The Rational Approach to Wealth Management with Cameron Passmore

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Cameron Passmore is Executive Chairman and Portfolio Manager at PWL Capital, one of Canada’s premier independent advisory firms that puts its people and clients at the heart of its purpose. He’s also co-host of the Rational Reminder podcast with Ben Felix, a leading advocate for evidence-based, systemic investing, and is dedicated to the continuous development of people, knowledge, and technology.

In this episode, we discuss PWL’s client-centric approach, how they structure the organization to align with purpose, building a nationally-recognized brand centered on improving financial literacy, the Canadian advisory landscape and the misalignment of incentives, and more.

Please enjoy our conversation with Cameron Passmore.



The Investipal Podcast is produced by ⁠⁠⁠⁠. Past guests include Peter Lazaroff, Douglas Boneparth, Jamie Hopkins, Tyrone Ross and many more.

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Key Takeaways:

  • PWL Capital's approach to financial advising, which integrates financial planning and portfolio implementation under one roof. The firm is independent, employee-owned, and operates with a fee-based model, avoiding conflicts of interest by not selling any other financial products. Their investment strategy relies on building diversified, globally-invested portfolios that align with the client's stated objectives.
  • PWL Capital, through initiatives like the Rational Reminder podcast and educational YouTube videos, actively contributes to financial literacy by providing evergreen content and white papers. This educational content helps individuals make informed financial decisions, offering insights into investment strategies like the use of ETFs and the principles of quant investing.
  • The growth and potential of independent financial advisors in Canada is different than the U.S. The Canadian advisory landscape is dominated by the Big Six banks, whereas the U.S. RIA model fosters independence. PWL is structured similarly to the most successful U.S. RIAs which allows for a collaborative environment where advisors share clients and work towards common goals without the pressure of sales quotas, contrasting sharply with the traditional bank or brokerage models that may prioritize product sales over client needs.



00:00 Introduction to PWL Capital and Cameron Passmore

06:55 Building Diversified Portfolios at PWL Capital

13:50 Joining a Team with One Client Base

23:49 The High Expense Ratio in Canada

31:30 The Importance of Rebalancing and Sticking to a Strategy



Cameron Howe: Hi everyone, welcome back to the Investipal podcast. Today's guest is Cameron Passmore. Besides having an amazing name, Cameron is the executive chairman and portfolio manager of PWL Capital, a fee-based advisor in Canada. He also hosts the Rational Reminder podcast with his co-host, Ben Felix, where they're helping individuals make sensible investing decisions. Cam, nice to have you on.

Cameron Passmore: Thank you. Great to be here. Yes, there's not many of us, Cameron's around, so it's always good to meet a fellow Cameron.

Cameron Howe: Absolutely. I have to call it out when I see it. So Cameron, I guess, you know, as a starting place, you know, PWL is a fee based only independent advisory firm in Canada. There's not a lot of you out there. I'm curious, you know, if you want to give a little bit of an overview of PWL and your background specifically as well.

Cameron Passmore: Yeah, sure. So the company was founded almost 30 years ago. And the objective back then was to integrate financial planning and portfolio implementation in one spot. And we're really a company with a purpose to really help people make better informed financial decisions. So this is all we do. We have no other products for sale. We are paid based on assets under management. So a percentage of assets is how we do our work. And we spend a lot of time, you know, being the best possible partner we can be for individuals as they make financial decisions. So someone to, you know, thought leadership. So we have things like the, The Rational Reminder podcast and Ben's YouTube channel. We put a lot of white papers out into the, into the ethos. We do our best to understand our clients, spend a lot of time with them, uncover their goals, their objectives. And implement the portfolio on the other side. So we believe that basically on the portfolio side, that markets work. Markets are reasonably, I'm not gonna say they're perfectly efficient, but they're efficient enough that it's hard to beat them by picking individual stocks. So we build highly diversified, globally diversified portfolios that are designed to meet the objectives that the clients state to us. So that is what we do. We're a firm of 75 people in the company and we have one client base, we're independent, we're employee owned and that is our objective. So I joined the company back in 96 after four or five years selling mutual funds back in the early nineties and the industry has come, as you know, has come a long way since then where I started and we used to be paid a percentage of what you sold, the mutual fund you sold as a commission upfront. So these were. the advent of back and load mutual funds. So I converted from selling beef, which was a commodity, to selling mutual funds, which in hindsight, even though we were doing some financial planning with it, we were paid to move product. And a few years in, it became obvious that doesn't make a lot of sense when you're in a service business to be paid just to move product. So I set out to, my partner I at the time set out to find a platform where you could first of all, distribute ETFs because ETFs were just starting in the mid to late 90s in Canada. So we wanted a platform where we could implement other products to be product agnostic, but also be paid by the client as opposed to being paid by the product. And the timing was perfect because once you are paid by the client, you can look at indexing this wonderful world of index, the belief that markets largely work.

Cameron Howe: Mm-hmm.

Cameron Passmore: If you're only paid to sell active mutual funds, you can't afford to look at index funds until you're paid by the client. So just an incredible realization, incredible learning just as the whole world, you know, this whole index fund revolution that has happened, it was, had been long underway, but from a product side in Canada really came into itself in the mid to late nineties. So it's just an unbelievable experience. So we've now been doing this for, like I said, almost 30 years.

Cameron Howe: I think it's very interesting. I know we were chatting just before this and I used to be a quant guy myself. I actually helped launch the ETF research business as well at CIBC. So ETFs are very near and dear to my heart as well. And I'm curious on your thoughts on the ETF side, like your approach to it, is it, you know, I guess your approach to portfolio management, is it a model approach or is it more discretionary to that individual?

Cameron Passmore: Amazing. It's a model approach for sure. We work a great deal with a company called Dimensional Fund Advisors, which I know you're familiar with, which in Canada, they're delivered through mutual funds. I think there's a great misunderstanding. Some people say mutual funds are bad, ETFs are good. Well, it's not necessarily true. It's what are they implementing? Once you start to learn about this world of quant investing, which you spent your career studying, it's all about implementation of good ideas. And in our opinion, Dimensional Fund Advisors does a great job of implementing great ideas. It happens to be in a mutual fund, which is also another great idea. Active mutual funds might not be such a great idea, right? Or the traditional active predictive type. Cause I know technically Dimensional Mutual Funds categorizes active funds. That's because they're different than the market, but they're not trying to make bets. They're not trying to predict the future. So I know we're getting into kind of nuanced discussion here, but once you quantitatively look at implementing great ideas in a portfolio in Canada, it is our opinion that Dimensional does a great job of that. There's also great ETFs of course too that people can build portfolios with because Dimentional funds are not available, I believe to the retail, mutual funds in Canada are not available to the retail individual investors.

Cameron Howe: Oh, interesting. Okay. So with that approach, your models are essentially, I'll call it like maybe five to 10 funds you're holding and you can build out sleeves on like a growth focused model, a more conservative model and allocate to clients accounts based off of their risk.

Cameron Passmore: We don't make any sort of weightings based on value versus growth. All of our portfolios are tilted towards value, size, profitability, quality. Those are built-in models. We don't try to do any sort of analytics on top of that to say overvalue any particular region, sector, style. We'll focus on how much we want in fixed income versus equity, for example, or cash as well. That's how we differentiate it, but all of our clients are in globally diversified size and style tilted portfolios.

Cameron Howe: Okay, very interesting. I mean, we could probably spend the entire podcast talking about this, but I think there's a more, there's also a very interesting conversation to be had around the Canadian advisor landscape. You know, like, I know you're familiar with it. A lot of, I think the stat I found, there's 10 times as many advisors who work for the big six than work for independent shops.

Cameron Passmore: Wow, I did not know that stat.

Cameron Howe: It is pretty staggering. And then, you know, we, we deal a lot in the US where we've seen the big rush of independent RIAs and a lot of, you know, like the First Republic Bank, for instance, a lot of those advisors have left to go launch their own. Um, I'm curious your thought on the Canadian landscape and if we will end up seeing more advisors and, more importantly, more clients move to independent advisors away from the Big Six.

Cameron Passmore: That is a great question. That's a question I spend the majority of my time thinking about. I've long followed the US RIA model. I first reached out to my good friend Larry Svedro who is a thought leader in this space. He's at a firm called Buckingham. Buckingham is one of the great independent advisory firms in the US but there's a number of them where they view one client, one service, one ownership model and that's something that's very near and dear to our hearts. And you know, I think there is an opportunity in Canada and that's exactly what we are trying to do to be that independent, privately operated, independent firm that is here simply with the purpose of helping individuals make better financial decisions and then implement the portfolios and the planning solutions for them with them. I think there's a huge opportunity there and that's something that I think in a banking environment, typical retail branch banking environment is very hard to implement because there's so many other products that people need from banks that to try to do a proper job on the planning side is very, very difficult. And banks have to serve a broad swath of people and to do the planning part properly, I think that's a tall order in that kind of environment. Now there's some great, great advices in all channels without a doubt, but I do think there was an opportunity for an independent to a scale independent enterprising candidate to do that. And that's what we're trying to do.

Cameron Howe: What do you think is holding the client back? Is it from like an integrated service where, you know, like I have my checking account with said bank. It's also easy to bring on an advisor who has access to all of those accounts instead of me having to move money over to an independent.

Cameron Passmore: Another great question. I, as I said on our, we talked about this on our podcast a couple of weeks ago, I love the bankers that help me personally with my own banking needs. They're phenomenal. The services is excellent and I love having a stable banking system. I just can't imagine doing what we do for clients inside what I know. And I've never worked inside a bank, but what I know about, I hear about from our colleagues that have joined from banks doing what we do in that kind of environment, I just can't see that necessarily happening at scale. Yes, there's gonna be some great pockets across the bank for sure. But when you have a purpose built, this is all we do. We have 75 people dedicated to one client base solely seeking to improve the client experience. That is all we do, integration of financial planning, portfolio implementation, and portfolio decisions. That is it. So we keep trying to improve our decision-making models. You know, Ben's work, it's simply incredible to get this kind of research where you're taking this research and this thinking around financial planning and decision making and boiling it down into great actionable items that our team can then use with clients. And again, it's one client base, one team. It's an amazing thing to build out. Whereas in a typical environment, banking environment or other brokers environment, you've got different, and you know this better than I do, Cameron. You have, you might have 20 teams in a brokerage office, but they're all going to have a different twist and different flavour. They've all got their own independence, but you're sitting next to someone who may not share your views on planning or portfolios or are markets efficient, whatever it might be. So my takeaway from that is, you know, do great work basically on your own as a team and be compliant and make sure you sell. That is my impression. I never worked in an environment, so I realized there could be some pushback there, but I just think there's so much power in being with colleagues who share your philosophy and just keep wanting to make the same thing better all the time.

Cameron Howe: I wonder if the key blocker, besides Canada being obviously a smaller market in the US and thus it is more concentrated. I remember I got in trouble for the name behind it, but I'd run an oligopoly index. So you take like the TSX, but you get rid of all the mining and energy companies and you really look at the big five, the grocers, the railway companies, telecoms and that index outperforms the S&P quite reliably over time just because of how concentrated our market is and they're the ones who generate essentially all the profit in the TSX anyways. So you know because we're such a hyper fixated market amongst a few firms regardless of the industry you're in, I wonder if and I'm curious your thoughts on it if an advisor who is looking to get into the space. They have the two options in front of them. Do I go and join PWL and be an independent advisor or do I go work for a Big Six? If the key blocker on wanting to go independent is the referrals that advisor can generate from the Big Six. I'm curious your thoughts. Like if you had any advisors who've come over to PWL and there's been some issues because they end up generating most of their business through bank referrals.

Cameron Passmore: Yeah, so when you join us, you're joining a team with one client base. You're not building your book.

Cameron Howe: Interesting.

Cameron Passmore: That's the big difference right there. So if you truly want to build and be your own entrepreneur and build your own book, you would never come here. People come here with a shared purpose. So many people reached out based on hearing us on the podcast talk about how we operate, how we think, what we believe in. So people want to come and join that mission, that purpose and be part of that team. So it's a very distinct characteristic of people who would be attracted to that model. And this is what some of the great firms in the US have done, be it Buckingham, be it Creative, be it WEG, be it whatever any one of these big RIAs have done. Ritholtz, another one, right? Where you get this mission-driven purpose behind the company. People want to join that as opposed to, I want to join a brokerage with the highest payout. Let me do what I do best. And that's the world I used to be in. Just let me do what I do. I want a platform to plug into. And often if I can find a better payout somewhere else, people bounce around for a payout or for the check to go to move to different brokers. That's not really purpose driven, right? Nothing wrong with it. That's what you want to do. That's fine. We're just a little bit different. We want people who want to be part of the same team. And you know, for example, we will share clients. We have it where advisors can, can take a vacation and the team fills in the gaps while they're gone. So it's one team, one client base. It's a very, very different environment than a traditional broker's environment.

Cameron Howe: Oh, that's interesting. I actually haven't heard it framed like that before. So essentially, you know, if not to discount any, there's a lot of great advisors out there, but you know, the ones who are hyper fixated on really, you know, providing value to clients would be more aligned to a PWL model than one who is solely focused on growing their book.

Cameron Passmore: Yes, and the economic opportunity in joining a firm like us, like our model is join, join the team, build one book, one clientele, one team and then you get a chance to buy equity of the firms who are very deliberate and thought out succession plan to transition ownership to the next generation. So we are selling shares from G1 to G2 actively because this is a huge issue in our industry where the - proverbial old guy like me ends up hoarding the equity from G2. But we have in place where shares are cascading to G2 thoughtfully and deliberately each year. So even though you're not building your book, you get a chance to own some of the company.

Cameron Howe: Oh, very smart. Okay, I like that. And then so essentially a client comes inbound to the firm and you decide which advisor it gets lauded to.

Cameron Passmore: - as opposed to fighting over lead as it comes in. And with the content, and we're doing what we call a painkiller strategy on content, which is put out content that's evergreen, so someone's looking up, should I take my CPP now? Should I rent versus buy? Should I invest in dividend stocks? There's content that's out in the world that people, you know the old saying, if I have pain, I'll go find the solution, but if I want a vitamin, well one day I'll take a vitamin.

Cameron Howe: Yeah.

Cameron Passmore: Most people in Canada either go to the bank or go to Reddit or Google with a problem they're trying to solve. You know, I'm getting divorced, what should I do? My parent, my parent just passed away. What do I do with my inheritance? So we, if we can put evergreen content out there, people will reach out. So we have people reach out and they're a physician in Kelowna, but we have a team that specializes in physicians. If I'm a business owner in pick a place, someone else can pick it up and the team is not fighting over leads.

Cameron Howe: I like that. Okay. And so on that note, how does PWL's compensation model differ than a traditional advisor?

Cameron Passmore: I mean it's been a while since I've worked in a traditional advisory environment, but I believe most are on percentage type payouts and then that advisor covers whatever cost they choose to have in their practice. It could be a big team, small team, high tech, low tech, that's up to the advisor, right? Our environment is not that it's salary based. We believe salaries are competitive, but the industry gets confused because a typical advisor gets paid for what they do and what they own. So you end up getting this wide range of incomes, right? Whereas you can go and replace someone for what they do for much less than what a typical advisor makes. So we've disentangled getting paid for what you own versus getting paid for what you do. So you get paid for what you do, then you can invest in equity so you can start getting paid for what you own separately. If that person wants to or not, that's up to them. It's a personal choice.

Cameron Howe: Okay.

Cameron Howe: Right. Okay. And so down that path as well, you would only be clipping an AUM fee based off the assets you manage. You are not also upselling insurance products or you're not clipping like a trailer on any sort of funds you recommend.

Cameron Passmore: No, no, no. 98% of our revenue is from AUM fees and the portfolios. But the advisor's compensation is not directly linked mathematically to the AUM of their clients. Because we'll share clients between different teams or you might be better served by this team over that team or what have you. So people don't hoard clients because there's no mathematical link between that and your compensation.

Cameron Howe: Right, okay. Very interesting. I like this.

Cameron Passmore: The purpose is powerful and that's what's so motivating. It's so much fun to be one team and we share and we do best practices. We do training together. We go to conferences. It's an amazing environment for sure. It's not for everybody. I will grant you that.

Cameron Howe: Well, I guess, you know, there's something topical. The investment advisor is not the same as a branch level financial advisor, but I do think it plays into this theme quite well, where, you know, the, that CBC marketplace, uh, article that came out or new show that came out about a month ago on the high pressure sales tactics by, and placed on these branch level advisors pushing products. I think you probably had a similar experience back when you were selling mutual funds. I'm curious your thoughts kind of on the news behind that and if you think there's any sort of regulation change that needs to come in to help protect clients.

Cameron Passmore: -regulation, I don't know. I mean, there's, there's already professions, your regulation in place, but some of that story was just staggering, bad wrong advice. Like the examples of not knowing how MERS work now, whether that's true or not in those cases, it's just mind boggling to me. But the reality is financial literacy levels are extremely low all around the world and in Canada and more and more people are getting access to better quality financial literacy information. They're also getting access to a lot of bad stuff out there too. We had an episode on the podcast talking about how often it's the bad advice, the sensationalized bad advice that gets amped up by the algorithms of different platforms, which is somewhat frustrating when you've got, I realize this sounds bi, but when you've got good quality, thoughtful stuff that we're doing that may not get as amplified. But the information is out there, there's good information out there. There's great, there's a fantastic planning community in Canada. You and I know many of these people and there's a very vibrant community on Twitter, for example. There's phenomenal places to get all sorts of different kinds of advice. Whether you want to go AUM based with implementation under firm like ours, or if you want to go to a flat fee or a truly a fee only financial planning, and then you do the implementation yourself. I think more and more people are learning and they're realizing that there are options out there that are just as safe, much smarter, much technically better. There's some very thoughtful people in this space, but people, individuals have to go out and find this for themselves. But the quality of content that's available is off the charts. There's so many good, smart, driven, decent, honest people that are really making a difference in this space and that, that in my opinion, is who deserves to be amplified in this industry. I think it's going to be very hard for banks to do that just because of their size and their scale and their product lines. They've got B2B, B2C, and we all need good strong banks. I love my bankers for what they do. Credit implementation, banking services, stuff like that. I need that. But a lot of people have some very complicated financial lives, they've got complicated financial decision making, they have corporations and holdcos and family trusts and income splitting and you know, disabled children and the list goes on and on and on where you need someone that has the time and expertise and ability to sit down and think about you and not do it only a half hour meetings at some suburban branch. That's just not the environment for that. And I think more and more people are realizing that.

Cameron Howe: I guess it comes down to those branch level individuals are not fiduciaries. They're not there looking through your financials and making those recommendations instead they're pushing a product on you.

Cameron Passmore: I was told by a retired bank executive probably 20 years ago, said, don't ever forget that banking clients are a means to the bank's end. I was like, huh. I think we all know that at some level and I don't think you can ever forget that. No, no, we're a capitalist business too. We have to provide a service for good value. But as people realize, you know, the average expense ratio in Canada, I believe it's above 2%, tight. And that may be fine depending on your asset level, if you're getting good quality financial planning advice being delivered, but as your assets go up, your fees on a per dollar basis should be going down and you should make sure you're in front of a qualified, dedicated fiduciary advisor without a doubt. I mean, it just seems obvious when you state it, of course that's what you want. But if you don't know, you don't know. And so many people don't know anything right about how markets work. What kind of planning should I do? How should I set my goals? We have 300, our 300th episode is coming out this week. We've interviewed 150, probably unbelievable experts at all sorts of financial decision making. It is one huge complicated field. You start talking to these people and the more, some Ben talked about two weeks ago, he says, I love looking back and realizing how ignorant I was. You know, one year, two year, five years ago. I mean, that's the whole point. You just keep getting better and better and refining your offering as a mission driven firm into your, your service to clients. How do you do that? If everyone's got a different point of view on stuff, who's doing that common feeding of thinking? Who's challenging the status quo day in, day out to make things better? Who's playing with economic models for decision making? Should I take a dividend or salary? Should I set up an IPP or not? Who's doing that? How much effort is going into marketing versus thoughtful tools to help you make better decisions. I mean, that's the purpose. That's why we are here. We're just part of a great community and Canada is trying to make this kind of difference.

Cameron Howe: Yeah, that resonates very strongly with me. I remember when I might've said it on this podcast before, but I remember I used to write research reports and I would try to use, I was told by our readers to use more plain language. But I was advised we need to complicate the language intentionally to appear smarter and more out of reach. And I think that's a big problem with the industry overall is we try to over complicate a lot to masquerade, you know, that investing by and large, I think it's made out to be a lot more difficult than it actually is. There's a lot of the nuances you spoke about, but at the crux of it, you know, if you're looking to buy the S&P 500, you don't need an advisor. You can go and buy a low cost ETF for that. But then you have added in a lot of the complicated jargon this industry tosses around to make it appear a lot further out of reach for that everyday investor.

Cameron Passmore: It's easy to say you don't need an advisor to do that, but a lot of people do. A lot of people can't, don't know how, don't want to know how, and that gets back to a fair fee. And what's that service set for that fair fee? Because it's so much more than just the buying of SPY or something or XEQT, pick an ETF, right? There is, and most people, March 2020, what are they going to do with their SPY? They're going to sell it, they're going to hang on, they're going to get perspective, they're going to get some support during that period of time. What's that support worth? For some people it's worth a lot, tight? Someone can do it on their own? Absolutely. Why would you ever hire someone like us? It makes no sense whatsoever. If I could fix my car, I would not go to the dealership. Right? But, but most people don't, don't even get what the index has to offer. And you can buy the index for free. You can buy the index for less than what most funds pay the provincial government and HST. Like think about that. Like it's incredible time to.

Cameron Howe: Agreed. That's a fair point, yeah.

Cameron Passmore: To be investing with all these products that are super low cost, beautifully diversified, incredibly tax efficient. Integrate that with great planning from good people, seems like a winning combination to me. That's the opportunity. And I'm not saying just for us, I've said that's the opportunity for Canadians, right? As opposed to these examples in that story, going and be told that your management is only based on the growth of the portfolio. That might just be one example. Pretty good one though.

Cameron Howe: Mm-hmm. Yeah, I guess like on that note, how do you, do you come across a lot of individuals who might be comparing PWL versus like a robo advisor and the services between what you're able to offer versus what like an automated portfolio manager like they can offer.

Cameron Passmore: Yeah, robo. I mean, so many robos, even robos can't stay robotic, but they keep tinkering with the portfolio. Like a robo can't be a robot. I mean, it just cracks me up, right? And they're not that cheap. If you want to go cheap, go buy one of the pre-diversified ETFs, BlackRock, Vanguard, pick one. Right? Pick one. Those are what, 20 basis points? Robos would be more than that and how much value-added service are you getting? Yeah, you're getting a slick interface. In my opinion, so what? You don't need to look at your stuff anyways. Look at it once a year, twice a year, and that's right. Why look at it more than that? But there's so much value that a good advisor can bring to some people. So many people just don't even want to engage in this stuff. They just don't. They don't have the confidence.

Cameron Howe: I had one conversation a few months back with one advisor who, to your point, I do think Canadians are becoming more educated on this space. There's a lot of work to be done. I think it should start in our schools and promoting financial education at that level instead of figuring it out for yourself. But this advisor told me a story about how 10 years ago it used to be all on the advisor to figure out and educate that individual. Now they have clients coming to them telling them what ETFs they want them to buy and how like VOO is a lower fee than SPY and they wanna be placed in a low cost ETF relative to some other higher fee product. So they are becoming more educated around, you know, how they're thinking about their portfolio. I think there's still, I guess where I'm going with this, do you view the model now as being a bit more consultative in nature where the clients, because they're more educated it can provide more back and forth with that individual, or it still is very much on the advisor to educate their client.

Cameron Passmore: It's way more consultative. There's huge selection bias and who's reaching out to us. So many people reach out after seeing Ben's videos or listening to podcast or Mark McGrath on social media. A lot of people following him. There's a lot of lurkers on Twitter, for example. Our website also has a fair amount of traffic. We are getting a more informed audience, I believe, that's looking for the more nuanced, particularly on the planning portfolio implementation advice. We're doing a lot of work there. Sure, a lot of people could just go by VOO and call it a day. We don't get a lot of questions like that. Once you start digging into the world of factors and we spend some time explaining that and then why working with dimensional makes sense. There's not as much discussion around that. Most people get that. As Ben has said, investing is largely been figured out.

Cameron Howe: Mm-hmm.

Cameron Passmore: We spend no time predicting the future, predicting interest rates. We don't do any discussion around anything predictive whatsoever. The belief is markets work, pick an asset allocation, stick to it, rebalance regularly. Going through March and April 2020 is a perfect example. If you're in a 60-40 portfolio, we had days that are moving 10%. All of a sudden, your 60-40 becomes 55-45 pretty quickly. Did you rebalance that day? How many advisors in Canada did rebalance, how many had the tools to rebalance. When a pre-built portfolio, that rebalancing is happening automatically for you, whether you like it or not. And not just the 60-40 between stocks and bonds, but between all the different geographical regions, all the different styles, all the different other factors that's also being rebalanced in real time.

Cameron Howe: Yeah, we might have to save this conversation for another day, but I know you covered it off in one of your podcasts on the quant factors and how a lot of those crapped out, especially during that period as well on the induced market volatility and all the circuit breakers that came into effect. I remember sitting on the trading floor when all of that was happening for the very first time. Um, it was very fascinating, but it really started to break down, especially in the quant world, um, for some time. I think it's starting to come back now. I think you mentioned that as well in your podcast. The quant factors are starting to come back. But to your point, during that period, there was so much induced volatility that if anyone was taking action with their portfolio, you probably missed out on some significant gains when the market ended up rebounding quite aggressively.

Cameron Passmore: Yep. It just proves the point that you have to know when you are different than the market that there will be tracking error, positive and negative. You have to understand that going in. I always find it amusing how people have lower tolerance for tracking error on factors, but they're okay that the market can be different than bonds, for example. That tracking error is okay, but factors is not. But then if factors go positive and I've lived through this, when some of the factors went positive in early 2000s, it was wild. I've gone through that lost decade, the S&P 500 from 2000 to 2010, right? Canada outperformed, people wanted more Canada than all of a sudden US outperformed. People want more US. So I, you know, dollar goes up, dollar goes down. You see people go back and forth. It's hard to stick to a strategy long-term. It's hard.

Cameron Howe: Absolutely. Well, yeah, we've seen that firsthand if you become entrenched in a belief system like value eventually, you have to look yourself in the mirror and wonder if it's time to give up on that or If it is finally the next inning for that especially for that fact

Cameron Passmore: Then to do that, you have to say this time is different. Those are pretty expensive words when you use in the past. Because look when growth had that great run in the late 90s. So the growth beat value over like every time period. And all it took was moving ahead a couple of years into 2001, 2002, then all the data switched where value looked great over every time period. So things can change very quickly, but you have to be in your seat when that happens. And you just don't know when that's going to happen.

Cameron Howe: Yeah. Stick to a system, right?

Cameron Passmore: Stick to it.

Cameron Howe: Okay, Cameron, why don't we leave it there? I think this was a very interesting conversation. I'd love to have you back to talk more about the quant stuff in the future. For anyone listening who is interested in learning more about PWL, how can they find you?

Cameron Passmore: I'm easy to find on my LinkedIn, our website. You can find me on Twitter. That that's not hard. There's a Calendly link in our, in both my Twitter feed and Ben's Twitter feed. So if anyone wants to set up a time to talk shop, I'm open to it. You want to connect on LinkedIn, enjoy connecting there. Podcasts is out every Thursday morning. Ben's doing more YouTube videos now. So I encourage people to check those out. He's trying to do one or two a week, and they're incredible. So there's a lot going on.

Cameron Howe: Okay, I will leave a link in our show notes as well for anyone interested in learning more. Cameron, yeah, thank you very much for coming on.

Cameron Passmore: Great. Thanks for having me on. All right, stay well.

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