1 00:00:05,559 --> 00:00:08,520 Speaker 1: Welcome to the Fear and Greed Business Interview. I'm sure Almark. 2 00:00:08,560 --> 00:00:10,720 Speaker 1: Fear and Greed is working with the team at trading 3 00:00:10,760 --> 00:00:14,640 Speaker 1: platform moomoo and a series for investors. Every Friday, we're 4 00:00:14,680 --> 00:00:17,320 Speaker 1: bringing you an episode exploring how to use technology and 5 00:00:17,440 --> 00:00:22,320 Speaker 1: data for smarter investing. Today, it's all about the United States. 6 00:00:22,400 --> 00:00:25,000 Speaker 1: The US comprize is about half the global share market, 7 00:00:25,040 --> 00:00:28,600 Speaker 1: so it's no surprise that Australian investors are increasingly interested 8 00:00:28,720 --> 00:00:31,920 Speaker 1: in opportunities on Wall Street, from the tech giants to 9 00:00:32,040 --> 00:00:35,400 Speaker 1: some of the household names that have been around for generations. Remember, 10 00:00:35,520 --> 00:00:38,160 Speaker 1: the information in this episode is generally in nature, doesn't 11 00:00:38,200 --> 00:00:41,600 Speaker 1: take into account your own circumstances. Michael McCarthy is the 12 00:00:41,680 --> 00:00:45,360 Speaker 1: chief commercial Officer and market strategist at trading platform Moomoo, 13 00:00:45,400 --> 00:00:48,000 Speaker 1: which is a great supporter of this podcast. Michael, welcome 14 00:00:48,000 --> 00:00:50,200 Speaker 1: back to Fear and Greed. Thanks very much, Sean, it's 15 00:00:50,200 --> 00:00:53,360 Speaker 1: great to be here now. When I left school and 16 00:00:53,400 --> 00:00:56,800 Speaker 1: went to university and started thinking about investing, I knew 17 00:00:56,800 --> 00:01:00,720 Speaker 1: about McDonald's, but I couldn't really buy a share in McDonald's, 18 00:01:00,720 --> 00:01:03,880 Speaker 1: no matter how much I ate of the stuff. Investing 19 00:01:04,000 --> 00:01:07,360 Speaker 1: you in Wall Street stocks is much much easier now 20 00:01:07,600 --> 00:01:09,800 Speaker 1: than it has been previously, hasn't it? 21 00:01:09,800 --> 00:01:12,840 Speaker 2: It certainly has, Shawn, And this is one of the 22 00:01:12,920 --> 00:01:17,319 Speaker 2: key aspects of trading platforms. Online trading has brought democracy 23 00:01:17,360 --> 00:01:19,840 Speaker 2: to market. That is, it's allowed all of us to 24 00:01:20,040 --> 00:01:23,680 Speaker 2: access not just the Australian share market, but share markets 25 00:01:23,720 --> 00:01:26,280 Speaker 2: around the globe. And now if you drive at Tesla 26 00:01:26,440 --> 00:01:29,679 Speaker 2: or use Microsoft or Apple products, you can invest in 27 00:01:29,720 --> 00:01:31,920 Speaker 2: those companies directly and at low cost. 28 00:01:32,680 --> 00:01:36,160 Speaker 1: Okay, So where do I start When I'm looking at 29 00:01:36,200 --> 00:01:40,480 Speaker 1: Wall Street stocks, Microsoft, Tesla and Video. We'll hear plenty 30 00:01:40,520 --> 00:01:43,520 Speaker 1: about all those tech stocks, but what's my starting point? 31 00:01:44,040 --> 00:01:47,000 Speaker 2: The starting point is the key reason for going overseas, 32 00:01:47,040 --> 00:01:51,280 Speaker 2: and that is to reduce overall investment risk. Whether you're 33 00:01:51,400 --> 00:01:55,080 Speaker 2: diversifying because you're too concentrated in the major sectors represented 34 00:01:55,120 --> 00:01:57,880 Speaker 2: on the Australian market, or you're just looking for exposures 35 00:01:57,880 --> 00:02:01,800 Speaker 2: that are not Australian. The ability to buy US shares 36 00:02:01,840 --> 00:02:04,919 Speaker 2: to complement the Australian shares you might already be holding 37 00:02:04,920 --> 00:02:08,079 Speaker 2: in your portfolio is a very powerful risk management tool. 38 00:02:08,120 --> 00:02:11,040 Speaker 2: So that's the starting point I think for investors, and 39 00:02:11,080 --> 00:02:14,840 Speaker 2: as we always make very clear, personal circumstances are a 40 00:02:14,919 --> 00:02:17,880 Speaker 2: key to the right choices in markets. If you've already 41 00:02:17,919 --> 00:02:21,040 Speaker 2: got a whole lot of iron ore and mining stocks, 42 00:02:21,280 --> 00:02:24,919 Speaker 2: buying into a US car manufacturer might make sense because 43 00:02:24,960 --> 00:02:27,200 Speaker 2: you're buying up and down the supply chain, or it 44 00:02:27,280 --> 00:02:30,520 Speaker 2: might not because you're too concentrated in those areas. So 45 00:02:30,760 --> 00:02:33,680 Speaker 2: depending on what an investor already holds, there are a 46 00:02:33,919 --> 00:02:37,840 Speaker 2: plethora of choices for people in the US market. And 47 00:02:37,880 --> 00:02:40,880 Speaker 2: locally we've got almost three thousand instruments to choose from. 48 00:02:40,880 --> 00:02:43,200 Speaker 2: That's a pretty good investment universe. But when we go 49 00:02:43,280 --> 00:02:46,560 Speaker 2: to the US, we're talking about more than ten thousand shares, 50 00:02:46,960 --> 00:02:50,920 Speaker 2: around four thousand ETFs and other instruments, and when we 51 00:02:51,000 --> 00:02:54,639 Speaker 2: add in options, the choices in US investment markets are 52 00:02:54,720 --> 00:02:55,760 Speaker 2: almost limitless. 53 00:02:56,400 --> 00:02:58,080 Speaker 1: Okay, so we talk a little about the tech stocks, 54 00:02:58,120 --> 00:02:59,800 Speaker 1: let's just park those. What are some of the other 55 00:03:00,200 --> 00:03:03,880 Speaker 1: sectors in the US that investors can think about, particularly 56 00:03:03,919 --> 00:03:05,720 Speaker 1: if they want to diversify their portfolio. 57 00:03:06,200 --> 00:03:08,520 Speaker 2: Well, a lot of the choices that Australian investors make 58 00:03:08,600 --> 00:03:11,880 Speaker 2: relate to what's not available here. So more recently, with 59 00:03:11,960 --> 00:03:14,959 Speaker 2: a lot of global talk about nuclear energy, the ability 60 00:03:14,960 --> 00:03:17,880 Speaker 2: to invest in that, for Australian investors is offered by 61 00:03:17,960 --> 00:03:20,920 Speaker 2: going to the US markets and investing in those companies 62 00:03:21,080 --> 00:03:24,680 Speaker 2: that have nuclear power. Now that's not an investment everybody 63 00:03:24,760 --> 00:03:27,000 Speaker 2: is seeking, but it's a good example of how we 64 00:03:27,040 --> 00:03:30,600 Speaker 2: can diversify into industries that are available in the US 65 00:03:30,720 --> 00:03:33,480 Speaker 2: that are not necessarily available here. We don't have much 66 00:03:33,480 --> 00:03:37,279 Speaker 2: heavy manufacturing in Australia, and those who want those more reliable, 67 00:03:37,640 --> 00:03:41,960 Speaker 2: income producing businesses that have steady earnings profiles and are 68 00:03:41,960 --> 00:03:45,720 Speaker 2: involved in heavy manufacturing, those opportunities to invest come in 69 00:03:45,760 --> 00:03:48,040 Speaker 2: the US rather than here in Australia. So it's that 70 00:03:48,200 --> 00:03:51,480 Speaker 2: opportunity to choose what you don't find in Australia that 71 00:03:51,560 --> 00:03:53,920 Speaker 2: makes looking at US stock so compelling. 72 00:03:54,880 --> 00:03:58,320 Speaker 1: What about research? How should investors be researching some of 73 00:03:58,360 --> 00:03:59,760 Speaker 1: these companies. 74 00:04:00,040 --> 00:04:01,840 Speaker 2: Well, there are plenty of good ways to do that 75 00:04:01,960 --> 00:04:05,880 Speaker 2: on the momou platform, depending on what the investor judges 76 00:04:05,920 --> 00:04:09,640 Speaker 2: stocks by. If it investor uses charts to judge the 77 00:04:09,640 --> 00:04:13,200 Speaker 2: best stocks, those tools are available on the website. Not 78 00:04:13,240 --> 00:04:15,800 Speaker 2: only do we have a very advanced chart pack, we 79 00:04:15,880 --> 00:04:19,159 Speaker 2: have hundreds of indicators that those who like charts to 80 00:04:19,240 --> 00:04:22,040 Speaker 2: choose their stocks in use, but those who prefer fundamental 81 00:04:22,080 --> 00:04:25,719 Speaker 2: analysis looking at the companies themselves, their balance sheets, their 82 00:04:25,720 --> 00:04:29,200 Speaker 2: cash flow statements. That data is also available, and if 83 00:04:29,240 --> 00:04:32,599 Speaker 2: you prefer the shortcuts off and by financial ratios like 84 00:04:32,680 --> 00:04:36,320 Speaker 2: the price to earnings ratio and dividend yields, you can 85 00:04:36,360 --> 00:04:39,000 Speaker 2: find those on the memou platform too. So it depends 86 00:04:39,200 --> 00:04:41,760 Speaker 2: what investors are looking for. But whatever it is they're 87 00:04:41,800 --> 00:04:44,520 Speaker 2: looking for and whatever method they use to choose their stocks, 88 00:04:44,760 --> 00:04:47,320 Speaker 2: it's available in the tools on the platform. 89 00:04:47,720 --> 00:04:49,719 Speaker 1: Stay with me, Michael will be back in a minute. 90 00:04:56,480 --> 00:05:00,800 Speaker 1: My guest this morning is Michael McCarthy from Mumour, So 91 00:05:00,839 --> 00:05:03,440 Speaker 1: tell us about riskless. There's a riskless way of training 92 00:05:03,440 --> 00:05:06,000 Speaker 1: on Mumu, which I don't believe to be honest with Michael. 93 00:05:06,120 --> 00:05:07,800 Speaker 1: How can anything be without risk? 94 00:05:08,440 --> 00:05:11,680 Speaker 2: Well, the reason that's without risk, Sean, is because the 95 00:05:11,760 --> 00:05:15,080 Speaker 2: rewards are all on paper, as are the losses. It's 96 00:05:15,120 --> 00:05:18,760 Speaker 2: called paper trading. It's a way of testing your theories 97 00:05:18,760 --> 00:05:21,240 Speaker 2: in the market, of testing the platform, of testing your 98 00:05:21,360 --> 00:05:25,280 Speaker 2: understanding of how orders work, without actually putting money at risk. 99 00:05:25,480 --> 00:05:28,560 Speaker 2: It's a virtual account, a play money account, and every 100 00:05:28,920 --> 00:05:32,440 Speaker 2: move We investor has one available to them. It's highly 101 00:05:32,480 --> 00:05:35,680 Speaker 2: recommend that investors going to a new market use the 102 00:05:35,760 --> 00:05:40,440 Speaker 2: paper trading facility to first of all, test their understanding 103 00:05:40,520 --> 00:05:42,240 Speaker 2: of what it is they're doing in the market and 104 00:05:42,320 --> 00:05:45,120 Speaker 2: test their theories to see if their investment approach is 105 00:05:45,200 --> 00:05:48,760 Speaker 2: working in the current market conditions. So using paper trading 106 00:05:49,000 --> 00:05:52,440 Speaker 2: is a key step in becoming accustomed to a new market, 107 00:05:52,560 --> 00:05:55,120 Speaker 2: and because of that, we partner with one of the 108 00:05:55,160 --> 00:05:58,320 Speaker 2: exchanges in the US, the Nasdaq Exchange, to offer regular 109 00:05:58,400 --> 00:06:01,640 Speaker 2: paper trading competitions so that investors can test their skills 110 00:06:01,640 --> 00:06:03,839 Speaker 2: not only in the market, but against each other. 111 00:06:04,520 --> 00:06:07,560 Speaker 1: So very much to try before you buy approach, Michael. 112 00:06:07,800 --> 00:06:10,599 Speaker 2: Very much. So try without risk. Of course you don't 113 00:06:10,640 --> 00:06:13,320 Speaker 2: get the rewards either, but try without risk so you 114 00:06:13,360 --> 00:06:14,320 Speaker 2: fully understand it. 115 00:06:14,640 --> 00:06:19,000 Speaker 1: Okay, once you have tried and you've decided that you 116 00:06:19,080 --> 00:06:22,440 Speaker 1: do want to invest, and you're looking at different stocks 117 00:06:22,440 --> 00:06:25,400 Speaker 1: to buy. We've talked about this before, but the idea 118 00:06:25,400 --> 00:06:28,239 Speaker 1: of stock screeners and the use of AIS to create 119 00:06:28,320 --> 00:06:32,400 Speaker 1: a portfolio that suits you or maybe even mimic some 120 00:06:32,440 --> 00:06:33,400 Speaker 1: of the greats. 121 00:06:33,560 --> 00:06:38,640 Speaker 2: Absolutely and so on the platform. We do use screeners extensively, 122 00:06:38,720 --> 00:06:41,839 Speaker 2: and once again, the screeners can be customized to however 123 00:06:42,080 --> 00:06:45,440 Speaker 2: an investor used the market. But investors don't have to 124 00:06:45,480 --> 00:06:48,240 Speaker 2: start with any knowledge. We have some pre made screeners 125 00:06:48,640 --> 00:06:51,680 Speaker 2: ready to go. Some of them focus on key investment 126 00:06:51,720 --> 00:06:56,480 Speaker 2: themes like income producing share portfolios or high growth stocks. 127 00:06:56,480 --> 00:06:59,039 Speaker 2: And if an investor is new to using a screen 128 00:06:59,080 --> 00:07:02,480 Speaker 2: and they can try these model screeners first to filter 129 00:07:02,560 --> 00:07:05,440 Speaker 2: stocks to find those that best fit what it is 130 00:07:05,480 --> 00:07:07,200 Speaker 2: they're looking for in a US stock. 131 00:07:07,839 --> 00:07:11,280 Speaker 1: Okay, what about the tax implications and all the bureaucracy 132 00:07:11,800 --> 00:07:15,000 Speaker 1: involved in it? How does that flow through when you're 133 00:07:15,000 --> 00:07:15,920 Speaker 1: investing in the US. 134 00:07:16,360 --> 00:07:19,000 Speaker 2: Well, I should be very clear, we don't provide tax 135 00:07:19,040 --> 00:07:22,640 Speaker 2: advice where an online trading platform, and investors should seek 136 00:07:22,680 --> 00:07:25,360 Speaker 2: advice if they have any doubts about the tax status. 137 00:07:25,440 --> 00:07:28,920 Speaker 2: But essentially, if you're an Australian in Australia, you are 138 00:07:29,000 --> 00:07:33,120 Speaker 2: trading from your home country and the tax implications are 139 00:07:33,280 --> 00:07:35,960 Speaker 2: almost exactly the same as if you were trading right 140 00:07:36,000 --> 00:07:36,800 Speaker 2: here in Australia. 141 00:07:37,640 --> 00:07:40,720 Speaker 1: Okay, So if I'm thinking about going to Wall Street, 142 00:07:40,800 --> 00:07:43,240 Speaker 1: I've decided I've tried before I buy it, I've looking 143 00:07:43,280 --> 00:07:47,760 Speaker 1: at some of these strategies. The fundamental reason why I 144 00:07:47,800 --> 00:07:51,520 Speaker 1: would go to Wall Street or the UK or European markets, 145 00:07:51,720 --> 00:07:54,640 Speaker 1: what is it? Is it? Because you kind of suggested 146 00:07:54,680 --> 00:07:57,400 Speaker 1: that when you're investing in Australian markets, you're very heavy 147 00:07:57,440 --> 00:08:01,280 Speaker 1: on banks, heavy on miners. Is it all aboutification, It's 148 00:08:01,360 --> 00:08:02,560 Speaker 1: a big part of it. 149 00:08:02,760 --> 00:08:06,000 Speaker 2: Diversification is a risk management tool available to all of this. 150 00:08:06,200 --> 00:08:09,680 Speaker 2: Whether we're fund manager investing tens of billions of dollars 151 00:08:09,760 --> 00:08:13,080 Speaker 2: or whether we're kicking off our investment Portfolilio with our 152 00:08:13,120 --> 00:08:17,960 Speaker 2: first thousand dollars, Diversification is a powerful risk management tool. 153 00:08:18,000 --> 00:08:22,280 Speaker 2: So the reasons for going to international markets sit directly 154 00:08:22,360 --> 00:08:25,440 Speaker 2: in the risk reward equation. The idea is to reduce 155 00:08:25,560 --> 00:08:28,840 Speaker 2: risk by spreading your investments around the globe and across 156 00:08:28,880 --> 00:08:32,719 Speaker 2: different industries, but also increase your chance of getting exposure 157 00:08:32,960 --> 00:08:35,520 Speaker 2: to the rewards that come with being in the right stocks. 158 00:08:35,760 --> 00:08:39,120 Speaker 2: Those magnificent seven tech stocks that everybody's talking about in 159 00:08:39,160 --> 00:08:42,040 Speaker 2: the US have accounted for half of the gains in 160 00:08:42,080 --> 00:08:44,800 Speaker 2: the US over the last two years for the whole market. 161 00:08:45,080 --> 00:08:47,680 Speaker 2: And so if you didn't own one of those seven stocks, 162 00:08:47,880 --> 00:08:49,880 Speaker 2: you might still have done well, you might still have 163 00:08:49,960 --> 00:08:52,000 Speaker 2: good returns, but you might have missed out on some 164 00:08:52,040 --> 00:08:57,040 Speaker 2: of the spectacular awards that come from catching global investment waves. 165 00:08:57,800 --> 00:09:00,000 Speaker 1: Okay, and so the people that are now shifting into 166 00:09:00,160 --> 00:09:04,120 Speaker 1: this global investment wave, and it will be on institutional investors. 167 00:09:04,120 --> 00:09:07,680 Speaker 1: It's high networth individuals, retailers, et cetera. Michael, I presume, 168 00:09:08,000 --> 00:09:08,880 Speaker 1: oh absolutely. 169 00:09:09,320 --> 00:09:12,679 Speaker 2: Some of our newest traders to the market prefer US stocks. 170 00:09:13,000 --> 00:09:16,240 Speaker 2: They favor particularly the highly liquid stocks, which mean that 171 00:09:16,280 --> 00:09:18,520 Speaker 2: they can get in and out very quickly. So it's 172 00:09:18,600 --> 00:09:22,160 Speaker 2: not just people looking at the long term and creating portfolios. 173 00:09:22,640 --> 00:09:25,760 Speaker 2: There's also opportunities for those who take different approaches to 174 00:09:25,840 --> 00:09:28,520 Speaker 2: the market. And whether you're a nimble day trader looking 175 00:09:28,559 --> 00:09:30,320 Speaker 2: to get in and out regularly over the course of 176 00:09:30,360 --> 00:09:33,840 Speaker 2: the session, or buying for the months or years ahead, 177 00:09:34,200 --> 00:09:38,199 Speaker 2: the opportunities are multiplied when we consider US stocks. 178 00:09:38,760 --> 00:09:41,000 Speaker 1: It's exciting. Michael, thank you for talking to Fear and Greed. 179 00:09:41,320 --> 00:09:42,080 Speaker 2: Thanks very much. 180 00:09:42,480 --> 00:09:45,120 Speaker 1: That was Michael McCarthy from mumou, a great supporter of 181 00:09:45,120 --> 00:09:48,720 Speaker 1: this podcast. For more information on the mumu platform, follow 182 00:09:48,720 --> 00:09:51,640 Speaker 1: the link in today's show notes for this interview. Remember 183 00:09:51,920 --> 00:09:54,680 Speaker 1: information in this podcast is general in nature. You should 184 00:09:54,679 --> 00:09:57,679 Speaker 1: get professional advice, including tax advice, and make sure a 185 00:09:57,760 --> 00:10:00,800 Speaker 1: product is right for you before proceeding. This is the 186 00:10:00,880 --> 00:10:03,280 Speaker 1: Fear and Greed Business Interview. Join us every morning for 187 00:10:03,280 --> 00:10:05,880 Speaker 1: the full episode of Fear and Greed. Daily business years 188 00:10:05,880 --> 00:10:08,520 Speaker 1: for people who make their own decisions. I'm Sean Elmer. 189 00:10:08,880 --> 00:10:10,760 Speaker 1: Enjoy your day.