Structured products can offer unique investment opportunities and customization but also come with risks and complexities. It is vital to thoroughly understand the product’s structure, risks, and potential returns before investing. In this episode, we delve into the value of structured products and recap a past episode about the philosophy of money before continuing our focus on reading and finance by diving into the book, Just Keep Buying by Nick Maggiulli. Nick is a highly regarded author known for his insightful and engaging works on finance and investing. With a passion for demystifying complex financial concepts, Nick has earned a reputation for his ability to present information in a clear and accessible manner. His ability to blend storytelling with data-driven insights made his articles immensely popular among readers of all backgrounds. We discuss the pros and cons of financial products, why investors prefer them, the dark side of structured products, and what investors need to avoid. We recap a past episode with Barry Ritholtz about the philosophy of money and the main takeaways from our conversation with him. Then, we delve into Just Keep Buying and the invaluable lessons and uncover hidden gems it offers readers before speaking to Nick about savings and investing. We discuss the best strategies for investing, how to spend your money comfortably, why you should never wait for the markets to dip, and much more. To learn everything about structured products and valuable insights about saving and investing, tune in now.

https://youtu.be/zgSLPctgPWM

Key Points From This Episode:

Learn about structured products and what they offer investors. (0:03:12)
Why structured products can be a problem for investors. (0:07:00)
We discuss whether the pricing of structured financial products is fair. (0:12:05)
How financial institutions use complexity to exploit uninformed investors. (0:14:51)
Outline of key findings from research conducted on structured financial products. (0:17:47)
The behavioural aspect of structured products and why investors prefer them. (0:22:20)
A recap of the main takeaways from our interview with Barry Ritholtz. (0:26:10)
This week’s book review of Just Keep Buying. (0:28:54)
Nick explains the difference between saving and investing. (0:32:54)
A comparison of just keep buying and dollar cost averaging strategies. (0:35:21)
Whether people should wait for a dip in the market before investing. (0:37:23)
Why you do not need as much savings as you think you need. (0:39:04)
What the biggest lie is regarding personal finance. (0:42:29)
Find out how to spend your money guilt-free. (0:44:13)
He unpacks what comes after the just keep buying strategy, and how to be comfortable spending more in retirement. (0:46:48)
Financial advice that Nick has for listeners. (0:51:03)
The aftershow: upcoming guests, feedback about the show, and more. (0:53:59)

Participate in our Community Discussion about this Episode:

https://community.rationalreminder.ca/t/episode-255-structured-products-plus-just-keep-buying-with-nick-maggiulli-discussion-thread/23684

Book From Today’s Episode:

Just Keep Buying: Proven ways to save money and build your wealth — https://amzn.to/3qh1cF7

Links From Today’s Episode:

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

Rational Reminder Website — https://rationalreminder.ca/

Shop Merch — https://shop.rationalreminder.ca/

Join the Community — https://community.rationalreminder.ca/

Benjamin on Twitter — https://twitter.com/benjaminwfelix

Cameron on Twitter — https://twitter.com/CameronPassmore

Nick Maggiulli on Twitter — https://twitter.com/dollarsanddata

Nick Maggiulli — http://ofdollarsanddata.com/

‘The dark side of financial innovation: A case study of the pricing of a retail financial product’ — https://doi.org/10.1016/j.jfineco.2010.12.006

‘Engineering lemons’ — https://www.sciencedirect.com/science/article/abs/pii/S0304405X21001653?via%3Dihub

‘Ex Post Structured-Product Returns: Index Methodology and Analysis’ — https://www.pm-research.com/content/iijinvest/24/2/45

‘Catering to Investors Through Security Design’ — https://academic.oup.com/qje/article-abstract/132/3/1469/3057435

About The Author

Cameron Passmore

Cameron Passmore has been a leading advocate for evidence-based, systemic investing for over 20 years in the Ottawa area. Today, Cameron and his team serve a broad range of affluent clients across Canada.