The Rational Reminder Podcast · Oct 8, 2026 · 1h 6m · 50m saved
With Ben Felix, Chief Investment Officer at PWL Capital · Dan Bortolotti, Portfolio Manager at PWL Capital · Kelly Thomas, Associate Wealth Advisor at PWL Capital
$10,000 put into ProShares' 3x leveraged S&P 500 ETF at its 2009 launch would be worth $1.3 million today, Ben Felix said, more than 10 times what the same money would have grown to in a plain S&P 500 ETF.
The usual warning about these funds is that resetting the leverage every day eats away at returns over time. Felix said he repeated that warning on the show himself, and that the research has since shown the daily reset is not the cause. A 2x leveraged S&P 500 mutual fund launched in 1994 still trailed the plain index for decades.
"I would submit that probably zero investors held that fund for that whole period, right?" — Dan Bortolotti
Ben Felix, Chief Investment Officer at PWL Capital, on The Rational Reminder Podcast, worked through the academic papers on leverage after listeners in the show's community told him his earlier view was wrong. Dan Bortolotti, a PWL portfolio manager, wrote about the first leveraged ETFs in Canada years ago, and Kelly Thomas, an associate wealth advisor at the firm, opened the episode by answering a listener who said the hosts' marriage episode needed a woman's view.
The full episode is covered here so you can skip it. 66 minutes of audio, 16 minutes of reading.
Here are the 13 lessons that matter.
Key Takeaways
Who does the household's buying can make one spouse look like the spendthrift
Daily resets do not cause volatility drag; volatility does, and leverage raises volatility
On an asset with 5% daily volatility, a 2x fund needs nearly 100% a year just to match it
The $1.3M result came from an unusually calm, cheap-money stretch since the 2009 bottom
The theory for borrowing young assumes your job income behaves like a bond, and Felix said many incomes do not
Every bear market since 1927 was less damaging with daily resets than with a margin loan, per a 2022 paper
Swap-based funds carry a risk the expense ratio does not show: a counterparty can close the contract after a crash
Single-stock leveraged ETFs carry total costs of around 12% a year, and more of them lost over 75% than beat their stock
A blend of 75% plain index fund and 25% 2x fund gives 1.25x exposure
Most investors may not need the extra return at all, Thomas and Bortolotti said
1. The Marriage Episode's Gaps
Felix read a listener comment on the show's recent episode about the finances of marriage, which said the conversation would have been better with at least one woman on it. Thomas, who had read the comment with him at a PWL event, came on to cover what the three men missed.
Spending labels can reflect household roles rather than personality
She said one spouse can look like the spendthrift only because that person buys the children's clothes, groceries, birthday presents and school supplies, while the other's spending is mostly personal.
"So when we talk about financial compatibility, we should look at how much someone spends, what they're spending it on, why they're spending it, and who's carrying responsibility for making those purchases." — Kelly Thomas
Career sacrifices create inequality that a prenup may miss
Prenuptial agreements focus on the wealth each person brings into a marriage, Thomas said, but parental leave, reduced hours and passed-up promotions also cost one partner future earnings, retirement savings, Canada Pension Plan credits and pension benefits. Felix said the most productive prenup discussions he has seen among clients put that issue at the center of the document.
Financial autonomy is different from financial infidelity
Both partners should have money and credit in their own name and an understanding of the full picture, Thomas said, because a person with nothing in their own name is at a serious disadvantage if the relationship ends. Felix added that the opposite risk is financial abuse, where one partner uses control of the money to control the relationship. Thomas relayed a therapist friend's view that a relationship is healthy when a person has the money to leave and chooses to stay.
"So having that ability to stand on their own two feet if something were to happen is so important." — Kelly Thomas
Bortolotti said the podcast benefits from having more voices from across the firm.
