1 00:00:09,880 --> 00:00:13,320 Speaker 1: Hello and welcome to The Australian's Money Puzzle podcast. I'm 2 00:00:13,400 --> 00:00:17,440 Speaker 1: James Kirby. Welcome aboard everybody to a special edition of 3 00:00:17,480 --> 00:00:20,600 Speaker 1: the show. You may know I've been associated with the 4 00:00:20,720 --> 00:00:24,840 Speaker 1: Top one hundred and fifty Barons Financial Advisor's List, which 5 00:00:24,880 --> 00:00:27,840 Speaker 1: is produced by us at The Australian in conjunction with 6 00:00:27,920 --> 00:00:31,840 Speaker 1: Barons of New York. Well, it's out today and this year, 7 00:00:32,280 --> 00:00:35,839 Speaker 1: this year we have a new number one financial advisor 8 00:00:35,880 --> 00:00:38,160 Speaker 1: in Australia which is a big deal. I'll tell you why, 9 00:00:38,560 --> 00:00:42,199 Speaker 1: because there hasn't been a new number one for five years. 10 00:00:42,880 --> 00:00:46,920 Speaker 1: And it is Matthew Cassidy of the Partner's Wealth Group 11 00:00:47,040 --> 00:00:50,160 Speaker 1: and I've got him on the show him, Matthew, how are. 12 00:00:50,080 --> 00:00:52,720 Speaker 2: You very well? Thank you, James, I'm very good morning. 13 00:00:53,280 --> 00:00:55,120 Speaker 1: Great to have you on. Matthew has been on the 14 00:00:55,120 --> 00:00:57,920 Speaker 1: show before, folks, so it's good to have him as regular. 15 00:00:57,960 --> 00:01:00,920 Speaker 1: Best we know him on the show and he is 16 00:01:01,080 --> 00:01:04,319 Speaker 1: obviously both a top advisor but very good on the 17 00:01:04,319 --> 00:01:05,319 Speaker 1: big picture as well. 18 00:01:05,680 --> 00:01:06,080 Speaker 2: Matthew. 19 00:01:06,160 --> 00:01:08,720 Speaker 1: I mean, I just did a lot of work this 20 00:01:08,760 --> 00:01:11,959 Speaker 1: time of the year on the whole advisory scene and 21 00:01:13,319 --> 00:01:15,080 Speaker 1: a couple of things I wanted to ask you, but 22 00:01:15,200 --> 00:01:17,200 Speaker 1: just quickly, just for the listeners, and you know, if 23 00:01:17,200 --> 00:01:19,959 Speaker 1: you're not across this stuff, you know, financial advisors basically 24 00:01:20,000 --> 00:01:22,880 Speaker 1: there was fifteen thousand of them left in Australia. There 25 00:01:22,880 --> 00:01:26,520 Speaker 1: was about thirty ten years ago or so. That's the 26 00:01:26,560 --> 00:01:31,000 Speaker 1: first sort of big piece of news. The second major 27 00:01:31,840 --> 00:01:35,320 Speaker 1: change in the industry is apart from the fact that 28 00:01:35,360 --> 00:01:39,280 Speaker 1: they've become very expensive and even an ordinary every day 29 00:01:39,319 --> 00:01:42,839 Speaker 1: around the corner suburban advisor will cost you maybe three 30 00:01:42,880 --> 00:01:46,360 Speaker 1: and a half thousand dollars a year. But apart from that, 31 00:01:46,400 --> 00:01:50,440 Speaker 1: there's also been something of a split where people like 32 00:01:50,560 --> 00:01:54,320 Speaker 1: Matthew at his partner's wealth group and other groups they have, 33 00:01:54,560 --> 00:01:57,120 Speaker 1: they're very much sort of sailed off into a sort 34 00:01:57,120 --> 00:01:59,920 Speaker 1: of a league of their own. And then there is 35 00:02:01,080 --> 00:02:03,880 Speaker 1: a gap, I suppose for in the market, and that's 36 00:02:03,920 --> 00:02:06,720 Speaker 1: something that I would probably talk about. But Matthew, so 37 00:02:06,840 --> 00:02:09,560 Speaker 1: think the first things first, you know, I want to 38 00:02:09,560 --> 00:02:14,760 Speaker 1: ask you, what can people reasonably expect from an advisor? 39 00:02:15,080 --> 00:02:18,320 Speaker 1: And I'm thinking about top advisors, not just you, but 40 00:02:18,360 --> 00:02:21,080 Speaker 1: that's that whole sort of corehort that's on the group. 41 00:02:21,639 --> 00:02:26,400 Speaker 1: What do you do that's above and beyond what might 42 00:02:26,440 --> 00:02:30,440 Speaker 1: be reasonably expected. How come people like you wrapped up 43 00:02:30,480 --> 00:02:32,320 Speaker 1: to the top of this list. 44 00:02:33,480 --> 00:02:38,239 Speaker 3: So having a financial advisor is a dedicated financial professional. 45 00:02:38,320 --> 00:02:41,560 Speaker 3: I was seeing all components of your financial wellbeing for 46 00:02:41,600 --> 00:02:45,679 Speaker 3: yourself and your family. I think that also gives consideration 47 00:02:45,880 --> 00:02:50,720 Speaker 3: to your other broader business interests over the last you know, 48 00:02:50,720 --> 00:02:52,840 Speaker 3: I've been in this industry for twenty five years, and 49 00:02:53,639 --> 00:02:56,519 Speaker 3: the industry today to what it was when I first entered, 50 00:02:56,560 --> 00:02:59,360 Speaker 3: looks materially different, and the service offering that we have 51 00:02:59,520 --> 00:03:04,720 Speaker 3: is also materially different. The Australia, in terms of its 52 00:03:04,720 --> 00:03:09,200 Speaker 3: tax regime for accumulating wealth is complex on a world scale. 53 00:03:09,440 --> 00:03:11,440 Speaker 3: Last week I was in Singapore speaking with some wealth 54 00:03:11,480 --> 00:03:14,120 Speaker 3: management firms, and certainly in the US as well, it is. 55 00:03:14,040 --> 00:03:15,799 Speaker 2: Not as complex as it is in Australia. 56 00:03:15,840 --> 00:03:18,680 Speaker 3: And the questions that we think about when we sit 57 00:03:18,720 --> 00:03:22,359 Speaker 3: down with clients is not simply what do we do 58 00:03:22,440 --> 00:03:25,840 Speaker 3: to invest your capital? But it gives consideration to components 59 00:03:25,919 --> 00:03:30,920 Speaker 3: like tax structural advice. We work alongside fifty plus accounting firms. 60 00:03:31,600 --> 00:03:34,600 Speaker 3: We try to ensure we incorporate the tax structural side 61 00:03:34,600 --> 00:03:39,040 Speaker 3: into what we do with our accounting partners. Retirement planning, investment, 62 00:03:39,080 --> 00:03:43,360 Speaker 3: advice including private markets, insurance advice, legal services including a 63 00:03:43,400 --> 00:03:47,840 Speaker 3: state planning, lending, family office and subfamily office. So to me, 64 00:03:48,040 --> 00:03:53,200 Speaker 3: what a top advisor will do is collaborate amongst our 65 00:03:53,240 --> 00:03:56,360 Speaker 3: broader team of professionals within the business that all have 66 00:03:56,600 --> 00:03:59,360 Speaker 3: certain areas of expertise, and together they're much stronger. And 67 00:03:59,440 --> 00:04:01,800 Speaker 3: we've got to catch cry within our business Strugma together. 68 00:04:01,880 --> 00:04:04,920 Speaker 3: And the twenty three year journey of being an advisor 69 00:04:04,960 --> 00:04:07,480 Speaker 3: as well has certainly or twenty three years within partner's 70 00:04:07,480 --> 00:04:09,920 Speaker 3: wealth group has certainly taught me a lot. And I'll 71 00:04:09,920 --> 00:04:11,960 Speaker 3: probably share this term with you before you know, success 72 00:04:12,080 --> 00:04:13,760 Speaker 3: leaves clues over a long period of time, and I 73 00:04:13,760 --> 00:04:14,760 Speaker 3: think if you can learn off. 74 00:04:14,600 --> 00:04:19,479 Speaker 1: Those, yes, tell me about this complexity on an international 75 00:04:19,520 --> 00:04:23,600 Speaker 1: scared does it hamper does it hamper wealth ACU relation? 76 00:04:23,720 --> 00:04:26,039 Speaker 1: Does it hold people back across the board that we 77 00:04:26,120 --> 00:04:29,440 Speaker 1: have such an enormously complex system, particularly obviously in relation 78 00:04:29,560 --> 00:04:31,200 Speaker 1: to super I. 79 00:04:31,160 --> 00:04:34,760 Speaker 3: Think at times when people are very busy running their families, 80 00:04:34,839 --> 00:04:37,360 Speaker 3: running their life, running a business, to then have some 81 00:04:37,440 --> 00:04:41,159 Speaker 3: dedicated time to focus on their wealth plan. 82 00:04:41,520 --> 00:04:44,080 Speaker 2: When it is complex, I think create some friction. 83 00:04:44,320 --> 00:04:48,359 Speaker 3: So we encourage people to engage with an advisor to 84 00:04:48,400 --> 00:04:51,760 Speaker 3: try to understand where they are, where they're getting to, 85 00:04:51,920 --> 00:04:54,080 Speaker 3: and what are some strategies to actually help them improve 86 00:04:54,120 --> 00:04:57,560 Speaker 3: their situation. And I think the encouraging part of what 87 00:04:57,600 --> 00:05:00,400 Speaker 3: we do every day is to really give clients sights 88 00:05:00,760 --> 00:05:03,440 Speaker 3: and their families clarity about where they sit, where they 89 00:05:03,480 --> 00:05:06,600 Speaker 3: can head to, and help unbundle some of the complexity 90 00:05:06,640 --> 00:05:10,200 Speaker 3: with the tax structures, because you know, you don't need 91 00:05:10,200 --> 00:05:10,919 Speaker 3: the friction with this. 92 00:05:11,040 --> 00:05:12,039 Speaker 2: You need a clear path. 93 00:05:12,160 --> 00:05:14,880 Speaker 3: And we all know that when you've got less friction 94 00:05:14,920 --> 00:05:16,560 Speaker 3: in your own mind about where you're heading, it does 95 00:05:16,600 --> 00:05:18,480 Speaker 3: give you the opportunity to focus on what you do best, 96 00:05:18,520 --> 00:05:20,479 Speaker 3: which is running your family, running your career, and being 97 00:05:20,480 --> 00:05:22,560 Speaker 3: successful in your own right, which is one thing we're 98 00:05:22,600 --> 00:05:23,680 Speaker 3: extremely passionate about. 99 00:05:24,520 --> 00:05:27,360 Speaker 1: So I'm guessing when you were listing there what you do. 100 00:05:29,000 --> 00:05:31,839 Speaker 1: I'm assuming what you're telling me is that you do 101 00:05:31,920 --> 00:05:34,039 Speaker 1: a lot more. I mean you charge more, but you 102 00:05:34,120 --> 00:05:36,320 Speaker 1: do a lot more. So at your level, it's not 103 00:05:37,279 --> 00:05:41,560 Speaker 1: quarterly call. It's quite a thorough and it can run 104 00:05:42,040 --> 00:05:45,800 Speaker 1: right across I presume it runs across every aspect of life, 105 00:05:45,800 --> 00:05:50,560 Speaker 1: from a financial life, I mean from property to wills estates, 106 00:05:50,600 --> 00:05:54,240 Speaker 1: but active management shares the balance of your portfolio. 107 00:05:54,600 --> 00:05:55,400 Speaker 2: How deep does it go? 108 00:05:55,560 --> 00:05:58,040 Speaker 1: Do you like to suggest schools to people? 109 00:05:59,440 --> 00:06:00,440 Speaker 2: It is real broad. 110 00:06:00,480 --> 00:06:02,880 Speaker 3: I think you know, while your role and your engagement 111 00:06:03,080 --> 00:06:05,800 Speaker 3: is often around their financial affairs, if you're fully invested 112 00:06:05,800 --> 00:06:08,080 Speaker 3: in the relationship, you really use your contacts to solve 113 00:06:08,120 --> 00:06:11,520 Speaker 3: any issues you've got within within a family situation. And 114 00:06:12,040 --> 00:06:14,880 Speaker 3: in this last year, I've referred people to medical professionals 115 00:06:14,880 --> 00:06:18,240 Speaker 3: for surgery because they've had ailments. I've dealt with getting 116 00:06:18,480 --> 00:06:22,159 Speaker 3: psychologists involved for family issues. We've dealt with trying to 117 00:06:22,200 --> 00:06:26,280 Speaker 3: help younger members of their family in financial literacy. And 118 00:06:26,520 --> 00:06:30,000 Speaker 3: you know it's helping clients with travel agents, it could 119 00:06:30,000 --> 00:06:33,200 Speaker 3: be involved buying property, attending options for them. 120 00:06:33,560 --> 00:06:35,760 Speaker 2: I think if you're you know when we always. 121 00:06:35,440 --> 00:06:37,240 Speaker 3: Say that we're all in on a client scenario, and 122 00:06:37,279 --> 00:06:40,000 Speaker 3: I think if you're all in and you understand there 123 00:06:40,360 --> 00:06:42,280 Speaker 3: and you use your expertise to benefit the family, I 124 00:06:42,320 --> 00:06:44,560 Speaker 3: think that can be incredibly powerful. So it's like you 125 00:06:44,640 --> 00:06:47,120 Speaker 3: paid to do role A, but it so often roll 126 00:06:47,200 --> 00:06:49,520 Speaker 3: BC and do the clients really value And I think 127 00:06:49,520 --> 00:06:51,440 Speaker 3: if you can show that you're all in a relationship, 128 00:06:51,680 --> 00:06:53,919 Speaker 3: you do become an extended part of the family to 129 00:06:53,920 --> 00:06:56,880 Speaker 3: help them navigate and enjoy life. And I think a 130 00:06:56,960 --> 00:06:59,520 Speaker 3: key part of wealth is getting to the stage directs 131 00:06:59,520 --> 00:07:01,600 Speaker 3: you can enjoy your life and not be bogged down 132 00:07:01,600 --> 00:07:04,040 Speaker 3: by the complexity. And I think that's a nice challenge 133 00:07:04,040 --> 00:07:06,320 Speaker 3: for everyone to get to to ensure that when they're 134 00:07:06,360 --> 00:07:09,320 Speaker 3: overseas or they're enjoying their their prosperity, that they're not 135 00:07:09,320 --> 00:07:11,120 Speaker 3: concerned about the things and they can leave the worry 136 00:07:11,200 --> 00:07:13,080 Speaker 3: to some other parties that they trust to do that. 137 00:07:13,600 --> 00:07:15,800 Speaker 1: What about the limits of what you do that I 138 00:07:15,840 --> 00:07:17,520 Speaker 1: presume there's a point of which you hit a limit. 139 00:07:17,560 --> 00:07:20,080 Speaker 1: You're talking about families for instance. I mean if a 140 00:07:20,120 --> 00:07:23,080 Speaker 1: brother and sister simply hate each other and they get 141 00:07:23,120 --> 00:07:26,160 Speaker 1: on over nothing and their fate all the time, and 142 00:07:26,200 --> 00:07:28,480 Speaker 1: they're sitting around the table talking about what they're going 143 00:07:28,480 --> 00:07:30,640 Speaker 1: to invest in, it must be difficult. 144 00:07:31,920 --> 00:07:34,880 Speaker 3: Well, there's always some challenges and some difficulties, and that's 145 00:07:34,920 --> 00:07:37,600 Speaker 3: obviously not pleasant when you say those playing out. 146 00:07:37,880 --> 00:07:40,840 Speaker 2: I think the key thing is you also need to stay. 147 00:07:40,600 --> 00:07:42,840 Speaker 3: In your lane regarding what you do well, but also 148 00:07:42,920 --> 00:07:45,640 Speaker 3: refer out to other areas of advice that you believe 149 00:07:45,680 --> 00:07:49,080 Speaker 3: other experts have got capability. In an example of that 150 00:07:49,320 --> 00:07:52,880 Speaker 3: is a state planning where you know, taking care of 151 00:07:52,960 --> 00:07:56,120 Speaker 3: intergenerational wealth and thinking about issues more broadly for the 152 00:07:56,200 --> 00:08:00,920 Speaker 3: family is a really specialized area. It goes beyond having 153 00:08:00,960 --> 00:08:03,200 Speaker 3: powers of attorney and a state plan in place. It's 154 00:08:03,240 --> 00:08:05,800 Speaker 3: thinking about the complexity of families. It could be thinking 155 00:08:05,800 --> 00:08:09,440 Speaker 3: about God forbid of anything happens to the mum and dad, 156 00:08:09,480 --> 00:08:11,320 Speaker 3: who's going to take care of the kids into the future. 157 00:08:11,320 --> 00:08:12,600 Speaker 3: Are they going to stay in the family home or 158 00:08:12,600 --> 00:08:14,800 Speaker 3: are they not? How do we think about education for them? 159 00:08:14,800 --> 00:08:17,560 Speaker 3: And so I think therese highly specialized areas. You need 160 00:08:17,600 --> 00:08:21,280 Speaker 3: to have strong relationships, have you within partner's wealth group 161 00:08:21,280 --> 00:08:24,720 Speaker 3: as we really have that capability inside the firm again 162 00:08:25,520 --> 00:08:27,840 Speaker 3: twenty three plus years to do that. But the ability 163 00:08:27,840 --> 00:08:30,080 Speaker 3: for people to come into our firm and have that 164 00:08:30,160 --> 00:08:32,800 Speaker 3: professional a plug and play into the advised conversation we 165 00:08:32,880 --> 00:08:36,960 Speaker 3: find incredibly powerful. And particularly with the more complex families 166 00:08:36,960 --> 00:08:39,160 Speaker 3: that we have that have broader needs, the ability to 167 00:08:39,200 --> 00:08:41,520 Speaker 3: come in here and have one conversation and then they 168 00:08:41,559 --> 00:08:45,599 Speaker 3: have their key advisor to organize those various engagements I 169 00:08:45,600 --> 00:08:46,800 Speaker 3: think is incredibly powerful. 170 00:08:47,320 --> 00:08:50,640 Speaker 1: There are many more I mean literally, there are more 171 00:08:50,679 --> 00:08:54,120 Speaker 1: people in Australia every year. But more to the point, 172 00:08:54,679 --> 00:08:58,520 Speaker 1: there is also as you mentioned, intergeneration with there is 173 00:08:59,000 --> 00:09:02,360 Speaker 1: an enormous chance fare of wealth due to happen. I mean, 174 00:09:02,440 --> 00:09:05,880 Speaker 1: it always happens, but there is this particular occasion due 175 00:09:05,880 --> 00:09:09,400 Speaker 1: to the useful sort of per capita high levels of 176 00:09:09,440 --> 00:09:13,720 Speaker 1: per capita wealth in Australia and lucrative and market a 177 00:09:13,840 --> 00:09:18,440 Speaker 1: really big attractive market for financial advice out there with 178 00:09:18,600 --> 00:09:22,720 Speaker 1: lots of demand. But the industry that you're in has 179 00:09:22,760 --> 00:09:26,440 Speaker 1: actually shrunk. It's going nowhere in terms of its number 180 00:09:26,440 --> 00:09:28,960 Speaker 1: of people who are in it. If you do recruits 181 00:09:29,040 --> 00:09:32,560 Speaker 1: very few passages through into it. Did you expect that 182 00:09:32,600 --> 00:09:35,320 Speaker 1: to happen? And do you think there is anything that 183 00:09:35,360 --> 00:09:36,440 Speaker 1: could change that. 184 00:09:38,320 --> 00:09:40,280 Speaker 3: I think there's been a huge change over the last 185 00:09:40,360 --> 00:09:42,880 Speaker 3: seven or eight years with the professionalism within the industry, 186 00:09:42,880 --> 00:09:45,040 Speaker 3: and I think that is fantastic. You know, from the 187 00:09:45,040 --> 00:09:47,520 Speaker 3: industry I entered twenty five years ago to what it 188 00:09:47,600 --> 00:09:51,480 Speaker 3: is like, it's chalk and chose, and I think they added, 189 00:09:51,640 --> 00:09:54,840 Speaker 3: you know, the added professionalism and the added legislative overside 190 00:09:54,840 --> 00:09:57,439 Speaker 3: of the industry I think is just essential. Statistic I 191 00:09:57,520 --> 00:10:00,719 Speaker 3: recently heard is that the Australians superannuation system is now 192 00:10:00,760 --> 00:10:03,959 Speaker 3: four trillion dollars, it's growing to ten trillion dollars by 193 00:10:04,000 --> 00:10:06,880 Speaker 3: twenty forty and the current size of the superannuation market 194 00:10:06,960 --> 00:10:11,320 Speaker 3: is above the israil banking system. Yet the regulation still 195 00:10:11,320 --> 00:10:13,840 Speaker 3: has some catch up to do, so you know, safeguard 196 00:10:13,840 --> 00:10:16,400 Speaker 3: to Purple's well being, I think is really important. But 197 00:10:16,559 --> 00:10:19,199 Speaker 3: I think the important thing for wealth management professionals simply 198 00:10:19,440 --> 00:10:22,480 Speaker 3: running businesses is to reinvest in the talent within the 199 00:10:22,480 --> 00:10:24,839 Speaker 3: business and do things like a professional year to make 200 00:10:24,840 --> 00:10:27,920 Speaker 3: sure that you can give guidance to younger people in 201 00:10:27,960 --> 00:10:30,079 Speaker 3: the industry, give them a career. And I think the 202 00:10:30,880 --> 00:10:33,840 Speaker 3: forward looking firms are making big investments into those areas 203 00:10:33,880 --> 00:10:37,079 Speaker 3: to really develop the talent and really have that talent 204 00:10:37,120 --> 00:10:40,760 Speaker 3: emerging over the coming years into being financial professionals. I 205 00:10:40,800 --> 00:10:44,439 Speaker 3: guess the challenge is the cost of advice is also 206 00:10:44,640 --> 00:10:47,520 Speaker 3: materially increased, and I saw your article this morning in 207 00:10:47,559 --> 00:10:50,720 Speaker 3: the newspaper about AI and impact that's making as well. 208 00:10:50,760 --> 00:10:54,000 Speaker 3: And I think what advisors love is being in front 209 00:10:54,000 --> 00:10:56,840 Speaker 3: of clients, but clearly there's been an increase in the 210 00:10:56,840 --> 00:10:58,640 Speaker 3: cost of advice and some of the regulations. So I 211 00:10:58,640 --> 00:11:01,080 Speaker 3: think we're all working through the ability to do what 212 00:11:01,120 --> 00:11:02,760 Speaker 3: we do best, which is sit in front of clients 213 00:11:02,760 --> 00:11:04,040 Speaker 3: and solve problems for them. 214 00:11:05,840 --> 00:11:09,400 Speaker 1: So the thing is that the numbers have changed. Right, 215 00:11:09,440 --> 00:11:12,520 Speaker 1: It's literally quite difficult to get into an advisor now, right, 216 00:11:12,520 --> 00:11:15,360 Speaker 1: and I presume by definition it's more difficult to get 217 00:11:15,360 --> 00:11:18,320 Speaker 1: into a good one. And you were saying like you're 218 00:11:18,360 --> 00:11:20,720 Speaker 1: basically thaking less is more, and I'm sure that was 219 00:11:20,720 --> 00:11:22,480 Speaker 1: true to a point, right. So there was a lot 220 00:11:22,480 --> 00:11:26,320 Speaker 1: of there was a lot of bad operators in financial advice. 221 00:11:26,360 --> 00:11:27,720 Speaker 1: There's a lot of people who were de fact or 222 00:11:27,760 --> 00:11:31,760 Speaker 1: salespeople who were posing virtually as advisors and so shrunk 223 00:11:31,880 --> 00:11:34,120 Speaker 1: very severely. No profession has been cut in half like 224 00:11:34,160 --> 00:11:36,959 Speaker 1: we've seen, but it needs to grow now. I would think, 225 00:11:37,040 --> 00:11:38,920 Speaker 1: is there anything that can happen that would make it 226 00:11:38,960 --> 00:11:40,400 Speaker 1: more accessible to more people? 227 00:11:41,880 --> 00:11:44,640 Speaker 3: You know, the concept of robo advice, you know, I 228 00:11:44,640 --> 00:11:47,040 Speaker 3: think it hasn't had a lot of traction in Australia 229 00:11:47,040 --> 00:11:49,800 Speaker 3: to day. It's been I think it's been extremely complex 230 00:11:49,800 --> 00:11:53,800 Speaker 3: for any business to scale robo advice. I've seen last 231 00:11:53,800 --> 00:11:55,960 Speaker 3: week in Singapore, I saw a really smart operation. There 232 00:11:56,040 --> 00:11:58,080 Speaker 3: was a firm about five years ago I saw in 233 00:11:58,080 --> 00:12:00,720 Speaker 3: the US doing this really effectively. I'm just not quite 234 00:12:00,720 --> 00:12:04,360 Speaker 3: sure the technology has been available to scale robo advice 235 00:12:04,400 --> 00:12:08,520 Speaker 3: within Australia. But you know, financial educational literacy I think 236 00:12:08,640 --> 00:12:11,600 Speaker 3: is an absolute key, a key part of us financial 237 00:12:11,640 --> 00:12:14,440 Speaker 3: professionals need to do. And having some understanding an earlier 238 00:12:14,480 --> 00:12:16,920 Speaker 3: stage about how you navigate this area, how you make 239 00:12:17,080 --> 00:12:19,680 Speaker 3: us start in a really secure way, I think is important. 240 00:12:19,760 --> 00:12:22,560 Speaker 3: So I think that robo advice and digital advice at 241 00:12:22,559 --> 00:12:26,040 Speaker 3: the introductory level will emerge. I think it's necessary because 242 00:12:26,160 --> 00:12:29,000 Speaker 3: you know, the cost of engaging with advice has increased 243 00:12:29,000 --> 00:12:31,720 Speaker 3: probably thirty percent over the last two or three years, 244 00:12:31,840 --> 00:12:34,520 Speaker 3: and therefore, you know, businesses are needing to charge increased 245 00:12:34,520 --> 00:12:36,600 Speaker 3: prices to navigate those increased costs. 246 00:12:37,080 --> 00:12:38,640 Speaker 1: One last question before we go to the break, and 247 00:12:38,679 --> 00:12:40,319 Speaker 1: then we will move on to what I know people 248 00:12:40,400 --> 00:12:44,439 Speaker 1: will really enjoy, which is basically the having you having 249 00:12:44,480 --> 00:12:47,559 Speaker 1: access to you through the show. You talked about financial literacy. 250 00:12:47,640 --> 00:12:51,080 Speaker 1: It is really important. In the UK they've just introduced 251 00:12:51,520 --> 00:12:56,120 Speaker 1: compulsory financial literacy in schools. In New Zealand they've introduced 252 00:12:56,120 --> 00:12:59,000 Speaker 1: it to the core curriculum. In Australia, we have actually 253 00:12:59,040 --> 00:13:02,439 Speaker 1: fallen behind on all we see D scores. We were 254 00:13:02,520 --> 00:13:04,520 Speaker 1: higher a few years ago. Do you think it should 255 00:13:04,600 --> 00:13:06,080 Speaker 1: be in the school system. 256 00:13:07,400 --> 00:13:09,320 Speaker 2: I would strongly encourage that. 257 00:13:09,480 --> 00:13:13,320 Speaker 3: You know, the average person starts work, they start earning 258 00:13:13,320 --> 00:13:16,320 Speaker 3: an income, and you know that they start thinking about 259 00:13:16,400 --> 00:13:17,000 Speaker 3: what do I do? 260 00:13:17,080 --> 00:13:18,839 Speaker 2: You know, how do I navigate this? How do I 261 00:13:18,880 --> 00:13:19,360 Speaker 2: get ahead? 262 00:13:19,400 --> 00:13:21,560 Speaker 3: And you know, one of the one of the big 263 00:13:21,720 --> 00:13:23,880 Speaker 3: themes that's still a major issue in the capital cities 264 00:13:23,880 --> 00:13:26,679 Speaker 3: around Australia is the multiple of annual income to a 265 00:13:26,760 --> 00:13:30,439 Speaker 3: quiet property within twenty of the major cities. You know, 266 00:13:30,480 --> 00:13:32,920 Speaker 3: that is a major problem that unless you've got the 267 00:13:32,960 --> 00:13:35,680 Speaker 3: Bank of Mamma data assisting you with that. You listen 268 00:13:35,679 --> 00:13:37,920 Speaker 3: to one of your great podcasts on that issue, is 269 00:13:37,920 --> 00:13:40,440 Speaker 3: that it's really challenging. So how do you actually get 270 00:13:40,480 --> 00:13:43,280 Speaker 3: ahead and how do you start making some positive impacts 271 00:13:43,280 --> 00:13:45,680 Speaker 3: on that? And we do know that I think Warren 272 00:13:45,679 --> 00:13:47,360 Speaker 3: Buffett calls it the eighth wonder of the world, that 273 00:13:47,600 --> 00:13:50,040 Speaker 3: the power of compound interest over time really helps you 274 00:13:50,240 --> 00:13:52,800 Speaker 3: to navigate that. So the earlier start, the better, and 275 00:13:52,840 --> 00:13:55,439 Speaker 3: I think getting into the market and getting investing in 276 00:13:55,480 --> 00:13:56,840 Speaker 3: an early age is the key to that. 277 00:13:57,080 --> 00:14:00,880 Speaker 1: Okay, I suppose parts of horn Bullets compounding is that 278 00:14:00,920 --> 00:14:03,439 Speaker 1: he lives so long so live a long time is 279 00:14:03,559 --> 00:14:06,120 Speaker 1: very good too, isn't it? Which you find not the 280 00:14:06,160 --> 00:14:08,640 Speaker 1: advisors by the way, folks, but you look at the 281 00:14:08,720 --> 00:14:10,560 Speaker 1: rich list and the average age. Let me tell you 282 00:14:11,000 --> 00:14:13,480 Speaker 1: that comes that living a long time is a key 283 00:14:13,480 --> 00:14:15,360 Speaker 1: part of it. Okay, we are going to talk to 284 00:14:15,400 --> 00:14:19,080 Speaker 1: Matthew about what's going on in investing in a moment. 285 00:14:19,160 --> 00:14:30,400 Speaker 1: Back in a second. Hello, and welcome back to the 286 00:14:30,400 --> 00:14:33,720 Speaker 1: Australian's Money Puzzle podcast. I'm James Kirby and I'm talking 287 00:14:33,760 --> 00:14:38,240 Speaker 1: to Matthew Cassidy, the newly crowned top advisor in Australia, 288 00:14:38,320 --> 00:14:41,120 Speaker 1: number one on the one hundred and fifty Baron's Top 289 00:14:41,200 --> 00:14:44,040 Speaker 1: one fifty list of the Partner's Wealth group and you 290 00:14:44,200 --> 00:14:49,720 Speaker 1: and your colleague Robert Hand there at number five. And 291 00:14:49,840 --> 00:14:54,720 Speaker 1: to see the group being so well represented. Now as 292 00:14:54,760 --> 00:14:57,040 Speaker 1: I speak, I want to I don't want to get 293 00:14:57,080 --> 00:15:01,440 Speaker 1: too into the thickets too quickly, but but many people 294 00:15:01,480 --> 00:15:04,600 Speaker 1: believe we're at the upper end of I think very 295 00:15:04,640 --> 00:15:07,480 Speaker 1: broadly now in terms of how investing has changed and 296 00:15:07,520 --> 00:15:12,080 Speaker 1: how people approach investing. Passive investing and dtfs have become 297 00:15:12,200 --> 00:15:14,920 Speaker 1: really big of recent times, and a lot of people 298 00:15:15,960 --> 00:15:19,320 Speaker 1: have been very comfortable and had met good money in 299 00:15:19,360 --> 00:15:22,000 Speaker 1: recent years because the markets have been so good, and 300 00:15:22,200 --> 00:15:24,320 Speaker 1: to some extent that means I won't say you don't 301 00:15:24,320 --> 00:15:27,320 Speaker 1: need a financial advisor, but you could do quite well 302 00:15:27,320 --> 00:15:30,200 Speaker 1: with no advice in recent times because in the bull market, 303 00:15:30,400 --> 00:15:34,280 Speaker 1: you know, all mistakes are concealed and everybody does okay. Now, 304 00:15:35,160 --> 00:15:38,120 Speaker 1: in a separate role, I'm on an investment committee and 305 00:15:38,160 --> 00:15:42,560 Speaker 1: we had a presentation from a highly ranked investment manager 306 00:15:42,600 --> 00:15:45,080 Speaker 1: of which you would sit through many, I'm sure, but 307 00:15:45,240 --> 00:15:48,840 Speaker 1: their point was that this is the top of a bullmarket. 308 00:15:48,880 --> 00:15:51,720 Speaker 1: We don't know when it ends, but from here we 309 00:15:51,800 --> 00:15:57,960 Speaker 1: may have a much tougher, more volatile, more challenging market ahead. Similarly, 310 00:15:58,080 --> 00:16:02,360 Speaker 1: Raphael ant Of aren't of the Future Fund surprised? I 311 00:16:02,360 --> 00:16:05,520 Speaker 1: think many people this week talking about how the Future 312 00:16:05,520 --> 00:16:08,560 Speaker 1: Fund is expecting more volativity, how the Future Fund is 313 00:16:08,600 --> 00:16:11,800 Speaker 1: actually moving away from passive income to some extent and 314 00:16:11,840 --> 00:16:14,640 Speaker 1: going back into active and going into gold. On top 315 00:16:14,680 --> 00:16:17,480 Speaker 1: of all that, where do you think the passive investment? 316 00:16:17,640 --> 00:16:19,280 Speaker 1: What do you think of that whole contention I've put 317 00:16:19,280 --> 00:16:22,320 Speaker 1: in front of you, that ETFs and passive income allows 318 00:16:22,360 --> 00:16:24,200 Speaker 1: people to operate without advice. 319 00:16:27,320 --> 00:16:29,200 Speaker 2: You know, passive versus active. 320 00:16:29,440 --> 00:16:32,480 Speaker 3: I think when we give consideration to what your game plan, 321 00:16:32,520 --> 00:16:35,240 Speaker 3: your strategy is, it's got to come down ultimately to 322 00:16:36,080 --> 00:16:39,800 Speaker 3: your strategy, your time frame for investing. And I think 323 00:16:39,800 --> 00:16:42,000 Speaker 3: this is where an individual advisor or an advisor can 324 00:16:42,040 --> 00:16:45,120 Speaker 3: assist with the family we're referring to sort of Warren Buffert, 325 00:16:45,200 --> 00:16:48,520 Speaker 3: Berkshire Hathaway. I've been across there on three occasions more 326 00:16:48,680 --> 00:16:50,640 Speaker 3: than the team think twenty to thirty years ahead on 327 00:16:50,680 --> 00:16:52,760 Speaker 3: some strategies. So if you think about are you going 328 00:16:52,800 --> 00:16:55,000 Speaker 3: to try to time the market over a short period 329 00:16:55,000 --> 00:16:57,920 Speaker 3: of time if you have a superannuation fund and you've 330 00:16:57,920 --> 00:17:01,080 Speaker 3: got twenty years to accumulate capital, I think it comes 331 00:17:01,080 --> 00:17:03,800 Speaker 3: down to you down to ultimately to risk management. Clearly, 332 00:17:03,840 --> 00:17:05,960 Speaker 3: we've had a very good run in markets, and being 333 00:17:06,040 --> 00:17:09,040 Speaker 3: in an index fund that's done very well has obviously 334 00:17:09,440 --> 00:17:12,199 Speaker 3: been fantastic from a return perspective, But what now and 335 00:17:12,240 --> 00:17:14,280 Speaker 3: where are the risks emerging? And how do you ensure 336 00:17:14,320 --> 00:17:16,760 Speaker 3: that you're not deploying capital at the wrong time in 337 00:17:16,800 --> 00:17:17,280 Speaker 3: the market. 338 00:17:17,320 --> 00:17:19,120 Speaker 2: And when you think about. 339 00:17:19,000 --> 00:17:20,840 Speaker 3: You know, the twenty five years I've been in this industry, 340 00:17:20,880 --> 00:17:24,600 Speaker 3: the biggest risks actually come from deploying money into a 341 00:17:24,640 --> 00:17:27,080 Speaker 3: market at the wrong time, whether it be you know, 342 00:17:27,200 --> 00:17:30,120 Speaker 3: two thousand and one September eleven, whether it be two 343 00:17:30,160 --> 00:17:33,040 Speaker 3: thousand and seven before the GFC, you know, pre COVID, 344 00:17:33,119 --> 00:17:34,320 Speaker 3: we had a you know, I think it was a 345 00:17:34,320 --> 00:17:38,280 Speaker 3: twelve year run of thirteen plus percent returns in the 346 00:17:38,400 --> 00:17:41,040 Speaker 3: S and P five hundred. So clearly valuations were stretched, 347 00:17:41,040 --> 00:17:43,720 Speaker 3: and when you're deploying capital, you actually need to think 348 00:17:43,720 --> 00:17:47,520 Speaker 3: about it is the time on deploying capital appropriate? And 349 00:17:47,560 --> 00:17:51,000 Speaker 3: I think what a future fund Another other investors are 350 00:17:51,000 --> 00:17:52,760 Speaker 3: saying at the moment is now is the time to 351 00:17:52,760 --> 00:17:54,600 Speaker 3: show some caution. At a point in time where you've 352 00:17:54,600 --> 00:17:56,399 Speaker 3: had well above market for a couple of years in 353 00:17:56,400 --> 00:17:58,800 Speaker 3: a row performance of markets, you do need to give 354 00:17:58,840 --> 00:18:03,520 Speaker 3: consideration to risk manager gold. Gold over this last period 355 00:18:03,560 --> 00:18:06,920 Speaker 3: of time appears to be ultimately a head against the 356 00:18:07,000 --> 00:18:09,879 Speaker 3: US dollar weakness, and I think gold in its essence, 357 00:18:10,200 --> 00:18:12,040 Speaker 3: by owning an et if you're not really getting an 358 00:18:12,080 --> 00:18:14,440 Speaker 3: income and return off gold, you do if you're potentially 359 00:18:14,480 --> 00:18:17,000 Speaker 3: with a gold producer listed on the market, but by 360 00:18:17,040 --> 00:18:18,800 Speaker 3: owning ultimately you don't, so you want to make sure 361 00:18:18,800 --> 00:18:19,320 Speaker 3: you're getting the. 362 00:18:19,280 --> 00:18:19,800 Speaker 2: Growth on it. 363 00:18:19,840 --> 00:18:22,800 Speaker 3: So I think it comes down to ultimately, what is 364 00:18:22,840 --> 00:18:27,160 Speaker 3: your long term strategy. One of the things that we 365 00:18:27,200 --> 00:18:31,280 Speaker 3: think about that's really important pre retirement is what is 366 00:18:31,320 --> 00:18:33,919 Speaker 3: your risk of a major market movement in the two 367 00:18:34,000 --> 00:18:37,080 Speaker 3: years prior to retirement? And having gone through the GFC, 368 00:18:37,400 --> 00:18:40,359 Speaker 3: it teaches you a lot of things, and your biggest 369 00:18:40,440 --> 00:18:43,160 Speaker 3: risk prior to retirement if you're two to three years out, 370 00:18:43,240 --> 00:18:45,600 Speaker 3: is actually having a ten to fifteen or twenty percent 371 00:18:45,960 --> 00:18:49,080 Speaker 3: reduction in asset values and you actually need to sell 372 00:18:49,119 --> 00:18:51,800 Speaker 3: those growth assets to fund in your retirement income. And 373 00:18:51,840 --> 00:18:55,000 Speaker 3: so what planning ahead of that with clear strategies and 374 00:18:55,119 --> 00:18:58,040 Speaker 3: risk management is essential to safeguard your retirement. I think 375 00:18:58,080 --> 00:19:00,680 Speaker 3: that the planning around those things which some people don't 376 00:19:00,680 --> 00:19:02,800 Speaker 3: not for consider it, I think comes down to that 377 00:19:02,840 --> 00:19:05,119 Speaker 3: decision about are you passive, are you active? 378 00:19:05,400 --> 00:19:06,399 Speaker 2: Where's your time frame? 379 00:19:07,280 --> 00:19:10,719 Speaker 1: Can you can you just give us some clues as 380 00:19:10,800 --> 00:19:12,479 Speaker 1: to what you would see if I said to you, 381 00:19:12,560 --> 00:19:15,119 Speaker 1: I have two years ago and I'm worried about the crash. 382 00:19:15,480 --> 00:19:18,360 Speaker 1: I've done greation shares, and my allocation to shares has 383 00:19:18,800 --> 00:19:22,920 Speaker 1: swelled inadvertently because I've done so well, and now I'm 384 00:19:22,920 --> 00:19:26,760 Speaker 1: facing sequential risk because I see it is very clear 385 00:19:26,800 --> 00:19:29,920 Speaker 1: that we're at the very top of a market. Where 386 00:19:29,960 --> 00:19:32,600 Speaker 1: would you begin the conversation. Would it be just what's 387 00:19:32,640 --> 00:19:35,639 Speaker 1: the nature of the other investments that should be considered. 388 00:19:36,560 --> 00:19:39,639 Speaker 3: So some let's say you've got your retirement income is 389 00:19:39,720 --> 00:19:42,160 Speaker 3: someone wants to be around six percent of your total 390 00:19:42,160 --> 00:19:45,960 Speaker 3: investment capital. So if you want to safeguard and you 391 00:19:46,080 --> 00:19:48,320 Speaker 3: study the impact and the probability of risk over a 392 00:19:48,359 --> 00:19:51,840 Speaker 3: five year period, if you can safeguard two years of income. 393 00:19:51,920 --> 00:19:55,359 Speaker 3: So having liquidity in assets apparently around fixed interest for 394 00:19:55,480 --> 00:19:58,640 Speaker 3: two years prior to the period of retirement means that 395 00:19:59,080 --> 00:20:01,440 Speaker 3: if there was a major market movement on the growth 396 00:20:01,440 --> 00:20:04,440 Speaker 3: asset you've got allocated to, then you can actually safeguard 397 00:20:04,520 --> 00:20:07,200 Speaker 3: your time and income by that being available. This absolutely 398 00:20:07,240 --> 00:20:09,959 Speaker 3: certainty that if there is volatility in growth asset it's 399 00:20:10,000 --> 00:20:14,520 Speaker 3: been Australian chairs in sessional chairs, property, infrastructure, private equity otherwise, 400 00:20:14,920 --> 00:20:17,600 Speaker 3: then it ensures that you're not needing to sell at 401 00:20:17,600 --> 00:20:19,200 Speaker 3: a point in weakness. And I think that's a really 402 00:20:19,200 --> 00:20:20,120 Speaker 3: important safeguard. 403 00:20:20,680 --> 00:20:24,439 Speaker 1: Yes, okay, that's a pretty traditional view, isn't it. The 404 00:20:24,480 --> 00:20:27,720 Speaker 1: two year I haven't to expressed this two years, but 405 00:20:28,040 --> 00:20:32,960 Speaker 1: two years utterly liquid basically two years where there's a 406 00:20:33,000 --> 00:20:36,399 Speaker 1: cash pile that you have that sits alone, that is 407 00:20:36,680 --> 00:20:41,399 Speaker 1: no risk, and you should you wake up in the 408 00:20:41,400 --> 00:20:43,359 Speaker 1: morning and watch you just followed by twenty five percent. 409 00:20:44,560 --> 00:20:46,560 Speaker 1: You don't have to panic, you don't have to sell 410 00:20:46,840 --> 00:20:49,719 Speaker 1: anything you don't want to sell. That's very interesting and 411 00:20:49,760 --> 00:20:53,720 Speaker 1: it's very apt. I would imagine at this particular time, 412 00:20:53,960 --> 00:20:55,280 Speaker 1: I just wanted to ask you one or two other 413 00:20:55,359 --> 00:20:59,320 Speaker 1: quick things. There's been a fashion I say, a fashion 414 00:20:59,680 --> 00:21:06,480 Speaker 1: to unlisted assets and private credit and private equity, which 415 00:21:06,840 --> 00:21:10,280 Speaker 1: was restricted if you like to sophisticate it. I won't 416 00:21:10,280 --> 00:21:14,920 Speaker 1: say sophisticated. That's a classification sophisticated to wealthy and institutional investors. 417 00:21:15,520 --> 00:21:17,959 Speaker 1: In the last year or two it has become mainstream. 418 00:21:18,280 --> 00:21:20,840 Speaker 1: It has been pushed actually to some degree at retail 419 00:21:20,840 --> 00:21:23,679 Speaker 1: investors mums and dads who don't know anything about this 420 00:21:23,760 --> 00:21:26,480 Speaker 1: area and have no experience in it. And one of 421 00:21:26,520 --> 00:21:28,480 Speaker 1: the things that they may not be aware of is 422 00:21:28,520 --> 00:21:31,600 Speaker 1: how illiquid this can be. If there is a crisis 423 00:21:31,640 --> 00:21:33,959 Speaker 1: of some sort or just an old fashioned, you know, 424 00:21:34,200 --> 00:21:37,639 Speaker 1: hard correction on the market, some of these funds will freeze, 425 00:21:38,040 --> 00:21:40,840 Speaker 1: and some of them will partially freeze. Can you tell 426 00:21:40,880 --> 00:21:44,280 Speaker 1: me whether you on the single question of whether the 427 00:21:44,320 --> 00:21:48,600 Speaker 1: retail investor is a suitable client for unlisted assets. Do 428 00:21:48,640 --> 00:21:49,320 Speaker 1: you think they are? 429 00:21:50,800 --> 00:21:53,680 Speaker 3: I think, you know, when we you know, going through 430 00:21:53,720 --> 00:21:57,080 Speaker 3: the JFSA, there were clients that I think were saved 431 00:21:57,160 --> 00:22:00,639 Speaker 3: some unfortunate advice thinking that, you know, private credit or 432 00:22:00,680 --> 00:22:03,800 Speaker 3: fixed interest assets were liquid and then two years down 433 00:22:03,880 --> 00:22:06,480 Speaker 3: the path found that due to redemptions, people wanting to 434 00:22:06,480 --> 00:22:09,040 Speaker 3: pull money seeing risk and seeing what might have been 435 00:22:09,080 --> 00:22:11,720 Speaker 3: a dollar unit price trading at eighty cents, thinking that 436 00:22:11,800 --> 00:22:15,600 Speaker 3: was actually liquidity. Answer is it's not so. Private credit 437 00:22:16,080 --> 00:22:19,919 Speaker 3: really is a broad sector. Obviously, with the changes in 438 00:22:20,000 --> 00:22:22,879 Speaker 3: terms of the banking system post the GFC, there was 439 00:22:23,160 --> 00:22:25,040 Speaker 3: some broad changes in terms of what the banks were 440 00:22:25,040 --> 00:22:28,400 Speaker 3: willing to actually cond and it was really the emergence 441 00:22:28,400 --> 00:22:30,679 Speaker 3: of private credit. And I think given some of the 442 00:22:30,720 --> 00:22:33,720 Speaker 3: returns that people have seen, there's been an attraction to it. 443 00:22:33,800 --> 00:22:36,320 Speaker 2: But it is it really is a broad sector. 444 00:22:36,400 --> 00:22:39,040 Speaker 3: It's a wide spectrum of strategies and what you often 445 00:22:39,200 --> 00:22:41,000 Speaker 3: look at and what it actually is can actually be 446 00:22:41,640 --> 00:22:45,520 Speaker 3: really different. And therefore receiving advice from people that really 447 00:22:45,640 --> 00:22:48,080 Speaker 3: understand this I think is essential, and just looking at 448 00:22:48,119 --> 00:22:50,520 Speaker 3: an asset and Saints. That's a great return. I think 449 00:22:50,600 --> 00:22:55,560 Speaker 3: is really dangerous. I think the recent review, I think 450 00:22:55,680 --> 00:22:58,200 Speaker 3: was a really important step to also step up the 451 00:22:58,720 --> 00:23:01,119 Speaker 3: oversight of this particular sect, because, as you're comment, it 452 00:23:01,160 --> 00:23:04,320 Speaker 3: is a swelling area of capital and one that it's 453 00:23:04,400 --> 00:23:06,000 Speaker 3: due diligence and regulation on. 454 00:23:06,440 --> 00:23:09,640 Speaker 1: Okay, So it seems to me, Matthew, what you're saying 455 00:23:09,680 --> 00:23:14,840 Speaker 1: is it's okay if you're advised, and it's okay, it's 456 00:23:14,880 --> 00:23:17,679 Speaker 1: okay if you are expertly guided through the forest, as 457 00:23:17,720 --> 00:23:19,800 Speaker 1: opposed to just wandering in and saying, oh, look at 458 00:23:19,800 --> 00:23:24,159 Speaker 1: that eleven percent. Yeah, yeah, okay, very interesting. Okay, Now 459 00:23:24,200 --> 00:23:25,520 Speaker 1: we're going to take a short break and we're going 460 00:23:25,560 --> 00:23:29,280 Speaker 1: to talk to Matthew about the investment markets. Just I 461 00:23:29,359 --> 00:23:32,040 Speaker 1: think very keen to see what he says. I'm speaking 462 00:23:32,040 --> 00:23:35,000 Speaker 1: to him on the morning that Nvidia, which represented nine 463 00:23:35,040 --> 00:23:40,159 Speaker 1: percent of all Wall Street trade yesterday, has released its 464 00:23:40,240 --> 00:23:43,800 Speaker 1: results it being the most important stock in the world 465 00:23:43,920 --> 00:23:44,600 Speaker 1: beyond the doubt. 466 00:23:44,680 --> 00:23:45,800 Speaker 2: Just now, all right, talk to. 467 00:23:45,760 --> 00:23:56,600 Speaker 1: You in a moment. Hello, Welcome back to the Australians 468 00:23:56,720 --> 00:24:00,680 Speaker 1: Money Puzzle podcast. James Kirby talking to Matthew Cassy, Partner's 469 00:24:00,680 --> 00:24:03,359 Speaker 1: Wealth Group Number one advisor in Australia at the top 470 00:24:03,400 --> 00:24:07,600 Speaker 1: one hundred and fifty advisors as of today November the 471 00:24:07,880 --> 00:24:11,800 Speaker 1: twentieth to twenty five. Okay, Matthew, we're talking about the 472 00:24:11,880 --> 00:24:15,639 Speaker 1: markets and shares. Tell me what you think of this. 473 00:24:15,800 --> 00:24:18,159 Speaker 1: I'm just looking at a video of codes coming in 474 00:24:18,200 --> 00:24:20,520 Speaker 1: about a video I've been asked to speak about it 475 00:24:20,560 --> 00:24:21,680 Speaker 1: here and there on radio. 476 00:24:21,480 --> 00:24:21,840 Speaker 2: Et cetera. 477 00:24:22,280 --> 00:24:27,280 Speaker 1: One stock, one stock went from a trillion to three 478 00:24:28,000 --> 00:24:31,040 Speaker 1: trillion in the blink of an eye, something close to 479 00:24:31,080 --> 00:24:35,080 Speaker 1: the entire value of the Australian Superannuation System. Okay, so 480 00:24:35,119 --> 00:24:37,920 Speaker 1: it came out with its results. Hey, the results were good. 481 00:24:38,000 --> 00:24:41,160 Speaker 1: Yet again, they were higher than expected. Yet again, So 482 00:24:41,200 --> 00:24:43,960 Speaker 1: we find that this one stock pulls a sector, which 483 00:24:44,000 --> 00:24:46,440 Speaker 1: is AI, which pulls Wall Street, which pulls sixty four 484 00:24:46,440 --> 00:24:50,320 Speaker 1: percent of the entire world market with it. How do 485 00:24:50,359 --> 00:24:53,600 Speaker 1: you view this market? Is it a convincing Are these 486 00:24:53,600 --> 00:24:56,679 Speaker 1: earnings enough to drive the sorel of excitement we have 487 00:24:56,920 --> 00:25:00,680 Speaker 1: just now in Wall Street? 488 00:25:01,400 --> 00:25:04,320 Speaker 3: I mean the last you know, last two years, two 489 00:25:04,400 --> 00:25:07,080 Speaker 3: hundred and seventy percent return, you know, the market cap 490 00:25:07,200 --> 00:25:09,639 Speaker 3: four point five trillion dollars at the moment, it is 491 00:25:09,680 --> 00:25:10,840 Speaker 3: an absolute powerhouse. 492 00:25:10,880 --> 00:25:12,840 Speaker 2: Effectively powering the future of AI. 493 00:25:13,040 --> 00:25:16,480 Speaker 3: And I think you know this, we are absolutely on 494 00:25:16,520 --> 00:25:18,639 Speaker 3: the start of this AI journey. I think that the 495 00:25:18,720 --> 00:25:21,479 Speaker 3: thing that you need to be careful of with this is, 496 00:25:22,920 --> 00:25:25,119 Speaker 3: you know, when we're sitting here in two thousand and 497 00:25:25,160 --> 00:25:28,240 Speaker 3: one thinking that dot com was taking off, then you know, 498 00:25:28,440 --> 00:25:30,760 Speaker 3: it's not a license to print money in this particular area. 499 00:25:30,880 --> 00:25:32,560 Speaker 3: You know, you need to pick the right assets, the 500 00:25:32,640 --> 00:25:35,399 Speaker 3: right sector. But without doubt, this AI theme is going 501 00:25:35,440 --> 00:25:38,359 Speaker 3: to continue to accelerate. And in VideA is absolutely the 502 00:25:38,359 --> 00:25:41,320 Speaker 3: pinnacle stock actually with that, and so you know, the 503 00:25:41,359 --> 00:25:44,960 Speaker 3: further the further growth of this is absolutely going to accelerate. 504 00:25:45,040 --> 00:25:45,359 Speaker 2: I think. 505 00:25:45,560 --> 00:25:48,399 Speaker 3: I think the thing is, particularly after such a strong run, 506 00:25:49,000 --> 00:25:51,520 Speaker 3: you know, where does your allocation the assets sit. You know, 507 00:25:51,720 --> 00:25:54,119 Speaker 3: it would appear that this trend will continue. Will we 508 00:25:54,240 --> 00:25:57,359 Speaker 3: have some a market correction moving forward? Obviously on a 509 00:25:57,400 --> 00:26:00,280 Speaker 3: valuation basis, there's some risk of that, but it's going 510 00:26:00,320 --> 00:26:02,560 Speaker 3: to be hard to suggest that's not the continuous run. 511 00:26:03,240 --> 00:26:05,200 Speaker 2: Where do competitors come into this into the future. 512 00:26:05,119 --> 00:26:08,600 Speaker 3: Are they going to maintain their current market share? Is 513 00:26:08,640 --> 00:26:11,040 Speaker 3: a new theme of buying some of the services they 514 00:26:11,080 --> 00:26:13,439 Speaker 3: provide get overtaken by someone else. I mean, therese are 515 00:26:13,480 --> 00:26:15,159 Speaker 3: all risks when you look at a stop that you 516 00:26:15,200 --> 00:26:17,960 Speaker 3: need to consider, and again, look at your portfolio, think 517 00:26:18,000 --> 00:26:20,120 Speaker 3: about your allocation, and if you've had a really good 518 00:26:20,160 --> 00:26:22,920 Speaker 3: run on at trim it. Because everything plans out the 519 00:26:22,960 --> 00:26:24,919 Speaker 3: way you think it is into the future and your 520 00:26:24,960 --> 00:26:29,080 Speaker 3: wealth is a steady accumulation is an important thing thing 521 00:26:29,200 --> 00:26:32,560 Speaker 3: as opposed to big shocks with over allocation in a 522 00:26:32,560 --> 00:26:33,320 Speaker 3: particular sector. 523 00:26:34,480 --> 00:26:36,960 Speaker 1: So when you said trim it, be willing to sell 524 00:26:37,000 --> 00:26:41,199 Speaker 1: your winners or at least offload tea profits regularly. Is 525 00:26:41,200 --> 00:26:42,840 Speaker 1: that as something you would suggest. 526 00:26:45,440 --> 00:26:48,000 Speaker 3: I remember twenty odd years ago there was a client 527 00:26:48,040 --> 00:26:52,280 Speaker 3: with a mining stock and this wasn't an overly wealthy family, 528 00:26:52,359 --> 00:26:54,280 Speaker 3: and they had a stop which went from twenty cents 529 00:26:54,320 --> 00:26:57,000 Speaker 3: to five dollars, and we really strongly encourage them to 530 00:26:57,080 --> 00:27:00,679 Speaker 3: trim their five million dollars allocation. And that five million 531 00:27:00,840 --> 00:27:02,800 Speaker 3: was out of a total portfolio of five and a 532 00:27:02,840 --> 00:27:05,800 Speaker 3: half and our advice that didn't proceed with that, in 533 00:27:05,840 --> 00:27:07,760 Speaker 3: the stop managed to go down to twenty cents. 534 00:27:07,560 --> 00:27:08,560 Speaker 2: And they lost a lot of that. 535 00:27:08,600 --> 00:27:10,880 Speaker 3: I think these things just leave a bit of a 536 00:27:11,560 --> 00:27:13,520 Speaker 3: something with you over a long period of time, And 537 00:27:14,080 --> 00:27:16,359 Speaker 3: again you know, from a risk management perspective, you know 538 00:27:16,400 --> 00:27:18,199 Speaker 3: everyone is going to have an allocation when VideA in 539 00:27:18,200 --> 00:27:19,280 Speaker 3: their international portfolio. 540 00:27:19,280 --> 00:27:20,800 Speaker 2: It's at such a large part of the index. 541 00:27:20,840 --> 00:27:24,720 Speaker 3: But when some of these stocks become above five percent, 542 00:27:24,840 --> 00:27:27,120 Speaker 3: ten or twenty or thirty percent, it does create risk 543 00:27:27,200 --> 00:27:30,159 Speaker 3: that if your timing's not right on it, then it 544 00:27:30,200 --> 00:27:33,200 Speaker 3: does create risk for you. And the safeguarding your cap 545 00:27:33,280 --> 00:27:34,560 Speaker 3: over a long period of time, I think is the 546 00:27:34,640 --> 00:27:37,600 Speaker 3: key to accumulating wealth and not making large mistakes. So 547 00:27:38,080 --> 00:27:39,840 Speaker 3: I think that's an amazing business. I think it's going 548 00:27:39,920 --> 00:27:42,520 Speaker 3: to continue on a really positive run. It's absolutely got 549 00:27:43,200 --> 00:27:45,679 Speaker 3: the best business to oversee the future of AI. But 550 00:27:45,760 --> 00:27:48,560 Speaker 3: tonight everything also runs in a uniform and uniform manner 551 00:27:48,600 --> 00:27:49,159 Speaker 3: moving forward. 552 00:27:50,359 --> 00:27:53,320 Speaker 1: Yes, a hell of a story, Matthew. The goals meaning 553 00:27:53,560 --> 00:27:56,000 Speaker 1: reminds me, and you're thinking about mistakes reminds me of 554 00:27:56,280 --> 00:27:58,720 Speaker 1: Just to finish off the buffet, leaned about the number 555 00:27:58,760 --> 00:28:01,760 Speaker 1: one rule of investing is don't lose money, and the 556 00:28:01,880 --> 00:28:04,560 Speaker 1: second rule is don't forget the first rule. Sounds like 557 00:28:04,840 --> 00:28:07,920 Speaker 1: that seems to be pretty close to your heart. Okay, hey, 558 00:28:07,920 --> 00:28:10,200 Speaker 1: look very good to have you on the show this morning, 559 00:28:10,320 --> 00:28:12,600 Speaker 1: and congratulations I know you for a long time, and 560 00:28:12,640 --> 00:28:14,040 Speaker 1: I know you're on the list for a long time. 561 00:28:14,400 --> 00:28:17,320 Speaker 1: And it's nice to see someone someone new and fresh 562 00:28:17,560 --> 00:28:20,160 Speaker 1: coming on to and someone who's willing to talk about 563 00:28:20,200 --> 00:28:22,800 Speaker 1: all aspects of investors for everyone. I really do and 564 00:28:22,840 --> 00:28:26,800 Speaker 1: our listeners appreciate that. Okay, Matthew Cassidy, thanks very much, 565 00:28:27,160 --> 00:28:31,280 Speaker 1: we'll talk again. Much sent Matthew Cassidy there of the 566 00:28:31,280 --> 00:28:35,200 Speaker 1: Partner's Wealth Group. Okay, any questions, Let's have some correspondence 567 00:28:35,440 --> 00:28:38,760 Speaker 1: the Money Puzzle at the Australian dot com dot au. 568 00:28:38,880 --> 00:28:39,560 Speaker 1: Talk to you soon.