31) He highlights the model's strong explanatory power, with average R-squared around 0.93 across test portfolios.

(0:25:00) Dan clarifies that unexplained return could reflect skill, luck, or another missing factor.

(0:25:27) Ben emphasizes how dramatic the jump was from CAPM's explanatory power to the three-factor model's.

(0:26:11) He points to small-cap growth as the major area the model struggled to explain.

(0:27:09) Ben explains how the model also absorbed dividend-to-price and earnings-to-price "anomalies."

(0:28:01) Dan discusses why dividend strategies may simply act as rough value screens rather than offering something unique.

(0:28:52) Ben expands on how later research, especially profitability, sharpened value investing implementation.

(0:30:37) He notes the unresolved debate over whether factors are true risk exposures or persistent mispricing.

(0:32:16) Ben explains how factor models changed the way investors evaluate active managers and fees.

(0:33:16) Dan raises the possibility that some early active managers may have intuitively identified factor opportunities before the research formalized them.

(0:34:09) Ben discusses whether factor premiums have shrunk after publication and why the evidence is still noisy.

(0:34:59) He describes how the paper helped launch the boom in empirical asset pricing research.

(0:35:35) Ben introduces the "factor zoo" problem and the explosion of published factors.

(0:36:49) He explains the five-factor model and the addition of profitability and investment.

(0:38:21) Dan asks about the intuition behind profitability and investment, especially why profitable firms might have higher expected returns.

(0:39:38) Ben explains profitability through a multi-factor lens and inferred discount rates.

(0:42:15) He argues that combining factors matters because single-factor portfolios can have offsetting exposures.

(0:44:05) Dan points out that layering too many factors naively can just bring you back toward the market portfolio.

(0:44:56) Ben discusses the tradeoff between diversified tilts and concentrated factor bets.

(0:46:29) Dan describes factor tilting as a subtle adjustment around a diversified core portfolio.

(0:46:47) Ben cites Fama's idea that investors need to "talk themselves out of the market portfolio."

(0:47:16) He notes that there is still active debate over which factors and models truly make sense.

(0:48:31) Dan explains why momentum is harder to implement in practice because of turnover, taxes, and trading costs.

(0:49:23) Ben says even simple-sounding factors like value and profitability remain heavily debated in academia.

(0:50:20) He brings the discussion back to practical relevance: how investors can access factor exposure through funds.

(0:51:06) Ben explains Dimensional's roots in academic research and its long history of implementation.

(0:52:48) He introduces Avantis as a newer competitor with similar academic foundations and newly launched Canadian ETFs.

(0:53:42) Ben discloses that PWL uses Dimensional extensively, while noting they are not paid to mention Dimensional or Avantis.

(0:54:09) He summarizes what factor investing means for investors seeking higher expected returns through systematic tilts.

(0:55:47) Dan reflects on how early PWL's adoption of index and factor-based investing was in the Canadian market.

(0:57:07) Ben invites listeners to learn more about how PWL applies this thinking in client portfolios.

(0:57:41) The episode moves to the after show and review section.

(0:58:21) Dan reads a listener review focused on evidence-based investing, planning, and disciplined saving.

(1:00:23) Ben notes that they never actually named the paper during the main episode.

(1:00:32) Dan closes with: the paper is Common Risk Factors in the Returns on Stocks and Bonds.

Links: Patrick Adams – MIT PhD Candidate: https://patrick-adams.com/

Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

What if your biggest investment risk isn't the stock market—but your own income?

In this episode, we are joined by Patrick Adams, a PhD candidate at MIT, for a fascinating deep dive into how income risk, spending commitments, and liquidity constraints reshape what "optimal" investing actually looks like. Drawing on large-scale administrative tax data, Patrick challenges the conventional wisdom that young investors should be heavily—or even fully—invested in equities.

We explore why stocks appear safe over long horizons but become risky when real-world constraints force investors to sell at the worst possible times. Patrick explains how high-income households behave during market downturns, why their income risk is closely tied to stock market performance, and how consumption commitments like mortgages and childcare create hidden financial leverage. The conversation also introduces a new life-cycle model that incorporates these frictions—leading to surprisingly conservative optimal equity allocations for working-age investors. This episode reframes asset allocation as a problem of liquidity and risk management, not just return maximization.

Key Points From This Episode:

(0:00:00) Introduction to the podcast and overview of the episode's focus on asset allocation and new research.

(0:01:18) Patrick Adams' background, MIT PhD research, and how the paper was discovered.

(0:07:08) Why stocks are considered safe for long-term investors based on historical returns.

(0:08:37) When the "stocks for the long run" logic breaks down—forced selling during downturns.

(0:10:35) Evidence: High-income households sell stocks during crashes instead of buying.

(0:12:24) Data source: Administrative U.S. tax return data and its advantages/limitations.

(0:14:23) Investors shift into fixed income during crashes rather than staying invested.

(0:16:52) Financial reality: High wealth, but low liquid assets relative to income.

(0:18:00) Human capital: Income is risky and correlated with stock market downturns.

(0:20:15) Typical allocation: About 25% of liquid wealth in stocks for working-age households.

(0:22:36) Higher-income households have more volatile flows and greater exposure to stock risk.

(0:23:42) Income shocks drive stock selling—not just panic or behavioral mistakes.

(0:25:29) Why households draw down assets instead of cutting spending sharply.

(0:27:26) Consumption commitments (mortgages, childcare) act like hidden leverage.

(0:27:57) Key risk factors: Income volatility, low liquidity, and inflexible expenses.

(0:31:31) Traditional models vs reality: People don't cut spending—they use savings.

(0:35:25) New model incorporates income risk, market crashes, and spending frictions.

(0:38:33) Core finding: Optimal equity allocation for working-age investors is only 10–40%.

(0:40:55) Practical takeaway: Asset allocation is fundamentally about emergency funds.

(0:42:35) Higher fixed expenses require larger safe asset buffers.

(0:43:49) Counterintuitive result: Retirees may optimally hold more equities than workers.

(0:46:56) Scenario analysis: Selling during downturns destroys long-term returns.

(0:49:12) Key drivers of results: Income-stock correlation and spending rigidity.

(0:51:11) Why this model differs from others suggesting 100% equity portfolios.

(0:53:20) When 100% equity could make sense: low risk, high wealth, high risk tolerance.

(0:56:28) Personal impact: Patrick rethinks his own savings, risk, and spending commitments.

(0:57:34) Advice for listeners: Focus on liquidity, income risk, and fixed expenses.

(0:59:58) Defining success: Impactful research, teaching, and meaningful personal relationships.

Links: Patrick Adams – MIT PhD Candidate: https://patrick-adams.com/

Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we unpack the growing tension in private markets—private equity, private credit, and private real estate—and examine whether their long-standing appeal holds up under scrutiny. With increasing pressure to bring these investments to retail investors, the discussion explores how illiquidity, valuation opacity, and complex fee structures may be masking risks rather than reducing them. We break down how private assets are marketed, why their "smooth" returns may be misleading, and what recent events—like gated funds and forced asset sales—reveal about their true risk profile.

Key Points From This Episode:

(0:00:00) Introduction to the episode and overview of private markets as the main topic.

(0:00:39) Clarifying PWL Capital's full-service wealth management approach beyond asset management.

(0:03:24) Why private markets are under scrutiny and recent negative developments across asset classes.

(0:06:36) The seductive sales pitch: higher returns, lower risk, and low correlation to public markets.

(0:08:32) Private assets explained: what they are and why they appear less volatile.

(0:10:06) "Volatility laundering" and the illusion of stability in private market valuations.

(0:13:51) Retail investors entering private markets and the risk of adverse selection.

(0:15:09) Liquidity challenges and the growing issue of gated funds.

(0:18:33) Why illiquidity is especially problematic for retail investors with uncertain cash needs.

(0:20:41) The debate over whether an illiquidity premium actually exists.

(0:23:56) Trade-offs between liquidity and volatility in portfolio construction.

(0:30:41) Evidence on private equity performance vs. public markets and the role of fees.

(0:31:39) High dispersion in private equity returns and challenges of manager selection.

(0:33:00) Continuation funds and evergreen structures raising valuation concerns.

(0:36:00) Secondary market sales, NAV manipulation concerns, and "NAV squeezing."

(0:40:00) Private credit risks, gating, and comparisons to publicly traded BDCs.

(0:44:00) Insurance companies allocating to private credit and potential systemic risks.

(0:45:02) Private real estate funds, liquidity issues, and IPO valuation shocks.

(0:47:43) Public listings revealing large gaps between NAV and market prices.

(0:49:34) Summary: private markets may be as risky as public ones, with added complexity.

(0:49:44) Larry Swedroe's critique and the debate over private market outperformance.

(0:52:00) Illiquidity premium vs. "smoothing as a service" debate.

(0:54:00) Manager skill, persistence, and the challenge of accessing top-tier funds.

(0:56:50) Final reflections on ongoing research and the importance of informed debate.

Links: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

What if factor investing in Canada became as simple—and affordable—as buying a single ETF?

In this episode, we are joined by Eduardo Repetto, CIO of Avantis Investors, and Caitlin Ebanks, Director of ETF Strategy at CIBC, to unpack the long-awaited launch of Avantis ETFs in Canada. This conversation explores how a partnership built on client-first principles and fee discipline is bringing sophisticated, evidence-based investing strategies to Canadian investors in a dramatically more accessible way.

We dive into the structure and philosophy behind the new ETF lineup, including how Avantis applies factor tilts, why implementation details like direct security ownership and low turnover matter, and how the new asset allocation ETF (CAGE) could simplify portfolio construction for DIY investors. Eduardo also shares insights into Avantis' research process, expected premiums, and the realities of tracking error, while Caitlin explains how CIBC is positioning these products within the Canadian ETF landscape.

This episode is a deep dive into the evolution of factor investing—covering product design, pricing, portfolio construction, and the broader shift toward low-cost, transparent investment solutions.

Key Points From This Episode:

(0:00:00) Introduction to the episode and the significance of Avantis launching ETFs in Canada.

(0:00:42) Why this launch marks a major step forward in accessibility for Canadian factor investors.

(0:02:52) Lower fees and simplified implementation remove key barriers to factor investing.

(0:04:55) Background on Eduardo Repetto and Caitlin Ebanks.

(0:08:12) Avantis surpasses $125B AUM and the drivers behind its rapid growth.

(0:10:20) How the Avantis–CIBC partnership came together and aligned on client-first pricing.

(0:13:04) CIBC's ETF strategy and rationale for partnering with Avantis.

(0:14:49) Overview of the Avantis ETF lineup launching in Canada.

(0:19:33) Fee structure, competitiveness, and expected MER approach.

(0:21:25) Eliminating operational cost uncertainty from investor fees.

(0:23:20) "Gas station sushi" and maintaining product quality.

(0:25:08) Why ETFs were chosen over mutual funds as the primary vehicle.

(0:28:29) Roles of Avantis and CIBC in managing and operating the ETFs.

(0:29:32) Direct security ownership vs. ETF-of-ETF structures and tax implications.

(0:31:23) Construction of the CAGE asset allocation ETF and its factor tilts.

(0:33:46) Expected outperformance (1.5–2%) and tracking error (3–4%) ranges.

(0:35:26) Transparency challenges and regulatory considerations in Canada.

(0:37:26) How CACE differs from the TSX through profitability and valuation tilts.

(0:40:13) Low turnover and tax efficiency considerations.

(0:42:05) Long-term commitment to the ETF lineup and viability concerns.

(0:43:44) Ongoing research and potential improvements to factor implementation.

(0:46:07) Current research focus: improving profitability forecasting.

(0:48:30) What excites Caitlin and Eduardo most about the launch.

(0:50:41) Why CAGE could transform how Canadians implement factor investing.

Links: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this special 400th episode, the Rational Reminder hosts reflect on 50 years of index investing and the profound impact it has had on financial markets, investor behavior, and the cost of investing. The episode features a panel moderated by Ben Felix at the New York Stock Exchange—hosted by Vanguard and S&P Dow Jones Indices—bringing together leading voices in the indexing world to explore how passive investing evolved and what it means for the future of capital markets. Ben is joined on the panel by Tim Edwards (S&P Dow Jones Indices), Jim Rowley (Vanguard), and Shelly Antoniewicz (Investment Company Institute) to discuss the mechanics of indexing, the myths surrounding passive investing, and the evidence on how index funds affect markets. They unpack questions about market concentration, price discovery, and whether indexing is changing the structure of capital markets.

Key Points From This Episode:

(0:00:04) Introduction to the Rational Reminder podcast and the hosts from PWL Capital.

(0:00:24) Celebrating the 400th episode and reflecting on nearly eight years of podcasting.

(0:01:09) Dan Bortolotti discusses the early days of podcasting and the transition from the Couch Potato podcast.

(0:02:11) The rise of podcasts and YouTube as major sources of financial education for investors.

(0:02:49) How Rational Reminder grew after Dan ended his previous podcast and the demand for Canadian investing content.

(0:03:47) The podcast reaches a record audience with over 384,000 views and downloads in January 2026.

(0:04:19) Institutional investors—foundations, endowments, and unions—show increasing interest in PWL's low-cost index approach.

(0:06:20) Why indexing can still be a difficult sell for institutional investment committees.

(0:08:25) Peer effects in institutional investing: committees often hesitate to adopt strategies that seem unconventional.

(0:09:11) 2026 marks 50 years since Vanguard launched the first retail index fund in 1976.

(0:10:08) Ben moderates a panel at the New York Stock Exchange on the future of index investing.

(0:11:55) Overview of the panel participants from Vanguard, S&P Dow Jones Indices, and the Investment Company Institute.

(0:13:07) Discussion of research papers presented at the event examining index investing's market impact.

(0:14:32) Historical context: the S&P 500 is currently as concentrated as it was in the mid-1960s.

(0:15:36) The largest companies in 1965—AT&T, Kodak, GM, IBM—eventually faded from dominance.

(0:17:43) A hidden advantage of cap-weighted indexing: investors automatically own future winners.

(0:20:59) Debate about whether today's tech-heavy market concentration differs from past cycles.

(0:23:30) The explosion of index funds and ETFs has created thousands of ways to implement passive strategies.

(0:26:42) Technical improvements in ETF implementation, including lower tracking error and better hedging.

(0:29:02) The "Vanguard Effect": index investing has driven massive reductions in investment fees.

(0:29:38) Index funds account for about 23% of total U.S. market capitalization, not the commonly cited 50%.

(0:32:48) Evidence suggesting index funds have not increased large-cap concentration in markets.

(0:34:25) Passive funds represent only about 1–2% of daily trading activity.

(0:36:16) Dispersion in stock returns remains high, meaning opportunities for active management still exist.

(0:38:12) Panel begins: defining passive investing and why the term is more complex than it seems.

(0:42:13) Who invests in index funds? Millions of households using them primarily for retirement savings.

(0:45:22) How advisors and institutions use ETFs to build diversified long-term portfolios.

(0:46:19) The surprising role of ETFs in trading and market liquidity.

(0:48:30) The proliferation of niche ETFs raises questions about whether indexing has strayed from Bogle's vision.

(0:49:49) Academic research offers conflicting views on indexing's effect on market efficiency.

(0:52:27) Evidence suggests index fund growth has not increased market volatility.

(0:54:25) Dispersion data shows indexing does not eliminate opportunities for stock picking.

(0:57:15) Index funds own only about 30% of the U.S. stock market, leaving the majority in active hands.

(0:59:42) Historical perspective: high market concentration has occurred before and eventually declined.

(1:02:14) Research remains inconclusive about whether indexing harms markets.

(1:05:25) Over 20 years, 94% of actively managed U.S. equity mutual funds underperformed the S&P 500.

(1:06:20) Post-panel reflections and discussion with the Rational Reminder hosts.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we welcome back James Choi, Professor of Finance at the Yale School of Management, to unpack one of the most important—and misunderstood—questions in personal finance: How much of your portfolio should be in stocks? Drawing on his new paper, Practical Finance: An Approximate Solution to Lifecycle Portfolio Choice, James walks us through the classic portfolio choice problem first solved by Robert C. Merton, later extended by Francisco Gomes and co-authors, and now made dramatically more usable through a spreadsheet-based approximation. We explore how risk aversion, wealth, labor income risk, and expected returns shape optimal asset allocation, why simple rules like "100 minus your age" aren't terrible but still costly, and how James and his co-authors managed to approximate a complex dynamic optimization model with an error of less than 0.1% in lifetime welfare.

Key Points From This Episode: (0:04) Introduction and why this episode delivers on "mathy roots."

(1:10) James Choi's new paper: Making lifecycle portfolio choice solvable in a spreadsheet.

(5:15) The portfolio choice problem: How much should you allocate to stocks versus risk-free assets?

(6:09) The classic Merton (1969, 1971) solution and the "Merton share."

(8:00) The equity premium formula: Expected excess return ÷ (risk aversion × variance).

(11:20) Extending the model to risky labor income (Cocco, Gomes, and Maenhout).

(14:27) Why labor income behaves bond-like—even when it's risky.

(16:33) How wealth, risk aversion, and labor income characteristics affect optimal equity allocation.

(20:52) Transitory vs. permanent labor income risk—and why permanent risk matters more.

(23:04) Solving thousands of parameter sets to approximate optimal lifecycle allocations.

(27:09) How close is the approximation? ~3–4 percentage points on average, with

(29:56) Comparing to rules of thumb: 100 minus age and 60/40.

(32:08) Why 0% equities is often far worse than 100% equities.

(33:33) What the optimal allocation typically looks like over the life cycle.

(38:55) Walking through the publicly available Google Sheet to calculate your allocation.

(44:39) Estimating your risk aversion using a coin-flip thought experiment.

(46:08) Forecasting future labor income and using wage imputation.

(48:05) Why housing is excluded—and why it's so hard to model.

(50:35) How often you should update your assumptions (hint: not often).

(53:06) Leverage, constant leverage ETFs, and why young investors might rationally use them.

(58:55) Discussing lifecycle advice from Scott Cederburg and co-authors.

(1:07:40) What practical finance problem James wants to tackle next (hint: the 4% rule and retirement spending).

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we sit down with Tom Hardin, also known as "Tipper X," the former hedge fund analyst who became one of the most prolific informants in the largest insider trading crackdown in U.S. history. Tom walks us through his journey from rule-following soccer referee in Georgia to Ivy League graduate and rising Wall Street analyst—before crossing the line into insider trading at age 29. What makes this conversation so compelling is not just the crime, but how ordinary it felt at the time. Tom explains how small rationalizations, cultural pressures, ambition, and the normalization of questionable behavior gradually eroded his ethical boundaries. After being arrested and recruited by the FBI, he wore a wire 48 times and helped build over 20 cases in Operation Perfect Hedge, exposing widespread misconduct across the hedge fund industry. We explore the psychology of ethical failure, the "fraud triangle," moral licensing, and the difference between ethics in the classroom and ethics in the real world. Tom also reflects on redemption, forgiveness, mentorship, and how he now defines success after losing his finance career.

Key Points From This Episode:

(0:04) Introduction to Tom Hardin, former hedge fund analyst turned FBI informant.

(5:15) Tom's conviction: One count of securities fraud and one count of conspiracy after four illegal trades netting $46,000.

(6:11) Early life as a rule-following soccer referee and how ambition shaped his identity.

(8:07) The hedge fund world as a meritocracy—high pressure, high stakes, and performance-driven culture.

(9:13) How insider trading networks operated openly in certain hedge fund circles.

(12:21) The legal definition of insider trading: material non-public information and breach of fiduciary duty.

(15:25) How difficult it is to consistently generate returns without some form of edge.

(16:26) The first insider tip—and the rationalizations that followed.

(19:03) The "fraud triangle": pressure, opportunity, and rationalization.

(22:16) Placing the first illegal trade—and feeling almost nothing.

(24:39) Peer validation and the normalization of wrongdoing.

(28:38) The 6:30 a.m. arrest and being approached by the FBI.

(31:43) Deciding to cooperate—and becoming "Tipper X."

(36:24) Learning to wear a wire and extract incriminating statements over multiple meetings.

(38:26) Inside Operation Perfect Hedge: 81 individuals charged, 32 cooperators.

(39:28) The chilling effect on hedge funds and the possible decline of illicit "edge."

(42:12) Being publicly unmasked as Tipper X and the personal cost to his family.

(44:02) Why ethical failures are incremental—not sudden transformations.

(45:11) The gap between academic ethics and real-world psychological pressure.

(46:57) The role mentorship could have played—and how culture shapes behavior.

(50:29) Tom's view on hedge funds for retail investors: high fees, limited liquidity, and questionable value.

(52:04) Ethical drift, rationalization, and warning signs to watch for.

(52:35) Redemption: Owning mistakes fully and learning to forgive yourself.

(55:02) Redefining success—relationships, honesty, and meaningful contribution.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Dan Bortolotti — https://pwlcapital.com/our-team/

Dan Bortolotti on LinkedIn — dan-bortolotti-8a482310

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we welcome back return guest Hank Bessembinder for a deeply analytical conversation spanning leveraged ETFs, volatility, and the future of performance measurement. Hank walks us through his latest research on leveraged single-stock ETFs, clarifying the misunderstood concept of "volatility decay" and decomposing returns into rebalancing effects and frictions. The results are striking: meaningful underperformance relative to simple levered benchmarks, driven by both embedded costs and the mechanics of daily resets. In the second half, we shift gears to a more foundational question: What is a return, really? Hank challenges the dominance of arithmetic averages and even geometric means, arguing that neither truly captures the long-term investor experience. He introduces the concept of the sustainable return—a measure based on the cash flows an investment can support without depleting capital—and outlines how it could reshape academic finance and real-world financial planning.

Key Points From This Episode:

(0:01:03) Welcome back to Hank Bessembinder and overview of his recent research.

(0:06:16) What "volatility decay" really means—and why the term may be misleading.

(0:09:16) Why volatility does not necessarily reduce mean returns in constant leverage ETFs.

(0:10:11) Ex-ante decision-making and the wedge between mean and median outcomes.

(0:11:26) Single-stock vs. index leveraged ETFs: Similar mechanics, different magnitudes.

(0:12:52) Why past research has been so cautionary about long-term use of leveraged ETFs.

(0:15:53) How rebalancing costs differ for long and short leveraged products.

(0:16:57) The benchmark: Levered buy-and-hold versus constant daily rebalancing.

(0:19:46) Empirical results: Long funds underperform by ~0.8% per month; short funds by ~1% per month.

(0:21:10) Decomposing underperformance into rebalancing effects and frictions.

(0:24:15) The real (though rare) possibility of returns below –100% in leveraged products.

(0:27:04) Simulation results over 50 years: Skewness, negative medians, and rebalancing drag.

(0:28:38) Why volatility tends to coincide with reversals—and why reversals drive rebalancing costs.

(0:31:15) Practical guidance: Who, if anyone, should use leveraged single-stock ETFs.

(0:34:58) The limitations of arithmetic means and single-period models.

(0:36:55) Why aggregate investors are not buy-and-hold investors.

(0:39:17) The shortcomings of arithmetic averages, alphas, and Sharpe ratios for long-horizon measurement.

(0:42:38) Why log returns don't solve the core measurement problems.

(0:44:56) The case for dollar-weighted returns and the limitations of IRRs.

(0:48:18) Modified IRRs and their role in capturing aggregate investor outcomes.

(0:50:14) Introducing the sustainable return: Measuring what can be withdrawn without depleting capital.

(0:53:22) Expected sustainable return and its close relationship to the geometric mean.

(0:56:09) Proportional sustainable return and withdrawal-based performance measurement.

(1:00:00) Individual stock returns through the lens of sustainable returns.

(1:00:53) Nudging academic finance beyond the "econometric streetlight."

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode of the Rational Reminder Podcast, we are joined by Theresa Ebden, Vice President of the Investor Office at the Ontario Securities Commission, for a deep dive into how regulators are thinking about modern investor risks—from AI-powered scams to finfluencers and the gamification of investing apps. Theresa explains how the OSC works to protect investors through policy, education, behavioral research, and direct engagement with the public, and why investor education is one of the most powerful tools regulators have.

Key Points From This Episode:

(0:01:55) Overview of the OSC and why its investor research and education work matters.

(5:42) What the Ontario Securities Commission does and its mandate to protect investors and capital markets.

(6:25) Inside the OSC Investor Office: policy, education and outreach, and the investor contact centre.

(9:28) How the Investor Office identifies priority issues using inquiry data, behavioral insights, and global collaboration.

(12:11) The nature of investor inquiries: fraud, crypto confusion, complaints, and recovery room scams.

(14:01) How contact-centre data feeds into education, outreach, and policy responses.

(16:07) Overview of GetSmarterAboutMoney.ca and its role in investor education.

(20:43) Major retail investor risks today: AI-enhanced scams, finfluencers, dark patterns, and gamification.

(24:43) What to do if you're impersonated by AI in scam advertisements.

(29:28) What a "finfluencer" is and the different categories they fall into.

(31:01) Research findings on how strongly finfluencers influence investor decisions.

(32:55) Why non-investors are especially vulnerable to finfluencer advice and social-media scams.

(36:11) How investors can evaluate online financial advice and check credentials.

(38:02) Regulatory challenges in overseeing finfluencers and online financial content.

(41:04) How AI magnifies traditional scams and why AI-enhanced fraud is more effective.

(43:42) Mitigation strategies: education, just-in-time warnings, and system-level tools.

(47:25) Relationship investment scams and why they are especially damaging.

(52:53) Research on gamification in investing apps and its effects on investor behavior.

(55:25) The Get Smarter About Trading simulator and how it demonstrates gamification effects.

(57:19) How gamification can be used positively to improve diversification and outcomes.

(58:16) Theresa's perspective on success and her focus on improving the individual investor experience.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Dan Bortolotti — https://pwlcapital.com/our-team/

Dan Bortolotti on LinkedIn — https://ca.linkedin.com/in/dan-bortolotti-8a482310

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

Ben Felix and Braden Warwick are joined by Dr. Charles Chaffin, a leading voice in financial psychology, to explore why investors so often act against their own best interests—and how better tools and frameworks can help bridge the gap between rational plans and real human behavior. The conversation blends behavioral finance, goal setting, and risk profiling, while also introducing a new evidence-based risk tolerance questionnaire now being made publicly available to listeners. The episode digs into why humans are wired for short-term survival rather than long-term optimization, how biases and environment shape financial decisions, and why coaching—not transactions—is becoming the advisor's most important role. Charles explains concepts like money scripts, financial flashpoints, identity-based goals, and financial self-efficacy, tying them directly to investing behavior and client outcomes. The discussion also goes deep on financial risk tolerance: what it really is, why people consistently misjudge it, and why psychometric tools outperform traditional questionnaires.

Key Points From This Episode:

(0:00:00) Introduction to Episode 395 and guest Dr. Charles Chaffin

(0:01:15) Charles' background in financial planning psychology and authorship

(0:02:30) Why PWL wanted to move beyond the Grable–Lytton Risk Tolerance Scale

(0:03:40) Introduction to the Money and Risk Inventory (MRI) and full disclosure

(0:04:55) Announcement: Public access to a psychometric risk tolerance questionnaire

(0:05:10) Risk tolerance vs. risk capacity—and how PWL combines both

(0:06:43) Why firms must map risk scores to asset allocations themselves

(0:08:35) The role of psychology in financial planning beyond technical advice

(0:10:17) The Klontz–Chaffin model of financial psychology

(0:12:05) Why humans are "bad with money": survival brains and emotions

(0:13:30) How heuristics and biases derail long-term planning

(0:15:42) Tools for overcoming bias: automation, pre-commitment, and friction

(0:21:29) How environment and social context shape financial behavior

(0:26:38) Financial flashpoints and their lasting impact on risk tolerance

(0:29:35) Financial self-efficacy and why low confidence leads to avoidance

(0:36:01) Money scripts: avoidant, worship, status, and vigilant

(0:40:07) Why understanding your own money scripts matters

(0:41:19) Common behaviors that lead to poor financial outcomes

(0:42:59) Practical strategies for recognizing and mitigating bad behaviors

(0:48:22) The role of identity in goal setting

(0:50:07) Why goals matter for motivation and behavior alignment

(0:52:56) Intrinsic vs. extrinsic goals and self-determination theory

(0:58:26) When quitting a goal is the right decision

(1:00:26) What financial risk tolerance really is

(1:02:16) Why people consistently misjudge their own risk tolerance

(1:03:31) How stable risk tolerance is over time—and what changes it

(1:05:12) Why reassessing risk tolerance regularly improves outcomes

(1:06:05) Handling couples with mismatched risk profiles

(1:07:37) Psychometric vs. revealed-preference risk questionnaires

(1:09:30) Evidence showing psychometric tools better explain real risk-taking

(1:10:39) Where traditional risk tolerance questionnaires fall short

Links From Today's Episode:

PWL Risk Profile Tool — https://research-tools.pwlcapital.com/research/risk-profile Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

Equal-weighted index funds sound like an elegant solution to some of today's biggest investor anxieties: high market concentration, elevated valuations, and outsized influence from a handful of mega-cap stocks. In this episode of the Rational Reminder Podcast, Ben Felix, Dan Bortolotti, and Ben Wilson take a deep, evidence-based look at whether equal weighting actually improves portfolios—or simply introduces new risks under a different name. The discussion breaks down how equal-weighted indices differ fundamentally from traditional market-cap-weighted indexes, why equal weighting has historically outperformed in certain periods, and what's really driving those results beneath the surface. The team explains how equal weighting tilts portfolios toward smaller, cheaper, and more volatile stocks, while also systematically trading against momentum due to frequent rebalancing.

Key Points From This Episode:

(0:01:10) Introduction to Episode 394 and discussion about declining enthusiasm over long podcast runs.

(0:02:00) PWL Capital's growing work with institutional clients and why index-based approaches are rare in that space.

(0:05:12) Episode topic introduced: equal-weighted index funds and why listeners keep asking about them.

(0:06:00) Definition of market-cap-weighted vs. equal-weighted indexes using the S&P 500 as the main example.

(0:07:14) Historical outperformance of equal-weighted S&P 500 indexes and why start dates matter.

(0:09:00) Equal weight vs. cap weight performance over the last decade: meaningful recent underperformance.

(0:10:21) Market concentration concerns and why equal weighting appears attractive during periods of high valuations.

(0:12:00) Why market-cap-weighted indexes do not mechanically buy more overvalued stocks as prices rise.

(0:16:14) Trading costs explained: explicit vs. implicit costs and why turnover matters more than TER.

(0:19:16) Capital gains, tax efficiency, and reporting differences between Canadian and U.S. funds.

(0:21:07) Market concentration historically shows little relationship with future returns.

(0:24:58) Volatility comparison: equal-weighted indexes are meaningfully more volatile due to small-cap exposure.

(0:25:12) Equal weighting increases exposure to small-cap, value, and high-volatility stocks.

(0:28:58) Sector distortions created by equal weighting and why this represents uncompensated risk.

(0:31:21) Unintended consequences: sector bets, security-level overweights, and forced rebalancing.

(0:32:30) Turnover is roughly 10× higher in equal-weighted funds than cap-weighted equivalents.

(0:33:15) Equal weighting behaves as a systematic anti-momentum strategy.

(0:34:02) Multi-factor regression results: positive size and value exposure, negative momentum loading.

(0:36:33) Rebalancing frequency trade-offs and how quarterly rebalancing amplifies momentum drag.

(0:42:21) Comparison with alternative approaches that target similar factor exposures more efficiently.

(0:44:47) Why backtests are seductive—and why live fund results matter more.

(0:47:40) Investor behavior, uncertainty, and the constant search for strategies that "fix" the market.

(0:48:41) Factor investing in disguise: most deviations from cap-weighting are just factor tilts.

(0:53:06) Equal weighting as an acceptable strategy—if investors understand and accept the trade-offs.

(0:57:18) Listener feedback, enthusiasm jokes, and discussion about Spotify video uploads and audio speed.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Dan Bortolotti — https://pwlcapital.com/our-team/

Dan Bortolotti on LinkedIn — https://ca.linkedin.com/in/dan-bortolotti-8a482310

Ben Wilson on LinkedIn — https://www.linkedin.com/in/ben-wilson/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

What if financial planning were approached the same way engineers design aircraft, medical treatments, or complex systems—with clearly defined objectives, constraints, and rigorous trade-off analysis? In this episode, Benjamin Felix is joined by Braden Warwick for a deep dive into what it means to engineer financial outcomes. Drawing on Braden's background as a PhD-trained mechanical engineer and his work building financial planning software at PWL Capital, the conversation reframes financial planning as a design problem rather than a speculative exercise. They explore the critical distinction between a financial plan and a financial projection, why uncertainty does not invalidate good planning, and how professional communication under uncertainty can build trust with clients—especially those from technical backgrounds. The discussion highlights the importance of goals-based planning, sensitivity analysis, and explicitly quantifying trade-offs when clients have multiple competing objectives.

Key Points From This Episode:

(0:00:04) Introduction to Episode 393 and the return of Braden Warwick (0:02:50) Braden's role at PWL and his experience deploying Conquest Planning software (0:05:46) The tension between low industry entry barriers and professional standards in financial planning (0:07:54) Braden's background in mechanical engineering and academia 0:09:33) Financial plans vs. financial projections: why uncertainty doesn't make a plan "wrong" (0:12:59) Lessons from medicine and engineering on communicating decisions under uncertainty (0:15:15) An engineering framework for financial planning: objectives first, then solutions (0:18:42) Why surface-level goals like "minimize tax" or "maximize returns" often miss what really matters (0:21:19) Evaluating plans against goals using projections, scenario analysis, and sensitivity analysis (0:24:28) Why sensitivity analysis helps planners focus on what actually drives outcomes (0:29:27) Handling multiple competing goals using trade-off analysis and Pareto frontiers (0:36:46) Practical ways planners can present trade-offs without complex math (0:39:25) Case study setup: professional financial planning with corporate clients (0:40:20) Salary vs. dividends for business owners when optimizing for legacy goals (0:44:26) Why financial planning software outputs can be misleading without context (0:48:23) The importance of understanding how planning software calculates key metrics (0:50:22) Using PWL's free retirement tool to analyze CPP and OAS timing decisions (0:53:44) Approximating Monte Carlo outcomes using standard error of the mean (0:56:16) Linking "bad" and "terrible" outcomes to plan success probabilities (0:58:44) How CPP and OAS deferral affects sustainable spending and downside protection (1:02:46) What makes PWL's CPP calculator different from typical break-even tools (1:05:15) Why wage inflation assumptions materially affect CPP deferral decisions (1:07:46) Closing framework: goals, constraints, sensitivity analysis, and quantified trade-offs (1:09:36) Financial planning as an emerging discipline rooted in engineering-style thinking

Links From Today's Episode: Live Webinar: How Much Do You Need to Retire in Canada? | Feb 12 @ 12NN EST | Register here — https://pages.pwlcapital.com/webinar-how-much-do-you-need-to-retire-in-canada?utm_source=rational%20reminder&utm_medium=rr_ep393&utm_campaign=webinar_retirement

Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582.

Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/

Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

ETFs were once almost synonymous with low-cost, sensible investing. But that era is changing fast. In this episode, Ben Felix, Dan Bortolotti, and Ben Wilson introduce and unpack the concept of "ETF slop"—the explosion of complex, high-fee, behaviorally engineered ETFs that are designed to attract assets rather than improve investor outcomes. The trio traces how ETFs evolved from simple index-building tools into wrappers for increasingly speculative strategies. They discuss how the ETF "halo effect" can mislead investors into equating structure with quality, and why innovation in financial products often benefits manufacturers more than end investors. From thematic hype to downside "protection" that isn't what it seems, the episode offers a clear framework for thinking critically about modern ETF offerings.

Key Points From This Episode:

(0:00:04) Introduction to the Rational Reminder Podcast and the hosts. (0:00:39) Ben introduces the idea of "ETF slop" and why ETFs are no longer synonymous with sensible investing. (2:20) More actively managed ETFs now exist than index-tracking ETFs in the U.S. (3:30) ETFs increasingly engineered to attract assets rather than improve investor outcomes. (4:04) Record ETF launches in 2025: over 1,000 in the U.S. and 300+ in Canada. (6:43) Average management fees on newly launched ETFs rival traditional active mutual funds. (7:47) The ETF "halo effect" and why structure is mistaken for quality. (10:31) What an ETF actually is—and why it's just a wrapper for a strategy. (11:13) The first ETF was launched in Canada and still exists today. (14:40) ETFs as tools for speculation versus long-term investing. (17:08) Evidence that simpler allocation funds reduce harmful investor behavior. (20:35) Why too much product choice can make good investing harder. (21:40) Four categories of ETF slop introduced: thematic, buffer, covered call, and single-stock ETFs. (22:16) Why thematic ETFs appeal to optimism and extrapolation bias. (24:04) Evidence that most thematic ETFs underperform after launch. (26:25) Morningstar data: almost no thematic ETFs outperform over long horizons. (28:55) Why exciting narratives don't translate into superior returns. (31:25) Buffer ETFs explained: capped upside with partial downside protection. (34:31) Research showing high fees, high costs, and inconsistent protection. (38:16) Why simple stock/bond mixes dominate buffer ETFs even in drawdowns. (42:53) Covered calls: high income today, lower total returns tomorrow. (45:48) Why covered call ETFs systematically underperform their underlying assets. (47:38) Income needs can be met more efficiently without covered calls. (48:19) The cult-like following driven by double-digit yield marketing. (49:57) Single-stock ETFs as the "sloppiest" form of ETF slop. (53:44) Leveraged and inverse ETFs magnify volatility and complexity. (56:20) Research showing massive underperformance versus simple benchmarks. (58:56) Why these products resemble speculation more than investing. (1:03:35) Complexity in investment products is strongly linked to poor outcomes. (1:05:48) John Bogle's warning: beware of new and "hot" investment products. (1:06:48) Why ETFs are powerful tools—but only when used correctly.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Ben Wilson on LinkedIn — https://www.linkedin.com/in/ben-wilson/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

Financial planning is built on assumptions — about markets, inflation, longevity, human behaviour, and even the questions clients bring into the room. In this episode, Ben and Braden welcome a diverse panel that originally came together at the FP Canada Conference to explore how those assumptions influence planning outcomes in practice. Joining them are Adam Chapman, a retirement-focused planner who helps clients turn their money into memories; Joe Nunes, an actuary with decades of pension and longevity experience; and Aaron Theilade, Director of Continuing Education at FP Canada. Together, the panel unpacks how to make assumptions credible, how to stress-test them, how to navigate client bias, and how planners can blend math with humanity to create better client outcomes.

Key Points From This Episode:

(0:00:04) Why this episode: recreating a conference panel on planning assumptions.

(0:01:03) Braden on the panel's value for planners and DIY investors.

(0:02:32) Meet the guests: Adam, Joe, Aaron, and Braden.

(0:06:04) Assumptions matter: directional accuracy > prediction.

(0:07:47) Actuarial view: start with inflation, bond yields, and risk capacity.

(0:09:38) Engineering mindset: plan for expected and unexpected outcomes.

(0:13:21) Client pushback: longevity surprises and hidden assumptions.

(0:16:59) Asset allocation: strategic, goal-based, informed by behaviour.

(0:20:57) Software limits: life is too variable for perfect modeling.

(0:22:01) Behaviour gap: retirees spend less over time despite inflation.

(0:25:18) Software guides; planners interpret and humanize outputs.

(0:28:48) Use assumptions based on the specific question (e.g., withdrawals).

(0:30:31) Always ask: "Why are we modeling this?"

(0:34:15) Handling bias: reframe assumptions to reveal inconsistencies.

(0:38:19) Assumptions evolve: returns, spending, and research all change.

(0:42:38) Longevity beliefs: explore "why," not just the data.

(0:50:38) Core truth: every plan is wrong — planning is iterative.

(0:52:20) When to update: depends on age, goals, and material changes.

(0:57:23) PWL approach: twice-yearly updates + adjustments during extremes.

(1:00:03) Tips: focus on behaviour, communication, goals, and integration.

(1:10:02) Success: relationships, impact, freedom, and sharing knowledge.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this first episode of 2026, we sit down for a deep dive into one of the hottest concerns coming from clients and listeners lately: Is the U.S. stock market dangerously concentrated—and are we in an AI bubble? Ben, Dan, and Ben unpack the data, the history, and the psychology behind today's valuations, drawing lessons from past episodes of market euphoria such as Nortel in Canada, the dot-com boom, and Japan's 1989 peak. They explain why high market valuations—not concentration—pose the bigger challenge, how bubbles historically fuel real economic innovation while hurting investors, and why diversification continues to offer the only reliable protection against unknowable futures. Along the way, they revisit examples of how value stocks, small-cap value, and global diversification have fared across different market regimes.

Key Points From This Episode:

(0:00:40) What RR is about: evidence-based insights, synthesis episodes, expert interviews, and long-form inquiry — not debates.

(0:04:20) Why listeners value RR: transparency, friendly inquiry, returning to topics over time, and the hosts' dynamic.

(0:09:25) Rising concern: clients asking whether U.S. market concentration and an AI bubble mean it's time to exit stocks.

(0:11:10) Advisors echo similar worries: U.S. politics, all-time highs, and emotional decision-making.

(0:14:20) Today's data point: Top seven U.S. stocks = 36% of S&P 500; 32% of the total U.S. market — highest on record.

(0:16:10) Why people fear concentration: a decline in the Magnificent Seven could meaningfully drag down the index.

(0:17:30) Canada's cautionary tale: Nortel once hit 36% of the TSX — collapsed to zero — but the market recovered by 2005.

(0:21:20) Bubbles through history: canals, railways, fiber optics, dot-coms — innovation funded by speculation.

(0:25:30) Dot-com parallels: huge ideas, low cost of capital, lots of failures — but lasting infrastructure remained.

(0:28:40) AI dominance: Since ChatGPT, AI-linked companies drove 75% of S&P returns, 80% of earnings growth, 90% of capex.

(0:31:15) Reminder: No bubble calls — just context. High prices don't equal an inevitable crash.

(0:33:10) Concentration vs. valuation: concentration shows weak links to future returns; valuations matter far more.

(0:35:05) Market timing trap: U.S. valuations were high in 2021 — selling then would have been disastrous.

(0:36:40) The U.S. lost decade: 2000–2010 returns were flat; in CAD, recovery didn't happen until 2013.

(0:38:55) Value stocks held up: U.S. value and small-cap value delivered positive returns while broad indexes stagnated.

(0:41:00) Recency bias reminder: Canadians once avoided U.S. stocks entirely after a decade of underperformance.

(0:44:05) Japan 1989: World's largest market crashes — still not recovered in real terms 36 years later.

(0:47:10) Global diversification wins: A 40% Japan-weighted global portfolio still performed fine thanks to U.S. growth.

(0:49:00) Cross-country data: Many markets are far more concentrated than the U.S. — still delivered solid returns.

(0:52:30) Valuation evidence: Higher CAPE = lower future returns — economically strong pattern across countries.

(0:55:40) Core lesson: Diversification + discipline. You will always hold winners and losers — that's the point.

(0:57:55) Practical ways to lower concentration risk: global equity funds, small caps, and Canada's 10% cap rule.

(1:00:30) Why active managers don't help: only ~30–47% outperform depending on concentration trend.

(1:03:25) Final takeaway: high valuations may imply lower returns, but prediction is impossible — stay diversified.

(1:05:15) After-show review: Addressing a one-star critique ("Fartcoin Designer") with humour and community context.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this special year-end episode, Ben and Cameron turn the spotlight inward for a behind-the-scenes look at the Rational Reminder podcast. They're joined by the extended team that keeps the show running—from compliance to editing to marketing—to reflect on a landmark year in the podcast's evolution. We hear from Multimedia Specialist Matt Gambino, Compliance Reviewer Ross Brayton, long-time Marketing Lead Angelica Montagano, and others who share their roles, personal stories, and what the show means to them. Ben and Cameron also discuss the podcast's growth trajectory, the impact of joining OneDigital, standout market events from 2025, and what's ahead for 2026. It's a thoughtful, personal, and often funny conversation that celebrates community, nerdiness, and meaningful work.

Key Points From This Episode:

(0:01:00) Behind the scenes: Why the entire Rational Reminder team joined the mic for this special episode.

(0:01:40) Meet the production crew: From video editing to compliance and marketing.

(0:02:54) From 767 to 334,000: How the podcast grew since August 2018.

(0:04:40) YouTube's rising role: Now 33% of all podcast consumption.

(0:07:24) AMA evolution: How listener Q&As became a regular series in 2025.

(0:08:45) Bringing in PWL advisors: Sharing real-world financial planning experience on the pod.

(0:10:05) 12,500 members: Rational Reminder Community continues to thrive.

(0:11:30) OneDigital acquisition reflections—one year later, no pressure to cut costs or change values.

(0:14:23) Compliance-free growth: Maintaining service levels while scaling the firm.

(0:15:06) Market surprise of 2025: Canadian small caps up 35%+ year-to-date.

(0:16:55) Real estate rewind: National average home prices down 20% since 2022 peak.

(0:19:24) Rent declines too: Down 7% YoY in Toronto, 4.4% in Vancouver.

(0:20:39) Looking back: A wild year of unexpected returns and market resilience.

(0:21:00) A different kind of year-end episode: No highlight reel—just team storytelling.

(0:23:53) [Matt Gambino] The editor speaks: Role evolution, creative direction, and 200+ episodes later.

(0:28:42) YouTube growth: From 11,000 to 46,000 subs under Matt's watch.

(0:32:55) Matt on money: What 4 years editing the pod taught him about finance and happiness.

(0:36:54) Defining success: Matt's answer after years of listening to the show.

(38:40) [Ross Brayton] Compliance from the inside: What Ross listens for, and why disclaimers got longer.

(0:43:05) Ross on investing: From Warren Buffett books to podcast fact-checker.

(0:46:11) Planning life after financial independence: Ross poses a thoughtful challenge.

(0:47:41) [Angelica Montagano] The original marketer: How the podcast started in a hallway.

(0:50:14) Early tech struggles: Mono recordings, brick recorders, and lots of duct tape.

(0:51:53) COVID's silver lining: Why lockdowns accelerated the pod's evolution.

(0:54:20) Launching the RR Community: From 100-member goal to 12,500+ and counting.

(0:55:49) Podcast = Brand: How RR became central to PWL's identity and communication.

(0:57:26) What's next: Angelica's dreams for live events and even a coffee table book.

(0:59:10) Angelica on investing: From ex-banker cynicism to believer in behavior and psychology.

(1:00:38) Favorite moment: Hearing real stories of how listeners' lives have been changed.

(1:01:36) Defining success: Impact, confidence, and financial empowerment.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

In this special year-end AMA, the full PWL crew — Ben Felix, Cameron Passmore, Ben Wilson, and Dan Bortolotti — sit down together for the first time on the podcast to reflect on the roller-coaster that was 2025 and to tackle a wide range of thoughtful listener questions. The episode begins with reflections on a year that included wild market swings, an extraordinary rally few predicted, major changes within PWL, and personal milestones. From there, the team dives deep into the psychology of staying invested, the real risks of inexperienced investors going 100% equities, the complexity of asset location and pre-tax vs. after-tax allocation, and how to talk to family members who are paying too much in investment fees.

Key Points From This Episode:

(0:04) Introduction — first-ever full-team recording and setup for the year-end AMA.

(1:12) Why not all AMA questions could be answered — over 400 submissions and many not suited to the format.

(1:48) 2024 market recap — from early-year panic to strong double-digit global equity returns.

(3:59) The speed of recoveries — why missing a quick rebound can permanently derail returns.

(5:34) Cameron's lessons from 2024 — unpredictability, growing adoption of evidence-based investing, joining a bigger organization, and driverless-car optimism.

(7:41) Ben Wilson becomes a co-host — an unplanned evolution shaped by listener feedback.

(9:51) Dan on humility in forecasting and reconnecting with theoretical research.

(11:18) Ben's personal year — firm acquisition, equity value jump, and navigating his cancer diagnosis.

(12:32) Talking to parents about high fees — emotional dynamics, non-confrontational questions, and the danger of implied judgment.

(23:01) Should beginners hold 100% equities? Behavioral risk, volatility blindness, and why it shouldn't be the default allocation.

(30:35) Pre-tax vs. after-tax asset allocation — why RRSP dollars aren't equal to TFSA dollars and how that changes true risk exposure.

(36:09) Why PWL rarely optimizes asset location — complexity, low payoff, and behavioral clarity.

(44:42) What PWL does (and doesn't) offer — discretionary management, integrated planning, outside specialists, and tax deductibility rules.

(49:04) "I know I need index funds — but how do I actually buy them?" Robo-advisors vs. one-ticket ETFs and why placing a trade is the real barrier.

(57:47) Ben's lessons as a new homeowner — maintenance costs far above expectations and the hidden burden of being your own contractor.

(1:01:54) The strangest portfolios — single-stock windfalls, leverage without client awareness, bullion-only strategies, and the infamous "meatloaf portfolio."

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Ben Wilson on LinkedIn — https://www.linkedin.com/in/ben-wilson/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, the team digs into the newly updated 2025 edition of The Wealthy Barber — Dave Chilton's iconic Canadian personal finance book that helped shape millions of financial journeys. Ben, Dan, and Ben walk through the biggest lessons Dave has reworked for a world of high housing costs, social-media-fueled spending pressure, new tax-sheltered accounts, and the ever-present noise of investing advice. This discussion explores why the book remains so effective: it blends timeless principles with approachable storytelling, humor, and deeply practical guidance. The conversation also highlights Dave's real-world insights from reviewing thousands of personal financial situations across Canada. You'll hear how the book explains foundational habits like paying yourself first, why simple investing beats stock picking, how renters can build wealth, and why understanding your own spending is the key to unlocking both financial progress and happiness. Whether you're brand new to money or a seasoned investor, the updated lessons hit harder in 2025 than ever before.

Key Points From This Episode:

(0:04) Introduction — recording early and setting up a deep dive into the updated Wealthy Barber.

(0:53) Why the new 2025 edition lands so well: humor, modern references, and timeless lessons.

(1:30) Dave Chilton's real-world insight from reviewing thousands of Canadians' financial situations.

(2:23) Why the storytelling works — characters, humor, and accessible teaching.

(3:45) Inside the narrative: Roy the barber, Matt, Maddie, Jess, Kyle, and the barbershop regulars.

(7:53) Lesson 1: "You can do this" — personal finance isn't about math, it's about simple principles.

(12:08) Lesson 2: Save 10% and pay yourself first — habit beats theory, compounding does the rest.

(14:29) Why saving is hard today: algorithms, FOMO, lifestyle creep, and rising costs.

(16:57) The behavioral case for saving early, even if economists say otherwise.

(18:52) Lesson 3: Be an owner, not a loaner — stocks vs. bonds and the engine of human ingenuity.

(22:49) The investor's paradox — the less you think you know, the better you invest.

(24:05) Why indexing wins: skewed stock returns and the impossibility of picking winners.

(27:49) How investing has changed since 1989 — indexing is now widely accessible.

(28:18) "The world feels scary today…" — the 1847 quote showing it always feels that way.

(34:03) RRSP vs. TFSA — identical outcomes at equal tax rates, and why RRSPs shine when taxed lower later.

(39:12) Debunking the RRSP "tax bomb" — why high earners still benefit most.

(42:06) Lesson 4: Housing — the four levers to buy today (cheaper homes,

(46:34) Why today's young buyers need new strategies, not 1980s nostalgia.

(48:02) Longer amortizations: counterintuitive but often financially sound.

(49:05) Leverage vs. psychology — why borrowing to invest feels scary even when the math matches.

(52:36) Renting isn't throwing money away — disciplined renters can match homeowner wealth.

(53:51) The hidden costs of owning — repairs, trees, chimneys, and constant surprises.

(55:44) The Canadian stigma around renting — and why it's undeserved.

(56:42) Lesson 5: Spending — "faulty brain wiring," social pressure, and unconscious habits.

(1:00:46) The multi-month spending summary — tedious but life-changing for both finances and happiness.

(1:02:43) Joy units per dollar — reallocating spending to maximize happiness.

(1:03:47) Practical rules: delay big purchases, beware car costs, indulge selectively, and remember "$1 saved = $2 earned."

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Ben Wilson on LinkedIn — https://www.linkedin.com/in/ben-wilson/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

What happens when alternative investments shift from niche products to the industry's go-to value proposition? In this episode, we're joined by financial planner and self-described "pathological nerd" Aravind Sithamparapillai for a rigorous exploration of private markets, product due diligence, advisor incentives, and the narratives driving the surging popularity of alts. Aravind has become known in advisor circles for asking the uncomfortable questions at conferences—the ones that expose gaps in explanations, shaky assumptions, and in some cases, outright contradictions. In this conversation, he shares the stories and analytical frameworks behind his deep dives into mortgage funds, private credit, private real estate, IRR-based marketing, vintage stacking, stale pricing, operational risk, and why even large professional allocators get burned. We explore how advisors are selling alts, how funds are pitching them, what due diligence actually requires, how expected returns can be decomposed, and why illiquidity and "low correlation" benefits rarely play out in practice. Aravind also explains how some funds maintain stable NAVs through "extend and pretend," how gating works, why audited financials aren't a safety blanket, and why even top-tier firms miss red flags.

Key Points From This Episode:

(0:00:38) Aravind's introduction and reputation for deep, "pathological" research

(0:02:23) Why alts have become embedded in Toronto's planning culture

(0:03:38) Client pressure, advisor FOMO, and the belief that 60/40 is "broken"

(0:05:31) Aravind's personal path into indexing, factors, and Dimensional

(0:10:46) Why he started digging into alts: curiosity, client conversations, and advisor narratives

(0:13:47) The "conference meme": why he asks questions others avoid

(16:58) The role of intellectual honesty vs. industry narratives

(20:19) The pivotal 2023 mortgage fund story: duration, turnover, and a major contradiction

(22:51) "Extend and pretend": how stable NAVs can be manufactured

(28:59) What "gating" actually means and why it matters

(31:48) Marketing tactics: cherry-picked start dates and chart crimes

(32:47) IRR manipulation, vintage stacking, and anchoring bias

(36:35) Why comparing gross private credit returns to net equity returns is misleading

(39:18) The problem with "low correlation" as a selling point

(41:00) Why rebalancing with illiquid assets often fails in practice

(44:58) How Aravind builds expected return estimates for alts

(47:07) Private real estate: why expected returns often land near public market levels

(48:48) A case study: apparent outperformance disappears once you match the right benchmark

(51:43) The idiosyncratic risk of overweighting single-sector, single-region REITs

(55:12) Why most advisors don't truly understand the all-in fees

(58:00) What real due diligence should include (and why it's so hard)

(1:00:35) Should advisors trust third-party due diligence providers?

(1:02:58) How much comfort should investors take from audited financials?

(1:05:02) Why valuation levels (1–3) matter and why most private funds use Level 3 inputs

(1:06:00) The overall conclusion: markets work, but alts require extraordinary scrutiny

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Ben Wilson on LinkedIn — https://www.linkedin.com/in/ben-wilson/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we feature two conversations that highlight PWL's culture, values, and intentional approach to advice. We first sit down with Trevor Daigle and Brett Watt, founders of EB Wealth in Halifax, to talk about why they chose to merge their thriving independent practice with PWL — PWL's first acquisition in Atlantic Canada. Trevor and Brett open up about what they saw in PWL's infrastructure, culture, and client-first philosophy, the internal hurdles they had to clear (including their own egos), and the moment they realized they "couldn't unsee" what PWL had built. Then, in the second half of the episode, PWL Portfolio Manager and Financial Planner Phil Briggs walks us through a remarkable real-world case. A podcast listener's father decided to take the commuted value of his defined benefit pension… and the family approached PWL to invest it. Rather than simply execute the plan, Phil stepped back to rigorously analyze whether that decision made sense at all. The result is one of the most compelling demonstrations of evidence-based financial planning we've featured on the show — covering risk pooling, tax implications, Monte Carlo results, survivor benefits, and the emotional side of decision-making.

Key Points From This Episode:

(0:00:51) Welcoming Trevor and Brett — and why their practice, EB Wealth, aligned so closely with PWL's holistic philosophy.

(0:02:30) How long-term cultural fit, infrastructure, and research depth drove their decision to join PWL.

(0:04:57) "We can't unsee that": The moment a visit to Ottawa convinced them PWL's values were real at every level.

(0:07:45) Their biggest concern: giving up control after years of running an independent practice — and how that shifted.

(0:09:43) Setting aside ego: How thinking long-term and client-first changed their perspective on joining PWL.

(0:11:35) What excites them most about the future: growth, learning, and being surrounded by experts who prioritize client outcomes.

(0:13:17) Seeing PWL's collaborative culture in action — and why industry-typical "sales meetings" were nowhere to be found.

(0:14:43) Transitioning clients and feeling the immediate impact on conversations and relationships.

(15:05) The setup: A podcast listener reaches out after his father already decided to take the commuted value of a DB pension.

(17:25) Why Phil was surprised — and the questions he wanted answered before talking about investing.

(17:25–18:49) The benefits of staying in a DB pension: risk transfer, inflation protection, and mortality pooling.

(19:07) The risks: employer insolvency, underfunding, and historical examples like Sears Canada and Nortel.

(20:10–22:04) Evaluating pension solvency: sponsors, surplus status, funding ratios, diversification, and regulatory filings.

(23:49) Reasons someone might take the commuted value: investment preferences, life expectancy concerns, and survivor benefits — the central issue in this case.

(25:15–30:52) The tax trap: how the "excess amount" of a commuted value can trigger immediate taxation — in this case at the 53.53% marginal rate — and how RRSP room and PARs interact.

(31:26–33:53) Modeling the decision: building retirement scenarios in financial planning software, including spending, inflation, CPP/OAS, rental income, and Monte Carlo analysis.

(34:00–37:54) Results:

60/40 investment after commuting: overfunded plan but with significant volatility.

100% equity: higher legacy, similar failure rate.

Leaving the pension with the employer: similar retirement score but dramatically higher Monte Carlo success (96%) due to guaranteed income, inflation hedging, and tax smoothing.

(38:32–40:55) Why the pension's stable income floor and deferred taxation made such a big difference — even in a shortened-life-expectancy scenario.

(41:05–41:37) Other firms simply accepted the commuted-value plan; PWL was the only firm to fully analyze the decision.

(43:50–44:53) How personal values, risks, and emotional comfort interact with data in real financial planning decisions.

(45:00–47:28) The next decision: choosing between a higher pension with a 2/3 survivor benefit or a lower pension with a 100% survivor benefit — and how break-even analysis (age 81) informed the client's choice.

(47:44–48:31) Why planning software provides clarity people can't get through gut feel alone.

(48:31–49:59) Trust and incentives: why turning down a large investable sum was the right decision — and why PWL celebrates that.

(50:08–51:01) Culture + incentives: how PWL's structure allows advisors to prioritize clients without sales pressure.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Ben Wilson on LinkedIn — https://www.linkedin.com/in/ben-wilson/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we're joined by Mamdouh Medhat, VP and Senior Researcher at Dimensional Fund Advisors, for an exceptionally deep, exceptionally nerdy exploration of factor investing—focusing on profitability, value, defensive equity, and the persistent misunderstandings that surround them. Mamdouh walks us through his retrospective paper (co-authored with Robert Novy-Marx) on the profitability premium, why profitability subsumes a wide range of quality metrics, and why it dramatically clarifies how we should think about defensive/low-volatility strategies. He also explains the role of profitability in value's US underperformance since 2007, why price-to-book remains a remarkably effective valuation metric, and how Dimensional incorporates these insights into portfolio construction. In the second half of the conversation, we shift to private markets. Mamdouh unpacks Dimensional's research on buyouts, venture capital, private credit, and private real estate—revealing what percentage of the global investable universe these funds actually represent, how to benchmark them properly, how much dispersion exists across managers, how fair-value accounting changed the game post-2007, and why many perceived diversification benefits are actually just return smoothing.

Key Points From This Episode:

(0:04) Intro to Mamdouh Medhat and why his research fits the Rational Reminder "nerdy happy place."

(1:32) The story behind Mamdouh's retrospective paper with Robert Novy-Marx and the impact of the original profitability research on academia and practice.

(5:36) Three things the paper examines: quality investing, defensive/low-risk strategies, and value—unified through profitability.

(6:55) Why none of the 15 major academic and practitioner quality metrics add explanatory power beyond profitability.

(8:18) How spanning tests show profitability explains quality, but quality does not explain profitability.

(12:24) Quality measures largely load on profitability—they're noisier versions of the same thing.

(13:14) The link between quality metrics and fundamental momentum, especially for QMJ and quarterly ROE.

(15:18) Practical implications: profitability is a parsimonious, more efficient way to capture the "quality" dimension.

(16:30) Defensive equity through the profitability lens—why high profitability predicts low volatility.

(18:58) Why long-only low-volatility strategies produce zero five-factor alpha—and why a simple high-profitability/low-investment portfolio plus T-bills beats them.

(22:14) Alternative value metrics (EBITDA/EV, intangible-adjusted book-to-market, etc.) don't outperform price-to-book when profitability is accounted for.

(24:57) Many "improved" value metrics simply rotate in profitability exposure, not better value information.

(26:17) Roughly half of US value's post-2007 underperformance is explained by its negative correlation with profitability.

(28:42) Industry tilts (e.g., energy/financials vs. tech/healthcare) drive much of value's volatility—not its long-term return.

(30:33) The theoretical case for combining clean valuation (price-to-book) with clean expected cash flow (profitability).

(33:36) Academic implications: models must jointly explain value and profitability—and their negative correlation.

(35:09) Practitioner implications: parsimony—use clear valuation and cash-flow measures, limit excessive complexity.

(36:53) How Dimensional measures profitability: operating profitability (revenue – COGS – SG&A – interest) scaled by book equity.

(41:09) Why tilting toward or away from countries based on aggregate characteristics rarely adds value—premiums come from stocks, not countries.

(42:57) Industry-level tilts show similar patterns—industry momentum exists but is impractical due to massive turnover.

(46:15) How Dimensional handles country and industry weights: sort within countries, then apply sector caps.

(48:27) Private markets: private funds make up roughly 10% of the global investable universe—not 25–100% as sometimes claimed.

(50:53) Benchmark choice for private funds is crucial—S&P 500 is not appropriate for buyouts or VCs.

(52:00) Using KSPME (public-market equivalent), buyouts and VCs match small-cap value/growth benchmarks; private credit matches high yield; private real estate underperforms listed real estate.

(55:50) Factor exposures post-2007 explain 70–80% of private-fund return variation due to fair-value accounting.

(1:00:48) Wide dispersion in private-fund performance—top 5% double or triple capital; bottom 5% lose half.

(1:03:49) Little evidence of manager persistence—manager selection must rely on due diligence, not past vintages.

(1:08:24) No strong time trend in private-fund outperformance, but correlations with public markets have increased.

(1:09:13) Many diversification benefits historically attributed to private assets were actually illiquidity-driven smoothing.

(1:12:25) Rising demand and democratization likely reduce expected returns in private markets—exclusivity is fading.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582.

Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on YouTube — https://www.youtube.com/channel/Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode of Rational Reminder, Ben Felix, Cameron Passmore, and Ben Wilson return with a classic AMA format—answering listener questions that dig deep into the behavioral and evidence-based foundations of sensible investing. From lump-sum investing to the psychology of advice, the trio blend data, humor, and clear thinking to demystify complex financial ideas. They discuss the behavioral logic behind dollar-cost averaging, why mutual funds might actually be more tax-efficient than ETFs in Canada, and whether technology could ever truly replace human financial advisors. Plus, they share their biggest investing mistakes (yes, Bitcoin makes an appearance), dissect the rise of "buffered" ETFs, and explain why chasing complexity usually costs investors more than it helps.

Key Points From This Episode:

(0:00:05) Introduction – The first episode featuring all three hosts together: Ben Felix, Cameron Passmore, and Ben Wilson. (0:44) OneDigital update: expanding evidence-based advice across Canada with new PWL partners in Halifax. (2:36) The mission in motion – bringing the "markets work and planning matters" philosophy to more Canadians. (5:29) "Finding and funding a good life" – how PWL integrates wellness and happiness into financial planning. (6:16) AMA Question 1: Lump-sum vs. dollar-cost averaging — why lump-sum wins 65% of the time. (10:05) Base rates, behavioral regret, and the real role of an advisor. (12:22) The 2020 PWL paper results and how behavioral hedging fits in. (16:10) If dollar-cost averaging feels safer, maybe your portfolio is too aggressive. (18:08) AMA Question 2: Advice for smaller portfolios — how technology, AI, and fee-only planners can fill the gap. (21:01) Can AI really replace advisors? Cameron's Waymo analogy sparks debate. (23:33) AMA Question 3: Mutual funds vs. ETFs — why in Canada, mutual funds may actually be more tax-efficient. (30:00) The Capital Gains Refund Mechanism (CGRM) explained — and why it matters. (34:31) Dimensional's Canadian funds vs. Vanguard ETFs — tax distribution data that surprises most investors. (37:40) AMA Question 4: Are discount bonds priced for tax efficiency? The evidence says no—discount bonds still win. (42:23) AMA Question 5: Biggest investment mistakes — from Bitcoin regrets to house-buying reflections. (48:15) AMA Question 6: Buffered ETFs — comfort, complexity, and why simple portfolios outperform. (53:45) Simplicity as a superpower — why "markets work" is still the most radical idea in finance. (55:27) AMA Question 7: Updating the RR model portfolio — why there's no "optimal" portfolio and simplicity wins again. (58:31) After show: Reviews, humor, and a reminder about "No Net Worth November." (1:04:15) Life offline — Cameron's reflections on quitting social media and finding clarity.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder Website — https://rationalreminder.ca/

Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on X — https://x.com/RationalRemindRational Reminder on TikTok — www.tiktok.com/@rationalreminder

Rational Reminder on YouTube — https://www.youtube.com/channel/

Rational Reminder Email — info@rationalreminder.caBenjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, Ben, Cameron, and Dan are joined by Ted Cadsby, former executive at CIBC, author of The Power of Index Funds, Closing the Mind Gap, and Hard to Be Human. Ted brings a rare combination of experience in both finance and cognitive psychology, having helped introduce index investing to Canada before turning his attention to how human thinking itself often misleads us. Ted shares inside stories from his time at CIBC—how he tried to make the bank an indexing leader in the late 1990s, the pushback he faced, and why he still believes so deeply in indexing today. Then, the conversation turns to human cognition: why our brains evolved for simplicity, certainty, and emotion, and how those traits can sabotage both our portfolios and our peace of mind. From "greedy reductionism" and "certainty addiction" to emotional overreaction and competing selves, Ted unpacks the five cognitive design flaws that make it hard to be human—and how metacognition and mindfulness can help us overcome them.

Key Points From This Episode:

(0:04) Introduction to the Rational Reminder Podcast and hosts.

(0:18) Cameron's story about rediscovering The Power of Index Funds and reconnecting with Ted Cadsby.

(2:21) How Ted brought index investing to CIBC and tried to make the bank a leader in indexing.

(5:58) Why assessing active managers taught Ted about randomness, noise, and the illusion of skill.

(8:42) The moment Ted "saw the light" on indexing—and why randomness, not market efficiency, is the real obstacle for active managers.

(12:54) How Ted tried to implement index investing at CIBC and the cultural resistance he faced.

(15:05) The goals of The Power of Index Funds (1999) and how he tied indexing to human behavior.

(18:49) How his indexing push created internal conflict at CIBC and ultimately led to his departure.

(23:23) The influence of John Bogle and Vanguard on Ted's mission to bring indexing to Canada.

(26:59) Why he's still passionate about indexing, and what worries him about private equity.

(31:44) How human cognition and philosophy led him from finance to exploring how we think.

(34:46) The "Big Five" cognitive design flaws that shape human decision-making:

1. Greedy reductionism – our urge to oversimplify complex systems.

2. Certainty addiction – craving the feeling of knowing, even when we're wrong.

3. Emotional hostage-taking – overreacting and ruminating.

4. Competing selves – inner conflicts between present and future selves.

5. Misguided search for meaning – overextending our need for purpose.

(44:11) Why modern life amplifies these flaws and how System 1 (automatic) and System 2 (deliberate) thinking play into it.

(48:00) The human superpower: metacognition—our ability to think about thinking.

(49:57) How mindfulness and a "meditative stance" help us use metacognition daily.

(53:57) Why knowing your biases isn't enough—emotional regulation is the real challenge.

(56:27) How to recognize triggers for deeper reflection and System 2 thinking.

(1:00:34) How systems thinking and better questions can combat our reductionist tendencies.

(1:05:57) Why our addiction to certainty fuels overconfidence and poor decisions.

(1:08:43) How humility, probabilistic thinking, and skepticism can make us wiser investors and humans.

(1:11:39) When to listen to emotions—and when to treat them as cognitive red flags.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder Website — https://rationalreminder.ca/

Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on X — https://x.com/RationalRemindRational Reminder on TikTok — www.tiktok.com/@rationalreminder

Rational Reminder on YouTube — https://www.youtube.com/channel/

Rational Reminder Email — info@rationalreminder.caBenjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Dan Bortolotti — https://pwlcapital.com/our-team/

Dan Bortolotti on LinkedIn — https://ca.linkedin.com/in/dan-bortolotti-8a482310

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this special Investing 101 episode, the Rational Reminder hosts—Ben Felix, Dan Bortolotti, and Ben Wilson—team up to revisit the fundamental concepts that every investor should understand before diving deep into portfolio construction or market theory. Drawing from Ben's original "Investing 101" presentation and years of client experience, the trio lay out why investing matters, how inflation shapes your future, what stocks and bonds really represent, and why a disciplined, evidence-based approach beats prediction and luck every time. They unpack core ideas like financial independence, risk versus volatility, global diversification, and market efficiency, then connect them to practical tools like ETFs and Vanguard's asset allocation funds.

Key Points From This Episode:

(0:00:24) Why this episode revisits "Investing 101"—inspired by a listener still unsure how to begin.

(0:05:03) Why investing matters: inflation erodes purchasing power, investing fights back.

(0:06:33) The math of compounding: how a 7% return versus 2% changes your retirement entirely.

(0:10:57) Saving early and often: habit formation beats late-life catch-up.

(0:11:53) The trade-off between saving more and taking more investment risk.

(0:14:04) Utility theory and the psychology of saving when young.

(0:16:39) Marginal utility: when more money no longer adds happiness or purpose.

(0:20:47) Stocks and bonds explained: ownership versus lending and the role of each.

(0:23:11) The Japan story: a cautionary tale about chasing past winners.

(0:26:49) Narrative investing: why investors love stories and get burned by them.

(0:30:19) Market capitalization weighting—how global prices tell you what to own.

(0:33:42) The stock market is not the economy: why news headlines mislead investors.

(0:37:14) The power of diversification: why most individual stocks fail—and a few drive all returns.

(0:41:56) Bonds, volatility, and inflation risk—why "safe" assets aren't risk-free.

(0:44:41) Building your mix: matching volatility tolerance with long-term goals.

(0:45:10) The behavioral challenge: risk is only useful if you can stay invested.

(0:48:08) Active management as gambling: adding unrewarded noise to your portfolio.

(0:51:43) The paradox of skill: why markets punish even brilliant active managers.

(0:55:51) Efficient markets and Eugene Fama: the evidence that prices already reflect all information.

(1:00:20) How small fees compound into big losses over decades.

(1:03:07) The behavioral hurdle of indexing: trusting a system with "no one at the wheel."

(1:04:54) The real value of financial advice: behavior, discipline, and holistic planning.

(1:07:24) Implementing the plan: how asset allocation ETFs simplify everything.

(1:11:41) Rebalancing and emotion: why automation protects investors from themselves.

(1:14:24) Paying a bit more for simplicity: why 0.10% in fees can be worth it.

Links From Today's Episode: Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder Website — https://rationalreminder.ca/

Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on X — https://x.com/RationalRemindRational Reminder on TikTok — www.tiktok.com/@rationalreminder

Rational Reminder on YouTube — https://www.youtube.com/channel/

Rational Reminder Email — info@rationalreminder.caBenjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Dan Bortolotti — https://pwlcapital.com/our-team/

Dan Bortolotti on LinkedIn — https://ca.linkedin.com/in/dan-bortolotti-8a482310

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

What if capitalism itself is confusing your personal finance decisions? In this week's episode, Harvard economist John Y. Campbell joins us to unpack his new book, Fixed: Why Personal Finance Is Broken and How to Make It Work for Everyone, co-authored with Tarun Ramadorai.

John argues that the financial system—while essential—is failing ordinary people through complexity, hidden costs, and misplaced incentives. Drawing on decades of research in household finance, he explains why products are too expensive, advice too conflicted, and decisions too difficult, and how policy and design can fix it.

Key Points From This Episode:

(0:04) Introduction – Rational Reminder's focus on sensible investing and decision-making. (1:46) Why Canadian finance feels broken: complexity, branding, and lack of competition. (4:53) Introducing John Y. Campbell and his new book Fixed. (5:43) The role of the financial system in everyday life: smoothing income, enabling investment, and managing risk. (7:14) The two main problems in modern finance—products are too complicated and too expensive. (9:17) Why financial decisions are so hard: our brains didn't evolve for math, and temptation bias wins. (11:36) How far financial literacy education really helps—and its limits for inequality. (14:26) The "corruption of capitalism": how capitalists exploit consumer confusion and misperceived value. (18:15) Cross-subsidies: how the mistakes of the poor often subsidize the wealthy. (21:05) Competition only works when consumers can compare price and quality. (22:15) Financial innovation—when technology helps vs. when it deceives. (24:24) Conflicts of interest in advice: why "trusted" advisors often don't act in clients' best interests. (26:26) Why loyal, long-term bank customers often get worse deals. (27:20) The illusion of opting out: why avoiding finance (or choosing crypto) is "jumping out of the frying pan into the fire." (30:24) The global emergency-savings problem—why volatility hits the poor hardest. (32:26) Is college worth it? Returns, costs, and who actually benefits. (35:47) How to think rationally about buying versus renting a home. (38:16) Housing in retirement—why reverse mortgages make sense but are misunderstood. (40:25) Mortgage mistakes: not shopping, not refinancing, and the racial gap that results. (44:41) Using utility theory to make better insurance and investment choices. (46:55) Principles for investing in stocks: participate, diversify, minimize fees, and ignore short-term noise. (48:24) How real investor behavior deviates from these principles—chasing returns and confusing investing with gambling. (51:17) Insurance mistakes: overinsuring small risks, underinsuring big ones. (54:11) How much to save for retirement—and how most people fall short. (55:40) Lifecycle investing: why target-date funds are good but could be better. (57:56) Why annuities make sense, and how better framing could make them more popular. (59:30) Technology's double edge: lower costs but higher temptation and discrimination. (1:02:17) Lessons from crypto: why stablecoins matter and what regulators should learn. (1:05:26) From nudge to shove: how governments should actively design simpler, safer products. (1:10:02) Where regulation goes too far—and why governments shouldn't run finance directly. (1:13:10) Priority areas for reform: retirement accounts, transaction accounts, and insurance. (1:14:49) The four design principles for a better system: simple, cheap, safe, easy.

Links From Today's Episode:

Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582.

Rational Reminder Website — https://rationalreminder.ca/

Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on X — https://x.com/RationalRemind

Rational Reminder on TikTok — www.tiktok.com/@rationalreminder

Rational Reminder on YouTube — https://www.youtube.com/channel/

Rational Reminder Email — info@rationalreminder.ca

Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this AMA episode of the Rational Reminder Podcast, Ben Felix and Dan Bortolotti return to answer listener questions across a wide range of topics—from covered call ETFs and dividend tax credits to currency hedging, bond mechanics, leverage, and career reflections. They open with a striking quote from Harvard economist John Campbell on how markets cater to perceived benefits rather than real ones—a perfect setup for their recent discussions on the rise of covered call ETFs.

Key Points From This Episode:

(0:59) John Campbell's quote on capitalism's tendency to meet perceived rather than rational needs—and how that perfectly describes the financial industry.

(3:44) Covered calls as the perfect example: products that respond to investor demand for yield, not what's actually in their best interest.

(4:49) Dan compares income-chasing in covered call ETFs to Apple's marketing genius—except in finance, the benefits flow mostly to issuers, not investors.

(5:48) Why dividend bias was relatively harmless, but the covered call craze is not—and how new ETFs "multiply like rabbits."

(7:46) Ben's analysis: in every example studied, covered call investors ended up with less wealth than those holding the underlying equities.

(8:13) The hidden trade-off: holding covered call ETFs is like keeping 25–30% of your portfolio in cash for a decade.

(9:33) Lighter interlude: Dan teases Ben about his lentil (and later cabbage) lunches.

(9:59) First AMA question: Are domestic dividend tax credits already priced into stock valuations? (Short answer: partially, depending on investor composition.)

(12:13) Why even if tax benefits are "priced in," Canadians with favorable tax rates still come out ahead.

(15:58) Hedging currencies in commodity economies like Canada and Australia—when it helps, when it hurts, and why there's no perfect answer.

(18:48) Dan explains why unhedged portfolios can actually be less volatile for Canadians and why most hedging is imprecise and costly in practice.

(20:03) Behavioral perspective: splitting the difference between hedged and unhedged can be the "strategy of least regret."

(21:06) Bonds demystified—why falling prices during rising rates affect funds and individual bonds equally.

(22:22) Understanding duration: bond ETFs are designed to stay at a target maturity, while individual bonds age toward zero duration.

(26:03) How rising yields actually improve financial plans by boosting future expected returns.

(29:08) Choosing the right bond fund duration based on your time horizon and liabilities.

(33:39) Are recent bond losses an anomaly? Ben and Dan explain how decades of falling rates created unrealistic expectations.

(36:21) The role of unexpected rate changes in bond volatility—and why central banks don't control long-term yields.

(38:01) Market-cap weighting: why it remains the most defensible way to allocate across countries and sectors.

(41:48) What's changed their thinking after six years of Rational Reminder—from Scott Cederberg's asset allocation data to the behavioral power of homeownership.

(45:13) The Horizons/Global X ETF debate: how swap-based, corporate-class structures create tax efficiency—and why that efficiency could vanish.

(50:42) Why PWL avoids these products: potential hidden tax liabilities and lack of transparency for clients.

(54:31) Borrowing to invest: Ben outlines why leverage works in theory—but Dan explains why most investors shouldn't touch it.

(57:25) New "modest leverage" ETFs (125% exposure) as a more behavioral-friendly version of borrowing to invest.

(1:00:36) Fulfillment and frustration in finance: helping people achieve peace of mind vs. seeing deception still rampant in the industry.

(1:03:09) Five years of Vanguard's all-in-one ETFs (like VEQT): how they've delivered exactly what they promised and reshaped DIY investing in Canada.

(1:07:47) Why these "one-ticket" portfolios remain the biggest innovation in Canadian investing—and why global diversification matters more than ever.

(1:08:50) Revisiting bonds in retirement: what to expect when they don't offset stock volatility, and how to rethink risk management beyond yield-chasing.

Links From Today's Episode:

Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder Website — https://rationalreminder.ca/

Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on X — https://x.com/RationalRemind Rational Reminder on TikTok — www.tiktok.com/@rationalreminder

Rational Reminder on YouTube — https://www.youtube.com/channel/

Rational Reminder Email — info@rationalreminder.ca Benjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Dan Bortolotti — https://pwlcapital.com/our-team/

Dan Bortolotti on LinkedIn — https://ca.linkedin.com/in/dan-bortolotti-8a482310

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com)

In this episode, we are joined by Mark Higgins, an award-winning author and institutional investment advisor, to discuss the power and importance of studying US financial history. Mark brings his wealth of knowledge as a financial historian to the show as he shares the value of studying financial history, the role the financial system plays in the overall success of the US, and the impact Alexander Hamilton made on the country. We unpack government debt, the concerning levels of it in America, and the impact of having a central bank before discussing what happens, historically, when a bank is unregulated. Mark describes some early warning signs of a bubble, touches on the historical origins of flawed financial practices, and shares some important lessons we can learn from the history of the US financial system. Hear all about alternative asset classes, evergreen funds, and red flags in the private market. Finally, our guest tells us how he defines his own personal and professional success. This conversation sheds light on the history of finance in the USA and how we can learn from it, so be sure to tune in now!

Key Points From This Episode:

(0:00:00) An introduction to Mark Higgins and an overview of today's topics of discussion.

(0:04:16) The value of studying financial history and the role the financial system plays in the USA as a whole.

(0:06:33) Why Alexander Hamilton stands out in US financial history and the importance of government debt.

(0:09:29) Mark discusses the concerning debt levels in America and the impact of having a central bank.

(0:12:29) What happens when banking is unregulated, and key themes across major US financial depressions.

(0:16:48) Some early warning signs of a bubble and the problematic nature of speculation and comparison.

(0:19:42) Historical parallels for crypto and meme stocks and the historical origin of flawed practices in the investment industry.

(0:24:27) Mark shares some of the most important lessons we can learn from US financial history and what we may have to relearn in the future.

(0:27:41) Alternative asset classes, why so much has been allocated to them in recent history, and how modern portfolio theory is abused in the promotion of alternative investments.

(0:33:56) Mark shares his thoughts on 'evergreen funds', why they are so flawed, and their effects.

(0:39:51) The biggest red flags in private markets today and what he thinks will happen if retail starts taking up private assets.

(0:43:03) How often Mark sees institutions being sold alternatives, and why trustees of these institutions have to be different.

(0:49:23) Mark tells us how he defines success in his life on a personal and professional level.

Links From Today's Episode:

Meet with PWL Capital: https://calendly.com/d/3vm-t2j-h3p

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder Website — https://rationalreminder.ca/

Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on X — https://x.com/RationalRemindRational Reminder on TikTok — www.tiktok.com/@rationalreminder

Rational Reminder on YouTube — https://www.youtube.com/channel/

Rational Reminder Email — info@rationalreminder.caBenjamin Felix — https://pwlcapital.com/our-team/

Benjamin on X — https://x.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://pwlcapital.com/our-team/

Cameron on X — https://x.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Mark Higgins on LinkedIn — https://www.linkedin.com/in/markhiggins/

Books From Today's Episode:

Investing in US Financial History: Understanding the Past to Forecast the Future — https://enlightenedinvestor.com/

Security Analysis — https://www.amazon.com/Security-Analysis-Principles-Benjamin-Graham/dp/007141228X

Pioneering Portfolio Management — https://www.amazon.com/Pioneering-Portfolio-Management-Unconventional-Institutional/dp/1416544690

Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).

The economic effects of the coronavirus pandemic have been unprecedented and the seismic shifts have caused numerous unforeseen challenges. While no-one could have predicted the enormity and speed of the current crash before it happened, several signs indicated that an economic contraction was on the horizon. Today's guest, Ben Rabidoux, President of North Cove Advisors, a boutique research firm, is here to share some macroeconomic trends and what they tell us about the state of the Canadian economy. His research expertise includes Canadian housing, macroeconomic trends, and household credit. We kick off the episode with some listener feedback as well as a listener question, where we discuss how to incorporate unvested stock options into your personal financial planning. There are several ways to go about this and numerous factors to consider, so it's important account for them all. Ben then dives straight in, giving us an overview of the economic landscape before the sudden upheaval. He sheds some light on population growth and its relationship to economic growth. As a great deal of the economic gains was coming from non-resident growth, the crisis is likely to change this. We also talk about personal debt and HELOC loans. Coming into the recession, the household debt service ratio was incredibly high, with interest rates at an all-time low. Ben walks us through how these vulnerabilities might pan out and what could happen with HELOC debt. Along with this, we also discuss the relationship between housing and economic growth, with some truly astonishing data from Canada, the changes that are likely to happen with rental supply, and Ben's take on some personal finance topics. This show was an incredible overview of some of the larger forces at play, and it went a long way to paint a clearer overall picture. Be sure to tune in today!

Key Points From This Episode:

The recent film, Playing with FIRE details the particulars of the FIRE Movement in a way that is accessible, informative, and impactful. Both Cameron and Ben were hugely impressed with the film and the argument it makes for the framework of FIRE. Today we are joined by the producer and star of the film, Scott Rieckens, to discuss the movie and his own journey to reach financial independence. In much the same way that the film does, Scott makes a compelling and inspiring argument for the central philosophy of the movement, emphasizing what many of us will agree are the most important part of our lives and the way we can think about these to maximize our health and happiness. We discuss values and decision making, and how the FIRE perspective accounts for psychological and emotional changes to what is meaningful in your life. Scott explains the reframing that occurs with the system and the important aspects of it, especially those that matter in an introductory setting. We talk about communication and upkeep, the 4% rule, and the individual nature of your own financial strategy. Ultimately the ideas of FIRE are just ways to think about what is really important to you and your family and they provide a way to focus and enhance these. For this truly inspiring and potentially life-changing discussion, be sure to listen in with on the Rational Reminder!

Key Points From This Episode:

When it comes to the question of whether the economy affects the stock market, it's not about whether the former is in a good or bad state, but how that relates to what the market was expecting. In today's episode we get into predictions about labour economics during COVID-19, the relationship between the market and the economy, and how to make decisions that suit your risk tolerance. We kick things off by reviewing insights Edward Lazear and Gerard O'Reilly gave in a recent webinar. They spoke about how the current crisis relates to past events from the perspective of labour economics, and what empirical data is saying about stock returns and the economy. A talking point here is the idea that recessions are defined by committees, and always long after they have either begun or ended. This leads to the topic of whether there is a relationship between economic data and stock market performance. We find many examples of cases in the short and long term where no correlation can be found between the two, and cases where the market starts to recover before the economy. We discuss how this speaks of a fundamental difference in the analytical methods of economists versus investors, not a rigged market. The first group assesses past information while the second invests based on where they think things will go. We talk about what happens when GDP is good but not as high as expectations were, and how per-share earnings growth can only keep up with GDP if no new shares were issued. We then switch to the concept of risk aversion and discuss the differences between system one and system two thinking, before moving into a comparison between two methods of analyzing risk. Tune in for your weekly reality check!

Key Points From This Episode:

No one credible ever said that investing was a simple endeavour. It might have some simple guidelines, that if followed are more likely to yield positive results, but the ins and outs of the markets, decisions and their impacts, movements and crashes are never straightforward one-dimensional cases. Our guest today, Cliff Asness, really brings this point to bear, showing the nuance and multiplicity of all the topics we discuss. As the experienced owner of AQR and a wealth of knowledge and insight, Cliff shares a host of ideas and thoughts on as many topics as we have time for. We start off the chat talking about market efficiency before moving into the murky waters of value. We hold value investing to be sound, as does Cliff, yet the last few years have stretched even our commitment to this philosophy a little. The perspective that Cliff is able to share, drawing from his formative years in the investing world in the '90s is invaluable and a lot of what we talk about gets contrasted to the tech bubble of that period. The conversation also covers the size of stocks and portfolio allocation. Although Cliff has strong opinions on most of these issues he does a great job of showing the lack of definitive answers to any one of them, allowing space for new knowledge and outlying evidence to make its mark. We also get into finding the right kind of investor for your own style and goals, the role of good communication in finance and the influential article that Cliff wrote about 'pulling the goalie'. In it, Cliff lays out what the data tells us about certain late-stage situations in which it is statistically wise to make more risky choices. For all of this and a fabulously entertaining conversation, listen in with us today!

Key Points From This Episode:

In today's episode, we take a less analytical position on the current situation to focus more on the behavioral side of things. Joining us are two returning guests, Dr. Moira Somers and Dave Goetsch, who share their unique perspectives in a very real and at times refreshingly comical conversation about how people could most beneficially respond to this moment in time. Dave speaks of his personal experience going from panicky investor to getting a feel for the broad concept of index investing, and the idea that learning not to worry about the market on a day to day basis can be applied to life more generally. Dr. Somers provides some psychological background to these different strategies for tolerating stress. She shares her insights about a typical response to crises called amygdala hijack and how two main personality types called 'the monitor' and 'the blunter' deal with stress. We speak about some more healthy strategies for coping, with banding together and communicating featuring as strong solutions that allow us to clear our heads and problem solve more creatively. The conversation also covers the idea that this moment can be taken as a time to reflect, and even to double down on skills that aren't necessarily investment-related but which can help ensure financial stability in the future. Toward the end of the episode, we look at how financial advisors could be the most useful to their clients right now and hear a strong argument for a strategy that combines experience-based advice with a more important trait: a high EQ. Tune into today's episode to find out how you can gain more of a bird's eye view of your version of the current situation.

Key Points From This Episode:

The Smith Maneuver was developed by Fraser Smith as a smart way for Canadians to convert a traditional, non-deductible mortgage into a deductible mortgage by systematically re-borrowing to invest. Today we are joined by Fraser's son, Robinson, to talk about the maneuver, his father's legacy and explain how you can use it to your financial advantage. In his book, The Smith Maneuver, Fraser laid out a plan for working the mortgage and debt system to your advantage, by deducting the interest on a mortgage, while still being able to claim exemptions on the sale of a house. Robinson does a great job of explaining the procedure for implementing the strategy and all the possible ways to use it. He talks about risk, different kinds of debt and investor diligence, giving everything you need on the subject! Robinson believes in his father's vision of bringing the practices of the wealthy to the average Canadian and allowing wealth creation through leveraging possibilities instead of the inertia and fear that most people choose. For the last part of our conversation, Robinson gives us some examples from the Smithman Calculator, illustrating just how effective the system can be! Join us on the Rational Reminder Podcast today, to get it all!

Key Points From This Episode:

In our second special release episode during the 2020 COVID-19 bear market we discussed a broad history of US bear markets from 1900 to 2020, the recent volatility in the bond market, bond ETF NAV spreads, a nuance in the legislation on tax-loss harvesting, and some of the tax-related changes that Canada has rolled out in light of the current situation.

How we are handling the situation as a firm, investing through a crisis, historical comparisons, and more.

It's not unreasonable to assume that a desirable retirement equates to having the financial freedom to meet one's lifestyle and personal goals. The more efficient a person is with their assets, the higher the likelihood of this, which is why sensible retirement income planning is so necessary. Today's guest is Wade Pfau and he is arguably one of the main thinkers in the retirement income space at present – a more readable Moshe Milevsky if you will. This podcast is usually devoted to high-level discussions about portfolio investment so it was an honour to have Wade join us and have a similar kind of conversation but rather about retirement income planning. Retirees face some unique risks when it comes to strategies for asset management, insurance, and investments, which means they require tailored strategies, and today Wade weighs in on some of the different approaches we see out there. The topic of probability versus safety-first approaches, and the potential wisdom in amalgamating the two as a means of preparing for retirement, crops up a lot in this discussion. Wade talks about the four L's of the safety-first strategy, how it recommends building up a base of savings that act as an income to reach higher legacy in the long term. He suggests that people need to account for longevity risk more and argues for the efficiency of assuming that you will live until the average oldest age. That way you don't end up throttling your lifestyle by saving unnecessarily during retirement. In our discussion, Wade also shares valuable insight into low interest rates versus expected returns, the ineffectiveness of the 4% rule, annuities and deferred annuities concerning mortality credits, and different types of buffer assets. Tune in for all this and much more on the topic of retirement planning from one of the greats in the field today!

Key Points From This Episode:

Welcome back to the Rational Reminder Podcast everybody. Today we are using the opportunity to have a bit of a philosophical discussion about a bunch of things related to your retirement and the financial planning that goes into it. We touch on the all too obvious topics of the coronavirus and last week's market fluctuations before we scan the last ten years for any notable data points on fluctuations and the years with the biggest dips. We look at life expectancy and how this affects a retirement planning strategy. In British Columbia, drug use among younger generations has brought down life expectancy estimates, while improved health care has extended them in some regards. This leads to a few comments on biological age and how knowledge of yours should play a big role in your personal strategy for the end of your life. The last part of the episode is spent considering the current state of the discourse around the FIRE movement and what has grown out of it. We can see that it is not uncommon for large portions of the aging population to be happy to carry on working, and that the idea of getting out of the workforce as soon as possible may only be attractive to certain kinds of professions. For all this and a whole more from Cameron and Ben, be sure to tune in!

Key Points From This Episode:

You can't get anything good out of life without taking a risk, and this holds true in the world of investing too. Depending on the situation, people are willing to either pay more for high-risk or risk-free, and matters become more complex because the term 'risk-free' means a different thing to everybody. Today's guest is economist Allison Schrager, Senior Fellow at the Manhattan Institute, author of An Economist Walks into a Brothel,and long time collaborator with Nobel laureate, Bob Merton. Allison is an expert on risk and she joins us in this episode to speak about this topic in relation to retirement and retirement finance. We talk about the idea that while risk has been given conventionally bad associations, it can be more accurately understood as a probability distribution between the future occurrence of both potentially good and potentially bad things. Allison shares her opinions about how both young and old people should approach risk, and stresses the importance of having clearly defined goals and a good financial advisor. She shares her thoughts on managing systemic vs idiosyncratic risk, why the retirement crisis is not all doom and gloom, and the laddered bond portfolio she developed with Bob Merton. Joining this episode, you'll also hear Allison speak about how misinformation causes people to be hesitant about annuities, the connection between risk management in surfing and investing, and why investing in education is smarter than investing in a house. Allison covers a whole lot more risk-related topics in this episode too, so don't miss out on it.

Key Points From This Episode:

Let's say you make a choice that had you chosen differently, things would ostensibly have turned out more favourably. Later on, a similar situation comes up and you make the choice you think you should have made previously in the hope that the result you wanted before will come true this time around. This is called counterfactual thinking and it forms the main topic of our discussion in today's episode. First publicized in a fascinating paper called The Psychology of Preferences, Daniel Kahneman and Amos Tversky explore the abundance of instances where humans employ irrational 'what if' thinking in their processing of recently made decisions that resulted in an undesirable outcome. People tend to think back and wish that they had made a different choice, irrationally thinking that if they had, things would have worked out better. This idea, of course, has applications to investing in stocks with particular implications due to the utter randomness of the market. This is a mind-blowing discussion about human irrationality with links to many leading papers that research this principle in relation to different situations. Outside of our main discussion, we also touch on why you should think twice before buying a condo, the utter absurdity of the Robo-Advisor business model, monthly posted DVD accounts and the surprising birth of Netflix, and finally, the ambiguity of Vanguard's partnering with HarbourVest.

Key Points From This Episode:

The financial advice industry has always been a place of change, and yet certain old practices hang around for decades. Our guest today, Dennis Moseley-Williams, is all about moving things forward for the good of the client and the advisor. The basis of his understanding is the characterization of the economy as one fundamentally built around experiences. Applying this lens to the financial sector means that advisors need to think about how to provide more than just a service to their clients, they need to stage an experience and a process of curated growth and learning. In our conversation, Dennis unpacks the evolution up to this point, showing how each step requires adjustments and progress from providers and the space that opens up due to technological advances must be filled with something of value. We discuss communication, fulfillment and happiness and Dennis makes a strong argument for the role of the financial advisor reaching beyond the bank; he believes it should include all important areas of life. The last part of the episode is spent thinking about ways that willing advisors can offer the most to their clients and how to pitch and scale these businesses in the smartest ways. For this fascinating chat with a truly innovative thinker and gifted speaker, be sure to join us!

Key Points From This Episode:

On today's episode of The Rational Reminder, we once again cover a host of topics. We begin with Cameron sharing his thoughts on a book he recently finished, The Ride of a Lifetime, and some of the lessons he took away from it. We then tackle three listener questions, where we cover Mawer and index funds hypothetically driving prices. Then, in the portfolio portion of the show, we turn our attention to value premiums. Fama and French recently released a paper on the topic, and Ben is naturally very excited to share his assessment on it. We unpack how value has performed in the US, unexpected big value findings, and other takeaways from the paper. After that, we explore the total cost of ownership in our planning section. These are expenses that you incur when you begin investing. We shed light on some of them and the effect they have on your investments. Finally, we end the show with Tim Nash's take on our assessment of sustainable investing in episode 82. His insights offer an interesting perspective on the topic. While we can't say we're fully on board with his active position, it's certainly a fascinating viewpoint. Don't miss out on today's jam-packed show!

Key Points From This Episode:

The last ten years have seen so much said and done in the cryptocurrency space, and yet the future of bitcoin is still somewhat unclear. For Michael Sonnenshein however, bitcoin and the crypto market still offer the freedom and possibilities that have long been espoused as their greatest values. He joins us today to talk about his role at Grayscale Investments, how Grayscale fits into the larger Digital Currency Group family and how he envisions the wide-open future possibilities for bitcoin. We discuss some basics for the bitcoin conversation and Michael does a sterling job of setting out the lay of the land at present. From there, we turn to the role of Grayscale in dealing with bitcoin which can also be bought directly. Michael then takes the opportunity to compare bitcoin and gold; showing how they overlap and then bitcoin improves on the benefits that gold investments have historically provided. The last part of the conversation is spent addressing the safety of bitcoin and how time is showing its resistance to shocks and is earning bitcoin its place among other highly trusted assets. For all this and more fascinating insights into a big part of the future, join us on the Rational Reminder today!

Key Points From This Episode:

Welcome to this week's episode of the Rational Reminder! Today, we get stuck into a commonly asked about investment topic – socially responsible or sustainable investing. The show kicks off with Cameron sharing some fantastic insights he gained from a book he recently finished, The Undoing Project. We then delve into the CalPERS story that was in the spotlight at the end of 2019. After that, we move the planning portion of our show, where we tackle the topic of sustainable investing. Many prominent Canadian pension funds have said that sustainability will be a core part of their investing going forward. We explore why sustainable investing has to mean lower returns, how this kind of investing effects social change, and what the amount you need to give up to feel good about your investments is. We also look at the subjectivity of ESG ratings and how this relates to your values. Ultimately, sustainable investing is about balancing the continuum of views and values, how closely they can be matched, and how you can do that in a diversified way. The sustainable label may not meet your expectations of sustainability which is why finding the balance can prove to be challenging. We round off the show by sharing our thoughts on how to restructure your portfolio when it comes time to live off of it. You don't want to miss out on this interesting show, so tune in today!

Key Points From This Episode:

On today's show, we are joined by Kim Melanson who is a local lawyer in Ottawa. The bulk of the conversation is spent on the particulars of drafting a will and the considerations that have to go into this process. Kim also reminds just how important it is to have an up to date will, something many of us have heard but many of us do not act on! She talks about good times to update your documents and the ins and outs of naming guardians and executors before discussing inheritances, donations, and probate. We then turn to a few different types of wills, namely mutual will, mirror wills, and dual wills. Kim weighs in on the topic of 'will kits' and services that make the writing of a will appear a little easier. We also talk about some common errors that are made in the realm of estate planning before turning our attention to family law. Kim answers our questions common-law relationships, domestic contracts, divisions of assets and more, so for all of this from a true expert on Ontario legal matters, be sure to listen in with us today on the Rational Reminder Podcast!

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For our very first episode of 2020, we kick things off with some quick updates before sharing Cameron's ten best financial planning strategies for the new year. After laying out some statistics about the great asset class returns that 2019 saw, we get into the wonderful listener questions we have been receiving over the break. Our first topic is about buying versus leasing cars, and Ben shares his thoughts on some of the reasons he recently converted to leasing. Our second question is about using credit to invest in a TFSA and acts as a great segue into our main topic for today's show: implementing leverage in an investment portfolio. We discover some fascinating outputs given by a Monte Carlo simulation that compares the reliability of expected returns between diversified and concentrated investment portfolios. Surprisingly, the concentrated portfolio, while unpredictable, actually produces higher returns, even in its worst iterations. We start to think of concentrated portfolios as just another form of leveraging after comparing IUSV to VLUE ETFs, and then move on to the idea of time diversification as it relates to implementing leveraging in Lifecycle investing. As always, we end off with our bad advice of the week, with the 60/40 stocks and bonds model taking centre stage, so hop on and join us for the ride!

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Today on the show we welcome the Head of Investment Solutions at Dimensional Fund Advisors, Marlena Lee. Marlena has a Ph.D. from the University of Chicago where she served as the TA to Eugene F. Fama. She has been at Dimensional for 11 years where a big part of her role is communicating what their research team is doing for the advisors and clients who are using their products. In this fascinating episode, we discuss and define models, factors, and the importance of understanding the risks involved with any investment decision. We talk about the many different reasons why stocks have different returns, and what the research says about underperformance and our expectation of positive premiums. Marlena has some interesting perspectives on whether risk or behavior drives higher returns, and shares some of her biggest lessons gained from working with Eugene Fama, and Dimensional Fund Advisors.

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As we see 2019 out and enter a new decade, we thought it only fitting to do a round-up of some of our shows this year. While we had 26 guests throughout the year, we chose 14 that best captured the sensible investing and education-focused spirit of our show. Some of the guests we have included on this special episode include Rob Carrick, from The Global Mail and leading authority on Canadian personal finance, Alexandra McQueen, a teacher at York University, who offers an explanation on the difference between financial economics and financial planning and Jonathan Clements, who explains why the hardest part of investing is keeping it simple. We also share clips about nipping overconfidence in the bud with Daniel Crosby and the next grand challenge of investing with Dave Nadig. This is just a snapshot of some of the incredibly generous people who have joined us this year. We hope that this show has contributed in some way to educating and helping investors make informed decisions and we are excited for what's on the horizon. Happy New Year from all of us here at The Rational Reminder!

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On today's episode, we are joined by Mark Goodfield of The Blunt Bean Counter blog to talk about estate planning and wills. Mark is a partner at BDO Canada, a national accounting firm and has created a wealth of content on investing, tax and the relationship between the two.

He provides full-service wealth management, but does not advise on nor manage investments. Estate planning is a difficult task because you are confronted with your mortality, but it is hugely important because without a clear-cut plan, those left behind will have to deal with many complications in the midst of grieving. Mark has seen these complications with some of his own clients and the negative effects it has had on them. Along with conventional estate planning, such as drawing up a will, Mark also strongly advises transparency about your finances both with your partner and your children. This will not only ensure that there are no surprises, but also allow them to gain a level of financial literacy to deal with money, if they currently do not have that responsibility. He believes that people are not open enough when talking about money, which has implications long after they are gone. While estate planning is largely to do with finances and assets, Mark does not believe that money automatically correlates with success. This is why it is equally important to consider the legacy you leave behind in other ways, such as strong relationships and giving time to good causes. For this and much more, join us today!

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https://rationalreminder.ca/podcast/77

Welcome to another episode of the Rational Reminder Podcast. We kick off the show today with some great listener feedback before diving into the content of a new podcast by Dr. Laurie Santos called The Happiness Lab. In a recent episode of her show, she gets into the idea of human adaptability to fortuitous or catastrophic events. Our capacity to regulate back to a default state has big implications for dreams of greater happiness through wealth acquisition. Next, we move on to three great listener questions, which by the way will be replacing the investment topic segment of the show from now on. We answer questions about the merit of Ray Dalio's all-weather portfolio, fall back rules for prospective rental property owners, and whether the Smith Manoeuvre is a good move for high-income earners. Next up you'll hear some fascinating statistics about residential property value in relation to homeownership and income in Canada. Rob Carrick's article about how tax-free savings accounts are the greatest Canadian financial success story of the century comes under our scrutiny after that. Finally, we end off with our bad advice for the week, in which we discuss the recent protest by investor advocates to speed up the banning process for early withdrawal fee-charging mutual funds. Tune in for your weekly reality check on sensible investing and financial decision-making for Canadians!

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https://rationalreminder.ca/podcast/76

On today's episode, we have Dr. Daniel Crosby joining us for an insightful discussion about the psychology behind investing behaviour. Dr. Crosby is a behavioural finance expert and asset manager who applies his study of market psychology to help people better understand the financial decisions they make and to shed some new light on our ability to be rational. We talk about the inevitability of our emotions and how they impact our actions, but also how they might be leveraged for positive outcomes. As far as behavioural biases are concerned, overconfidence is by far the biggest threat to our investment success, but on the flip side, Dr. Cosby shares why, outside of investing, this trait can serve us really well. We enquire about his thoughts on how wealth changes people's behaviour, on whether the FIRE Movement has some credibility to it, and he explains why having a strong theoretical underpinning is necessary when making decisions based on empirical data. Join us for some more science-based investment advice!

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Thanks for joining us for another episode of the Rational Reminder Podcast. We are proud to say that last week's show received our highest amount of downloads yet, with 10 000 in its first week, so a big thank you to our listeners for that. We begin our discussion this week with some takeaways from the Playing With FIREdocumentary about doing affordable things that feel good as a way of cutting costs. Next, we dive into some caller questions, discussing whether putting a downpayment on a rental property as a way of parking cash until you have enough to scale up to a bigger property would be a good idea. We also discuss whether it would make sense to invest in an individual Canadian bank stock based purely on the track record of our banks, which brings up some interesting points about how stocks work. We then dive into our main topic by beginning with some pointers on choosing the best belief system to evaluate investment strategies from, comparing our 5-Factor model with the Quality model and Jim Simons's too. This leads into a deep dive we take into the legitimacy of the definition of quality given by a variety of American and Canadian funds. We share our main takeaways from this discussion with you which should prove very useful. Our planning advice for the week is around getting insurance for income replacement in retirement. Finally, we make a lot of good out of some bad bank advice by drawing from our recent research into reverse mortgages and annuities, so don't miss out on this one!

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In today's episode, we are joined by an exciting guest, The Loonie Doctor, of The Loonie Doctorblog to talk about his work not only on physician finance but also on holistic wealth. A physician by training, The Loonie Doctor has scaled back his practice to put more work into the blog and financial education. He masterfully balances precise technical advice on topics like tax alongside 'softer' aspects of money, such as how it affects relationships and other aspects of human capital. These insights are useful for many, but particularly for physicians who often to do not talk about money because of the nature of the work they do. The Loonie Doctor believes that in not talking about finance, it adversely affects physicians' ability to perform at their peak. Finance, however, is not the only marker of wealth and The Loonie Doctor offers a holistic wealth framework in which wealth can be measured in a variety of ways. He also provides a host of other insights, such as advice for DIY investors, how to avoid social pressure around spending and much more. For all this, join us today!

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Some of The Loonie Doctor's background and what lead him to starting the blog. [0:02:20.0]

The two big reasons that it is important for physicians to talk to one another about money. [0:03:47.0]

Wealth must be looked at holistically as it includes financial, human, economic and social capital. [0:06:15.0]

How individual spending decisions compound and have a larger economic effect. [0:08:10.0]

What can be done to build a healthy career that inspires and adds value to your life. [0:11:16.0]

Which factors to account for when making long-term insurance decisions. [0:13:13.0]

Reasons why whole-life insurance should not be a catch-all financial plan. [0:17:06.0]

How to avoid social pressure and spending large amounts of money. [0:19:51.0]

Financial decisions should be understood in relation to non-monetary value they add. [0:22:48.0]

How The Loonie Doctor uses evidence effectively in investment decisions. [0:26:30.0]

How to make the decision between DIY investing or using a financial planner. [00:29:16]

Some of the lessons that The Loonie Doctor has learned having seen so much death. [00:34:28]

Insights into The Loonie Doctor's framework about asset location. [00:38:36]

Today on The Rational Reminder Podcast, we talk about the relationship between asset allocation and outcome, the ins and outs of reverse mortgages, and finally, life insurance (or lack thereof) in Canada. However, we begin by sharing some interesting points covered in a recent Barry Ritholtz interview with Eugene Fama and David Booth for his Masters in Business show. We talk about how Booth started the first index fund and discovered the value factor, and quote some of Fama's classic perspectives on behavioural finance and market bubbles. On the topic of asset location, Ben shares some of the findings of his recent research. He weighs in on his surprising discoveries about how to go about investing stocks and bonds in RRSP and taxable accounts to get the maximum yields. One of his main takeaways is the concept of putting bonds in your RRSP to intentionally trick yourself into a more aggressive portfolio. Regarding reverse mortgages, we begin with some definitions and explanations of why they might be beneficial, and then cover the question of whether or not they are the symptom of a 'debt-addicted' society. Finally, we end off by discussing a recent study by Policy Advisor which found some shocking facts about how Canadians are drastically underinsured. For all this and more, join us today!

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Today we welcome Dave Nadig onto the show, who joins us off the back of a brilliant presentation he gave at the Wealth Stack conference last month in Scottsdale. Dave is the founder of etf.com and has had key positions at FactSet, Barclays Global Investors, and Cerulli previously. Today Dave sits down to talk about the difference between ETFs and mutual funds, EFT product saturation, the coming of Direct Indexing and well as non-transparent active funds, and risk probabilities in different asset security options such as gold and stocks. He also debunks the myth that ETFs lead to a pricing bubble, highlighting 401(k)s as part of what might be creating this illusion of top-heaviness. He also has a brilliant perspective on trusting the junk bond through a seeming disconnect, which is really one of timing that actually creates opportunities for price discovery. Dave also spends some time on the subject of his belief that the science of investing is largely figured out. He believes therefore that human behavior and decision making through a lifetime investment path is far more mysterious, and highlights the need for good financial advisors in this respect. Join us to take a deep dive into the world of ETFs with Dave today!

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On today's episode, we cover a variety of topics, such as some tips for DIY investors, highlights from a conference Cameron recently attended, home country investment bias and whether it's possible to have too much money in your RRSP. We begin first by talking about what DIY investors can do to ensure that they are investing to the best of their abilities. As people who work in investment daily, we often forget how tricky a terrain it can be to navigate if you are not armed with all of the knowledge, so we hope to pass some of it on to you. After that, we move onto the lessons Cameron learned from the Dimensional Advisors conference. We unpack ideas such as why he believes the world is 'running towards factors,' how Dimensional is leveraging academic research to inform their work along with some other highlights. Following on from that and picking up on what was spoken about at the conference, we delve into the pros and cons of home country investment bias. In some instances, this bias makes perfect sense, both from a returns and tax perspective and in other instances less so. We take you through some of these scenarios and what they mean for an investor looking to diversify. And finally, in the planning portion of our show, we tackle RRSPs, whether it is possible to overinvest in them, how they compare to other investments and much more. To learn more, join us today!

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Today we are joined by Wesley Gray who is the CEO of Alpha Architect, a firm in the US that specializes in concentrated factor strategies. Having completed his MBA and PhD at the University of Chicago – the Harvard of the finance world – Wes is an authoritative voice when it comes to quantitative research and factor investing. Incredibly, he took a 4-year break during his PhD, joined the marines and went to Iraq, and has also written several books. He went from value investor and stock-picker to having a strong quant focus and realized that it was possible to eliminate the human biases while still capturing the factor premiums. Our talk with Wes illuminates the nuanced nature of factor investing, behaviour versus risk-based factor premiums and active management versus passive and indexing. He discusses the process of collecting data for his PhD, the rules according to which they structure portfolios, how their boutique firm differs from larger advisor companies and who their ideal client is. Wes also shares his views on selecting the best quant model, hedge funds, value premiums and market-cap indexing. Join us for another insightful episode!

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Welcome back to the podcast everybody, we have another great round-up episode for you where we field questions that you sent in and cover a bunch of things we think you need to hear! We discuss how you should weight your stocks and bonds ratio and times that you could think about changing it, we also talk about index funds, Michael Burry and why his reputation is a bit overstated. Then we get into the different types of risk! We cover volatility, uncompensated risk, skewness, and inflation and help you think about each and the impact that they may have on your portfolio. The conversation then turns to planning, longevity, and sustainability and we talk about how to prepare for your last years cleverly and realistically. Goals are so important when laying out a sustainable strategy and we give you a bunch of questions to ask yourself to make the task a bit easier. We finish off with another edition of last wee's worst advice and this time around we are talking about some questionable actions and remarks from TD Ameritrade. For all this and more, join us on the Rational Reminder, today!

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Links From Today's Episode:

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder Website — https://rationalreminder.ca/ Benjamin Felix — https://www.pwlcapital.com/author/benjamin-felix/

Benjamin on Twitter — https://twitter.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://www.pwlcapital.com/profile/cameron-passmore/

Cameron on Twitter — https://twitter.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Larry Swedroe — https://www.etf.com/contributors/larry-swedroe

Vanguard — https://investor.vanguard.com/corporate-portal/

Michael Burry — https://www.cnbc.com/2019/09/04/the-big-shorts-michael-burry-says-he-has-found-the-next-market-bubble.html

Barry Ritholtz — https://ritholtz.com

The Economist — https://www.economist.com

AlphaZero — https://deepmind.com/blog/article/alphazero-shedding-new-light-grand-games-chess-shogi-and-go

Stockfish — https://stockfishchess.org/

Ray Dalio — https://www.bridgewater.com/leadership/ray-dalio/

Bryan Kelly — https://som.yale.edu/faculty/bryan-t-kelly

Philippe Jabre — https://www.ft.com/content/3d07e70c-fefc-11e8-ac00-57a2a826423e

Jabre Capital — https://www.jabcap.com/

Bernie Madoff — https://www.investopedia.com/terms/b/bernard-madoff.asp

Fama French Five-Factor Model — https://blog.quantinsti.com/fama-french-five-factor-asset-pricing-model/

Alexandra McQueen — https://www.pensionacuity.com/

Alexandra McQueen Episode — https://rationalreminder.ca/podcast/2019/8/15/episode-59-financial-economics-and-annuities-rational-planning-for-retirement

Prof Moshe Milevsky — https://moshemilevsky.com

Schulich School of Business — https://schulich.yorku.ca

Schwab — https://www.schwab.com

TD Ameritrade — https://www.tdameritrade.com

Jason Zweig — https://jasonzweig.com

Wall Street Journal — https://www.wsj.com

Costco — https://www.costco.com

Raymond James — https://www.raymondjames.com/

Morningstar — https://www.morningstar.com

From a trader on Wall Street to a financial advisor with her own firm, our guest today, Jill Schlesinger, has accumulated a lifetime of knowledge in the investing and financial world. Today she is a household name and well-known media personality, appearing on a variety of CBS shows and hosting her own podcast called Jill on Money. But she is far more than an investment expert: she also has a ton of insight into people's emotional and psychological responses to money, sharing with listeners those areas that people tend to struggle with most when it comes to their financial lives. Jill also weighs in on the current talk about the inverted yield curve and the coming recession and gives her educated opinion about money in marriage, DIY investing, robo-advisors, buying versus renting and the FIRE movement. Be sure to join in our conversation!

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Welcome back to Rational Reminder Podcast! We kick off today's episode with a discussion about the gap between investor performance and fund performance, the potential reasons why asset allocation funds produced a positive gap and the role that timing and volatility play in a negative behaviour gap. IPOs have been in the media a great deal lately – and not for particularly positive reasons and we tackle the topic with reference to specific companies. We also talk about Dimensional's paper on the issues with IPOs since the early nineties and then we introduce you to The Fama Portfolio, a valuable resource that we will likely quote quite a bit from in the future! As we have mentioned before, the use of empirical findings is incredibly limited without a theoretical framework and we talk about why the conversation around the efficient market hypothesis needs to change and why general statements about markets are not to be paid too much attention to. We discuss the bad advice for the week and the importance of goal setting in retirement.

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Our guest today on the Rational Reminder Podcast is Dr. Wendall Mascarenhas. Wendall is a listener, DIY investor a medical professional. He actually reached out to us on Twitter and suggested this episode, a listener-centric discussion as well as one comparing the different approaches to evidence from the medical and the financial communities. We thought this was a great idea and the perspective that Wendall offers is very illuminating and thought-provoking. We discuss some of Wendall's own experience and background in both investing and medicine and from there go onto a more theoretical discussion of evidence and literature, asking the question why the financial industry is not more concerned with data. Wendall lays out the evidence pyramid and explains a few of its layers, we discuss a few tips and think about the extent to which DIY investors should involve themselves in their money with things like factor investing. Wendall also offers some of his thoughts on financial advice and the emergence of new information. For this fresh and insightful chat, be sure to join us!

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Michael Burry says we should get out of indexing. Jim Cramer says it's time to jump in. These are interesting times in the world of investing! On today's episode, we discuss Burry's recent claims about passive investing and advise on a plan of action should he turn out to be right. Benjamin recently posted a new video on dividends, and we have a conversation about the responses the video triggered and give some good reasons for our stance about the irrelevance of dividends. We also talk about negative interest rates, how they affect that market and explain why it's not a good idea to do day trading for a living. In the second part of the episode, we are thrilled to be joined by Benjamin's mom to whom we will attempt to explain the ABCs of factors. Following many requests from listeners to discuss factors in layman's terms, we hope that our explanation today will shed some light on the topic!

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We have a really special episode in store today as we welcome Tim Nash, the Sustainable Economist! Tim shares a vast amount of knowledge and ideas with us on how investors wishing to put their money where their heart is can go about investing more ethically and sustainably. We hear about Tim's journey into investing and economics and how he wound up doing the work he currently does, helping investors clarify where their money is going and how to put it portfolios that are more aligned with their beliefs. He unpacks how these ideas and actions can have an impact and what it would take for some kind of systemic shift towards more sustainable industry and companies. We discuss the use of other modes of change as well as the personal practice of investors versus the placement of their money. Tim does such a great job of explaining how he goes about assessing different companies and portfolios and filtering which meet the criteria that he would suggest to his audience. The last part of the episode contains a really impressive argument from Tim around how investing this way can also be beneficial for strictly economic reasons and that it would suit all people to consider the factors he is espousing. For an inspirational chat with a truly great guest, listen in today!

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Welcome back to another episode of the Rational Reminder! We are doing another variety show for all of you and this week we cover some news, current affairs, questions and of course our staple bad advice of the week! We start the show looking at the restructuring of swap-based ETF's from Horizons before looking at Michal Burry's latest commentary and predictions. From there we move onto John Rekenthaler's recent article on Morningstar about Canadian financial advice and what it is lacking. We discuss gold and why it is still not a good investment choice for almost all situations and even draw on some inspiring words from Warren Buffett on the subject! The conversation then turns to tax-loss selling; we unpack how it is possible to use this tactic to your advantage and look at some of the specifics that it entails. Lastly. we cover a particularly bad piece of advice that had the Twitter community up in arms recently! So for all of this and a bit more, listen in with us today!

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We have another phenomenal guest joining us on the podcast today. You might know Ted Seides from his famous bet with Warren Buffett or, more recently, from his widely successful Capital Allocators Podcast. Ted is what we would call a classically impressive guy, having studied at both Ivy League frontrunners Yale and Harvard and having founded Protégé Partners, an asset management and advisory firm that specializes in hedge funds. In addition, he has trained under the legendary David Swensen, and together with his experience and training, has become a big name in the investing world. On this episode, he discusses the wealth of knowledge he has gained from David, the criteria for selecting a fund manager and how to approach evaluating the performance of that manager over time. Contrary to the assumptions about his views on index funds, he explains what he believes about them and whether he thinks the market is likely to become saturated. We then get into a conversation about the investment habits of the wealthy, why relationships are so important in this business and why he would not make the same bet again. Don't miss out on this exciting conversation with Ted Seides!

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Welcome back to the Rational Reminder everybody! We are taking this episode to round up all the recent goings-on and tackle a few residual issues that we believe need some attention. We start off by contemplating how much we have both been learning with the wealth of guests that come through our doors. We would never be confronted with this many ideas and inspiration if it were not for this great platform on which we find ourselves! From there we go on to discuss all the recent talk of a recession and the many assumptions that seem to be being made. Here at the Ration Reminder Podcast, we want to try and dissuade you from thinking you can easily predict the movement of the markets or believe those that say they can. It is just not that straightforward. Most often, a recession is only noticeable during or even after it has occurred. Rather stick to a good, diversified strategy without trying to guess and gamble on questionable information. The conversation also covers the portfolio changes from Wealthsimple before Benjamin does what he does best and explains valuation theory for all of us! So for all this and a few more goodies, be sure to listen in!

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Welcome to another episode of the Rational Reminder Podcast! We have a fantastic guest joining us today to talk about annuities, or in more general terms, pensionization. Alexandra Macqueen is certified financial planner, who is also a financial author, editor, York University educator, consultant, and speaker. Alexandra co-wrote a book with Dr. Moshe Milevsky called Pensionize Your Nest Egg: How to Use Product Allocation to Create a Guaranteed Income for Life, an incredible resource on our topic today. In this episode, Alexandra talks about the important distinction between financial economics and financial planning, the former being much more rational and quantitative than the latter, which is largely based on folklores and rules of thumb. We discuss the concepts of retirement sustainability quotient (RSQ) and financial legacy value (FLV) and the impact they have on each other, before diving into explaining what annuities are and how they are meant to function. She also advises on the use of the GIC ladder, copycat annuities, and considerations for deferring your CPP. Don't miss out on this insightful conversation!

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On today's episode, Benjamin and Cameron are talking real estate, specifically mortgage rates and REITs. For the first time since the early 90s, fixed mortgage rates are lower than variable ones, which have always been the popular choice. However, due to the fact that Canada's yield curve is inverted, short term rates higher than their long-term counterparts. This is not usually the case, which makes it a great time to consider a fixed term mortgage, bearing in mind that it requires some lifestyle considerations. Benjamin and Cameron also provide some insights into the rental property market changes since 2015, with some astonishing figures. They then discuss REITs, which many think should be considered their own asset class. While it is often recommended to have REITs in your portfolio, research is starting to show that you are taking a great deal of risk you are not being compensated for. This means you may be better off investing in other options such as high exposure bonds which bear much less risk. For all this and much more, join us today!

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On today's episode we are so happy to be joined by none other than Barry Ritholtz! As the founder and CIO of Ritholtz Wealth Management, host of the Masters in Business Podcast and regular financial blogger for more than 15 years, Barry is someone we have been dying to speak to on the show and who we have taken loads of inspiration from over the years. We talk to Barry about his own podcast which has been going strong for years now and is just about to reach its 250th episode! He also explains the beginnings of his firm and how his role has evolved in it since it started. From there, the conversation turns to the different parts of an investing philosophy we and Barry pretty much share and we ruminate on the state of the financial industry in US and Canada currently. We all feel that it is surprising that brokerage firms still find business in this day and age, when it has been shown so many times, for an extended period of time to be a far inferior business model for clients. Barry offers some pretty sensible advice on how to pursue financial growth in the long term and shares how RWM approaches client acquisition. For all of this and so much more, be sure not to miss this great episode!

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On the show today we are going back to basics, just Cameron and Benjamin going through some useful topics for your financial benefit! We start talking about GIC's and the article on MoneySense that led to this conversation. GIC's have a somewhat mix and match reputation, one which we believe has been often misunderstood and misrepresented. We try to show in which ways people have been misled into thinking that GIC's are the best option when, we believe, they are not. From there we turn to more general portfolio ideas, comparing the performance of the S&P 500 over time and drawing on a very useful study that illuminates the index's limitations. Our last topic for today is around saving for college and RESP's or registered education saving plans. We talk about asset allocation, how to think about starting and best practices when drawing on these funds. We finish off the show with some bad advice regarding dividend investing that actually referenced a video we made! So for all and a bunch more great stuff, be sure to tune in today!

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Joining us on the podcast today is Jonathan Clements, former Wall Street Journal columnist, founder of HumbleDollar and author of From Here to Financial Happiness, How to Think About Money and several other books. Jonathan is a well-known name in the world of personal finance as he has been giving financial advice for more than 20 years. Today he talks about the role of stories in shaping people's understanding of and relationship with money by sharing an anecdote from his own childhood. He discusses how his investment philosophy has changed in favor of index funds, why investing is much simpler than people tend to believe and then he gives us a glimpse into his own investment portfolio and the financial decisions he is making in his personal life. Jonathan also offers a balanced perspective on home ownership from an investment point of view, advises on the things worth spending money on and then we debate the age-old question of whether money can in fact make you happy.

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Today on the Rational Reminder Podcast we have joining us Dr. David Blitzer who is the Managing Director and Chairman of the S&P Dow Jones index committee. He has been there from the time when indexes were barely even being traded and the first time S&P Futures began trading, and since then, indexing has turned into the massive phenomenon we all know today. Indeed, S&P indexes were (and still is) at the center of this explosion. Today Dr. Blitzer talks to us about the early days of indexing and shares some of his ideas about why indexing became so popular. We also discuss the possible reasons why some people still choose actively managed funds and the effect that the abundance of research has had on their dwindling appeal. Ever wondered where the rapid growth in indexing will end up? What happens after indexing? Can indexing become too big? Be sure to join us for this masterclass on indexing!

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When Dr. Blitzer joined S&P and how index investing has changed over time. [0:03:33.0]

The relationship between an S&P and a product manufactured like Vanguard. [0:06:03.0]

Considering the reasons why indexing became so popular and the role of ETFs. [0:10:11.0]

How research has impacted people's perception about active management. [0:12:54.0]

Some theories on why it is so difficult to beat the S&P 500. [0:18:13.0]

How the change to indexing has affected smaller markets such as Canada. [0:25:39.0]

Dr. Blitzer's thoughts on factor weighting. [0:30:28.0]

The line where we cross over from passive to active investing. [0:32:18.0]

Can indexing become too big, and what's next? [0:41:00.0]

What Dr. Blitzer ascribes his success to. [0:45:26.0]

And much more!

Live in the studio with us today is Preet Banerjee, renowned speaker, personal finance expert, consultant and author of Stop Overthinking Your Money. He is also the founder of MoneyGaps, a hybrid-advisor platform designed to help financial advisors make financial planning accessible to more Canadians. Having done a reality TV show and with a popular YouTube channel, Preet is on the forefront of the finance world, and he is here to talk to us about the findings that his DBA research has produced. He discusses his endeavour of seeking empirical evidence for the actual contribution that advisors are making to the financial lives of people, and we talk about the crucial difference between robo and human advisors and how people's diverse needs demand diverse solutions. This is a really insightful conversation with someone who knows what he's talking about, so be sure to listen in on this one!

Key Points from This Episode:

Welcome to this week's Rational Reminded Podcast! Today we're diving into the recent CPPIB report that portrays actively managed funds in the most optimistic light. But before you trade in your index funds, we look at the methodologies and calculations employed by the report and show why there are a number of issues with their findings. Benjamin shares his proposal for an alternative analysis that employs a more risk appropriate benchmark, and we discuss why the report can be seriously misguiding. We also talk about the transitional issues that have result from MD Financial being taken over by Scotiabank and why some MD Financial clients have not been too pleased with it all. We tackle the issue of value versus growth stocks and look at a number of research papers that could explain the developments that have taken place in this regard. Nearing retirement and unsure when to take your CPP? Be sure to join us to find the answer to this complex question!

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On the Rational Reminder today we are joined by Ellen Roseman from The Toronto Star, who has been writing and working in the realm of Canadian personal finance and consumer rights for many years. We have a great chat about her work history, what has driven her career and what motivates her to continue to pursue her path of creating financial awareness for more people. We discuss the position of advocacy for consumer rights and how that translates into her everyday work, her most important and recent areas of action, the classes she is involved in teaching and her most recent book, titled Fight Back. Ellen weighs in on the topics of financial advice and how to seek out the best of it, actively managed funds and how she is involved FAIR Canada. We finish off with a fun bit about how Ellen found herself blocked on Twitter by Suze Orman and Dave Ramsey! For all this and more, listen in today!

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