Allow me to begin by describing a defining moment in the establishment of Wealthsimple. In Canada, obtaining a license to manage discretionary funds typically necessitates two things: practical experience and a formal education (either the CFA or a more local, more expeditious title called the CIM).
When Michael Katchen founded Wealthsimple in 2014, he lacked both credentials, so he began cold-calling anyone he could find on LinkedIn who met the requirements. Unfortunately, no one wanted to work for a non-profit organization that had neither begun operations nor raised funds. Katchen experienced rejection after rejection.
Dave Nugent- The Dominant CIO
Until he met Dave Nugent, who was a financial advisor at RBC and had a CIM at the time. Dave Nugent immediately understood Wealthsimple’s objectives. He was concerned with facilitating investments for the masses. Therefore, Nugent left RBC, where he was a member of a $300 million-managing group, to join an unnamed company. Shortly after he joined the team, Wealthsimple raised $2 million and began operations.
Dave Nugent is therefore Wealthsimple’s first Chief Investment Officer. (He also served as the Chief Compliance Officer, which was a crucial contribution.)
Now, I don’t know David Nugent, but it’s my job to get inside the heads of Bay Street’s top executives, so I’ve created this profile of him using FBI-style profiling:
-His friends refer to him as The Nooge or The Noogester.
-His preferred phrase is “That’s what I’m talking about!”
His hobbies are lifting weights and playing volleyball.
He was the student body president at his college, Huron College, from which he graduated with a degree in Political Science.
(This final point is true. Katchen also attended Huron College prior to graduating from the prestigious Ivey School of Business).
I don’t believe Dave Nugent spends his weekends studying the history of the Austro-Hungarian monetary union, but that’s fine. Bay Street is filled with intelligent people; where will this lead them? Buffett has stated that temperament is crucial. How did that go? Long-Term Capital Management had a number of Nobel Prize winners.
Dave Nugent is relatable: if there was a survey to determine the CIO with whom you would most like to have a beer, Dave would be the clear winner. There would be no runner-up. Dave understands how bewildering finance can be; he probably still recalls the rigors of his CIM studies.
Thus, we assume that Dave Nugent is a “one-pager” kind of guy. As he should be, Warren Buffett has stated that the most effective investment strategies can be described in a single paragraph.
This is why I was so alarmed when I discovered a 33-page “Investment Methodology White Paper” published by Wealthsimple in August of this year, announcing the addition of ostensibly more sophisticated asset classes. I believed the purpose of passive investing was to choose a strategy and stick with it for decades.
This document is filled with jargon, statistics, pie charts, and graphs. And did I mention that it is 33 pages long? Furthermore, there are three of whatever the plural of “appendix” is. And what is a “white paper” exactly? I do not believe for one second that The Nooge authored this incendiary document, and I wonder if he even approves of it.
This document appears to be an attempt by an intellectual faction within Wealthsimple to seize power from The Nooge. This document contains provocative terms such as “inflation-linked bonds” and “minimum-volatility indices.” In The Nooge’s cathedral, there was blasphemy.
I have attempted to determine who could be behind this intellectual uprising within Wealthsimple, but have thus far identified only one possible spokesman: one Michael Marco in their New York office. Consequently, this Marco fellow is a Yale graduate.
He worked for Bridgewater Associates, the most profitable hedge fund in history, and Cravath, the Goldman Sachs of the legal industry. So, now that Katchen is associating with the Desmarais boys, with their posh Harvard and Goldman pedigree, Huron College is no longer a viable source for recruiting Wealthsimple’s leadership? I see how this would work.
Bridgewater is meaningless to me. The economic technobabble of Ray Dalio is absurd. Bridgewater publishes daily; however, daily market commentary cannot be intelligent (see David Rosenberg, Denis Gartman, etc.). Did you know that Warren Buffett completed his undergraduate degree at the University of Nebraska and was rejected from Harvard Business School? He jokes that the Nebraska football players believe the N on their helmets represents knowledge.
And consider what the Oracle of Timmins, the legendary Ojibwe-Canadian-Swiss singer Shania Twain, stated:
So you’re a rocket scientist, then?
That doesn’t really impress me!
So you have the intellect, but do you also have the touch?
Don’t misunderstand, I think you’re fine.
However, that will not keep me warm during the middle of the night.
This “white paper” and all its formulas and jargon will not keep me warm in the middle of the night when market winter arrives. When winter arrives, I hope to be able to rest my head all night on Big Nooge’s masculine chest and be comforted by his strong embrace.
I am not speaking figuratively.
Skinny geeks won’t do!
Dave Nugent is pictured alongside Katchen in the earliest slides of Wealthsimple. However, he is no longer listed among the nine members of the leadership team on their website.
As I explained, there is no Wealthsimple without Nooge. What became of the phrase “Dance with the one who brought you?”
I have studied Shania Twain similarly to how others study Sun Tzu, and an incident in her life provides a valuable lesson here. Shania’s husband had an affair with Ms. Thiébaud, her best friend. After two years, Shania wed Mr. Thiébaud. What does this signifier? The obvious solution is for the Nooge to have a fling with TD Bank’s CEO, Bharat Masrani. That’ll teach her a lesson. Or perhaps a PR-savvy rival – if any – should do a Shania and poach The Nooge?
One thing is certain: Wealthsimple is engaged in a battle for its investment soul. You are either with The Nooge or with the Excel terrorists.
OPM Wire is the only credible news source covering the ideological conflict that is tearing Wealthsimple apart. The reason for this is straightforward: we have the lowest journalistic standards. We try to stay objective, but in the face of such profound injustice, we cannot remain silent. We’re on Team Nooge all the way.
According to Eilleen Regina Edwards, you are still our best option.
Shania is better known by her stage name.
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