Our focus for this episode is the real utility of financial advisors, and Ben shares a host of research and findings about the supposed and actual value that advisors can offer investors. This segment continues our exploration of investment basics, a fundamental theme for this show and our work at PWL Capital. One of the biggest and clearest lessons that becomes apparent through this discussion is the need for financial literacy independent of advice and so-called expertise from the outside. With that said, we do find time to share some of the positives investors can accrue from dealing with a trustworthy advisor and the conditions necessary for this. Later in the episode, our colleague Lukas Fleck joins us to share his review of The Obstacle Is the Way by Ryan Holiday and some of his own reading habits and tips. We finish the episode with lighter content about hot sauces, TV shows, and Ben's latest home improvement.
Key Points From This Episode:
Introducing today's question about the usefulness of financial advisors. (0:03:35)
Common financial mistakes made by households. (0:11:13)
Some of the research and findings grounding today's discussion. (0:18:13)
Investing and self-control; what we can learn from data about smokers. (0:22:49)
Looking at some of the potential benefits of hiring an advisor for investors. (0:28:40)
A quick review of Episode 43 with Dave Butler from 2019. (0:34:07)
Today's book review of The Obstacle Is the Way, with Lukas Fleck, and some of the biggest takeaways. (0:36:43)
A look at Lukas' reading habits, favourite recent books, and his increased focus on getting through books. (0:44:59)
Advice for starting a book club and Lukas' reading hacks. (0:50:49)
The after-show; Ben tells us about his basketball hoop, last week's episode of Succession, and the hot sauce debate. (0:54:44)
Upcoming events, audience reviews, and future guests on the podcast. (0:58:31)
Read the Transcript:
Ben Felix: This is the Rational Reminder Podcast, a weekly reality check on sensible investing and financial decision-making from/to Canadians. We are hosted by me, Benjamin Felix and Cameron Passmore, Portfolio Managers at PWL Capital.
Cameron Passmore: Welcome to Episode 249. Recording this on an unbelievably beautiful day in Ottawa. One week after this terrible ice storm we caught between here and Montreal that wiped out power for a lot of people. I know Ben, you are without power. But today it's like 28 degrees and crystal-clear sunshine. It's beautiful up.
Anyways, in this week's program, you are going to answer the question, I can't wait for the answer. What are financial advisors useful for? I'm going to do a quick summary of episode 43 when I sat down with co-CEO Dimensional Fund Advisors, Dave Butler. And then our colleague, Lukas Fleck is going to join us and we're going to review, Ryan Holiday’s book, The Obstacle Is the Way and then we're going to talk about Lukas' reading hacks, and also our company book club. Of course, we have the after show where three people join us to talk about this and that, including the ever-heated debate of hot sauces, Ben. Yes, come for Ben's deep dives into stuff financial, but you stay for the hot sauce.
Ben Felix: You joke, but people really do stick around for the end.
Cameron Passmore: I know, and people also take hot sauce unbelievably serious. So, I upped up my hot sauce game because I kind of got caught in the crossfire on this one unintentionally. So, we'll talk about that.
I want to try to increase the audience of the podcast. I think that's a reasonable objective we should all have. I think a lot of this content is worthwhile for a lot of people. I especially highlight a lot of the guests we've had. So, if everyone who listened to this, shares it with one person, I think collectively, we can make a difference. That doesn't seem like that big a request. So that'd be awesome. Also, if you're a Canadian, that happens to be looking for a great advisor to work with, to plan and manage your serious long-term money. Reach out. We have an unbelievable team of advisors, and we'd be happy to speak with any Canadian who might be interested.
Ben Felix: It's true that our podcast audience has been like growing much more slowly than it did at first. It grew a lot really fast and it's been stable, which is nice. But the rate of growth definitely changed over the last, I don't know, year.
Cameron Passmore: Yeah, it's not a complaint. It's just there's such great content that so many people could benefit from, like, pick an episode, Charlie Ellis, right? Applicable to millions of people, or Ken French, Eugene Fama, or go down the list, right? There's been so many great people. So, it would be great if you could share.
Ben Felix: Yeah. I think that's a good request. I think I say that at the end of all of my YouTube videos too. Don’t I? If you found this useful, share it with someone who –
Cameron Passmore: Share it. Just share it. Anything to add Ben?
Ben Felix: Nope.
Cameron Passmore: All right, let's go with episode 249.
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Ben Felix: Welcome to Episode 249, of the Rational Reminder Podcast.
Cameron Passmore: All right, you've had your snack, Oscar’s asleep. So, already for the big feature.
Ben Felix: Yeah, hopefully, it's good. I don't know. I wrote this but haven't actually read it yet. So, I'm going to be like you hearing it for the first time.
Cameron Passmore: It's funny. Later in the program, we talk to our colleague, Lukas. So, we got a chance to see how the sausage is made, which was kind of funny.
Ben Felix: Lukas got to see the behind-the-scenes of the podcast, yes.
Cameron Passmore: Behind the scenes, as we say, is a whole lot of duct tape that goes on behind the scenes.
Ben Felix: Lots of duct tape. Anyway, so that the main topic that I have prepared here is, and this is part of the advanced basics, as we've been calling it, curriculum, which is a literal curriculum that I've created, which we'll use for other stuff later. But this is the – I jumped ahead. This is the very last topic in the curriculum. There are a couple more that we're going to have to go on backfill. But I've been doing much reading about this topic, so I wrote it, because it was part of the things I wanted to write anyway. Anyway, the topic is, what are financial advisors useful for? Why did you make that face?
Cameron Passmore: We pretty much built our careers on this. I'm dying to know the answer, devoted 32 years of my life to this.
Ben Felix: We did an episode a while ago on what is good financial advice. And we talked about some of this stuff. But we also talked about other stuff like goal formation, which is not in here. It's not in here, because that's not something that has – from what I could find – that's been researched in an academic way.
There's one paper that I found that was okay, but I don't know, the findings weren't robust enough where I was like, “Yes, I should include this.” But that's hard to study. How do you study that? I don't know how you would even structure that. If anyone's listening and has research on the relationship between goal setting and financial advisors, I'd love to see it, but I couldn't find it.
So, what I've done here is focused on the things that are theoretically and empirically robust and published in top financial economics journals, not smaller journals focused on financial planning, which have a tendency to be more practitioner, industry-focused, and maybe biased.
Cameron Passmore: Interesting.
Ben Felix: So, I want to step back from that and not talk about studies that show people with higher net worth have financial advisors because those studies don't make sense. There's lots of those. Anyway. So, this is – I tried to find stuff that was more rigorous, and that was a great setup. I'll get into it. So, as our listeners likely know, it's increasingly common knowledge that low-cost index funds have effectively solved investing for most people. I kind of say that as a joke, because as anybody in the Rational Reminder community knows who spends many hours of a day discussing the optimal portfolio, there's still lots of decisions to be made when it comes to investing. But using low-cost index funds is a pretty good solution for most people. So, I think we can say, somewhat tongue in cheek, that investing has been solved.
Cameron Passmore: And that is a big bold statement that's inside the Random Walk book by Burton Malkiel. I was reading it last night again to prepare for an interview with him, and that's exactly what he says, and that book is 50 years old.
Ben Felix: Yeah. We saw that with Charlie Ellis was too. There are people that were making that call decades ago. But I think it's becoming increasingly common knowledge today.
So, in that environment, the question I wanted to answer is, or the question that I think lots of people might have is, what value are financial advisors providing? If it's not beating the market or selecting investments. If we take it as a given that investing has been solved, that implementing a portfolio has been solved, what is it that financial advisors are doing?
I think, asking that question is important for consumers because it tells them what they should be demanding from a financial advisor, and I think it's important for financial advisors because they need to know where to focus their time. So, I think, in theory, financial advice is useful because personal finance decisions are complex, and common rules of thumb, often give incorrect answers. We've talked about that many times, and many households are financially illiterate.
So, you take complexity, rules of thumb that give wrong answers, and financial illiteracy. And you can see why in theory, an impartial, unconflicted, competent, financial advisor, and all those qualifiers, we'll see why they're funny in a bit. But you can see why theoretically, that would be a great solution. If you could just plug that unbiased advice and expertise into all of these complex decisions and financially literate households. Of course, that would make sense as a solution.
The other problem is that financial products themselves are extremely complex. And there's a bunch of really interesting research, theoretical research, and empirical research showing or suggesting that financial products are intentionally complex.
The idea behind that research is that financial product manufacturers intentionally increase product complexity to shroud prices like to make it more difficult to the consumer how much they're actually paying to buy the product. And that prevents some consumers from becoming knowledgeable about prices, which allows the product manufacturer to maintain much higher margins than they would if all consumers knew about prices.
There's some pretty cool papers on that from the early 2000s on that theoretical thinking. And then, in the financial product landscape, specifically, there's been really interesting empirical work showing that that is in fact happening, which I mean, like, of course, it is. We know that as people who see financial products all the time. But consumers don't necessarily know that, which is exactly the point.
Cameron Passmore: The focus is often on the story, not on the costs. People love to make buying decisions based on the stories.
Ben Felix: Sure. The prime example of that is probably structured products, and that's where some of the interesting empirical work has been done, where you've got these extremely complex products where the costs are just totally opaque. Maybe insurance contracts can fall into category two, which is really hard to know what you're paying, and it costs. So, it's hard to assess alternatives. It's hard to – anyway.
Now, as if that weren't enough, so we've got the complexity of the decisions, the complexity of the products, we've got financial illiteracy, and then the other big issues are that households have cognitive and behavioural biases. Households tend to incorrectly assess the effects of compounding. They tend to prefer smaller rewards now to larger ones later. That's exponential growth bias and present bias. And add that on to the complexity stuff, I was just saying, of products. Those biases and other ones may be exploited through contract design, and good old-fashioned manipulation and deception. I had my source for the manipulation and deception is Robert Shiller's 2015 book, Phishing for Fools. It's got a whole a whole book on that.
So, given the challenges that households face in making good financial decisions, it should not be a surprise that they often make costly mistakes, and we get some of this from John Campbell coming up next week, too. That's possibly why I had my head on this topic. That's definitely why, actually. I had a bunch of tabs open from preparing for that conversation, and I just went from there.
Cameron Passmore: Sidebar, that conversation is not to be missed.
Ben Felix: Yes, that's an incredible, incredible episode. Not to diminish how incredible many of our past episodes are, but that one's unreal.
Okay, so the mistakes that households make, and these are all statements based on research, like each statement is linked to at least one study. So, households often invest in high fee funds, even when otherwise identical, lower-fee options are available. That one's fascinating. They look at S&P 500 funds and say, “Why the household not invest in the lowest fee S&P 500 fund?” It's a great question. They failed to refinance their mortgages when it would be beneficial to do so. They under-diversify their portfolios or failed to participate in the stock market altogether. They engage in a tension-induced trading. They over-invest in their employer stock, particularly if that stock has performed well in the past. They failed to contribute to retirement plans with employer matches, even when they can take the money out with no penalty. They under-save for retirement, and they under annuitize their assets and retirement. That's not an exhaustive list of mistakes that households make. But it's a bunch of pretty interesting ones that I think we've talked about before, at various points in the podcast.
Now, you look at that, or you hear that. And again, like I said earlier, it seems like financial advice should just be the solution; you get a good advisor in there, and they fix all that up. But it's much more complicated than that. Unfortunately, financial advisors often have conflicts of interest with their clients, and some are more conflicted than others, depending on how they are in their compensation. In some samples, financial advisors failed to de-bias their clients. So, we've got these biases that are an issue that I was talking about earlier. But in some samples, advisors failed to correct for those and may even reinforce the client's biases, if the bias is in the interests of the advisor. If it's good for a client to chase returns, or if it's a good for our clients to prefer actively managed funds than the advisor, well, this is based on – what's the – I can't remember what the word is for it. It's research where they take somebody and put them in the shoes of a client and have them go talk with advisors.
Cameron Passmore: Like a blind shopper?
Ben Felix: It’s like that, but there's an actual name for that approach to – anyway, my I can’t remember what it's called. So, that that's where that finding came from. They actually encouraged biases in some cases. If a client comes in with a portfolio of index funds and asks for advice, advisors who earn commissions will push them toward actually managed funds. So not ideal, at least in that sample.
In another sample of life insurance agents in India, the agents overwhelmingly recommend the products that pay them high commissions while being suboptimal for their clients, and they cater to the beliefs of uninformed consumers, even when those beliefs are incorrect. They seem to focus on maximizing their commissions as opposed to focusing on how much insurance coverage their customers need. Obvious conflict of interest. Unmitigated conflicts of interest.
So, not surprisingly, there's evidence that placing higher standards on the requirement for advisors to act in their client’s interests, as opposed to their own, does improve outcomes. There's one study using state-level variation and fiduciary duty. This was for annuities, and they find that the existence of fiduciary duty increases risk-adjusted returns for clients by 25 basis points, largely due to raising the bar on advice.
There's another study that shows that the sales of higher fee products that pay high commissions, this was again based on annuities, are four times as sensitive to brokers’ interests as to investors. That's crazy. Did you hear that? Sales of higher fee products that pay commissions are four times as sensitive to brokers' interests as to investors. That’s wild. And then, after the US Department of Labor proposed a rule in 2016, holding brokers to a fiduciary standard, sales of high-expense annuity products fell by 52%.
Cameron Passmore: Wow.
Ben Felix: As sales became more sensitive to expenses and investor welfare improved.
Cameron Passmore: Wow.
Ben Felix: Yes. Incentives matter, and I guess regulation matters, as well. Now, there's another study, and I didn't write notes on it. But it was another study in the Indian market, where there's a similar thing; there was a similar shock to the market that they were able to look at. And in that case, the agents shifted to a different type of product. I don't remember what the details were in that study, but it reminded me of in Canada, we banned deferred sales charges on mutual funds, and then we see deferred sales charges on segregated funds increase, seemed like the same kind of setup.
Cameron Passmore: Kind of like the whack-a-mole game.
Ben Felix: Yes. Yes, exactly. Now, I think it's interesting that theoretical research suggests that if consumers are aware of advisor’s conflict of interest, advisors are incentivized to learn which specialized product best meets the client's specific needs, which can actually be good for consumer welfare. So, the commission model isn't objectively bad if consumers are informed is basically what that is saying.
But if clients are naive and believe that the advisor is offering them unbiased advice, when in fact they're not, in that setup, commission-based compensation may be used to exploit their naivety. I think that's more realistically what we tend to see in real life, and it's probably related back to the earlier comment about households being largely financially illiterate. Not largely; that's not quite fair. In many cases, households are financially literate or have low financial literacy, likely related to that bank financial advisors in one sample. This is a paper in the review of financial studies. Their founder recommends the bank's own mutual funds and structure products to the detriment of their clients. It's crazy how much research has been done on conflicts of interest in financial markets.
Cameron Passmore: I would add to that. It's crazy the amount of research has gone into this work. The number of references you have in here and the names of these authors is nuts. That the body of work that is cited in this summary is unreal.
Ben Felix: Yes. Well, trying to do a rigorous overview of the topic.
Cameron Passmore: You have 31, 32 references, and like the who's who of academics that I recognize this so much more.
Ben Felix: Because it's so easy to find, like industry publications, or whatever on the value of advice, or the subject of evaluation of the value of financial advice, but I kind of wanted to find Journal of Finance and Journal of Financial Economics and Review of Financial Studies level research that had looked at these topics, and it's out there.
Okay, so there's these conflicts of interest. Where are we? I mean, like I said, at the beginning, I'm hearing this for the first time, too, because even though I wrote it, I haven't actually read through it yet. Let's think about where we are right now. Households make a lot of financial mistakes because financial decisions are complex, financial products are complex, households have biases. You would think financial advisors could be a good solution to that. But so far, where we're at is that there are a lot of conflicts of interest that affect the quality of that advice and maybe even make it detrimental.
Now, there's another paper that we've talked about a few times on the podcast, which looks at the beliefs of financial advisors. So, it kind of tries to isolate for conflicts of interest by looking at what the financial advisors do in their own accounts. If there's a conflict of interest, the financial advisor might be owning index funds in their own account and then selling high fee actively managed funds to their clients. But empirically, and this is the study the misguided beliefs of financial advisors that people might be familiar with, in the Journal of Finance, they find that financial advisors trade frequently. And in this specific sample, it's not necessarily representative all financial advisors, obviously.
But in this sample, they trade frequently; they chase returns, they prefer expensive, actively managed mutual funds, they under diversify. One of the most interesting parts of the study is that they continue making these mistakes after they left the financial services industry. Because one of the counterpoints could be, “Oh, well, they're just doing that so that their clients think that it's good because the advisor is doing the same thing.” But then, as soon as they leave the industry, they'll go buy index funds, but they don't. They keep making the same mistakes.
Cameron Passmore: Wow. Fascinating.
Ben Felix: So, this one is suggesting that even if we solve conflicts of interest, it doesn't necessarily solve the problem of advisor competence. I know that all I've talked about is, like, why a financial advisor is not useful, but I will get to why they are useful or where they're useful, at least in this research that I found.
One other thing on the misguided police financial advisors that last time we talked about this, someone pointed this out, I think in a YouTube comment or something, the finding that advisors in this sample behave that way, and that's why I emphasize in this sample, it could show that it’s representative of biases that advisors have, or it could show that the firms because this was based on I think two different Canadian financial institutions. This research, it could show that those firms specifically select advisors who will deliver sincere, but misguided advice to clients.
So, the firms could be going on looking for people who, and like, “Hey, we do this too, just in a different way. But we go and look for advisors who are aligned with our investment philosophy and our belief system. So, we want people that want to eliminate conflict of interest or reduce conflicts of interest, and recommend low cost of investment and all that kind of stuff.” But these financial institutions could be recruiting people to do the opposite. So, it could be an extremely biased sample and not at all representative. That is important to point out.
In another Canadian sample. Financial advisors exert substantial influence over their client’s asset allocations but provide limited customization for client attributes like risk tolerance, age, investment horizon, financial sophistication, and they charge high fees for doing so. So, that's another potential issue, is there's conflicts of interest, there's potential incompetence, and then there's potential lack of customization. If there's a very cookie-cutter approach, where advisors are giving everyone the exact same portfolio and calling a financial advice, that could also be suboptimal for investors.
So, the evidence so far suggests that financial advice is often low quality due to conflicts of interest, misguided beliefs, and a lack of customization. Despite this, and this is what I find interesting, we know that these problems exist. But despite this, people still seek financial advice. So, there's got to be a reason. I read in one of John Cochrane’s papers the long time ago that when you see the market doing something, you can say that people are just stupid. Or you can ask why that's happening.
We talked to Will Goetzmann about this, too. He talked about the home country bias when and when that came up, and he talked about how people have been saying for years this is a mistake. But hey, maybe there's actually some logic to this. So, that's kind of what I had, in my mind, when I was going through this. Why are people still seeking financial advice despite all the issues that we know exist? A few reasons.
In one study of German brokerage clients, investors with self-control issues, and this is a really interesting instrument that they use to measure that. They took people who smoked cigarettes and said they have self-control issues, and there's – I'll elaborate on that in a second. So, they found people with self-control issues measured by smoking cigarettes are more likely to delegate their decisions to financial advisors, which work in this case, like a commitment device, and even with advisor incentives, over-trading for these investors is reduced. Investment biases are mitigated, and performance is improved.
Cameron Passmore: Wow, that’s fascinating.
Ben Felix: So, we take a sample of investors who would have made themselves, worse off, and in that case, the financial advisors serves as a commitment device and mitigates their self-control issues. Now, on that smoking thing, because I kind of read that. I was like, “Really? Is that a good instrument to measure?”
So, there's another paper by the same author, where they basically prove that, or showed it empirically, that smokers do have self-control issues in financial decision-making. They trade more impulsively, and their lower self-control exacerbates existing investment biases; that's a separate paper. And then, they did another paper looking at how financial advisors affect that.
Investors who exhibit the exponential growth bias. So that's the bias that interprets compound functions as linear and causes all sorts of problems with long-term decision making. In this sample in the paper in the Journal of Finance, they get more, they seek more outside financial advice, and those biased households or biased investors, who do get advice are just as wealthy as the least biased households. But biased households who don't get advice are less wealthy.
Investors may additionally benefit from trust. This is a theoretical paper in the Journal of Finance. They may benefit from trust to the extent that having a trusted advisor reduces the perceived riskiness of investments and allows risk-averse investors to own higher expected return assets than they would have otherwise owned on their own. I think that one is pretty interesting. That paper is called 'Money Doctors', which is kind of a funny title.
Consistent with what that paper puts forward, theoretically, there's a lot of Canadian research here. But there's more research on a Canadian financial advisor sample that shows that advisors do influence savings behaviour. They do influence risky acid holdings and the influence trading activity. So, the authors of that paper suggest that financial planning benefits may explain investors' willingness to pay high fees for advice. That's kind of in line with the de-biasing that shows up in some samples and the trust. The trust allowing for greater equity allocation,
Financial advisors, they increase stock market participation and risk-taking and decrease investments in cash accounts. This is another paper. And then longer advisor-client relationships, which this paper says is a proxy for trust, increases clients’ willingness to take risk and to stick with their investments after market declines. So, there's the de-biasing. There's the increasing self-control of financial advisors as a commitment device. There's the de-biasing the exponential growth bias, which I find really interesting because that's what financial planning, the process of financial planning, or of doing long-term projections is like a process of de-biasing exponential growth bias.
We talked about this with Eric Johnson. If you give someone the number, instead of saying, “This number compounded for 40 years.” Just give him the end result, it's a lot easier to think about, and that's exactly what financial planning projections do. By their nature, they de-bias for exponential growth bias. And then, we have trust, which increases risky asset exposure.
Okay. And then the last one, this is a paper that from the Journal of Financial Economics, they look at a lifecycle model that incorporates the fact that investors have to forego acquiring job-specific skills when they spend time managing their money. And their efficiency and financial decision-making varies with age. So, they say that there's a decline, a cognitive decline over time, that makes it more challenging to make financial decisions. I don't think most people would agree with that or would disagree with that. I think that's pretty reasonable assumption to make. We hear that all the time that, “Oh, when I get older, I'll probably hire a financial advisor.”
So, they show that the demand for delegation of financial management is going to vary with the opportunity cost of time. This is super intuitive. When you think about it, it's going to vary with the opportunity cost of time. So, if someone has a very high opportunity cost of time, they'll be more likely to delegate, and it varies with age and cognitive ability. So, as people get older, they made a really interesting point, actually, in that paper. As people get older and the cognitive load of financial decisions increases, the other thing that happens is the opportunity cost of time also increases because their life expectancy decreases. That's at least what they're suggesting in the papers is what's going on. And then the level of financial wealth is the other interaction. And the level of financial wealth matters in their model because fees are relative to, it's like a percentage of assets type situation.
So, in their model, consumer welfare is improved by the availability of delegated management. But the model does assume that financial advisors always act in the best interest of clients. So, we're kind of back to that topic.
In addition to that, and this is moving on to other research now, delegation can have benefits in removing stress and mental overhead. So, there's one paper that looks at a decision delegation when the decision affects other people. People are more likely to delegate decisions when they affect more than just themselves. Again, just totally anecdotally, that's something that we've certainly seen where there may be a spouse in a relationship who's perfectly capable of managing the family's wealth. But because they have a spouse who’s also making decisions on behalf of, they decided that they're not comfortable holding that full burden.
The last one on that is that expert financial advice neurobiologically offloads financial decision-making. So, the actual firing in the brain required to make financial decisions about lottery payoffs turns off when people defer to an expert. So, in terms of like actually reducing your cognitive load, that appears to be a thing too.
To summarize all that, despite conflicts of interest and often suboptimal advice, households benefit like despite that. I think that's important. We know these issues exist, but in the face of those households can still benefit theoretically and empirically from an increase in self-control, a reduction in biases that affect long-term decision-making, and higher equity market participation due to trust in an advisor. And investors with a high opportunity cost of time or declining cognitive ability, theoretically, derive benefits from delegated advice.
Now, if you've removed conflict of interest and control for advisor competence, I think that there's a pretty good case for financial advice for some households. It's a big problem, though, that there's a lot of – and this is a regulation issue, I think. There's a ton of heterogeneity in financial advisor, quality, and compensation models. So, that poses a problem because people still need to be able to identify the need for advice and assess the quality and incentives of an advisor for them to be most useful. As we've seen, even when there are complex, and even when advisors aren't perfectly competent, they can still be useful. But I think it's fairly obvious that they're much more useful if we can control for those things or remove those variables.
A couple other interesting obstacles, I guess, is it's the Dunning-Kruger effect. People with inflated perceptions of their own financial literacy are more likely to make mistakes and less willing to accept financial advice. So, that's interesting, and more knowledgeable investors are more likely to seek and benefit from financial advice, which is also interesting. Less financially literate, consumers are less likely to seek financial advice. There are all sorts of interactions there. They may have less wealth, for example. But still interesting.
As super simple rules to follow, I think that investors can avoid advice that's associated with a commission. Which means what questions should you ask if you're going to be getting financial advice from someone. We've said this before; you have to know how they're being paid. You have to know what the advisor’s incentive is, and to what extent that aligns with your own. I think you have to demand commitment to a fiduciary standard or or some similar level of commitment. There are all kinds of different ways to approach that, I guess. In Canada, we have the portfolio manager registration category, which implies that level of commitment, but then they're also like, people who are CFP professionals and people who are CFA charter holders, they commit to that level of, of a standard.
But the hard part is, one of those last points that I made is that, like, the people who would probably benefit from financial advice the most are less likely to seek it out. You have to have a baseline level of financial literacy, to know that you need advice, to know what you don't know, and to benefit from the financial advice that you receive. I don't know if financial advice solves the need for financial literacy. I think that there's still a need for people educate themselves. But given that, I think financial advice does have some interesting qualities in de-biasing, acting as a commitment device, building savings plans, and yes, I guess that's it.
Cameron Passmore: I'll go out on a limb and say that was one of your finest deep dives.
Ben Felix: Really?
Cameron Passmore: Absolutely. I thought that kind of wraps up so many concepts and ideas, and is very useful to the end consumer 100%.
Ben Felix: Well, I'm glad to hear it.
Cameron Passmore: And may we get feedback that agrees or disagrees with –
Ben Felix: This was the worst episode ever. I want my money back.
Cameron Passmore: All right. Did you want to go to the quick review of a past episode?
Ben Felix: Yes.
Cameron Passmore: All right. As people know, this is where newer listeners can learn about a past episode that they may want to check out. So, I'll give a bit of a backstory. Four years ago, almost to the day, I think, I was invited –
Ben Felix: That was four years ago. Come on.
Cameron Passmore: Yes, four years ago. I was invited to a conference in Sydney, Australia, and got a chance to sit down with the co-CEO of Dimensional Fund Advisors. So, that was our second episode, where only one of us did the interview. The first one was you and Shane Parrish. This was Dave and myself. Every other one we've done together. For those who don't know, Dimensional is an asset management company that creates portfolio solutions based on the kind of stuff that you talk about in your deep dives; founded in 1983. They currently manage about 800 billion Canadian or so and is one of the great storied firms in this whole index fund revolution that's been happening for decades.
Full transparency we've been working with Dimensional, as people know, for client solutions since they came Canada 20 years ago this fall. So, you're talking about time flying. It’s unreal. Anyways, so with that setup, here's the quick review.
So, episode 43 from 2019 is a great place to learn about an important player in the index fund revolution, Dimensional Fund Advisors. What makes them particularly interesting is that they're at the intersection of some of the great academics of the past 50 years, along with the implementation of these great ideas. So, Dave Butler, the co-CEO of Dimensional, has had a front-row seat to this evolution over the past 25 years and has worked alongside such great people as David Booth, Eugene Fama, Rex Sinquefield, Mack McLeod, and of course, Gerard O’Riley, his co-CEO. But ideas about clients are of little value.
So, Dave's story is interesting in that he was part of a small, determined team that brought this message to financial advisors. This is a whole new time for Dimensional as they've only worked with institutions prior to then. So, Dave, was one of the first hires by Dan Wheeler, who we pay tribute to a few weeks ago. The interesting thread in this conversation with Dave is the company's concern and care for the ultimate client. The goal to improve the client investment experience, use research and technology to embrace indexing, and create products that investors can use in building portfolios.
Anyways, the conversation was full of great stories, how he almost joined the NBA, to how his first interview with Dimensional ended up at lunch with Nobel laureate Merton Miller, which is just a terrific story. We talked about operating as a co-CEO, some lessons about leadership, and working alongside academic giants such as Fama and French. So, such an interesting episode. And that was episode 43, with Dimensional Fund Advisors co-CEO Dave Butler.
***
Okay, let's move to the book review section and try something different this week. Ben, is that good with you? As listeners can imagine, learning is a big part of the life and culture here at PWL. So, I thought for fun this week, we would invite our colleague, Lukas Fleck to join us to participate in the book review. And then to also talk about the 23 and 23 challenge.
Lukas, it's so great to have you on the podcast.
Lukas Fleck: Thanks for having me on. Long-time listener.
Cameron Passmore: Excellent. Long-time listener, first-time visitor.
Lukas Fleck: Exactly.
Cameron Passmore: So, you joined the firm, Lukas, five years ago as an investment advisor, based here in Ottawa, and you also recently became a CFA charter holder. Congratulations.
Lukas Fleck: Thank you.
Cameron Passmore: You're also the coordinator of our company Book Club, which we'll talk more about later. But the book we wanted to review this week is the book that we discussed at our March book club. I’ll let you queue it up.
Lukas Fleck: For sure. So, the book is The Obstacle Is the Way by Ryan Holiday.
Cameron Passmore: So, how do we choose that book in the book club?
Lukas Fleck: Yes. So, we operate sort of on a rotation basis for choosing books. It's a little bit random. This book was recommended to us by Tessa. She's our people in culture lead. And it was a great read.
Cameron Passmore: And Tessa, I think many listeners know, is Ben’s sister. Fantastic team member. Anyway, so we'd like to kick it off with a bit of background. Can just share who Ryan Holliday is?
Lukas Fleck: For sure. So, Ryan's a writer, media strategist, and a best-selling author. He's best known for his books on stoicism primarily. So that includes this book, The Obstacle Is the Way. Also, Ego Is the Enemy, and The Daily Stoic. He's also got a website. It's called Meditations on Strategy and Life. This is what he's really sought out to do in his career is write about things that he felt people don't talk about enough. So life, how to be self-critical, self-awareness, philosophy, and strategy.
Cameron Passmore: So, what was the basic premise, quickly the basic premise of the book?
Lukas Fleck: Yes. So, the book really is, is a formula or a headspace for overcoming really any negative situation that you might encounter in life. The big takeaway is to thrive, not just in spite of whatever happens but because of whatever happens. Obstacles aren't something to be feared or avoided. But rather, it's an opportunity to grow and become stronger. Our actions may and will, be impeded by obstacles, but you can't impede our intention. We can always accommodate and adapt and overcome those impediments. This impediment to action actually advances action. So, in other words, what stands in the way becomes the way and that was repeated a lot in the book.
Ben Felix: I didn't realize this is the book we're going to be talking about. And it's funny because a really good friend of mine, two weeks ago, it's actually the guy that people who have listened for a long time now that I went hiking in Newfoundland with. He was texting me that I have to read this book. It changed his life, and I absolutely have to read it. I was like, “All right, I'll read it.” I haven't read it yet. But it's just kind of neat to see that come up here too.
Cameron Passmore: Wow. It was a cool book. And the topic really is what it's about. It's about using the obstacle to show you the way and taking that as a challenge, which is super interesting.
Ben Felix: Well, what were your main takeaways from the book, Lukas?
Lukas Fleck: Yes, my main takeaways, the author really highlighted three key disciplines, and those three that he highlighted was perception, action, and the will. So, perception is how we perceive a situation, and it shapes how we respond to it. We can't control what happens to us, but we can control how we respond. By choosing to see obstacles as opportunities for growth, rather than just a negative thing in the way of where we're trying to get to, we can approach challenges with a much more positive attitude. And then actually overcoming those challenges obviously takes action, just that second discipline. So, we need to be willing to put in the work to actually overcome obstacles.
And then the last one is will, which is the willingness to keep going and keep trying in the face of adversity and sort of building off that discipline of will. The book made a couple of key distinctions between perseverance and persistence that I found really interesting. So, perseverance that involves the willingness to adapt and change our strategy when we're faced with an obstacle. So, it's realizing that the path isn't necessarily a straight line. Persistence, on the other hand, that's sort of trying something over and over, even when it's not working. The author definitely portrayed perseverance in a much more positive light.
Another cool takeaway, I thought, Cameron, I think you highlighted this was that many of our problems actually come from having too much. So great times can be great softeners. Abundance can be its own obstacle. So, scarcity has bred some of the world's greatest ideas and innovations. The author gives some really good concrete things to keep in mind when we're facing an obstacle, so I'll go through those, and that's to be objective, to control emotions, to keep an even keel, to choose to see the good in a situation, to study your nerves, to ignore what disturbs or limits others, to place things into perspective, to revert to the present moment. And a big one is to focus on what can be controlled. So, I really liked that sort of list of actionable items to keep in mind.
Cameron Passmore: As you think back in the book, did anything really particularly ring true to you?
Lukas Fleck: Yes, a big one for me is that perceptions are the problem. So, when we're faced with an issue or an obstacle, it's easy to get tied up in emotions when really, we should be dedicating that energy to actually solving the problem that's in front of us. So, not wasting time on our emotions or perceptions and just focusing on the actual end goal and moving forward. A huge one for me is focusing on what can be controlled. This is so applicable to all aspects of life. Investment philosophies included. It's been a mantra, that's definitely – that I've definitely lived with for the past little while, especially studying for exams. It’s something that I had to keep telling myself is just focus on the inputs. That's all I can control is building good study habits, staying adamant about progressing towards that goal, and the output is just a by-product of those inputs. So that really helped me.
A good line that I made note of was nice and simple, and it's listen to failure and learn from failure. So, that just kind of speaks to that notion of failing forward, always learning from mistakes or issues that you face, and I really liked that.
Ben Felix: The one line that jumped out at me that I've heard others say is how you do anything, is how you can do everything, and we can always do what's right. So, I love that line.
Lukas Fleck: I like that.
Ben Felix: It’s a pretty good line. So, I guess I'm going to have to read this book now, because it's coming at me from all angles. Was there anything Lucas that you didn't like about it?
Lukas Fleck: There wasn't much that I didn't like about it. I really enjoyed the book. I think the one thing that I would tell people going in is that I wasn't wowed by any sort of new novel ideas. I think the way that the author organized some of these thoughts was really good, and it solidified a lot of things that I think I've thought about a lot or that our team is already doing. So, it was more of a book of like, reiterating those good practices rather than wowing me with a novel idea that I haven't thought of before. But I don't think there's an issue with that. I actually get a lot out of reading books that confirm habits that I've been doing. It's nice to have that confirmation. But I think just something to keep in mind. That was just my experience.
Ben Felix: So, what's your overall recommendation on the book?
Lukas Fleck: I would recommend it for sure. It's a fairly quick read and a lot of really good takeaways that I think are broadly applicable to life.
Cameron Passmore: There you go, Ben. You're surrounded. So, I guess you have to read it. So, Lukas, you're part of the 23 and 23 challenge, which people who are not part of that can join at rationalreminder.ca. How far along are you towards the objective?
Lukas Fleck: I'm about halfway through now. I think I'm working on books 12 and 13, just over halfway. I'm tracking well. For me, that's good. I know a lot of the guests who have been on here are probably through about 100 books this year, but I'm proud of what I've been able to do in my reading goals.
Cameron Passmore: That's awesome. So, what are your reading habits?
Lukas Fleck: Yes. I mean, I'll start this off by saying that I by no means think that the way I do things is the best. Honestly, I've been constantly jumping around, changing my habits, trying to find what works for me. But I'm happy to share what I have found throughout that journey, and hopefully, it's applicable to some people.
So, I only started reading more heavily about a year and a half ago. So, going through university, going through a lot of industry exams after the fact that just became my excuse. I’m not saying it's a good excuse not to read for personal growth or for pleasure, and I was just so focused on getting through the technical side of my growth and knowledge that I didn't read a ton of books. So, I kept telling myself, as soon as I'm done this, I'm going to dive into it. And that reading list kept growing and growing, and I had a huge pile of books ready to go as soon as that was done. So, I started building that habit after I was done writing my CFA exam, and I found it very easy to build that habit and keep that habit. It's quite enjoyable.
I tend to have one tech space book. So, that could be a physical copy or Kindle on the go and one audiobook on the go at all times. I enjoy both differently. I go through audiobooks much, much quicker because I can mix it into my everyday routine. If I'm walking my dog, shovelling, going to the gym, I can listen to an audiobook. I tried to save books with a lot more data or diagrams for text. A good example of this is The Behavior Gap by Carl Richards. I read that earlier this year. He has this amazing way of simplifying complex topics down to like a back-of-the-napkin-type drawing, and you would just be missing so much of that book if you listen to it, rather than reading it, and actually seeing these diagrams. So, I do try to select my books, or how I read my books a little bit based on the content. But other than that, I just try to read every day, even if it's just 20 minutes. It's just like any habit to build repetition.
Ben Felix: I remember after finishing the CFA exams, feeling like I could learn anything.
Lukas Fleck: I think that's part of it too, for sure. Because all of a sudden, all of your evenings are freed up to do whatever, and I'm used to sitting down and studying for hours on end. Why not learn something else? So yes, I've been enjoying just broadening that scope of knowledge.
Ben Felix: I remember that. It's like you build the, I don't know, exercise the muscle of just sitting down and studying and learning stuff. And then CFA is gone. It's like you have gap to fill.
Lukas Fleck: Yes. I don't know about you, but I have that like paranoia of losing that skill from, like – I just got to keep the momentum going. It is nice to take breaks. But I think it's important to try to keep that momentum because it's not easy to pick up that skill and kind of force yourself back into the study regime.
Ben Felix: Yes, definitely. How do you capture stuff from what you read?
Lukas Fleck: Yes, I've tried a lot of different tactics because I've struggled with this, for sure. But for audiobooks, I use Audible, and on Audible, you can snip clips of the book. So, if I'm driving or something, it's very easy to just take a quick snip, and then what I do, I just re-listen to those either when I'm done the book or through a large chunk of the book. I'll go back, listen to my snips, and just write them down into Notepad on my phone. I keep all those notes in a folder.
I also use Readwise, when I'm using Kindle. So, I have the Kindle app on my phone, and iPad, and I read off of that. It's awesome because you can go through and review a bunch of your highlighted texts as cue cards, sort of in random order. So, you start picking up things that you read a year ago. Yes, I forgot about that. And then something I've recently started doing is, I don't know if this is a term, but retention journaling is what I'm calling it, where I've heard that journaling is extremely important. I've never really tried it. So, I thought, I'm just going to start writing down interesting things that I read or learned throughout the day, and it's not structured at all. I just sort of, before bed, tried to download some interesting things that I either read, listened to, covered in a webinar, or just throughout a conversation I had with somebody, and it's been working well so far. Like I said, I just started it. So, maybe we'll have to report back in a bit. But just trying to build that new habit and see how that goes.
Cameron Passmore: So, these are handwritten into a journal book or typed?
Lukas Fleck: No, I'm typing them. I'm typing them into Notepad on my phone. I just find – my phone’s always with me. So, pretty easy to write stuff down.
Cameron Passmore: So, where do you get your reading ideas from?
Lukas Fleck: Oh, that's the easy part is finding books to read. My wish list is extremely long. I can't keep up with it. Coworkers, clients often have really good book recommendations, and it's great to read the same books because clients, it gives you something to like a common thing to talk about and discuss. And the podcast, obviously, I think, probably most of the books that I read, have either been discussed on the podcast, either prior to me reading it or after.
Ben Felix: What are your favourite recent books that you've read?
Lukas Fleck: One that stood out to me was Deep Work by Cal Newport. That was an amazing read. It resonated with me a lot. Because as an advisor, your day-to-day can be quite hectic, and it's difficult. You actually have to go out of your way to create this deep workspace and get focused work done. That book gave me some really concrete takeaways to apply, and I have applied. So, that was a great one. And probably, recency bias. But the book I'm reading now, it's called Making Numbers Count. Both of these books have been reviewed on the podcast. So, going back to where I find my book ideas from, I guess, making it pretty obvious, but Making Numbers Count is great. For anybody that's trying to display information with numbers or tell stories with numbers, it's a really, really good book.
Cameron Passmore: So, you mentioned our book club, and you're the coordinator of our company book club. What tips might you have for others that might be thinking about a book club in the workplace?
Lukas Fleck: Yes. So, I would highly recommend do not overthink it, don't over-engineer it. Just find some willing people. It doesn't matter how many people and just start discussing books. I think it's huge. Going back to how I capture ideas and action, I was like, talking about it with somebody is a really good way to solidify what I've learned from a book, and you get all these different opinions. People see things different ways, through a different lens, and it's so interesting to hear that. Cameron, you're part of these discussions. It's amazing. The takeaways that we get from it and where the discussion goes.
So, I would also recommend, it's good to have a moderator in place, somebody that's ready to come to the meeting with questions and keep the discussion going. But just remember that the moderator’s duty isn't to present. You don't want a slide deck and going through and reviewing a book. With a slide deck; I think the point of it is to discuss and get other people's thoughts.
Cameron Passmore: I agree. And it always goes in a direction you kind of didn't see ahead of time. You learn a lot about your colleagues. And then we've done a lot of discussions during those times about applying what we learn to our day-to-day work lives. So, it's a very productive use of time and a lot of fun, actually.
Ben Felix: You guys are selling me on the book club. I haven't participated.
Lukas Fleck: You should join. It's an open invite
Cameron Passmore: Open invite.
Ben Felix: Lucas, you're known around the office, with air quotes for people listening, because we don't really go to the office anymore, but around PWL for your life hacks. What reading hacks do you have to share?
Lukas Fleck: Yes. I knew this would come up. It's hard because reading isn't – like often hacks or to kind of find shortcuts and cheat the system a little bit. And reading isn't really one of those things. For me, one of the big benefits of reading is sort of the long-form content. It's not something I'm looking to cut corners on. But that being said, I did think of a couple life hacks for reading. One of them is I think it's good to have a good book summary provider. So, I use the app Headway. I have no idea if it's a good one or a bad one. Just the first one I tried. It has been working for me.
What this allows me to do is I can preview books before I read it. So, you can get a quick seven-minute summary of a book before diving in and seeing if it's something you want to dedicate some more time to. But then, I think even more importantly than this, after the fact, after I've read a book, it's really interesting to go back and re-listen to a summary, and it kind of brings you back into when you were reading the book, and it can be a book from a year ago. You just remember a whole lot of details that you would have otherwise forgotten. It's a little bit different than just taking notes because when you take notes, you're highlighting what you think is important then. But in a year from now, you've gone through a lot of different experiences, and sometimes items that you didn't highlight now stand out. So, I've been enjoying that.
There's also infographics for visual learners. So, you can see like a book summary as like an infographic format, which I find really interesting. And then, another quick little hack is for anybody using Audible; leverage your wish list. So, if you add everything to your wish list, basically every month, they release a couple included books, actually a lot of included books that are included in the subscription, so you don't need to go out and use a credit to pay for it. If you have everything in your wish list, then you can see the little orange logo saying, “included.” And oftentimes – I've been surprised with how often something in my wish list is included that month. So, if you're going through more than your one credit a month, it's a good way to move things up your reading list if it happens to be included.
Cameron Passmore: That's a good hack. Awesome. Lukas, great to have you on. I know you know a lot of the listeners, you meet a lot of people. But it's great to introduce you to the audience.
Lukas Fleck: Yes. Thanks so much for having me.
***
Cameron Passmore: All right, Ben — three listeners and us to talk about the after show. You sent me a picture on the weekend of your new basketball hoop. You get the most unconventional, shall we say, and I love it. I haven't been there, but I have you seen pictures of your setups. You got to tell.
Ben Felix: Well, yes. So, people got a kick out of the fact that we have this gigantic trampoline in our house. I had to get rid of that, unfortunately. Kids weren't too happy, but they’ll be okay. Yes, I got a regulation, 10-foot basketball hoop up in the equivalent of our living room, I guess. It's not really a living room.
Cameron Passmore: Now, you have cement floors, so it bounces?
Ben Felix: Oh, yes. When we looked at this house, it's a bit sketchy. It was never finished completely. The parts that matter were finished. But, like the interior finishes were never done. But when you walk in, there's this kind of main room in the house has a really high ceiling and a concrete floor. As soon as I saw it, I was like, “Oh, my goodness, you could put a basketball hoop in there.” And I've been dreaming about it ever since. So, I did it.
Cameron Passmore: Pretty cool. For those who watch Succession on HBO. I don't know Ben if you're a watcher or not, but the episode on Sunday, I'm not going to spoil anything. But if you're watching Succession and have not watched this week's episode, this would be last week when it was released. You got to watch it. Unbelievable. Unbelievable.
Okay, let's jump into this conversation about hot sauce. I got dragged into this. I'm in the crossfire of hot sauce with a bunch of our friends, our FinTwit friends. Are you a big hot sauce guy, Ben?
Ben Felix: I'm a big consumer of hot sauce, as is my wife.
Cameron Passmore: Do you have preferred brands?
Ben Felix: No.
Cameron Passmore: Tabasco?
Ben Felix: We have Tabasco in the fridge.
Cameron Passmore: But you don't deem Tabasco to be your favourite?
Ben Felix: No. It's definitely not my favourite.
Cameron Passmore: Okay, so you're going to be against Mark McGrath and I. I never said for the record, that it was my favourite. So Mark, who was our guest a month or so ago. He was a big fan of Tabasco, put that on Twitter. And, of course, other friends of ours jumped all over him to say it's terrible. You should be trying these other sauces, and I jumped in saying, “I kind of like it. I don't say it's the best, but I kind of like it.” Anyway, the passion that people have around hot sauce makes the debate over the relevance of dividends seem mild, which is quite something. Anyways, they said how can I stoop to such a level?
Ben Felix: I like Tabasco. It's part of the rotation.
Cameron Passmore: Anyways. Well, Jason finds it completely unacceptable, Ben, that we actually have Tabasco in our fridge.
Ben Felix: Sorry. Sorry, Jason. The one that I just finished a bottle of some like really, really hot Ghost Pepper hot sauce. It was incredible. I got a bottle at a farm store that I was at and we finished it in like three days.
Cameron Passmore: Did you have to sign? Because the kids got me one for Christmas last year. They had to sign a waiver to buy it. It was so hot.
Ben Felix: Yes. It's not that kind of hot sauce. It was still very, very, very hot. But it wasn't that like – yes, not the waiver kind.
Cameron Passmore: Anyways, these guys even got a cameo done by Alton Brown who I guess is a foodie on some Food Network. I don't know who he is. But I saw this video, and they've gone all the town. Anyway, so Mark and I are alone on one side, and we got Aaron and Erevan and Jason on the other side. Anyways, guys, it's a fun debate. So, now I've been introduced to – Jason sent me a bunch of hot sauce providers here in Ottawa, so I'm going to check them out and check out my hot sauce game.
Ben Felix: That's what I usually do. I usually get like one-off hot sauces that I find around –that’s why I don't have a favourite brand, really. It's just try different hot sauces. I do like really, really hot, hot sauces, though, which Tabasco is not.
Cameron Passmore: No. It’s easy. Plus the bottles are so cute in your fridge. It’s not that big of a deal.
Anyways, some recent reviews came in, which is very kind of people, so Growing the Valley Podcast in the States said, “My favourite personal finance podcast. Ben and Cameron are the perfect combination of investing nuts and bolts together with great social science findings, kind of like the Bogle Heads on Investing, and The Hidden Brain Podcast had a baby. Super appreciate that they dig into the academic literature for us, also enjoying the advanced basics episodes.”
Ben Felix: Tony smiles from Canada, “I don't know how you keep producing such quality content so regularly. The work that goes behind your podcasts is monumental. It's superhuman. Keep it up. Very inspiring.” I did almost die today trying to write the episode before we started recording, which is why I said a couple times that I hadn't seen it yet, because I was like head down writing for many hours before we started recording.
Cameron Passmore: Nice feedback from Travis in Canada said “This is a valuable addition to your week. I’m enjoying the podcast for a few months now. Ben and Cameron and guests provide excellent financial and life advice. Already taken away few life pearls and feeling rich. One of my takeaways, the ideal financial decision isn't always the best life decision. I have better appreciation of the value of my time. For example, I hired someone who was still a new dishwasher this week rather than doing it myself. The cost of well worth it, and the time gained and my kids and lack of stress over doing something I'm not knowledgeable about. I reviewed the cost at bay for financial advice. We'll be making changes that should save me thousands of dollars over the years. I'm more aware of my own biases and how they influence my decision making. I'm contemplating a change in my work structure to make me more time rich as opposed to money rich. There hasn't been another podcast so applicable to my daily life. Thanks, guys. And please keep up the good work. PS, my son has a worm farm. We've been using it for fishing bait, and I've been inspired now to use it to help teach him some business and financial lessons.” Very kind of Travis. Thank you.
Ben Felix: Very nice. Alpo100 from United States says that, “It's an incredible resource for the financially curious. Cameron and Ben do a phenomenal job taking the leading thinking in finance and distilling the information to something palatable for anyone curious about money. Thank you both.”
Cameron Passmore: Chris reached out on LinkedIn and asked if we're going to be doing a meet up at the IAFB conference in Edmonton in September. I can't make it. Are you going, Ben?
Ben Felix: Well, we're going to be in Toronto, you and I. That's going to overlap with that. So, if I am going to go, it's going to be like from Toronto to there. I'm undecided. Yes. But if I go, we can do a meet-up. Sure. As long as there are snacks. I only go to meetups with snacks.
Cameron Passmore: We can make sure there's snacks. Speaking of events and meetups, I think, we’re going IWI Ace Academy in San Diego in a few weeks. I'm going to be there if you want to meet up. If you're going to Future Proof Festival in September in Huntington Beach. We will be there. We're doing a live recording and thinking about hosting a Canadian breakfast for fellow Canadian advisors. So, you can reach out to info@rationalreminder.ca.
Also, thinking about a meet-up in the LA area on Saturday night, September 9th, and also in Toronto on September 20th. I'm kicking around the idea of going to Chicago this summer. So, might do a meet-up in Chicago. If anyone's interested, you can reach out in the store. We've had almost 800 orders in the store.
Ben Felix: In total, forever?
Cameron Passmore: Yes, in total, forever. We've been doing a couple of years, right? But summertime is Koozie time. Yes, your favourite word, Ben, Koozies. He had free Koozie and a free pair of socks. So, buy a hoodie. They're super soft, super comfortable. So, you buy a hoodie for 45 bucks, and if you're in North America, you get free shipping and socks in a koozie. So, again, that's all on rationalreminder.ca site. So, you can go there. Shop. Join the challenge.
Ben Felix: Can I ask you? Why do we have the store? Because we don't make money off of it? Is it just fun?
Cameron Passmore: We actually lose money off it, Ben, just to be clear. It’s just fun to get the merch out there and get retweets. No, we don't make money. We lose money and every year. And then when I go and get motivated, I do my giveaways because everyone inspired like we're shipping like $8 socks with free koozies across the continent for free. Whatever we did.
Ben Felix: Do you get joy out of knowing people are Rational Reminder swag?
Cameron Passmore: I do. It's cool. I love connecting with people. So, reach out in all the different platforms. I said this a couple weeks ago, if you're a financial advisor in Canada and are considering options for the succession of your practice, please reach out. As you said earlier, next week's guests incredible, Professor Campbell.
Also coming up in a few weeks will be a conversation with Burton Malkiel, author of A Random Walk Down Wall Street, which just released its 50th anniversary edition. It's phenomenal. I'm halfway through it now. So, we want to get a head start on that. We have lots of books coming up. We had Nick Maggiulli coming up. Just Keep Buying, Robin coming up. Jill Schlesinger just released a book. She's coming up, also. So, got a lot of good books coming up.
Ben Felix: So, this is a new thing we're doing now. It's like a new segment. You kind of briefly mentioned it last time we did an episode, but I don't know if we've –
Cameron Passmore: Well, it’s part of advanced basics, right? So, we're going to be doing more books on the financial basics, having the authors on to talk about their book, and we'll talk about their reading habits, as well as to kind of put it all together. Anything else this week, Ben?
Ben Felix: I wanted to leave something at the end here. I don't know if we'll be able to show the video or not because it's not ours. But the AMF in Quebec, which is like the securities regulator in Quebec. What does the AMS stand for?
Cameron Passmore: Autorité des marchés financiers, I believe.
Ben Felix: Yes. I knew that too. But I can't say it as well as you. Not that you did it very well. But I would have been worse. They have these ads that I see on Reddit, and I think that there's so funny. I'll describe it. But if we can show a clip of it, that'd be even better. So, they have videos of ridiculous activities. They have one of a woman trying to walk over like an icy river and falling on her face. They have one of a guy doing a jump on a bike over like a piece of plywood, trying to jump over four of his friends. And they have these just ridiculous things happening. And then, they say, “See the risk. It's just as obvious with crypto.” It's just hilarious because they're trying to protect consumers in Quebec from crypto. But I haven't seen protection that overt from other regulators.
Cameron Passmore: And this is a recent series of ads?
Ben Felix: Fairly recently. Yes, I've only noticed it for the last couple of weeks, probably. I don't know when they started. But they posted them on Reddit as promoted posts. It's just –
Cameron Passmore: But you don’t know if there were out there at the peak of the crypto craze last year.
Ben Felix: I don't know that. Yes, too late, maybe. But better late than never, maybe.
Cameron Passmore: I guess.
Ben Felix: They're in French too. So, they don't probably appeal to everybody. I live in Quebec, so I got them in French.
Cameron Passmore: Cool. All right. Anything else?
Ben Felix: No, that's it. All right, everybody. Thanks for listening.
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Deep Work: Rules for Focused Success in a Distracted World — https://amzn.to/3AuSXqZ
Making Numbers Count: The Art and Science of Communicating Numbers — https://amzn.to/41HXnWK
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