Guest User

July 16, 2026

“I Sold 50% of My Portfolio. What Now?” | #418 (AMA)

Guest User

July 16, 2026

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.

Read The Transcript:

Benjamin Felix: This is the Rational Reminder Podcast, a weekly reality check on sensible investing and financial decision-making from three Canadians. We're hosted by me, Benjamin Felix, Chief Investment Officer, Dan Bortolotti, Portfolio Manager, and Ben Wilson, Head of M&A at PWL Capital.

Dan Bortolotti: Welcome back to another AMA episode. Trying to get through the backlog of questions here, and we definitely have some good ones in the lineup today.

Benjamin Felix: These episodes do really well. The last couple have been some of our best performing recent episodes, so people seem to like them, or at least they seem to watch them. Hopefully, they like them.

Ben Wilson: And it always prompts new content. In the comments, people are asking more new questions to bring up in future AMAs, which is cool.

Benjamin Felix: These questions tend to be very practically relevant, as opposed to, I think, sometimes our topics are maybe a little bit more theoretical. Should we jump into them?

Dan Bortolotti: Let's do it.

Ben Wilson: Let's go.

Benjamin Felix: All right, I can read the first one. This is from Morvich, and they say, this is a really interesting question, actually.

They all are. This one in particular is fun to talk through. They say, I mistakenly sold VEQT and took a 50% cash position last year concerned about a bubble.

During the interim, I invested it in a money market fund. Now, I have regrets and want to invest it back. Should I do a lump sum?

Should I do it in monthly or quarterly installments? Or is the bubble concern real, and I should keep it as cash or keep a cash percent? I am a 44-year-old married person.

Both spouses make good money and don't need short-term money. We already own our home. We're just saving for retirement.

However, we started a bit late and are now focused on growing our retirement savings. That's a tough one. They sold out.

I didn't note down when this was submitted, which is unfortunate, but they sold out with concerns about a bubble. In recent history, markets have been pretty good. If there's a bubble, it hasn't popped.

A bit of a rough time to be out of the market. They're now worrying about whether they should get back in, and if so, how to approach it. I think this situation highlights one of the big problems with market timing is that you have to be right twice.

You got to be right once on the way out, and you've got to be right again on the way back in, which is often the more difficult one. It's a very common story. People get out because times are bad, and they're worried they're going to get worse.

In this case, it's funny how both things can happen. You might get out because times are too good, and you think there's a bubble that's going to pop. You want to get out before it pops.

It's funny how either one of those, times being bad or times feeling too good, can both be triggers for people to want to try timing the market. I did do a video recently on investing at all-time highs, and we also had Ben Carlson on this podcast who talked about this. Basically, the story there is that all-time highs in the stock market are normal.

Stock markets tend to go up over time. They've done that for hundreds of years. Reaching all-time highs should be expected.

In that video, I think I found that around 30% of months are all-time highs. We just look at monthly data.

Dan Bortolotti: 30% of months. Wow.

Benjamin Felix: There's a huge proportion of months that are all-time highs. This is not every month, but it should not be surprising when the stock market does hit a new all-time high.

Then the other thing I talked about in that video was not just all-time highs in the index level, but also valuations. Stock market valuations using the Shiller-CAPE ratio and how predictive or not that is of future returns. The story there is basically, there's for sure a relationship in the data, but it's super noisy.

I looked at a bunch of different countries' stock markets, and if you sort future returns on starting CAPE ratios, starting market valuations, there is a pretty monotonic relationship. It's like each step of higher valuations, average returns for the future 10 years do tend to be lower, but there's also a ton of noise around that. There can be 10-year periods where you start with a really high valuation and you actually get a really high return, which just makes it really hard to use this information to time the market or your exposure to stocks or your exposure to any one market.

What we've said in the past about this is that it might make sense to temper your expectations for the future when valuations are high. I mean, the US stock market has been a great example of this. Valuations have been unusually high for years now, and getting out of the US stock market has been a terrible mistake in recent history.

Anyway, all that to say that when people are worried about all-time highs, when they're worried about high stock valuations, they're probably not the right things to be worrying about. Now, assuming you're sitting in cash after selling out of the market, you've already done this. You've pulled the trigger.

You've done the sale. Now, you want to get back in. We can think about how to think about those next steps.

We know from our research and the research of other people that lump sum investing is statistically superior to dollar cost averaging over time. In our analysis on this, we looked at six different stock markets. We looked at 10-year periods, and we asked whether dollar cost averaging over the first 12 months of the 10-year period beat investing everything at the beginning of the first month.

Then with the dollar cost averaging in the end term, while the cash is waiting to be invested, we kept the cash in treasury bills. It's not earning nothing. What we found in that analysis is that lump sum investing beat dollar cost averaging around 65% of the time on average across all of our countries.

The approximate annualized cost of dollar cost averaging was about 38 basis points over 10 years, which is interesting, right? Because it's quite a bit, but it's not that much. We'll come back to how to think about that trade-off in a minute.

One of my favorite results from that analysis was that when we conditioned on bad lump sum outcomes, so we took all of our data and we sorted it by the outcomes that we knew in the total sample were the worst outcomes for investing a lump sum in the whole sample. What we found there is that in those worst lump sum cases, dollar cost averaging only came out ahead 51% of the time.

Ben Wilson: That point is super interesting. I find that point in client discussions so compelling.

Benjamin Felix: Actually, I said that wrong. Dollar cost averaging lump sum came out 51% of the time, so you're still slightly better off in terms of probabilities in that sample with a lump sum.

Ben Wilson: When this conversation comes up, this is one of the most compelling points. Even when you statistically pick the worst time, you're a coin flip away from being better off or not. Do you want to bet on a coin flip?

There's so much evidence in support of it, especially if you've got a long time horizon. It's compelling evidence to do a lump sum investing.

Benjamin Felix: But it's a coin flip if you know that you're about to invest in one of the worst lump sum periods, which you can't know that. Even if you did know that, it's still not guaranteed that you're going to get a better outcome with the dollar cost averaging. I found that really interesting.

Then in the paper, this I think speaks more directly to Morvich's situation. We did also look at valuations only for the US stock market just because there's so much more data there than for the other countries we're looking at. We found that when the US stock market was in the 95th percentile of expensiveness measured by the Shiller-CAPE, but only using backward looking data to measure the percentile rank.

That matters because you don't know what future valuations are going to be. If we look at the full sample of data and say, we're in whatever, 1985, and we're saying, is the US stock market expensive today relative to all observations in the full sample, even into the future? You've got much better information there to say whether the stock market is expensive relative to the future, but of course, today in 2026 or whenever Morvich wrote this question, you don't know what the stock market valuations for the next 40 years are going to be.

It's possible that we see CAPE ratios even higher than they are today. When we sort only using backward looking data to measure the percentile rank, dollar cost averaging came out behind 64% of the time compared to 71% of the time in the full US data set. Even when stock markets are expensive, dollar cost averaging is suboptimal.

Then we did also look at measuring expensiveness based on the full data set, which again, keeping in mind that this means you were able to predict the future, you're able to predict what future valuations were going to be. Lump sums in that case still came out ahead 54% of the time. Again, it's like even with perfect information about the future, it's really hard to come out ahead from dollar cost averaging.

I mentioned the 38 basis point on average 10-year average cost of dollar cost averaging. Because the cost is relatively small, if someone's really, really worried about this and they want to minimize their regret of the decision, this is an act of commission. You're making a decision to do something, which can often hurt if you get a bad outcome.

I think you can minimize regret by diversifying your acts of commission. Basically dollar cost averaging, you're making a bunch of market entry decisions as opposed to one big one. For the relatively modest cost, maybe that's the right thing to do.

Then the other thing that I always think about there is that if you're this worried about it, if this is such an agonizing decision for you, maybe your portfolio is too aggressive. Maybe you should just be lump summing into a more conservative portfolio.

Dan Bortolotti: I think that's the key insight right there. If you're in a position where, for example, the questioner asks like, is the bubble still a risk? Some variation of that.

The bubble's always a risk. A 30, 40% market decline is always a risk. If you're not comfortable with that, your asset allocation is too aggressive.

Very simple. I'm going to say one other thing on this because I've seen it so many times. That is, I don't think people who do this kind of strategy, and I don't mean DCA, I mean selling when they think that there's going to be a crash, have really thought it through.

Clients bring it up to me quite frequently. Fortunately, they don't do it. I'm able to talk them out of it.

But if you say to them, somebody like, for example, this listener, okay, so you sold 50% of your stocks and you went to cash because you were afraid that they were going to fall in value. Do you honestly believe that if they did fall in value by, I don't know, 30%, let's say, that you're going to be enthusiastic about buying more stocks? Because I can guarantee you, if you're nervous now, you're going to be more nervous after the crash happens, and you're not going to be enthusiastic about buying in.

I will use the COVID crash as an example because it was so quick and so pronounced. People were very worried when we started to read about the pandemic. I had a couple of clients who called and said, I think we should get out because there's going to be a crash.

And it turns out they were right. And theoretically, it actually would have been a good time to sell because the crash came very quickly after that. But when the crash came and the market lost 30% in, I don't know, two or three weeks, not only were we worried about the markets, but we were worried that people were going to die around us.

And I'm not saying that in a flippant way. We really were worried about that. I didn't hear anybody call me and say, hey, let's buy the dip.

Okay. I think we have to be honest with ourselves and say that if you are going to bail when markets are high, it is extremely unlikely that you will buy back in after they fall. And then if you don't buy back in after they fall and you wait for the market to run away, like unfortunately has happened in this case, you've completely done the exact opposite of what you were trying to do.

So just think it through before you take the first part of the action, which is the sell. Because as you said, Ben, you have to be right twice, but believe me, being right the second time is so much more difficult than being right the first time.

Ben Wilson: One scenario that I often think about and comes up in conversation is the opposite. If someone has a large upcoming expense, I've heard them come and say like, should I do a lump sum withdrawal or do a dollar cost average out, which I think is similar, but different. The way I often explain this is the most rational approach is to withdraw a lump sum because you have a known expense in a specific timeline.

There's an opportunity cost to that approach, but you avoid locking in a loss if the market happens to go down. If you are comfortable with the volatility and knowing that you could lose money, but you want to position yourself to take advantage of possible upswings in the market between now and your planned purchase date, you could take on that risk and dollar cost average out. And I think that's more of a reflection of do you have the higher risk tolerance to employ such a strategy, which for most people, the answer is probably no, I'm buying a house or I'm doing a big reno or whatever it is.

I frame that one a bit differently when the question comes up.

Benjamin Felix: Yeah, it's a liability matching concern. If you have a known liability, then having the cash available to fund it depends on the time horizon and the magnitude of the liability relative to your overall assets. But yeah, I think from a psychological perspective, people don't like to take money, even if it doesn't make a huge difference in the long run to their financial situation, people don't like to sell their portfolio after it's dropped.

I would tend to agree if they have a known fixed expense, having the cash available is probably going to feel better. And again, as we saw with the dollar cost averaging example, the basis points are not going to be huge if whether you're taking the money out over the course of a year or in a lump sum.

Ben Wilson: Exactly.

Dan Bortolotti: That's why I think really the message here needs to be do whichever one is going to make you get back into the market. It's less about, well, okay, you're going to be right two thirds of the time if you invest a lump sum, but if you are much more confident about getting in gradually, do it. If you're more comfortable getting in as a lump sum, then do that.

The last thing I'll say on this is I used to argue too that, or we sort of default to this idea that investing gradually is easier behaviorally because it's not like jumping into the cold lake all at once. But I have seen it many times where we've discussed a DCI strategy with a client and we're going to do it once a month for six months, whatever it is. And after month two, there's some volatility in the market.

Whoa, let's hold off on tranche number three. Maybe we should wait or markets went up and I don't want to buy in or markets went down and I don't want to buy in. And then you get into this brutal paradox.

You sometimes turn one difficult decision into multiple difficult decisions. So be aware that that is a risk too. Not because of the statistics, but honestly, for the behavioral reason, sometimes too, it's better to just take a deep breath and get back in.

Ben Wilson: I think that relates back to what you said before. If you realize month two in, I'm too nervous about this, then you probably have too aggressive of an asset mix. I've found that there's been scenarios that I've seen where someone's like, statistically, I want to optimize my portfolio as best I can.

I've heard that leveraging is a good way to do that. And we employ that, but then in the same kind of mindset to like, but let's dollar cost average it in. Those are almost two counterintuitive thoughts.

If you want to be aggressive and use leveraged money to optimize your returns, but then dollar cost average in because you're worried about the markets, those are two different ends of the risk spectrum.

Benjamin Felix: That's interesting. We do have another related paper that I'll mention quickly on this, where we looked at buying the dip rather than dollar cost averaging. We said, you have a lump sum of cash today, just like this person asking the question does.

They're deciding whether they should invest it all today or wait for a 10% or 20% drop in the market before investing and sitting treasury bills in the interim. Similar to the dollar cost averaging research, we found that buying the dip tends to be suboptimal because of the opportunity cost of not being invested today. There are of course cases where buying the dip does work out better, just like with dollar cost averaging, but most of the time you're better off just being invested.

Dan Bortolotti: I like to call buying the dip rebalancing. It basically accomplishes that in a much more systematic, disciplined way.

Benjamin Felix: Yeah, I like that.

Dan Bortolotti: If there's a dip, your asset allocation is going to be off target, rebalance. You just bought the dip.

Benjamin Felix: Who's got the next one?

Ben Wilson: I can read the next one. This is from Landon.

How do you and your team conduct ongoing investment review and due diligence? Do you have an investment committee? If so, what do those meetings look like?

Benjamin Felix: We do have an investment committee. Dan and I are both committee members, pretty tight committee. We have five members.

They're selected by the managed account committee, which is the committee that oversees PWL's overarching policies, I guess, and permits them to have those roles. They also create our overarching policies and then the investment committee is responsible for implementing those policies. As I said, we've got five members.

They're appointed. Membership is for a two-year renewable term. We have always a minimum of three CFA charter holders on the committee.

At the moment, we have four. Dan and I, I don't know if I mentioned that, are both members.

Dan Bortolotti: Dan is the lone non-CFA holder for the record. I think that rule was made for me. Thank you. I'm working on it.

Benjamin Felix: Dan brings a lot to the table, as you can imagine.

Dan Bortolotti: Including donuts.

Benjamin Felix: We meet virtually.

Ben Wilson: It's a virtual meeting, so Dan's eating the donuts by himself.

Dan Bortolotti: Correct. Worked out very well for me.

Benjamin Felix: The investment committee is responsible for voting on changes to PWL's approved list of securities. That's one of the policies that the managed account committee lays out is the definitions of the list of our approved securities and how changes can be made. Then the investment committee is responsible for moderating those changes.

If a portfolio manager comes and says, I'd really like to have this security available to me to manage client portfolios. Our research team prepares what's called a know your product report, which is basically just a due diligence report on that security. Then that is presented to the investment committee and we vote on whether we're going to approve it for use or not.

The investment committee will also vote on culling securities from the list if they're not getting used or if they're no longer appropriate. I did pull up the minutes of our last meeting just to give Landon and other listeners an idea of what we discuss. In that meeting, we reviewed and discussed our current approved lists of securities.

We've got a couple of different lists for different purposes. We reviewed the status of some securities that have arrived at PWL through acquisitions, but don't fit on our approved lists. We just talked about what the transition looks like for those and what we're planning on doing with them.

We had a general discussion about acquisitions. As listeners likely know, we've been more active in acquiring other existing wealth management firms and integrating them into PWL. We had a discussion about those acquisitions and the approach to transitioning portfolios to be more tightly in line with PWL's if they're not already.

Then we also had a pretty good round table discussion about the new CIBC Avantis ETFs here in Canada, which are of course competing with the Dimensional funds that we currently use. We just talked about our thoughts on that and how we might approach analyzing them and deciding what to do with them and whether we would use them with clients, which will be an ongoing project that we'll talk about on the podcast, I'm sure, when we're done with our project.

Ben Wilson: For sure. Since we've been doing acquisitions in the last year and a half or so, we've become a lot more intentional about how we approach investment committee. We actually reframed the entire committee and the process and how many members are on there because it was designed for a much smaller organization and we have grown over the years.

It's a much better structure going forward. As you can imagine, we are trying to grow intentionally building an integrated firm that's focused on the basic premise that markets work and planning matters. But as you can imagine, some of the portfolios out there are not exactly how PWL has built portfolios, which is okay.

In some cases, they fall on our authorized list and we can hold them long-term. In other cases, there's products that we want to come up with an appropriate transition plan that both respects the client's wishes, manages tax implications, but also achieves the goal of getting to a model portfolio that we believe is in line with the best way to invest for our clients.

Benjamin Felix: All that made having the current committee structure really important. It's been a much more active environment for the type of due diligence and voting that a committee like that has to do. In addition to approving the securities, we also do annual due diligence on our major fund providers.

Those are some of the big ETF issuers in Canada that PWL works with a lot and then also Dimensional Fund Advisors. We send each of them a due diligence questionnaire that we ask them to fill out once per year. The investment committee reviews those.

The questions are categorized into firm overview, conflicts of interest, strategic review, performance reporting, securities lending, risk management, investment teams, and trade execution. Then there are a whole bunch of sub-questions for each of those sections. In addition to that, we benchmark.

We go to the fund providers and say, can you answer these questions for us? Then we review those to make sure that we're satisfied with the answers. On top of that, we're also benchmarking all of our largest holdings every year.

We benchmark, I think it's 99% of our holdings. Some of them are just too small to worry about. We benchmark them every year to answer whether they're delivering on their stated objectives.

For an index fund, that's pretty straightforward. It just means asking whether the index fund is capturing the index return, net of fees and costs. We have actually picked up, there's one memorable case where there was a large, well-known US equity index fund that had pretty meaningful tracking error and it ended up being related to the way that the fund had been structured and implemented.

That was something that got flagged. That issuer has actually rolled out a new fund that has a more efficient structure to address those issues. It was just a memorable case because it was like, oh, this index fund is actually diverging from the index.

Dan Bortolotti: Yeah. I think we took a couple of lessons from there. One is don't take for granted that a supposedly plain vanilla index fund will have low tracking error because sometimes the fund providers, and I'm just going to say it, make mistakes.

They make poor judgment calls and it results in significant, honestly, it can be outperformance too, which you're happy in the short term, but you know that what goes up must come down if you're going to deviate from the strategy. The other thing that I was really encouraged about that is, I mean, we have now as a firm reached a scale and I think have enough of a reputation that we can go even to the biggest fund providers and say, this is a problem. I'm not going to say that we dictate how they operate.

Obviously we don't, but I think we have enough influence that they at least listen to us and will say, you know what, we've heard other people say the same sort of thing. And it's important to us that we deliver on our promises. And as you said, that fund provider actually corrected the mistake, what I think was a mistake, and created another product that's even structured in a better way.

And I like to think that as a firm, we have at least some influence on that in the Canadian market.

Benjamin Felix: For sure. It's good to know that we're watching, we caught it and flagged it and it's been addressed. It's great.

Also, Dan, like you said, it's a good lesson that you would assume, I mean, this is a major fund provider. You just assume that they're going to deliver the market return because that's what the fund says it's going to do, but it's not always true. Anyway, that's something that we watch very closely and we do that once per year.

And then for Dimensional, who of course are not just tracking an index, we are comparing the returns to market cap weighted indices to see, are they tracking positively or negatively relative to the market cap weighted index? We expect tracking error every year because they are tilting toward smaller and lower priced, more profitable companies. We track that over time.

We also track long-term performance to see how they're doing relative to the index. And then we also run multifactor regressions to observe the factor tilts in each geographic region that Dimensional has products for in Canada and also their alphas. Of course, we want to see zero or maybe slightly negative or ideally positive alphas, that's returns in excess of what would be expected based on the factor exposures.

Again, we're tracking that every year, both for that year and also long-term looking backwards. All of those analyses are reviewed by the investment committee once per year. And then the other big review that we do once per year is an overview of the firm's total holdings.

We look for product concentration. Do we have too much in a single fund or a single holding? We do have holdings within the firm that are not index funds or Dimensional funds because clients, for whatever reason, hold other securities, whether it's for tax reasons or we have some cases where because of their position on a board, they're required to hold securities or their insiders or executives at public companies, all kinds of stuff like that.

We do a big review of our total holdings. It's pretty interesting to see our overall asset allocation every year. Last year, we were around 70-30 in aggregate, which is just kind of neat to see.

70% stocks, 30% bonds. That's our due diligence process. That's the investment committee's function.

It's a big project to do all those reviews every year, but it's, we believe, incredibly important. Dan, you got the next one?

Dan Bortolotti: All right. This one is from Simon. Hi, guys.

I've been following your content for a while. It's great stuff and always well thought out. With regards to your episodes on ETF slop and following your mindset of what makes a sound investment product, I'm curious if there are any new ideas in Canadian listed ETFs that you would recommend that is not just a rebranding of a standard index fund of the same benchmark or are the same names always going to be the primary recommendation?

Benjamin Felix: I will say that new ideas are usually going to be slop because ETF issuers want to sell whatever is hot at the moment. They're also going to be catered to investor biases, which are usually going to be at odds with expected outcomes. If an ETF issuer can key in on some behavioral mistake that most investors make and make a product that caters to that, it's kind of definitionally deteriorating your expected outcome rather than improving it.

I did look at how many new ETFs are there in Canada so far this year. We're recording this on July 2nd. So far this year, so far, there have been 189 new ETFs issued in Canada, which is pretty crazy.

Ben Wilson: Wow.

Benjamin Felix: That is on pace to have more new ETFs issued in 2026 than we had in 2025, which was itself a record year relative to all past years of ETF issuance in Canada. There's no shortage of new ideas.

I'm not going to rehash the whole ETF slop discussion. We've done a pretty deep dive on that in past episodes, but things like covered calls, offered funds that have a capped upside and downside, single stock leveraged covered call, single stock ETFs, thematic ETFs, those are all pretty obvious cases of the type of slop that have been pretty successful at attracting assets despite not being great as investments. They're good for the ETF issuers, but not so good for the investors in the funds.

Looking through those 189 new ETFs for 2026, I can't say they're all slop. A lot of them are whatever, broad asset class or broad country or region funds that are like, you could slot them into any ETF portfolio, probably. I haven't done a deep dive on them, but a lot of them are pretty standard, but a lot of them are slop.

You go through the list, there's a lot of single stock ETFs, a lot of sector ETFs for the sectors that were hot in 2025, of course, lots of income oriented covered call type ETFs. There's also broad asset class stuff. I would say that for long-term investors, for the type of investors that are listening to this podcast and using index funds or maybe Avantis or Dimensional funds to build their long-term portfolios, there's not a whole lot of new ideas that are coming out that are worth changing your strategy for.

One exception probably, in my opinion at least, is the new Avantis CIBC ETFs for Canadian investors. That's probably the biggest new idea, if we can call it new. Obviously, that idea has been around for a long time.

That's probably the biggest new product, I guess, to hit the Canadian market that would maybe change what people do with their portfolios. As listeners probably know, they're using systematic active management. No, that's not always a dirty word.

Some active management can be okay to target characteristics associated with higher expected returns while maintaining low costs and broad diversification. That's all pretty reasonable. It's very similar to what Dimensional does.

Them launching Canadian listed funds, offering direct security ownership rather than just buying US listed ETFs in a Canadian wrapper is a pretty good thing for Canadian investors, I think. Whether it's a good product for any individual investor is going to come down to the trade-offs between simplicity and complexity and tracking error relative to the market, I think are probably the big ones. That's Avantis.

Then the other one that's worth mentioning, it's not really a new idea. Again, similar to Avantis, but BMO did make some moves in their asset allocation ETFs recently. They started using ZDB, which exclusively holds discount bonds for their fixed income allocation.

Now, that's interesting. I may even say exciting because discount bonds are more tax efficient for taxable investors because their returns come from lower coupons. You're getting lower interest payments combined with capital gains at maturity, while premium bonds are going to have higher coupons combined with a capital loss at maturity.

Those two combinations result in the same pre-tax expected returns, assuming all else equal, but they can result in very different after-tax returns. For taxable investors, that can matter quite a bit.

Dan Bortolotti: Yeah. Just to clarify that on the ticker. We're talking about here funds like XBAL, VBAL, which are the iShares and Vanguard versions of the 60% equity, 40% bond ETFs.

The BMO version would be ZBAL. If you were holding it in an RRSP or a TFSA, it doesn't matter. If you're holding it in a taxable account, you would expect ZBAL to be slightly more tax efficient because the bond component has been explained as holding discount bonds, and you're going to have less of a drag from the interest payments on those bonds.

I'd throw a couple into the mix here. Again, these are not brand new, but I'm just looking back to recent innovations in ETFs. HISA or high interest savings account ETFs, cash ETFs, if you will, were pretty innovative when they came out a few years ago.

The reason being that, of course, it's very easy to put cash into a savings account or a money market fund, et cetera. What was innovative about these savings ETFs was that they had access to deposits with major banks that were significantly higher yield. For example, if you were to put your money in a savings account, at the time, the interest rates were fairly high, you would get, I'm making numbers up, but let's say it was 4%, you could get these HISA ETFs that were yielding 5% because the underlying savings products were institutional rates that were higher.

There was a lot of controversy about this. Eventually, it was deemed that they weren't quite as safe as they appeared. There was no deposit insurance on them if you were a retail investor.

The gap between the yields that these ETFs are offering and other savings products has narrowed pretty dramatically. It was a good idea that didn't quite carry out for as long as it might have. There's a couple of places where I would like to see ETF innovation.

To follow up on this discount bond idea, this was something that BMO led the way years ago. I cannot believe that no other major ETF provider in Canada has created a similar product. All of the bond ETFs that are being sold out there, and there are billions of dollars in them, if you're holding those in taxable accounts, they are just not very tax efficient.

I'm a bit surprised, frankly, that that wasn't copied by other providers. That's one thing. The only one, and this is a bit of a niche product, but I think it would be great to have an ETF that held both international developed and emerging markets, but not US.

Vanguard has VXUS. iShares has a similar one that holds stocks in every country except Canada. That's fine and that's useful.

The reason it would be nice to have one that holds both international developed and emerging, but not US, is it can be really useful for asset location strategies. If, for example, you want to hold international equities in an RRSP and you want to hold Canadian and US equities in a taxable account, that would allow you to do it with fewer products. DFA has one in the mutual fund format, but there isn't a comparable ETF, at least not that I'm aware of. My two cents.

Benjamin Felix: Yeah, it's a good one. Maybe someone listening will create their product.

Ben Wilson: Add to the list of ETFs that are being created in 2026.

Benjamin Felix: Maybe there's one in there. I didn't look through all 189 new ETFs, so who knows?

Ben Wilson: Yeah, I think the main message is you just got to be wary because the fund manufacturers are definitely preying on the investor emotion and biases that come up in news headlines and Reddit streams and all these different tips that you get. They're preying on the fears, the opportunities, all the different emotions that come along with investing. Not necessarily bad products, just it's what people want.

They provide an option to sell to them.

Benjamin Felix: There's one of the funny things I saw going through that list is there were a bunch of silver and silver minor ETFs. Of course, silver had an insane year last year and then it's fallen off since then, but it's just funny that the products get issued for themes or whatever, sectors that have done well in recent history. It's pretty classic performance chasing, really in line with that paper from Zahi Ben-David about ETF issuers issuing products after the theme has done well and then investors eating the reversion to the mean.

The next one is from Benoit G. What rule of thumb would you recommend for allocating time to the construction and implementation of a financial plan? Intuitively, for individuals with low levels of wealth, say $10,000 or less, spending two hours to achieve a 2% return boost may not be worth it.

Such gains might come from straightforward actions like switching to lower fee funds rather than from alpha generated through trading or manager selection. On the other hand, spending no time at all on budgeting and cash flow management could lead to credit card debt and or chronic under-saving. Of course, the typical podcast listener may view this kind of planning as leisure rather than work and find the question moot.

I don't really have a rule of thumb, but it's definitely true that when wealth levels are low, non-investment planning is more important than investment planning. The 2% return boost is a pretty tame example, but I think it's pretty common, at least from what I see out on the internet, pretty common for people with low wealth to want to make lottery-like bets in the stock market to try and increase their wealth. That doesn't usually work out well.

I mean, that's why I say that 2% return boost is pretty tame. I think a lot of people are trying to hit the 100% return in a year by chasing whatever they think is going to do well, which may very occasionally work out, but usually it does not work out so well. They're spending a bunch of time doing it.

Focusing on budgeting and saving are useful skills for sure, but I'd say the biggest boost at low levels of wealth and income is probably looking for ways to boost your income. That's not always easy. I'm not just saying you can go out there and make more money tomorrow, but education, gaining the right skills, stuff like that can make a big difference in not only the level, but also the stability of your income.

If that's your situation, trying to pick a winning stock or whatever is probably much less impactful, especially over your lifetime than boosting the value of your human capital. It's tough to budget and save when you're surviving, when you have subsistence level of income. Life is just harder, but once your income is sorted out, budgeting and saving start to become better areas of focus.

Then there's things like taxes, insurance, legal planning, not necessarily in that order of importance. I think the big thing to be conscious of is spending time trying to eke out basis points or even percentage points from your investments when you have low wealth and your human capital is likely a much larger lever to optimize.

Dan Bortolotti: I'd agree with that for sure. I talked about it in my book. I wrote about it online like years ago.

I remember there was a lot of pushback because I would say that sort of the same thing. I mean, look at this example that the listener says $10,000. You save 2% a year.

It's $200. My argument would be try to save $16 a month doing something else. People will say, well, you can do both.

It's like, yeah, you can. If you're able to do both, great. You save $400 a year.

The point is, is that people don't have unlimited bandwidth. If you're going to concentrate on something, switching from one portfolio to another, I mean, we've talked about this before with asset allocation ETFs versus the underlying and it comes out to like 10 basis points. It's hard to stress how trivial that is unless you are talking about a pretty significant portfolio.

Your portfolio is a million dollars. Yes, fight for every basis point. If it's under 100,000, do the math.

Figure out how much you would be saving and then ask yourself, A, is this worth the effort? And B, is there something else I can do that would achieve the same amount of savings and maybe have other knock-on benefits as well?

Ben Wilson: I think at the smaller net worth, it's a generalization, but people are probably less aware of what planning strategies can be used. Even the types of accounts, should you be using an RRSP versus a TFSA versus an FHSA, depending on your situation. That's a basic concept that many people are not sure what to use first and when to use it or how best to employ those strategies.

I think also the human capital, how you can earn more, but the saving and budgeting, I think I'd push back on a little bit. It's important at those low income levels to budget carefully. I reflect back to when I was earning $40,000 when I started my career.

My wife and I, making low incomes, kept a tight budget and were able to save enough to put a 20% down payment on our first single family home. We were still doing things we enjoyed, but we were very frugal about how we went about things to set us up for future success. The saving and budgeting is quite key when you have limited resources at first.

Benjamin Felix: Yeah, it makes sense. I guess it depends how low your income is relative to subsistence and how much there is to squeeze out of there. Yeah, for sure.

If you can optimize a bit, that can make a big difference.

Ben Wilson: Okay, next question. A teacher from Winnipeg, can you do a deep dive into the BMO T-series, ZEQT-T, ZGRO-T, ZBAL-T of ETFs please? Good ideas for retirees who do not want to sell shares on their own or is it ETF slop?

Benjamin Felix: I actually find these really interesting. I don't think they're slop. There's some things you got to be aware of that we can talk about, but they're probably the best answer out there to the covered call funds that people love so much.

As Ben mentioned, the tickers, they're identical to the underlying ETF portfolios, so ZBAL, ZGRO, and ZEQT. They hold the same underlying funds. It's the same portfolio, it's just a different unit class.

The T-series of these funds, which we're talking about, ZBAL.T or dash T, whatever it is, they pay a 6% annual distribution, distributed monthly. The target payout is set once per year based on the 6% of the prior year and net asset value per unit. Then that payment is split into 12 equal monthly payments for the following calendar year.

Then payments are flat all year, regardless of market moves throughout the year until the next distribution calculation when the level of payment is recalculated. You're still getting all the benefits of an asset allocation ETF. You're getting low costs, internal rebalancing, all the behavioral benefits of that, but you're also getting these managed distributions that exceed the normal level of dividend and interest distributions that a fund like this would otherwise have.

The distributions for tax purposes are going to be made up of interest dividends, foreign dividends, and capital gains like any other asset allocation ETF, but there's also going to be a larger than typical return of capital component because you're getting that much larger distribution relative to the actual income that the fund is producing. I think if someone wants to maintain a steady asset allocation throughout retirement, and a big thing here is that they can live with annually variable income that follows the year-end fluctuations in the portfolio's value, which for ZEQT, that could be significant depending on the year-to-year values from year-end to year-end. If someone wants those things and is comfortable with that potential spending volatility and does not want to deal with selling ETF units themselves to create their monthly income stream, I think they're pretty interesting products.

To be clear, it's the same as any other asset allocation ETF, except that you're getting a manufactured 6% distribution. It's not a revolutionary product, but I think for someone who wants an asset allocation ETF, wants income, and doesn't want to have to manage doing the distributions themselves, it's interesting.

Dan Bortolotti: This is not a new concept, as you said. The fact that it's in an ETF is relatively new. This idea was pioneered a few years back, at least in Canada, by Vanguard when they created VRIF. I don't know how many people remember it.

Benjamin Felix: That's right, yep.

Dan Bortolotti: But it's an ETF, and I think the distribution was 4%.

Benjamin Felix: That's right.

Dan Bortolotti: It was the same kind of idea. They reset it every year. I remember even when that came out, people started to compare it, and they were like, well, I have this other monthly income fund, which is an old genre of mutual funds that crank out a targeted distribution every month.

I cannot tell you how widespread the misunderstanding is about these funds. There are ones that were paying 8%, 9%, 10% a year, and people honestly thought that that was a 10% return, or they'd call it a 10% yield when, of course, the underlying holdings were probably yielding 3% or 4%, and a huge component of that distribution is return of capital. It's just giving you your money back.

Useful if what you're trying to do is generate monthly cash flow, but incredibly dangerous if you think you're getting a 10% return, or in this case, 6% return. Look, you might well get a 6% long-term return on some of the more aggressive ones here, but you're certainly not going to get it every year. You just need to be aware that some of what you're getting is securities being sold, and you're getting a capital gain, and also some of your original investment being returned to you tax-free, but look, you have to understand how they work.

They're not necessarily sustainable indefinitely. Yeah, if you're a DIY investor and you want to hands-off cash flow, and Ben, as you said, you're willing to tolerate some annual fluctuations, and that it's going to go up and down every year depending on the changing value of the fund. Yeah, I think they're useful, interesting products.

I don't think we'd ever use them in a professional context. We need to be a little bit more hands-on, but for a DIY investor, yeah, for sure. Something to look at anyway.

Benjamin Felix: We for sure would not use them, but this service of creating that income stream, I know from our retired clients, is something they find extremely valuable, because we go and do the financial plan. We say, this is how much you can sustainably spend, and then we send that money to their bank account every month or two weeks or quarter, whatever that client wants, and we manage that whole process. They don't have to think about it.

The money just hits their bank account, and so this product takes that task away, but it's a blunt instrument. It's 6%. Is that the right level of withdrawal for somebody?

It's variable. It's going to change mechanically from year to year, whether you want it to or not. Whereas, of course, we would have discretion to say, well, we're going to maintain your income or increase it or decrease it, or whatever the case may be, depending on the situation and market conditions and all that stuff.

It's a purely variable withdrawal strategy that's going to change from year to year, which should be pretty sustainable in the long run. It's not a fixed 6%. It's not like the 4% rule type of withdrawal, but that also means that you're eating variable levels of income from year to year, potentially in a meaningful way.

VRIF that you mentioned, Dan, it is 70% in fixed income. That product compared to these three is quite a bit more conservative. I mean, even ZBAL.T, well, it's got a 6% withdrawal rate, 60-40 allocation. VRIF is a 4% withdrawal rate, but 70% bond allocation.

Dan Bortolotti: But I believe the asset mix in VRIF is dynamic. They change it. This was one of my beefs about when it first came out.

It was basically tactical asset allocation. In fact, I think I said at the time, why don't you guys just take VBAL and put a targeted return, and then BMO did it.

Benjamin Felix: That's funny.

Dan Bortolotti: So good on them for taking that idea and just making it more passive and no tactical asset allocation.

Benjamin Felix: It's right there in the fund description. In seeking to achieve the Vanguard ETFs investment objective, the sub-advisor will make asset allocation decisions based on the attractiveness of the underlying asset classes and their ability to provide consistent returns. Considerations may include, but are not limited to, economic and market conditions, total return characteristics, and risk profiles.

The portfolio asset allocation will be reconstituted and rebalanced from time to time. The monthly distribution is reviewed periodically.

Dan Bortolotti: That's a deal breaker for me.

Benjamin Felix: Doesn't sound very Vanguard.

Dan Bortolotti: No.

Benjamin Felix: That's interesting.

Ben Wilson: Yeah. I want to go back to what you said, Ben, about DIY investors using this as a tool that takes away that decision for creating the cash flow. I would say it does within a given account.

Do you invest in this ETF across all different account types? If you've got an RRSP, TFSA, taxable account, and others, if you have it in your taxable account, and that's where you're drawing money from, it takes that decision point away. But is that the best way to optimize your withdrawals and retirement?

Maybe, maybe not. It really depends on a number of different factors, which is when we look at it, that's what we look at. When you talk about, we take that away from clients, it's, we're looking at RRSP, we're looking at their tax brackets.

Does it make sense to use up some of the lower tax brackets in a given year because they're going to have higher taxes later? So there's more variables that come into play, and this could be a great tool for a DIY investor as they're managing their own retirement withdrawals.

Benjamin Felix: Yeah, you're right. It's a very dynamic decision across a lot of different dimensions. It is a very blunt instrument.

I would not call it slop. If it's used appropriately and people understand what the product is trying to do and where the distributions are coming from, it could be a good tool.

Dan Bortolotti: It clearly makes the most sense in a taxable account because first of all, in a TFSA, very few people are making systematic withdrawals from a TFSA. In a RRIF, you've got a targeted RRIF withdrawal. It's unlikely to be 6% unless, I don't know, whatever age it's sometime in your late 70s, it's exactly 6%, but it's never really going to be suitable for those types of accounts, I don't think.

Whereas in a taxable account, again, because the BMO version of the asset allocation ETFs also uses a discount bond fund, makes it better there. Put 100,000 in, it cranks out 500 bucks a month. It's not a terrible product at all.

I think it's potentially very useful if a blunt instrument, as you said.

Benjamin Felix: Who's got the next one?

Dan Bortolotti: Yeah, I think I'll take the next one here.

So this one is from Patrick 21. Does or will the rise in retail investor trading platforms and the promotion of gambling in the markets via gamified trading apps leave opportunities for actively managed funds to outperform relative to the past? It seems as though Benjamin Graham would have loved that type of atmosphere.

Benjamin Felix: Interesting question. There's been like a lot of academic research on this since the GameStop situation a while back now. I think we can't forget that markets are pretty competitive, even if imperfectly.

Any edge that you can get from exploiting uninformed retail trading, it's not going to be a secret and it's also not going to be risk-free. There's an old paper from 1990, I believe, that talks about noise traders and what you can do with them. One of the problems with exploiting uninformed traders, retail investors or noise traders, is that they are uninformed.

You can bet against them based on rational information and expectations. You can have a really good thesis for why you're right, but they're not playing the same game. They don't have limits to their rationality where they're like, I've reached my limit, that's enough.

They're playing a completely different game. I think we did see that with the GameStop short squeeze. I think that situation was representative of the problem with exploiting these types of investors. They're just playing a completely different game.

Dan Bortolotti: It's like trying to bluff a bad poker player. How could you possibly call that? It made no sense for you to call with what you had.

Yeah, but they didn't care and they called you anyway and you lost. It is definitely not risk-free. Maybe over the very, very long run, you will be able to exploit them systematically, but in the short run, it comes with huge risk.

Benjamin Felix: Huge risk, which maybe means there's a premium there. Who knows? Then again, markets are also competitive, so it's a tough one.

One interesting place to look because a lot of these types of stocks do tend to be small cap growth stocks is in the small cap growth sector. Those types of stocks do have lottery-like characteristics that retail traders might be attracted to, and that could present opportunities for active managers. I didn't know what the data was going to say when I pulled this up, but I was curious.

I pulled up the 2025 S&P US SPIVA report, which does detail the performance of active managers specifically in small cap growth. Small cap growth active funds have been the most successful category over the last one in three years. Again, this is ending December 2025, with only 34% and 38% of them trailing the S&P small cap 600 growth index.

That only holds for one in three years, five years, they start underperforming just like most other active managers do. On an asset-weighted basis, the average small cap growth manager has actually outperformed the index over the trailing one in three years, which is also interesting and very unusual in the SPIVA report. But it's kind of funny.

They had outperformed the small cap growth index, but the small cap growth index had performed horribly. Even though they outperformed the index, they underperformed the market by about 10 percentage points, both in the one and three-year periods. They won, but they won in a losing part of the market, I guess.

Then as I mentioned, the outperformance also disappears really quickly further back in history. But that one in three years is kind of in line with the meme stock era, at least approximately. There is a 2023 paper that looks specifically at meme stocks and market efficiency.

I just pulled a quote from the abstract. "During the GameStop frenzy, Robinhood Markets Incorporated made an unprecedented move by pausing the purchase of meme stocks, which represent a small segment of the market from January 28th to February 5th, 2021. To evaluate the impact of this ban on market efficiency, we created two meme stock indices based on the lists of restricted stocks and conducted robust tests utilizing daily changes in these indices and the S&P 500 index.

Our analysis suggests that meme stock trading does not have a negative impact on market efficiency." Pretty small, short sample, but it is an interesting event to study. They don't find a big impact on market efficiency, but it's one paper.

Just interesting when I was looking for information on this. I don't know, man. It's a different thing.

Lots of people gambling, whatever, stocks getting promoted to retail investors. Maybe if you could get your hands on the stocks that are going to be promoted to retail investors before they get promoted through the apps, maybe there's something to exploit there, but that would probably be illegal to obtain.

Dan Bortolotti: Probably. It's just a specific example of bad retail investing behavior. We're framing it as gamification, meme stocks, whatever, but there's a long history of individual stock pickers making poor decisions.

And there's always been a potential for active managers to exploit those mistakes. The mistakes are hard to get out in front of and they disappear quickly, as you said. When there are inefficient, irrational investors participating in the market, you can potentially capitalize on that, but it's just much easier said than done.

This idea that active managers around the world will suddenly find a multitude of opportunities to crush the market, it's not going to happen. If it would have happened, it would have happened by now.

Benjamin Felix: It's an equilibrium to that, right? If that did happen, money would flow into active management and those opportunities would go away. It's just how it works.

If you can predict when active management is going to have that opportunity and invest in active management right before then and get out afterwards, you could maybe make some excess returns, but that's not so easy to do. All right, next one. There's a trend on YouTube that the reason why assets like stocks go up is because of currency debasement, governments printing money.

Is this true? I've heard this before too. I find that this question, this line of thinking very quickly falls into what I would probably call conspiracy theory territory.

We know that stocks have historically delivered positive real long-term returns. That's adjusted for inflation, measured against consumer price indices for lots of different countries. To say that stock appreciation primarily comes from currency debasement, we need to take the position that inflation is not being measured properly and that the real inflation is actually much higher than what CPI measures.

Now, some people do take that position, which is fine and there are some alternative inflation indices that show different numbers from CPI. There are some valid criticisms of CPI. If you want to hear about how Canada's CPI is actually calculated and all the care that goes into making it a useful measure, we did talk to Andrew Barclay from Statistics Canada back in episode 348, but this debasement argument is often used to support the use of alternative currencies or so-called stores of value like Bitcoin.

It was common along this line of thinking for a while to see people posting the performance of the US stock market measured in Bitcoin to show that stocks have been flat when they're properly measured against a real currency that's not being debased, but that would not tell the same story today. Bitcoin has not been so hot and I think the Bitcoin as an inflation hedge or a store of value or a true measure of value story has kind of died a very painful death, especially recently. I mean, Bitcoin struggled in recent history.

Maybe it'll come back. I don't know. But the idea that it's a stable store of value or a true measure of whatever, I think that's pretty tough to argue, at least at the moment.

The other thing is if we compare stocks to other assets like real estate, commodities, bonds, and lots of other assets, it's pretty clear there's been a premium for owning stocks that does not rely on currency debasement.

Dan Bortolotti: A lot to unpack in that one. I mean, this idea that there is a giant conspiracy or that currencies used by governments and inflation measures used by governments are manipulated. I'm sure there's some truth to that.

The question is, what do you do about it? I think as an investor, I'm not sure that any of these suggested alternatives make any sense.

Benjamin Felix: I don't even know how much truth there is to that. You can make arguments that there are deficiencies in the way inflation is measured. There are arguments that exist.

But when we talked to the guy from Statistics Canada, it's pretty clear that he's not an agent that's been put there to deceive us about how they're constructing the CPI. He's an honest Canadian guy who's got a background in statistics and is working really, really hard to make sure the CPI is a really good measure of the cost of living in Canada.

Dan Bortolotti: Literally going to the grocery stores. I loved that episode because I thought this is such an antidote to people who think that governments make up inflation numbers. No, they literally have people going to the local grocery store and getting a can of beans from six different stores.

I'm making these examples up, but it's not far off. I think everybody's experience of inflation is very personal. If you don't drive a car, you don't really care about the price of gas.

If you commute 100 kilometers a day, that's an incredibly important price for you. People will always have anecdotes about these sorts of issues, and then they will put their own personal approach on some giant global phenomenon, which is obviously misleading. I'm not sure how relevant that is to the question. It's a good question. It's just hard to square it.

Benjamin Felix: Thinking about it, real or nominal, the relative performance of stocks and other assets is a pretty good indication that stocks have performed the way they have for reasons other than currency debasement. If currency debasement was driving all asset returns, you wouldn't see the dispersion of returns that we do see, but stocks have outperformed so many other asset classes over the long run. Even if a portion of it is being driven by currency debasement, there's something else that's driving relative stock returns compared to other assets.

Ben Wilson: Well, there's so many factors and information that goes into stock prices that there's no way to tie it back to one single thing. Even if currency debasement has some impact, there's no one thing that determines all stock prices across the entire globe. It's hard to argue that whether it's this or something else that is determining the future of all stock prices is tied back to one concept that doesn't check out.

Benjamin Felix: I also don't like government money printing and currency debasement as general principles that people talk about because I think those phrases are misused and misunderstood a lot. I would refer people to our episode with John Cochrane where we talked about his Fiscal Theory of the Price Level. If they want to better understand why government money printing and currency debasement, they don't tell the whole story.

Dan Bortolotti: We could also kind of default to the common sense idea that stocks go up in value because stocks are businesses and when businesses make money, they grow and then they make bigger profits and they continue to grow. That's not that difficult of an intuitive idea, but it's very different from real estate, commodities, Bitcoin, which don't change. They don't generate a yield and they don't grow.

I would argue that if you just want an intuitive answer, the fact that businesses, i.e. stocks, are the best performing asset class over however long we want to measure, that actually makes a lot more sense to me.

Benjamin Felix: They're productive assets. They're underlying businesses that are growing and increasing their profits and maybe their profit margins over time. All right.

I won't make you guys read this question because it's specifically to me.

Ben Wilson: I can read it. It's okay.

Benjamin Felix: Okay, okay, okay.

Ben Wilson: It's a serious one. We need to get the answers. This is from Mikey, big fan of the show. Ben, what shoes do you hoop with?

Dan Bortolotti: He didn't specify which Ben.

Benjamin Felix: I'm going to assume this was asked to you, Ben Wilson. What shoes do you wear?

Ben Wilson: My neighbor is the manager of Under Armour and I get good deals, so I usually buy Under Armour shoes.

Benjamin Felix: And you do play basketball?

Ben Wilson: I do occasionally play basketball.

Benjamin Felix: So this could have been to you. I assumed it was to me, but it very well could have been directed at you if Mikey knew that you occasionally play basketball, which he may have known.

Ben Wilson: If this question dates back prior to September 2025, we can almost guarantee it was for you since that's when I started joining the podcast.

Benjamin Felix: We don't have the date that it was written, so we can't make that assumption, Ben.

Ben Wilson: Can't make the assumption.

Benjamin Felix: I wear New Balance shoes. I have no idea what specific New Balance shoe. Nike's hurt my feet. They're really narrow.

I've had a couple of good pairs of Adidas in the past, but New Balance is consistently good. They last a long time. They're good, stable shoes.

That's my go-to, but it's also my feet are size 18, so it's pretty hard to find shoes. So sometimes I'll just kind of take what I can get if I need new basketball shoes. I don't just get to walk into Foot Locker or whatever and be like, hey, I'd be curious, Ben, if your neighbor could even get shoes in my size.

Ben Wilson: I'm sure he could order them at least.

Benjamin Felix: Maybe, yeah. They're tough to find. So New Balance, as long as I can get them, and if not, then I take what I can get.

Dan Bortolotti: Keep the footwear questions coming, listeners, please.

Benjamin Felix: Dan, do you have a preferred sports footwear shoe?

Dan Bortolotti: I actually wear New Balance as well. Same thing. If you have wide feet, they're definitely more comfortable than any other brand. However, I rarely hoop.

Benjamin Felix: Do you have a sport of choice?

Dan Bortolotti: Used to be running, and now it's mostly just doing weights and hiking.

Benjamin Felix: Hiking is one of my favorites, although I haven't been out. It's been such weird weather. It's either raining or smoking hot and tough.

Ben Wilson: Or both on the same day, like yesterday.

Benjamin Felix: Yeah. Yesterday was Canada Day for listeners who need a frame of time reference there. But yeah, that was a wild day.

Ben Wilson: Like 40 degrees in the morning and then intense thundershowers in the afternoon.

Benjamin Felix: Yeah. We went into the little town where we live because they do a big Canada Day thing. We were down there sweating our faces off.

By the time we got home, there was thunder and then it was pouring rain for the rest of the day. Very weird day. All right, we do have one review.

It's a very short one, but I'll read the disclaimer anyway. We have a review from Apple Podcasts. Under SEC regulations, we're required to disclose whether a review, which may be interpreted as a testimony, was left by a client, whether any direct or indirect compensation was paid for the review, or whether there were any conflicts of interest related to the review.

Reviews are generally anonymous, including this one. We are unable to identify if the reviewer is a client or disclose any such conflicts of interest. And the review just says, informative and with a great vibe.

Keep it up. It's from paleblue.2342 from Switzerland.

Dan Bortolotti: The precision that we expect from the Swiss in that three-word review.

Ben Wilson: Yeah.

Benjamin Felix: Very clean. All right.

Well, that's the end of our questions. And that was the only review. Anything else to add from you guys?

Dan Bortolotti: Covered it all.

Ben Wilson: Yeah, I don't think so.

Benjamin Felix: All right. Well, thanks guys. And thanks everyone for listening.

Dan Bortolotti: See you next time.

Disclaimer:

Portfolio management and brokerage services in Canada are offered exclusively by PWL Capital, Inc. (“PWL Capital”) which is regulated by the Canadian Investment Regulatory Organization (CIRO) and is a member of the Canadian Investor Protection Fund (CIPF). Investment advisory services in the United States of America are offered exclusively by OneDigital Investment Advisors LLC (“OneDigital”). OneDigital and PWL Capital are affiliated entities, and they mostly get on really well with each other. However, each company has financial responsibility for only its own products and services.

Nothing herein constitutes an offer or solicitation to buy or sell any security. Occasionally we tell you not to buy crappy investments in the first place, but that’s not the same thing as telling you to sell them.

This communication is distributed for informational purposes only; the information contained herein has been derived from sources believed to be “truthy,” but not necessarily accurate. We really do try, but we can’t make any guarantees. Even if nothing we say is fundamentally wrong, it might not be the whole story.

Furthermore, nothing herein should be construed as investment, tax or legal advice. Even though we call the podcast “your weekly reality check on sensible investing and financial decision making,” you should not rely on us when making actual decisions, only hypothetical ones.

Different types of investments and investment strategies have varying degrees of risk and are not suitable for all investors. You should consult with a professional adviser to see how the information contained herein may apply to your individual circumstances. It might not apply at all. Honestly, you can probably ignore most of it.

All market indices discussed are unmanaged, do not incur management fees, and cannot be invested in directly. Which is a shame, because it would be awesome if you could.

All investing involves risk of loss: including loss of money, loss of sleep, loss of hair, and loss of reputation. Nothing herein should be construed as a guarantee of any specific outcome or profit.

Past performance is not indicative of or a guarantee of future results. If it were, it would be much easier to be a Leafs fan.

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