The Rational Reminder Podcast

The episode is genuinely packed with mechanics-level detail about ETF creation/redemption, liquidity tiers, CAF charges, block pricing, and the CRM3 tailwind - well above average for a finance podcast. However, a meaningful chunk of runtime is lost to the recurring 'ETF slop' banter, the generic final success question, and some circular re-explanation of the same creation/redemption concept.

“In the US US markets you'll see trading of 20 to 30 times...Canada's a little more tame and it's closer to somewhere between six to 10 times.”

“it's usually anywhere between 5 and 25 basis points, guys. But we will embed that in our models in the ETF pricing”

A few genuinely interesting reframes - notably that the March 2020 'discount' was probably just better ETF price discovery, and that market makers earn on commissions not arbitrage - but the episode is primarily educational explanation of established mechanisms rather than contrarian or first-principles argumentation. The high-yield ETF mea culpa adds texture but is a common humility anecdote.

“those ETFs were trading at certain points at 30% discounts to where the quoted market was in the cash market. But the cash market wasn't trading anywhere near as much volume...So the true representation at that point in time was the ETF market.”

“arbitrage is not what market makers are out there looking to capitalize on and bid offer spread alone. It's to trade as much as possible with ETF investors. Because that's how we're going to make our money.”

Morley Conn is a genuine thirty-year practitioner currently running ETF market-making at Scotiabank's GBM desk - not a thought-leader or career podcast guest. He speaks with clear operational authority about P&L, losing trades, desk infrastructure, and client relationships, which is rare and credible.

“I've been in this business 30 years, you don't learn from your winning trades, Cameron, you only learn from your losing trades. It's a rite of passage in this market, in ETFs in particular as a market maker, that you're going to lose at some point a six figure, mid six figure P and L.”

“Each of the banks for our market making ETF market making operations, we have teams of developers that support our models. So we get, as mentioned from the custodians, we will get the inventory.”

The guest deploys specific, verifiable numbers throughout: AUM figures, ticker counts, secondary-to-primary trading ratios, CAF basis-point ranges, swap spread levels, retail/institutional market share splits, and CRM3 implementation dates. A few claims (e.g. the bankruptcy episode) are named only by description, and some block-trade guidance stays in ranges rather than firm data.

“The size of the Canadian ETF markets is 850 billion. Right now we've got about almost 1900 tickers. The US market is 14.7 trillion. With the T, they've got around 5000 tickers.”

“benchmark money market spreads of 45 like CDOR or in the US SOFR plus 45 to 50 up to like 100 basis points over the total return swaps”

Felix asks several sharp follow-ups - probing whether wide spreads profit market makers, distinguishing at-risk from NAV trades, and clarifying the pricing vector concept from a prior episode - showing genuine preparation. However, several questions are open invitations that receive unchallenged rambling, and the closing 'how do you define success in your life' question is pure soft-ball filler that wastes several minutes.

“Is the bigger risk there that you're going to get a wide spread or just that you're going to get noisy pricing of the underlying?”

“Is a wider spread good for the market maker? Is there a profit in a wider spread?”