Young people, especially millennials appear to be always coming under some element of criticism, be it a lack of motivation and excessive coddling among other things. Now a paper by finance professor claims that people who start investing in their younger years are predisposed to make bad decisions. In this episode Aman offers his takes on this premise and wonders if youth and investing are indeed a toxic mix?
It's decision day again!. In this episode I share my thought process on two recent investment decisions I made. One involved buying more shares in Disney and the other my decision to buy shares in Nike. Aman shows how he uses the 8 questions everytime he evaluates a stock to determine if it's worth buying.
Investing thanks to computer processing power has allowed us to filter, slice, and dice ridiculous amounts of information to give us insights into the behaviours and financial performance of stocks. It is driving more and more of our decision making and I feel that at the expense of more qualitative elements that are just as important in the decision making process. People who work in the investment industry are so dependent on the numbers that they have lost context and perspective and more importantly a respect for the value of money. This is attributable to the culture of Wall Street and Bay Street. In this episode (podcast on iTunes), I provide some examples of how easy it is drown in numbers to the point that we lose context and meaning in those numbers and how as individual investors, having an awareness of this perspective can be an enormous asset and advantage in making successful investment decisions.
The cornerstone of my investment coaching practice is to teach and mentor people to make better investment decisions as it pertains to the buying and selling of individual stocks and ETF's. It’s one thing to teach this stuff. It’s another thing to model the behavior and it’s a totally different thing to actually demonstrate tangible results. In this episode I reviews my updated Last 100 list and shares my insights on my investment experience and pedigree.
One of the things that intimidates people about investing is the endless formulas and ratios..the mathi'ness of it all. The image of someone sitting there pouring over spreadsheets can give people hives. I came across a pretty good article recently that outlined 7 steps to quickly analyzing a stock. I noticed that all 7 steps involved some element of math, which again to most people would be a turn off. It's fine but I believe there are other elements that go into evaluating stocks and ETF's that are not math related can be just as effective in framing investment decisions. In this episode I try to give some comfort and hope to those who have angst about investing. There really is more to investing than math.
I'll be honest, I really had no intention about offering any takes on the cryptocurrency mania but I get asked ALL THE TIME about whether it's worth investing in Bitcoin or any of the other cryptocurrencies that are exploding on the scene. To me investing Bitcoin is no different than investing in any other traditional paper currency....which is highly risky. At the same time, I really haven't had much of a grasp of how Bitcoin operates and what makes it so appealing. So in this podcast, I take a pretty deep dive to figure out how Bitcoin and cryptocurrencies work. So if you are in the same boat, then check out this podcast and let's learn together! NOTE: This episode was recorded prior to a couple of developments that have cast a bit of a cloud on Bitcoin, specifically China's decision to ban Bitcoin Exchanges as well as JP Morgan CEO Jamie Dimon's take that Bitcoin is a fraud, comparing it to the Tulip Mania.
In the last few months we've seen some business activities and transactions that I think will have major reverberations on how we do business and ultimately the types of investment opportunities that will emerge from them. In this episode Aman offers some hot takes on the Amazon/Whole Foods merger, the Alphabet (Google) partnership with Walmart, and finally the decision by Disney to part ways with Netflix and start distributing its content directly to customers. These three strategic moves are truly game changer moments in business.
With Mad King from North Korea and the Mad King from the USA trash talking using their nuclear weapons on each other, Aman tries to map out what that could look like and how it could potentially impact stock prices around the world. Suffice to say, it won't be good in the short term. What's more concerning is the impact it will have on how commerce is done around the world. As much as the rhetoric has been quite hot, these 2 "leaders" have a track record for talking a good game.
As stock markets around the world set record high's on an almost daily basis and despite all political chaos and maybe surrounding it, I keep wondering, and asking myself how sustainable this is? This just can't continue on like this. Something deep down is telling me this epic run will somehow end...but how? What is it that will take this whole house of cards down? In this episode Aman tries to brainstorm some possible scenarios that could be the trigger to pulling the stock market down.
The active investing versus passive investing debate continues and it will likely continue forever. An interesting wrinkle though in the debate has popped up and it involves literally the patriarch of index investing changing teams. In this episode Aman dives into this stunning change of heart. At first Aman was ready to go into full "gotcha" on this, however this case highlights an important quality that investors needs to build up in their tool box. Excuse the coughs!
At the core of my personal investing ideology is the concept of having entry and exit points for when a stock or ETF reaches a certain return level. In this episode I share some of my recent investment decisions many of which came to down to whether to hold or sell a few positions in my portfolios as they had crossed my personal return threshold.
In episode 69, I reported some interesting changes that occurred on my Robo Advisor portfolio that I setup a few years ago. At the time, I thought that the changes could have been temporary as part of stepping stone. In this episode, I check in on my Robo portfolio at the mid-year mark to see if those changes have remained.
RANT ALERT! In episode 66, I went on a bit of a rant after a blogger said I was asking the wrong investing question in that performance shouldn't play a factor in investing. A common feeling people who start investing experience is intimidation, especially from the financial services industry. They feel like they are being talked down and become hesitant to learn more and ask questions. This plays into to investment industry's hands. To give you another example, in this episode, I share with you a question person asked about robo advisors, and the response that was provided by someone who works in the financial services industry. The response made me really angry but at the same time didn't surprise me as it was a typical response I would expect.
A right of passage for anyone studying investing and finance in university is to face the beat down of learning one of core investing theories which is the Efficient Market Hypothesis (EMH). It is a particularly dry topic which I recall on several occasions made me almost fall asleep in class. In school they basically ram the EMH into your brain and I really wasn't in any place to know if it was a good thing. You just accept it and move on. Over time though, I grew more suspect of this model especially after seeing people like Warren Buffet and Peter Lynch basically thumb their nose at it and had a bank account to prove it. Over time also I've become a proponent of behavioural finance theories having a greater impact in how we make investing decisions. Another variant of the EMH has emerged, called the Adaptive Market Hypothesis, which integrates a behavioural component to the discussion. In this episode I examine both Hypothesis and offer my takes on the pro's and cons of each.
The move by Amazon to buy Whole Foods is a game changer deal on so many levels. In this Amazon, Aman offers his takes on the deal and how it can shake up the entire retail sector along with how he is framing his investment decisions in his own portfolios going forward.
A lot of times in investing, opportunities and times for action don’t happen on schedule. They just happen and you have to be ready to execute. That is the great benefit of having an investment ideology and The List of companies you’ve done your homework on and are ready to buy if the price is attractive enough and the fundamentals of the business haven’t changed from when you were evaluating the company. In this episode Aman reviews his recent investment decisions.
It's interesting to note that as stock markets in the US set record high's on a daily basis that when you dig deeper, most of the gains in the market are being driven by a handful of stocks. This episode of Stock Talk skews heavily into some academic research side and I use the term "skew" purposely as some old research has re-emerged and has shed some light on another factor that makes it hard to outperform the overall stock market.
No video for this episode!
Since I started doing Stock Talk in podcast and video forms, I've noticed something. It appears the most popular episodes are the one's where I've shared responses that I've offered to people that have sent me questions or responses that I've given in personal finance and investing groups. The great thing is these questions are not really that personal and I feel many, many people can benefit and learn from. It appears you feel the same way! So I plan to do more of these type of podcasts in the future. Here's my latest edition where I answer questions ranging from "What is an SEC 10-K Report?" to "What are the fundamental skills for investing in stocks?" to finally "How does investing in stocks work?". These are amazing, elegant, and powerful questions form a important foundation for investing.
Our journey to achieving important financial goals like retirement or buying a house have traditionally been long treks. In recent years we've been seeing more people who aren't interesting running that marathon but would prefer to sprint to the finish line and achieve FIRE (Financial Independence Retire Early) or other personal finance goals like paying off their mortgage in 5 years, or engaging in multi-year spending moratoriums. These types of extreme personal finance behaviours make great copy and get a lot of clicks and attention. They also create emotional feelings no different than someone who feels inadequate or has a bad body image because of images the media projects on us what norms we should be aspiring to do. In this episode, Aman offers some takes on this type of personal finance "porn" can while inspiring, can give most people a feeling of bad "personal finance image".