Advanced Investing

In the first episode of the Rational Reminder Podcast for 2019, we welcome Robin Powell. Robin is a journalist and content creator who has dedicated the more recent part of his career to helping spread the word on research backed investing and turning the tide on the history of investment advice.

Diligently saving for retirement is by far the most sensible thing you can do to achieve a comfortable retirement. After all, if you haven’t saved enough to begin with, how you invest it will only take you so far. That said, it’s also worth considering what taxes and optimal investing can do to the savings you do accumulate.

What the Ontario government is trying to do to the investment industry is shameful. We like to think regulations are there to protect us, but the current Ontario government and the Canadian Securities Administrator are doing anything but that. The last few months have been incredibly frustrating to watch as regulatory proposals come out that are clearly not in investor’s best interests.

We argue the case for Exchange Traded Funds (ETFs) as just the forerunner of a coupling of algorithms with advisors to improve the client experience.

I’ve always tried to stress that successful investing is about the right process, not the right products. But good products certainly help. In the latest episode of the podcast, my guest is Todd Schlanger of Vanguard Canada, who was one of the architects behind the firm’s asset allocation ETFs, launched earlier this year to great fanfare in the DIY investing community.

I’ll admit it. When I list all the ways investors have no control over portfolio performance, it does not make me the life of the party. I’m more the party pooper, telling investors they shouldn’t chase after hot holdings, dump declining ones, or jump in and out of the market based on whims and emotions.

I think we all know that its a good idea to have a mix of bonds and stocks in an investment portfolio. The bonds dampen down the portfolio volatility, and act as a hedge when equities tank.

I think that the term “factor investing” has been diluted by the onslaught of new, poor quality, factor-based products in the investment product market place.

Have you ever noticed? What’s clear to an “insider” isn’t always so obvious to everyone else. Doctors, lawyers, engineers … investment advisors. I’m afraid we’ve all been guilty of tossing around too many technical terms without defining them first.

Rob Arnott, the founder of Research Affiliates, was on the Masters in Business podcast a while back. He said something that, to me, was fascinating. He criticized Dimensional Fund Advisors for starting with market cap weights to build their products.