1 00:00:09,880 --> 00:00:12,960 Speaker 1: Hello, and welcome to The Australian's Money Puzzle podcast. I'm 2 00:00:13,039 --> 00:00:17,360 Speaker 1: James Kirby. Welcome aboard everybody. Well. I've mentioned in recent 3 00:00:17,960 --> 00:00:20,840 Speaker 1: weeks that we are planning to do some new features 4 00:00:20,840 --> 00:00:23,400 Speaker 1: here at the Money Puzzle, and today and over the 5 00:00:23,400 --> 00:00:26,920 Speaker 1: next three mondays, we're going to present a short series 6 00:00:26,960 --> 00:00:31,120 Speaker 1: to you on how top investors pick their winning investments. 7 00:00:31,640 --> 00:00:34,640 Speaker 1: My colleague at The Australian, Julianne Spragg, sat down for 8 00:00:34,720 --> 00:00:39,760 Speaker 1: a chat with top stock picker jun Bei Lu, the 9 00:00:39,800 --> 00:00:42,560 Speaker 1: co founder of ten Caps. She's more than tripled funds 10 00:00:42,680 --> 00:00:46,159 Speaker 1: under management more than one point five billion dollars. How 11 00:00:46,200 --> 00:00:48,960 Speaker 1: does she pick a good stock and what's your advice 12 00:00:49,040 --> 00:00:51,800 Speaker 1: for everyday investors? Let's find out. 13 00:00:54,000 --> 00:00:56,080 Speaker 2: Gin Bailou, thanks for joining me. I want to have 14 00:00:56,120 --> 00:00:58,080 Speaker 2: a chat to you about your journey. 15 00:00:58,240 --> 00:00:59,400 Speaker 3: So you came to. 16 00:00:59,360 --> 00:01:02,200 Speaker 2: Australia as a sixteen year old, got yourself into the 17 00:01:02,200 --> 00:01:06,440 Speaker 2: funds management business, initially as an analyst involved in a 18 00:01:06,480 --> 00:01:08,360 Speaker 2: fund that I think had around three hundred million dollars 19 00:01:08,440 --> 00:01:10,600 Speaker 2: funds under management, and grew that to over a billion 20 00:01:10,640 --> 00:01:12,880 Speaker 2: dollars and now out on your own at ten cap. 21 00:01:12,920 --> 00:01:14,240 Speaker 4: It's a pretty extraordinary story. 22 00:01:14,360 --> 00:01:14,959 Speaker 3: Oh, thank you. 23 00:01:15,360 --> 00:01:16,920 Speaker 2: We want to have a chat about that, but also 24 00:01:17,760 --> 00:01:19,640 Speaker 2: really keen to learn from you about what you've learned 25 00:01:19,640 --> 00:01:22,600 Speaker 2: about investing and get some of your tips for those 26 00:01:22,600 --> 00:01:24,080 Speaker 2: of us who just want to get. 27 00:01:23,920 --> 00:01:27,280 Speaker 4: Better at it. Let's maybe just start at the beginning. 28 00:01:27,400 --> 00:01:29,360 Speaker 2: And you came to Australia as a sixteen year old. 29 00:01:29,400 --> 00:01:30,440 Speaker 2: What was that like? 30 00:01:30,800 --> 00:01:32,240 Speaker 3: Oh, look, it's quite incredible. 31 00:01:32,280 --> 00:01:35,000 Speaker 5: Actually, I still remember thinking the first day I landed 32 00:01:35,040 --> 00:01:37,559 Speaker 5: in Australia, the first thing that struck me is the 33 00:01:37,560 --> 00:01:40,000 Speaker 5: sky was so blue. And I come from China at 34 00:01:40,000 --> 00:01:42,360 Speaker 5: the time, we don't see blue sky very often. Sky 35 00:01:42,480 --> 00:01:45,840 Speaker 5: so blue, and the cloud is so three D, almost 36 00:01:45,880 --> 00:01:48,240 Speaker 5: as if you could touch it. It's such a beautiful country. 37 00:01:48,360 --> 00:01:51,280 Speaker 5: I just remember thinking that was incredible. Of course, over 38 00:01:51,320 --> 00:01:53,400 Speaker 5: the next six month, I think I couldn't understand the 39 00:01:53,400 --> 00:01:55,480 Speaker 5: word of English, so it took a little while to 40 00:01:55,840 --> 00:01:59,240 Speaker 5: vaguely translate the body language into what people meant. 41 00:02:00,080 --> 00:02:01,120 Speaker 3: We went to read people. 42 00:02:01,240 --> 00:02:03,520 Speaker 5: Yeah, you kind of need to read, and it's incredible 43 00:02:03,560 --> 00:02:06,520 Speaker 5: how your our mind adapt them. So our brain sort 44 00:02:06,520 --> 00:02:08,919 Speaker 5: of adapt to the situation. I think within three months 45 00:02:09,120 --> 00:02:11,560 Speaker 5: I can sort of vaguely understand in the class that 46 00:02:11,880 --> 00:02:14,960 Speaker 5: what teachers sort of meant some subject matter like matt 47 00:02:15,000 --> 00:02:16,840 Speaker 5: and other things a bit easier, but when you go 48 00:02:16,880 --> 00:02:18,880 Speaker 5: into biology and others, becomes a bit harder. 49 00:02:19,000 --> 00:02:20,400 Speaker 3: But still you pick up real quick. 50 00:02:20,480 --> 00:02:22,799 Speaker 5: And I still remember every day when I was on 51 00:02:22,800 --> 00:02:24,919 Speaker 5: my way to school, I have to catch the bus 52 00:02:24,919 --> 00:02:27,360 Speaker 5: to go to school, and it's about forty minute bus ride, 53 00:02:27,440 --> 00:02:29,959 Speaker 5: and I used to take deep breath. I get quite 54 00:02:30,080 --> 00:02:34,560 Speaker 5: stressed and take deep breath, keep forcing myself thinking in English. 55 00:02:34,760 --> 00:02:36,960 Speaker 5: Because the hardest thing for a migrant is that you 56 00:02:37,040 --> 00:02:39,520 Speaker 5: think in your own language. Then you before you speak, 57 00:02:39,560 --> 00:02:41,520 Speaker 5: you translate it, and then when you hear it, then 58 00:02:41,560 --> 00:02:43,480 Speaker 5: you translate back and then you think again in your 59 00:02:43,480 --> 00:02:45,920 Speaker 5: own language. That's why it takes so long for you 60 00:02:46,000 --> 00:02:49,480 Speaker 5: to actually speak something. So if you force yourself to 61 00:02:49,560 --> 00:02:52,600 Speaker 5: think English, then it much faster, and then you actually 62 00:02:52,600 --> 00:02:55,480 Speaker 5: get practice all the time. So I remember that forty 63 00:02:55,480 --> 00:02:58,639 Speaker 5: minute bus ride. I used to practice every day and est. 64 00:02:58,600 --> 00:03:00,960 Speaker 4: In your head, you're strying to speak talking to myself. 65 00:03:01,040 --> 00:03:03,000 Speaker 5: Yeah, so I think I still today people catch me 66 00:03:03,040 --> 00:03:05,400 Speaker 5: talking to myself all the time, going crazy. 67 00:03:06,320 --> 00:03:09,040 Speaker 2: And your parents what triggered the move? Did they sort 68 00:03:09,080 --> 00:03:10,400 Speaker 2: of talk to you at the time about why they 69 00:03:10,440 --> 00:03:10,800 Speaker 2: were doing that. 70 00:03:10,880 --> 00:03:11,079 Speaker 3: Yeah. 71 00:03:11,120 --> 00:03:11,280 Speaker 2: Sure. 72 00:03:11,320 --> 00:03:13,120 Speaker 3: Look at the time, so my mother came. 73 00:03:13,000 --> 00:03:15,840 Speaker 5: To Australia as part of that whole relaxation of student 74 00:03:15,880 --> 00:03:19,000 Speaker 5: visa posta Tiama Square and Massacre. And at the time, 75 00:03:19,160 --> 00:03:21,959 Speaker 5: but in China, China was very poor. Every person in 76 00:03:22,040 --> 00:03:24,240 Speaker 5: China really wanted to see what it's like to be 77 00:03:24,480 --> 00:03:26,960 Speaker 5: in the foreign country. It's almost it's like a dream 78 00:03:27,000 --> 00:03:29,640 Speaker 5: come true. And my mother was very fortunate that she 79 00:03:29,760 --> 00:03:32,560 Speaker 5: came through in the visa and then she managed to stay, 80 00:03:32,680 --> 00:03:34,960 Speaker 5: worked many jobs and managed to stay. And then I 81 00:03:35,080 --> 00:03:37,960 Speaker 5: came and joined her six years later. So we separated 82 00:03:38,000 --> 00:03:39,880 Speaker 5: for six years and joined her six years later, and 83 00:03:39,920 --> 00:03:41,960 Speaker 5: then my dad came another four years later. 84 00:03:42,280 --> 00:03:43,720 Speaker 4: My goodness, what a journey. 85 00:03:43,960 --> 00:03:45,000 Speaker 3: I know, it's incredible. 86 00:03:45,200 --> 00:03:48,200 Speaker 2: And the attitudes towards money when you were growing up, 87 00:03:48,240 --> 00:03:50,840 Speaker 2: did your sort of parents sort of instilled in particular values. 88 00:03:51,120 --> 00:03:53,560 Speaker 5: Yeah, look, I think it just we grew up pretty poor, 89 00:03:53,640 --> 00:03:56,040 Speaker 5: so making money is it's probably a big thing. 90 00:03:56,080 --> 00:03:57,320 Speaker 3: But even though we were. 91 00:03:57,200 --> 00:03:59,720 Speaker 5: Poor, But my dad always remember he's I think he's 92 00:03:59,800 --> 00:04:02,520 Speaker 5: quite adventures. He was I would say, one of the 93 00:04:02,560 --> 00:04:06,280 Speaker 5: earliest investors in share market or bomb market there in China. 94 00:04:06,360 --> 00:04:08,520 Speaker 5: This is I think he started in maybe like ninety 95 00:04:08,720 --> 00:04:12,440 Speaker 5: nineteen ninety when the capital market was really literally it's 96 00:04:12,480 --> 00:04:15,520 Speaker 5: infancy in China and it was more or less just punting, right. 97 00:04:15,600 --> 00:04:18,640 Speaker 5: So I remember at home, we don't have computers. He 98 00:04:18,680 --> 00:04:21,280 Speaker 5: will print out all these paper and draw all the 99 00:04:21,320 --> 00:04:23,920 Speaker 5: lines of where the stock is today, and then draw 100 00:04:23,960 --> 00:04:26,479 Speaker 5: all these ratio and everything, and then every day he'll 101 00:04:26,480 --> 00:04:29,400 Speaker 5: make a prediction about the stock either going up or 102 00:04:29,400 --> 00:04:29,920 Speaker 5: going down. 103 00:04:30,560 --> 00:04:31,520 Speaker 3: He'll never get it wrong. 104 00:04:31,680 --> 00:04:34,160 Speaker 5: And then every day he'll stick up a paper. So 105 00:04:34,320 --> 00:04:37,240 Speaker 5: we literally have all these lines of paper because we 106 00:04:37,240 --> 00:04:41,040 Speaker 5: don't have computer going across my bedroom, his bedroom, living room, 107 00:04:41,120 --> 00:04:44,160 Speaker 5: all the way down downstairs, and they're into the kitchen, 108 00:04:44,320 --> 00:04:46,280 Speaker 5: so we just have all these charts everywhere. 109 00:04:46,320 --> 00:04:47,760 Speaker 3: So I grew up with the charters. 110 00:04:48,120 --> 00:04:50,920 Speaker 4: Wow investing you learned by Osmosis oh. 111 00:04:50,800 --> 00:04:53,680 Speaker 5: I reckon, it's exciting. I think what I learned is 112 00:04:53,760 --> 00:04:56,720 Speaker 5: that excitement. To me, it's always investing a bit like 113 00:04:56,880 --> 00:04:59,800 Speaker 5: treasure hunting. You go and find something before everyone else, 114 00:05:00,160 --> 00:05:02,880 Speaker 5: and then you founder you did the work, you found it, 115 00:05:03,160 --> 00:05:05,480 Speaker 5: and you know you make the return. So it's very 116 00:05:05,520 --> 00:05:07,520 Speaker 5: much like treasure hunting. So at the time I feel 117 00:05:07,640 --> 00:05:10,200 Speaker 5: a lot of my dad's excitement and disappointment and then 118 00:05:10,279 --> 00:05:12,160 Speaker 5: my at the time, I thought he would never be 119 00:05:12,279 --> 00:05:14,599 Speaker 5: wrong because every day he's pretic either up or doubt. 120 00:05:15,320 --> 00:05:16,440 Speaker 3: Sideway will be the wrong day. 121 00:05:16,760 --> 00:05:18,039 Speaker 4: What was treasure hunting? 122 00:05:18,400 --> 00:05:21,880 Speaker 2: Can you remember your very first investment, what it might 123 00:05:21,920 --> 00:05:23,480 Speaker 2: have been, and how old you were when you made 124 00:05:23,520 --> 00:05:26,200 Speaker 2: your first, like your first investment all on your own? 125 00:05:26,400 --> 00:05:27,160 Speaker 3: Yeah, yeah, that's right. 126 00:05:27,240 --> 00:05:31,040 Speaker 5: So my first investment actually when I already started working, 127 00:05:31,120 --> 00:05:32,159 Speaker 5: but very early days. 128 00:05:32,440 --> 00:05:34,960 Speaker 3: I think I put my money in a company. 129 00:05:35,880 --> 00:05:38,520 Speaker 5: Actually I put my money in a company where at 130 00:05:38,560 --> 00:05:40,440 Speaker 5: the time I thought, oh, look, I don't really know 131 00:05:40,480 --> 00:05:42,359 Speaker 5: how to invest. I just want to invest in something 132 00:05:42,440 --> 00:05:44,720 Speaker 5: that I know what it is, which is worth her 133 00:05:45,200 --> 00:05:47,360 Speaker 5: and because I go to the store. In fact, I 134 00:05:47,480 --> 00:05:50,760 Speaker 5: worked in Woolworth briefly as a checkout chick in high school. 135 00:05:50,560 --> 00:05:51,000 Speaker 1: So you knew it. 136 00:05:51,080 --> 00:05:53,480 Speaker 3: Well, yeah, so it's like that touch and feel. It's 137 00:05:53,560 --> 00:05:54,120 Speaker 3: really exciting. 138 00:05:54,279 --> 00:05:57,320 Speaker 4: And I still have my name bad from Coles just quietly, Oh. 139 00:05:57,720 --> 00:06:00,200 Speaker 3: I think I do too, Yeah, I think I do too. 140 00:06:02,600 --> 00:06:04,039 Speaker 3: And that was my first experience. 141 00:06:04,080 --> 00:06:06,120 Speaker 5: I didn't know anything about it, and that was at 142 00:06:06,160 --> 00:06:08,160 Speaker 5: the time where I just started looking at some of 143 00:06:08,240 --> 00:06:10,840 Speaker 5: the financial statements I learned in UNI and then my 144 00:06:10,960 --> 00:06:13,560 Speaker 5: first job as a start analyst, also working for morning 145 00:06:13,600 --> 00:06:14,560 Speaker 5: Staff for a bit as well. 146 00:06:14,880 --> 00:06:17,560 Speaker 2: So you studied finance to knew you wanted to go 147 00:06:17,640 --> 00:06:20,120 Speaker 2: into the finance industry become an analyst. So you've got 148 00:06:20,160 --> 00:06:21,840 Speaker 2: a bit of knowledge behind you then, but then you 149 00:06:21,920 --> 00:06:23,640 Speaker 2: sort of think you still stick to what you know. 150 00:06:23,800 --> 00:06:25,920 Speaker 5: So you'll buy I tell you what I think that 151 00:06:26,240 --> 00:06:30,720 Speaker 5: it's actually less inspirational than often what I portrayed to be. 152 00:06:30,839 --> 00:06:33,600 Speaker 5: It's actually, look, I always feel finance. I did finance 153 00:06:33,680 --> 00:06:36,240 Speaker 5: because as a Chinese kid, we'll go finance or accounting 154 00:06:36,440 --> 00:06:38,560 Speaker 5: definitely will find a job. That's what my mother tells me. 155 00:06:38,920 --> 00:06:41,440 Speaker 5: And as I go through finance, and then I kind 156 00:06:41,480 --> 00:06:44,240 Speaker 5: of learned the things that I like. I never liked 157 00:06:44,240 --> 00:06:46,520 Speaker 5: the accounting part of it. I find a very try 158 00:06:47,040 --> 00:06:48,520 Speaker 5: so and. 159 00:06:48,600 --> 00:06:50,520 Speaker 2: People who know me, they'll be having a giggle now 160 00:06:50,600 --> 00:06:53,120 Speaker 2: because one of my stories is my dad wanted me 161 00:06:53,240 --> 00:06:53,960 Speaker 2: to study accounting. 162 00:06:54,440 --> 00:06:56,600 Speaker 4: You'll get a job. But then I was just delinquent, 163 00:06:56,760 --> 00:06:59,520 Speaker 4: going no, I don't want accounting. 164 00:06:59,760 --> 00:07:03,080 Speaker 5: No, yeah, I think the accounting is the thing. Yeah, 165 00:07:03,200 --> 00:07:05,960 Speaker 5: Well I think I'm kind of pivoted as well. So 166 00:07:06,040 --> 00:07:08,200 Speaker 5: because with accounting, I did a one year of accounting 167 00:07:08,279 --> 00:07:08,960 Speaker 5: or that that that's not. 168 00:07:09,040 --> 00:07:10,400 Speaker 4: Me all the accounting. 169 00:07:10,440 --> 00:07:12,280 Speaker 5: Yeah, that's right, and they're too scared to drop the 170 00:07:12,480 --> 00:07:15,560 Speaker 5: entire commerce. Then my mother will be hugely disappointed. So 171 00:07:15,640 --> 00:07:18,440 Speaker 5: I shifted to finance, and then in finance that you 172 00:07:18,560 --> 00:07:21,800 Speaker 5: learn about behavioral finance and economics and a few other things. 173 00:07:22,080 --> 00:07:26,000 Speaker 5: And behavioral finance was so fascinating because that's the soft skill. 174 00:07:26,400 --> 00:07:28,800 Speaker 5: That's where you do the treasure hunting. You're trying to 175 00:07:29,440 --> 00:07:32,840 Speaker 5: think about how everyone else is thinking, what are their biases. 176 00:07:33,160 --> 00:07:36,640 Speaker 5: It's almost like a psychology class. I find that very fascinating. 177 00:07:36,880 --> 00:07:39,200 Speaker 2: Is that then how you can work out whether to 178 00:07:39,280 --> 00:07:40,800 Speaker 2: go with the herd or not? You know how there's 179 00:07:40,840 --> 00:07:42,239 Speaker 2: that herd mentality in markets. 180 00:07:42,520 --> 00:07:45,760 Speaker 5: That's absolutely right. I actually think unlike what many other 181 00:07:45,800 --> 00:07:48,080 Speaker 5: people think. Many people think investing about numbers and get 182 00:07:48,080 --> 00:07:50,520 Speaker 5: the numbers right and everything. I actually think get the 183 00:07:50,600 --> 00:07:52,840 Speaker 5: numbers right is almost a basic and that's a small 184 00:07:52,880 --> 00:07:55,480 Speaker 5: component of ultimate what the share price will do. It's 185 00:07:55,480 --> 00:07:57,720 Speaker 5: actually get your numbers right and what the share price 186 00:07:57,800 --> 00:08:00,600 Speaker 5: will do, especially in the immediate future, in the next 187 00:08:00,720 --> 00:08:03,800 Speaker 5: three to six months. Short term is all about sentiment. 188 00:08:04,200 --> 00:08:07,520 Speaker 5: Sentiment is behavioral bias, you know, is all about what 189 00:08:07,760 --> 00:08:10,680 Speaker 5: would other people pay for those numbers that you just 190 00:08:10,720 --> 00:08:13,200 Speaker 5: put together, And that's what share market. That's why these 191 00:08:13,280 --> 00:08:14,680 Speaker 5: days you see wild swings. 192 00:08:15,000 --> 00:08:16,320 Speaker 3: It's just that sentiment. 193 00:08:16,600 --> 00:08:19,880 Speaker 5: So it's actually incredibly important because if you can understand 194 00:08:19,960 --> 00:08:22,400 Speaker 5: that and then you can sometimes go against the hurd 195 00:08:22,680 --> 00:08:24,760 Speaker 5: then you make a lot more return. There's your treasure. 196 00:08:25,120 --> 00:08:27,680 Speaker 5: You found that before other people realized it was a treasure. 197 00:08:27,800 --> 00:08:30,360 Speaker 2: So is there something that you look towards to try 198 00:08:30,440 --> 00:08:33,280 Speaker 2: and work out that behavioral piece? Like, is there I 199 00:08:33,320 --> 00:08:35,880 Speaker 2: don't know if you're reading different aspects of how do 200 00:08:35,960 --> 00:08:38,240 Speaker 2: you try and determine what people are going to do? 201 00:08:38,520 --> 00:08:38,720 Speaker 3: Yeah? 202 00:08:38,800 --> 00:08:40,480 Speaker 5: I think firstly you need to and when you start 203 00:08:40,520 --> 00:08:43,360 Speaker 5: investing in something, don't start with a preconceived idea of 204 00:08:43,440 --> 00:08:46,000 Speaker 5: what it should be, because I find many investors make 205 00:08:46,080 --> 00:08:48,360 Speaker 5: this mistake is that they always feel, oh, I think 206 00:08:48,440 --> 00:08:51,400 Speaker 5: this is that, and then they when you believe something 207 00:08:51,480 --> 00:08:55,360 Speaker 5: firmly without open mind, then you start finding evidence just 208 00:08:55,440 --> 00:08:58,120 Speaker 5: to support your own view, our own view sometimes right, 209 00:08:58,240 --> 00:09:00,960 Speaker 5: sometimes right. It's very important to when you start looking 210 00:09:01,000 --> 00:09:03,760 Speaker 5: at something just keep a complete open mind looking at 211 00:09:03,840 --> 00:09:06,960 Speaker 5: as afresh or some of the previous mistakes, many mistakes 212 00:09:07,080 --> 00:09:09,240 Speaker 5: made mistake all the time, and one of some of 213 00:09:09,320 --> 00:09:11,880 Speaker 5: the biggest mistake is that when we have presecuencive idea, 214 00:09:11,960 --> 00:09:14,280 Speaker 5: then we start making pivot to the wrong side. Then 215 00:09:14,360 --> 00:09:17,800 Speaker 5: you stop listening to everyone, and then you kind of 216 00:09:17,960 --> 00:09:21,360 Speaker 5: just make the wrong bet about a company's future simply 217 00:09:21,440 --> 00:09:24,000 Speaker 5: because you just couldn't see what is coming. So yeah, 218 00:09:24,080 --> 00:09:27,040 Speaker 5: so I think open mind and curiosity is very important. 219 00:09:28,400 --> 00:09:32,199 Speaker 2: Do you have any rules or structures around how you 220 00:09:32,280 --> 00:09:34,120 Speaker 2: go to invest that you're talking about? It sounds like 221 00:09:34,160 --> 00:09:36,160 Speaker 2: you do an awful lot of research and you sort 222 00:09:36,200 --> 00:09:39,040 Speaker 2: of sounds like you pause and really get to understand 223 00:09:39,160 --> 00:09:40,520 Speaker 2: the company before you invest. 224 00:09:40,679 --> 00:09:42,640 Speaker 4: But how long does that take? 225 00:09:42,760 --> 00:09:46,040 Speaker 2: And is that sort of a metric or some sort 226 00:09:46,040 --> 00:09:48,560 Speaker 2: of plan that you work to before you actually invest 227 00:09:48,640 --> 00:09:49,800 Speaker 2: your money or your client's money. 228 00:09:49,960 --> 00:09:50,080 Speaker 1: Oh. 229 00:09:50,160 --> 00:09:52,959 Speaker 5: Absolutely, so look for a brand new company, it does 230 00:09:53,040 --> 00:09:56,280 Speaker 5: take much longer because ultimately we always talk about doing 231 00:09:56,280 --> 00:09:59,120 Speaker 5: your homework, is that you do need to understand the business. 232 00:09:59,360 --> 00:10:02,559 Speaker 5: So the core understanding of the business is firstly, what's 233 00:10:02,720 --> 00:10:05,880 Speaker 5: its customer proposition? What's the proposition? Why does it exist? 234 00:10:06,040 --> 00:10:08,880 Speaker 5: So ask this question, why does it exist? How does 235 00:10:08,920 --> 00:10:11,640 Speaker 5: it exist? How is it better than others? And how 236 00:10:11,679 --> 00:10:15,199 Speaker 5: does it make money and is that how or specialty 237 00:10:15,440 --> 00:10:18,800 Speaker 5: going to continue? Are they keep reinvesting what's special about 238 00:10:18,840 --> 00:10:21,160 Speaker 5: that business that they can keep going? And then you 239 00:10:21,240 --> 00:10:24,040 Speaker 5: can decide, Okay, well it can make this much money 240 00:10:24,120 --> 00:10:26,240 Speaker 5: and next share you will make more because I know 241 00:10:26,480 --> 00:10:28,719 Speaker 5: all these things they're doing, it's going to drive this 242 00:10:29,120 --> 00:10:32,400 Speaker 5: and I know the management execution is very important. They've 243 00:10:32,480 --> 00:10:34,880 Speaker 5: done it before and you met the management need. They're 244 00:10:34,920 --> 00:10:38,560 Speaker 5: driven because ultimately, especially small business, they run by people 245 00:10:38,600 --> 00:10:42,520 Speaker 5: who's creating, innovating an idea, so they've got to be driven. 246 00:10:42,920 --> 00:10:45,559 Speaker 3: So it's them. You kind of follow them when it's 247 00:10:45,679 --> 00:10:46,079 Speaker 3: early on. 248 00:10:46,440 --> 00:10:49,080 Speaker 5: So a lot of these when once you're done your homeworld, 249 00:10:49,120 --> 00:10:51,920 Speaker 5: you understand, you really understand the driver of the business, 250 00:10:52,160 --> 00:10:55,559 Speaker 5: where it's going, You understand the management, you understand in 251 00:10:55,640 --> 00:10:58,360 Speaker 5: and out of that business and that industry. And then 252 00:10:58,800 --> 00:11:00,719 Speaker 5: this is the first part of it. And then the 253 00:11:00,800 --> 00:11:02,839 Speaker 5: next part of it is to actually work out what 254 00:11:02,960 --> 00:11:04,959 Speaker 5: you want to pay for it. And that is the 255 00:11:05,160 --> 00:11:05,760 Speaker 5: tricky part. 256 00:11:06,280 --> 00:11:07,280 Speaker 4: That is the tricky part. 257 00:11:07,520 --> 00:11:09,520 Speaker 2: When we come back, let's talk about how to know 258 00:11:09,640 --> 00:11:12,520 Speaker 2: when a stock is too expensive, And I also want 259 00:11:12,559 --> 00:11:16,280 Speaker 2: to know your investing mistakes. What do they teach you 260 00:11:16,880 --> 00:11:20,760 Speaker 2: and what's your investing advice for everyday investors. We'll return 261 00:11:20,800 --> 00:11:22,760 Speaker 2: to our chat following this small break. 262 00:11:36,360 --> 00:11:36,800 Speaker 4: Jim Bay. 263 00:11:37,440 --> 00:11:39,440 Speaker 2: Before we went to the break, we were talking about 264 00:11:40,320 --> 00:11:43,120 Speaker 2: investing in shares, so doing all of the research deciding 265 00:11:43,760 --> 00:11:46,760 Speaker 2: which company you'd like to back. The tricky part though, 266 00:11:46,880 --> 00:11:49,880 Speaker 2: is working out whether there's value in that company. How 267 00:11:49,960 --> 00:11:52,040 Speaker 2: do you go about working out whether a company is 268 00:11:52,120 --> 00:11:53,319 Speaker 2: too expensive to buy? 269 00:11:53,720 --> 00:11:57,360 Speaker 5: I think in today's world the expensiveness really come back 270 00:11:57,440 --> 00:12:01,040 Speaker 5: down to relative valuation, so you compare it with something else. 271 00:12:01,360 --> 00:12:05,520 Speaker 5: So we in Australian market, if something is expensive, it's 272 00:12:05,640 --> 00:12:08,720 Speaker 5: not a reason for not buying something or for selling 273 00:12:08,840 --> 00:12:11,080 Speaker 5: something because yeah, I tell you why. 274 00:12:11,240 --> 00:12:11,760 Speaker 3: I'll tell you why. 275 00:12:11,840 --> 00:12:15,000 Speaker 5: Because Australian market growth is very hard to come buy. 276 00:12:15,440 --> 00:12:17,720 Speaker 5: So and then there's only limited there's only a couple 277 00:12:17,720 --> 00:12:20,319 Speaker 5: of companies you can buy that can grow. So there's 278 00:12:20,320 --> 00:12:23,160 Speaker 5: an incredible amount of money keeps piling into growth within 279 00:12:23,240 --> 00:12:25,439 Speaker 5: our share market and they will keep going to the 280 00:12:25,480 --> 00:12:28,640 Speaker 5: same company. So the evaluation today is much much higher 281 00:12:28,679 --> 00:12:30,240 Speaker 5: than they were ten years ago. 282 00:12:30,480 --> 00:12:33,040 Speaker 2: Simply because it's just not as many companies, not many compants, 283 00:12:33,240 --> 00:12:35,599 Speaker 2: that's right, And there's an awful lot of money that 284 00:12:35,640 --> 00:12:36,680 Speaker 2: needs to be funneled. 285 00:12:36,320 --> 00:12:38,880 Speaker 3: Towards amount of money. That's right, Yeah, that's right. 286 00:12:39,200 --> 00:12:43,360 Speaker 5: And everyone wants to growth company to future proof their portfolio. Right, 287 00:12:43,440 --> 00:12:45,920 Speaker 5: So your portfolio will have always have bit of everything. 288 00:12:45,960 --> 00:12:47,760 Speaker 5: You have, bit of gold, bit of a company that 289 00:12:47,840 --> 00:12:50,600 Speaker 5: paid dividend like banks and things give you good income, 290 00:12:50,880 --> 00:12:53,040 Speaker 5: and then bit of maybe bit of material, but bit 291 00:12:53,120 --> 00:12:56,040 Speaker 5: of a growth company because in five years time, you 292 00:12:56,080 --> 00:12:58,640 Speaker 5: want your portfolio to keep growing rather than just paying 293 00:12:58,679 --> 00:13:01,040 Speaker 5: out dividend, right, you don't want to then still every 294 00:13:01,120 --> 00:13:03,600 Speaker 5: year they say share market should double every seven years, 295 00:13:03,920 --> 00:13:06,920 Speaker 5: So you want that growth company to be the core 296 00:13:07,040 --> 00:13:09,679 Speaker 5: holding of a portfolio. And then on top of that 297 00:13:09,800 --> 00:13:12,760 Speaker 5: you've got some dividend. You've got some ciclical they call 298 00:13:12,800 --> 00:13:15,640 Speaker 5: a cicl call ciclicll is like companies do well when 299 00:13:15,679 --> 00:13:18,680 Speaker 5: the economy picks up and then do badly when economy 300 00:13:18,800 --> 00:13:21,400 Speaker 5: So you buy and sell you much more shorter term 301 00:13:21,480 --> 00:13:22,080 Speaker 5: with those ones. 302 00:13:22,480 --> 00:13:23,520 Speaker 3: So that's the portfolio. 303 00:13:23,679 --> 00:13:25,120 Speaker 4: So you think I need to have a bank in 304 00:13:25,160 --> 00:13:25,840 Speaker 4: my portfolio. 305 00:13:26,200 --> 00:13:28,480 Speaker 2: We always refer to the Big four and then Commonwealth 306 00:13:28,559 --> 00:13:31,520 Speaker 2: Bank has absolutely gone out on its own, like it 307 00:13:31,679 --> 00:13:34,400 Speaker 2: is just on a different level. So then how do 308 00:13:34,480 --> 00:13:36,040 Speaker 2: you work out then, if I want to have a bank, 309 00:13:36,160 --> 00:13:38,560 Speaker 2: does Commonwealth now look so expensive that I'm better off 310 00:13:38,640 --> 00:13:39,920 Speaker 2: going with these other three? 311 00:13:40,960 --> 00:13:41,640 Speaker 3: Pick one of them? 312 00:13:41,960 --> 00:13:43,920 Speaker 2: Or do you say, like what we were talking about 313 00:13:43,920 --> 00:13:46,320 Speaker 2: before is like the herds obviously going with CBA. 314 00:13:47,280 --> 00:13:48,959 Speaker 4: How do you make that decision? How do you sit 315 00:13:49,000 --> 00:13:50,040 Speaker 4: down and assess it? 316 00:13:50,320 --> 00:13:50,480 Speaker 5: Yeah? 317 00:13:50,520 --> 00:13:52,240 Speaker 3: Look a two things I agree with you. I think 318 00:13:52,280 --> 00:13:54,600 Speaker 3: banks looks really expensive. Yeah yeah. 319 00:13:54,679 --> 00:13:56,559 Speaker 5: And then the thing is like you don't really want 320 00:13:56,600 --> 00:13:59,600 Speaker 5: to As an investor who's not constantly watching the market, 321 00:13:59,840 --> 00:14:03,120 Speaker 5: I always have advice to stick with quality, stick with 322 00:14:03,200 --> 00:14:04,880 Speaker 5: the best quality company, and because you don't want to 323 00:14:04,880 --> 00:14:06,520 Speaker 5: worry about a day to day you've got to day 324 00:14:06,559 --> 00:14:08,800 Speaker 5: trade and all of that. Right, So unfortunately, I think 325 00:14:09,120 --> 00:14:12,520 Speaker 5: CBA is best position. It's the best bank, most expensive 326 00:14:12,559 --> 00:14:14,839 Speaker 5: in the world, I can say that. So when you 327 00:14:14,920 --> 00:14:17,320 Speaker 5: pick one, I think NAB looks okay. Relative Again, we're 328 00:14:17,360 --> 00:14:21,080 Speaker 5: talking about relative valuation. Things look relatively cheaper. NAP still 329 00:14:21,120 --> 00:14:24,000 Speaker 5: looks expensive for a bank on historical terms, but it's 330 00:14:24,000 --> 00:14:27,360 Speaker 5: a whole lot cheaper than what CBA is offering. So 331 00:14:27,680 --> 00:14:30,600 Speaker 5: I think relatively I would hold NAB instead of CBA. 332 00:14:31,040 --> 00:14:34,600 Speaker 5: But nothing will stop CBA from keep rallying away because. 333 00:14:34,440 --> 00:14:36,840 Speaker 4: If anyone listening, if they just put CBA, you. 334 00:14:36,920 --> 00:14:38,920 Speaker 5: Keep up because I tell you what, last three months 335 00:14:38,960 --> 00:14:41,680 Speaker 5: at the share price going where it actually six six 336 00:14:41,800 --> 00:14:44,760 Speaker 5: months ago a share price was moving higher because of 337 00:14:44,960 --> 00:14:47,160 Speaker 5: it's earning was doing a bit better and buy back 338 00:14:47,280 --> 00:14:50,040 Speaker 5: and all these great things. But last three months all 339 00:14:50,080 --> 00:14:53,680 Speaker 5: because international investor want to put money in Australia and 340 00:14:53,760 --> 00:14:55,400 Speaker 5: then what do they do. They kind of just buy 341 00:14:55,440 --> 00:14:58,120 Speaker 5: the top companies and they don't want to buy resources, 342 00:14:58,320 --> 00:15:00,280 Speaker 5: so they bought banks and then watch banks buy, you 343 00:15:00,360 --> 00:15:02,720 Speaker 5: buy the CBA. They don't want the problem with an 344 00:15:02,840 --> 00:15:05,600 Speaker 5: they's had a lot of issues and even Westpac is 345 00:15:05,640 --> 00:15:07,960 Speaker 5: not doing gray, so they kind of just put money 346 00:15:08,000 --> 00:15:08,720 Speaker 5: in the big one. 347 00:15:09,040 --> 00:15:12,600 Speaker 2: We get told a lot that, particularly when markets are volatile, 348 00:15:13,240 --> 00:15:17,960 Speaker 2: don't sell, sit tight, hang in there. I think for 349 00:15:18,200 --> 00:15:20,880 Speaker 2: investors too, there is an art in knowing when to sell. 350 00:15:21,320 --> 00:15:23,120 Speaker 2: How do you work out when it's a great time 351 00:15:23,720 --> 00:15:24,160 Speaker 2: to sell? 352 00:15:24,480 --> 00:15:28,480 Speaker 5: Yeah, so to sell is always the hardest question for it. Yeah, 353 00:15:28,680 --> 00:15:31,400 Speaker 5: so hardest question. I always believe you find a proper 354 00:15:31,680 --> 00:15:34,520 Speaker 5: growth winner. You do not sell right so you can 355 00:15:34,640 --> 00:15:36,360 Speaker 5: trim a little bit because you need money to buy 356 00:15:36,440 --> 00:15:36,960 Speaker 5: something else. 357 00:15:37,160 --> 00:15:38,120 Speaker 3: That's how we look at it. 358 00:15:38,240 --> 00:15:40,800 Speaker 5: So if I some of our winner like like three sixty, 359 00:15:40,920 --> 00:15:44,280 Speaker 5: Promedicus and these one that incredibly well. But the thing is, 360 00:15:44,480 --> 00:15:46,680 Speaker 5: if I find something else I think also can do 361 00:15:47,000 --> 00:15:48,440 Speaker 5: very well in the next to a month, I might 362 00:15:48,480 --> 00:15:50,000 Speaker 5: sell a little bit and put into it, but I 363 00:15:50,040 --> 00:15:54,400 Speaker 5: don't completely sell out because winners history have proven that 364 00:15:54,720 --> 00:15:56,720 Speaker 5: if you sell it, you'll never buy back in because 365 00:15:56,760 --> 00:15:59,520 Speaker 5: they keep going. So a company like that is they 366 00:15:59,640 --> 00:16:03,040 Speaker 5: just such a strong driver behind them in terms of 367 00:16:03,120 --> 00:16:05,520 Speaker 5: earning's growth. It just we just don't have many of 368 00:16:05,600 --> 00:16:06,120 Speaker 5: them around. 369 00:16:06,320 --> 00:16:08,320 Speaker 4: So how do you go about balancing your portfolio? 370 00:16:08,680 --> 00:16:10,760 Speaker 5: Yeah, So the good thing is that when you find 371 00:16:10,800 --> 00:16:13,440 Speaker 5: when we have the next opportunity coming out maybe so 372 00:16:13,600 --> 00:16:16,120 Speaker 5: I think even with like three sixty, it was a 373 00:16:16,200 --> 00:16:18,720 Speaker 5: few years ago, was very cheap. Everyone worried about what's 374 00:16:18,720 --> 00:16:20,920 Speaker 5: happening with the US and all that, and then you know, 375 00:16:21,000 --> 00:16:22,960 Speaker 5: you sell some of the growth names and funding too. 376 00:16:23,040 --> 00:16:25,440 Speaker 5: Those and even early in the year when you talk 377 00:16:25,440 --> 00:16:28,560 Speaker 5: about the market volatility, these times are great to picking 378 00:16:28,640 --> 00:16:32,160 Speaker 5: up high quality companies because people sell everything, especially people 379 00:16:32,240 --> 00:16:34,280 Speaker 5: like to sell winners because they go, oh, I don't 380 00:16:34,320 --> 00:16:36,360 Speaker 5: know what tariff is going to do I'm going to 381 00:16:36,400 --> 00:16:38,560 Speaker 5: sell my profit my winners because I've done so well 382 00:16:38,640 --> 00:16:41,440 Speaker 5: out of them. So people sold out all the growth names. 383 00:16:41,600 --> 00:16:45,280 Speaker 5: They're all thirty percent cheaper, literally in three weeks thirty 384 00:16:45,280 --> 00:16:48,520 Speaker 5: percent cheaper, and then they all jumped more than thirty percent. 385 00:16:48,600 --> 00:16:50,440 Speaker 5: Some of them have gone up thirty percent. 386 00:16:50,880 --> 00:16:53,160 Speaker 4: Behindslight's wonderful, isn't it. So yeah, that's how do you 387 00:16:53,320 --> 00:16:55,600 Speaker 4: stay calm in those times it can be turbulent. 388 00:16:56,080 --> 00:16:58,720 Speaker 2: That's got a job where you'll wake up in the 389 00:16:58,760 --> 00:17:00,360 Speaker 2: morning or maybe I don't know if you would have 390 00:17:00,400 --> 00:17:02,800 Speaker 2: done to go what's my morning going to be? Like, 391 00:17:03,160 --> 00:17:05,639 Speaker 2: It's just it's what Deffen is happening on global markets 392 00:17:05,760 --> 00:17:08,159 Speaker 2: really does impact what's happening on the local market. 393 00:17:08,080 --> 00:17:10,320 Speaker 5: Absolutely, so I think, look, I've been doing this for 394 00:17:10,440 --> 00:17:12,560 Speaker 5: twenty five years, so you kind of get used to 395 00:17:12,640 --> 00:17:15,240 Speaker 5: the volatility. Volatility will come, but you know it will 396 00:17:15,280 --> 00:17:18,320 Speaker 5: always pass. It will always pass, but you need to 397 00:17:18,400 --> 00:17:20,760 Speaker 5: work out what's the new information. So what we didn't 398 00:17:20,800 --> 00:17:23,880 Speaker 5: know at the time was really in this particular time 399 00:17:24,040 --> 00:17:26,119 Speaker 5: was tariff. We don't know what Trump is going to 400 00:17:26,160 --> 00:17:28,200 Speaker 5: do one hundred and forty seven percent on China or 401 00:17:28,200 --> 00:17:31,600 Speaker 5: all that. So for companies that potentially get impacted by 402 00:17:31,680 --> 00:17:33,800 Speaker 5: that tariff. We just thought that's too hard because I 403 00:17:33,840 --> 00:17:36,000 Speaker 5: don't know tomorrow. It could be one hundred percent tomorrow 404 00:17:36,119 --> 00:17:37,040 Speaker 5: or zero percent. 405 00:17:37,119 --> 00:17:38,600 Speaker 3: I don't know. That's we don't do. 406 00:17:39,000 --> 00:17:41,840 Speaker 5: But for the company actually doesn't get impacted by tariff, 407 00:17:42,000 --> 00:17:45,000 Speaker 5: they are thirty percent lower on no change to earnings. 408 00:17:45,240 --> 00:17:48,040 Speaker 5: This way, we know it will come back. So you 409 00:17:48,240 --> 00:17:51,800 Speaker 5: buy these businesses same as during pandemic. I remember when 410 00:17:51,880 --> 00:17:55,600 Speaker 5: market went free four same thing. Everything fell, especially the winners, 411 00:17:55,680 --> 00:17:58,080 Speaker 5: they fell first, and then we just sort of work 412 00:17:58,119 --> 00:18:00,040 Speaker 5: out what we do know what we don't know. So 413 00:18:00,359 --> 00:18:01,960 Speaker 5: the first thing is that what we do know is 414 00:18:02,000 --> 00:18:04,199 Speaker 5: that hard asset will come back. Sit in the airport. 415 00:18:04,600 --> 00:18:07,000 Speaker 5: Someone will buy this thing. It was forty percent cheap, 416 00:18:07,080 --> 00:18:09,320 Speaker 5: or someone will buy it. So you buy the hard asset, 417 00:18:09,520 --> 00:18:11,800 Speaker 5: and then we have the government promised to step in 418 00:18:11,880 --> 00:18:13,920 Speaker 5: give stimulus and all of that. Then we'll go, okay, 419 00:18:13,960 --> 00:18:16,399 Speaker 5: we can then buy retailers by JP high vibe. So 420 00:18:16,800 --> 00:18:20,520 Speaker 5: really need to really understand what information is there and 421 00:18:20,640 --> 00:18:22,879 Speaker 5: then based on and see if there's any change to 422 00:18:23,040 --> 00:18:25,439 Speaker 5: your investment assumptions of a company. 423 00:18:25,800 --> 00:18:28,480 Speaker 2: Let's dive into some of the mistakes along the way. 424 00:18:28,560 --> 00:18:31,680 Speaker 2: We've all made some safe places. 425 00:18:31,800 --> 00:18:33,600 Speaker 3: It's a safe space, that's right. 426 00:18:34,240 --> 00:18:35,520 Speaker 2: But I think to learn and to grow and to 427 00:18:35,560 --> 00:18:37,760 Speaker 2: become a better investor, you've had to have made some 428 00:18:37,840 --> 00:18:39,800 Speaker 2: clangers along the way. So I don't know if there's 429 00:18:39,880 --> 00:18:43,159 Speaker 2: one in particular that you recall what it was and 430 00:18:43,240 --> 00:18:43,800 Speaker 2: what it taught you. 431 00:18:44,200 --> 00:18:46,440 Speaker 5: Yeah, look, we make a mistake all the time, that's 432 00:18:46,480 --> 00:18:48,560 Speaker 5: what they say. So investing in the share market, right, 433 00:18:48,720 --> 00:18:51,320 Speaker 5: you work out your probability, so what they say, but 434 00:18:51,440 --> 00:18:53,920 Speaker 5: we do better than that, So we are probability is 435 00:18:53,920 --> 00:18:56,760 Speaker 5: about seventy to twenty percent will outperform, and but that 436 00:18:56,880 --> 00:18:59,560 Speaker 5: twenty percent time that we're underperforming will pick the company 437 00:18:59,600 --> 00:19:02,880 Speaker 5: that in the workhouse. So you always make misspedakes. That's 438 00:19:02,920 --> 00:19:05,320 Speaker 5: the key advice. You have to make mistake to learn, 439 00:19:05,600 --> 00:19:09,040 Speaker 5: otherwise you never learn. So there's one name always click 440 00:19:09,160 --> 00:19:11,800 Speaker 5: with me because that's early days in my career, obviously 441 00:19:12,040 --> 00:19:13,800 Speaker 5: feeling fantastic buying Woolworth's. 442 00:19:13,880 --> 00:19:16,120 Speaker 2: Oh this is easy, and so that investment went well, 443 00:19:16,440 --> 00:19:18,719 Speaker 2: we meant an So that that was your first investment. 444 00:19:18,760 --> 00:19:19,720 Speaker 4: Can you recall how much you's? 445 00:19:19,840 --> 00:19:22,960 Speaker 5: Can remember, Yeah, I made money and then I sold it. Yeah, 446 00:19:23,000 --> 00:19:24,480 Speaker 5: that's right, I made money. I think I made a 447 00:19:24,520 --> 00:19:26,200 Speaker 5: thousand dollars. I was so excited and I saw it, 448 00:19:26,400 --> 00:19:27,320 Speaker 5: I was like, yes, lock it. 449 00:19:27,320 --> 00:19:27,960 Speaker 3: In, okay. 450 00:19:28,080 --> 00:19:29,600 Speaker 4: So then you feel like, yeah, I know what I'm doing. 451 00:19:29,840 --> 00:19:31,080 Speaker 3: Yeah, that's right. It's way too easy. 452 00:19:31,280 --> 00:19:33,800 Speaker 5: And then that's when and then the I also just 453 00:19:33,880 --> 00:19:36,400 Speaker 5: started my celside job where I was the first time 454 00:19:36,560 --> 00:19:39,639 Speaker 5: young person being my full lead analysts and initiate on 455 00:19:39,720 --> 00:19:43,080 Speaker 5: this company. And I remember at the time JBHIGHI just 456 00:19:43,200 --> 00:19:46,199 Speaker 5: listed and it was expensive. I think sixteen times earnings 457 00:19:46,359 --> 00:19:49,440 Speaker 5: was very expensive. Then now will be like two hundred times. 458 00:19:49,560 --> 00:19:52,240 Speaker 5: But anyway, I was sixteen times earning. And then I thought, oh, 459 00:19:52,520 --> 00:19:56,640 Speaker 5: jbhif I sixteen times earning, Strathfield Car Radio, I don't 460 00:19:56,680 --> 00:19:57,560 Speaker 5: know if you know that one. 461 00:19:57,720 --> 00:20:00,600 Speaker 3: Oh that's going back. Yeah, yeah, okay, that's it. So 462 00:20:01,359 --> 00:20:04,080 Speaker 3: Strathfield Car Radio was trading on twelve times. 463 00:20:04,160 --> 00:20:06,720 Speaker 2: And and so just weren't they They were the company 464 00:20:06,760 --> 00:20:08,720 Speaker 2: and you could take out your the car radio and 465 00:20:08,760 --> 00:20:11,639 Speaker 2: your existing car and put in like the radis and 466 00:20:11,920 --> 00:20:13,040 Speaker 2: city players and stuff. 467 00:20:13,160 --> 00:20:13,560 Speaker 3: That's right. 468 00:20:13,560 --> 00:20:15,600 Speaker 5: And then those days car radio is big thing. So 469 00:20:15,720 --> 00:20:18,240 Speaker 5: every people when they buy the car, they go and 470 00:20:18,480 --> 00:20:21,600 Speaker 5: change their radio, they upgrade their radio. So JB High 471 00:20:21,600 --> 00:20:24,400 Speaker 5: Fi used to have those as well with the car radio. 472 00:20:24,520 --> 00:20:27,280 Speaker 5: It was a big credit, big components of that time, right, 473 00:20:27,320 --> 00:20:30,040 Speaker 5: that's right. Yeah, So you walk into Strathfield car radio. 474 00:20:30,080 --> 00:20:32,040 Speaker 5: They so they got car radio they got back then 475 00:20:32,080 --> 00:20:34,920 Speaker 5: they just started selling mobile phone in those things, and 476 00:20:35,000 --> 00:20:36,920 Speaker 5: they got a little bit of consumer electronics on the 477 00:20:37,040 --> 00:20:39,600 Speaker 5: side as well. So it's like a mini JB high five, 478 00:20:39,640 --> 00:20:41,119 Speaker 5: but poor men version JB High. 479 00:20:41,000 --> 00:20:42,680 Speaker 3: Five, okay, And he thought, well, it's cheaper. I was 480 00:20:42,760 --> 00:20:43,440 Speaker 3: as much cheaper. 481 00:20:43,600 --> 00:20:45,880 Speaker 5: Why not? They're rolling our stores as well, and JB 482 00:20:46,000 --> 00:20:47,160 Speaker 5: High five's rolling our stores. 483 00:20:47,480 --> 00:20:49,480 Speaker 3: Why would not buy this one? It's all great? 484 00:20:49,720 --> 00:20:52,240 Speaker 5: But and then I put on a great strong buy 485 00:20:52,400 --> 00:20:54,920 Speaker 5: and everything, and actually share price did well for about 486 00:20:54,960 --> 00:20:58,240 Speaker 5: three months. And then Richard Utriz was running JB High 487 00:20:58,240 --> 00:21:00,280 Speaker 5: five at the time. He came omember and saw for me. 488 00:21:00,760 --> 00:21:01,480 Speaker 3: He's like, you bad. 489 00:21:02,560 --> 00:21:06,160 Speaker 5: Have you been to the Strathfield store. That's the question 490 00:21:06,200 --> 00:21:08,160 Speaker 5: to me. He's like, have you actually been to the store. 491 00:21:08,440 --> 00:21:11,119 Speaker 5: I was like, no, I've seen pictures. It looks fine. 492 00:21:12,119 --> 00:21:13,720 Speaker 3: He's like, you should go and have a look. 493 00:21:14,240 --> 00:21:16,240 Speaker 4: And was he there to chat to you about trying 494 00:21:16,240 --> 00:21:20,520 Speaker 4: to invest in it? You never sell one jock. 495 00:21:20,600 --> 00:21:22,920 Speaker 5: I didn't have cell but they just just essentially he's 496 00:21:23,040 --> 00:21:26,600 Speaker 5: educating in the market, just listed yeah, doing a kind 497 00:21:26,640 --> 00:21:27,920 Speaker 5: of road show, and he's like, have you been to 498 00:21:28,000 --> 00:21:31,800 Speaker 5: the store. I've seen the pictures and everything. And then 499 00:21:31,840 --> 00:21:33,480 Speaker 5: I thought, oh damn, I probably should go and see 500 00:21:33,480 --> 00:21:35,680 Speaker 5: the store. And I did go see the store, was saying, 501 00:21:35,680 --> 00:21:37,680 Speaker 5: oh god, this is not like JB High Fi. A 502 00:21:37,720 --> 00:21:40,639 Speaker 5: majority of the store was designated to the car radio. 503 00:21:40,920 --> 00:21:42,760 Speaker 5: And then there's a couple of I think they have 504 00:21:42,840 --> 00:21:45,000 Speaker 5: a big contract where the Optus or Telstra, they're like 505 00:21:45,280 --> 00:21:48,440 Speaker 5: Telstra Optus love us, gave us all these big trailing revenue. 506 00:21:48,560 --> 00:21:50,480 Speaker 5: We sell one mobile phone, we'll get paid so much 507 00:21:50,520 --> 00:21:52,840 Speaker 5: and all that, and then tiny bit income stroom electronics, 508 00:21:53,080 --> 00:21:56,119 Speaker 5: completely different, very old school, very dated. They're not in 509 00:21:56,200 --> 00:21:59,600 Speaker 5: the shopping center, they're outside on those Paramatta roads, and 510 00:22:00,280 --> 00:22:02,879 Speaker 5: very different vibe between the stores. And then it's not 511 00:22:02,960 --> 00:22:06,440 Speaker 5: efficient every category and jbhihid back then only just started 512 00:22:06,480 --> 00:22:09,080 Speaker 5: selling a few category. They haven't started selling game yet, 513 00:22:09,119 --> 00:22:11,320 Speaker 5: they haven't started selling PC. There were so many new 514 00:22:11,359 --> 00:22:15,040 Speaker 5: categories to come, completely different, and I came back thinking 515 00:22:15,320 --> 00:22:17,680 Speaker 5: this is not good. But anyway, I wasn't experienced that 516 00:22:17,720 --> 00:22:19,400 Speaker 5: I thought, look, I could write it because. 517 00:22:19,200 --> 00:22:20,720 Speaker 4: You've made your decision right, and so I'm going to 518 00:22:20,760 --> 00:22:21,280 Speaker 4: back yourself in. 519 00:22:21,440 --> 00:22:22,360 Speaker 3: So every fritten it's great. 520 00:22:22,440 --> 00:22:25,639 Speaker 5: Yeah, and invested and I said it's great, buy and 521 00:22:25,680 --> 00:22:28,560 Speaker 5: then trying to convince everyone to buy. And six months later, 522 00:22:28,760 --> 00:22:32,240 Speaker 5: retail condition got a bit tougher, so consumer become tightened 523 00:22:32,280 --> 00:22:36,639 Speaker 5: their pockets and everything else. Immediately, Stratfield, they're like for 524 00:22:36,840 --> 00:22:37,880 Speaker 5: like started going negative. 525 00:22:38,000 --> 00:22:39,359 Speaker 4: Can you what year are we talking? 526 00:22:39,520 --> 00:22:41,800 Speaker 5: Maybe it was two thousand and five. There was one 527 00:22:41,920 --> 00:22:45,440 Speaker 5: year many retailer had downgrades. I think maybe it was 528 00:22:45,640 --> 00:22:47,520 Speaker 5: May two thousand and five or two thousand and four. 529 00:22:47,800 --> 00:22:50,399 Speaker 5: Winter was too hot as well, everyone downgraded because it 530 00:22:50,480 --> 00:22:53,240 Speaker 5: was two hot jackets won't selling A just group was 531 00:22:53,280 --> 00:22:55,760 Speaker 5: listed at the time as well. Remember but yeah, so 532 00:22:55,960 --> 00:22:58,720 Speaker 5: just retailer when things got a little bit tougher, retailer 533 00:22:58,760 --> 00:22:59,960 Speaker 5: don't have strong business model. 534 00:23:00,400 --> 00:23:01,960 Speaker 3: They just don't do it as well. People don't need 535 00:23:02,000 --> 00:23:02,439 Speaker 3: to go to. 536 00:23:02,560 --> 00:23:05,040 Speaker 5: Stratfield, whereas JB High Fire because they have a strong 537 00:23:05,080 --> 00:23:07,080 Speaker 5: busin models, but they pull people in. People want to 538 00:23:07,119 --> 00:23:09,400 Speaker 5: go and see what's going on or the excited excitement. 539 00:23:09,640 --> 00:23:12,000 Speaker 5: So things started going backwards and the minute staff for 540 00:23:12,119 --> 00:23:15,880 Speaker 5: retailers when things going backwards, going negative, it's heavily leveraged 541 00:23:16,000 --> 00:23:19,000 Speaker 5: because they don't have much debt, but the lease. 542 00:23:19,160 --> 00:23:20,920 Speaker 3: They have to pay a lot on the lease, so 543 00:23:21,040 --> 00:23:22,800 Speaker 3: there's not much room to move for retailers. 544 00:23:22,800 --> 00:23:25,439 Speaker 2: Start to see it turn negative, but you realize, as 545 00:23:25,480 --> 00:23:27,479 Speaker 2: we spoke about earlier, it's like you've made a decision 546 00:23:27,520 --> 00:23:28,040 Speaker 2: and you don't. 547 00:23:28,920 --> 00:23:30,560 Speaker 4: You don't sell out when things get volatile. 548 00:23:30,720 --> 00:23:32,760 Speaker 3: So did you stay? Oh no, no, no, So I 549 00:23:33,080 --> 00:23:33,720 Speaker 3: got this one wrong. 550 00:23:33,880 --> 00:23:36,280 Speaker 5: Yeah, because I realized how quickly things can back can 551 00:23:36,320 --> 00:23:38,920 Speaker 5: get bad, and so the minute it turns negative, I 552 00:23:38,960 --> 00:23:40,840 Speaker 5: think I sat there for six months, longer than I 553 00:23:40,840 --> 00:23:43,879 Speaker 5: should six months. So when it started turning, I didn't 554 00:23:43,920 --> 00:23:45,880 Speaker 5: move straight away because I thought it will get better. 555 00:23:46,119 --> 00:23:49,080 Speaker 5: Maybe just patch your consumer, Maybe they just unlucky. Management 556 00:23:49,119 --> 00:23:52,399 Speaker 5: always find the best excuses. Oh this thing happened, too 557 00:23:52,480 --> 00:23:53,399 Speaker 5: much rain or something. 558 00:23:53,720 --> 00:23:54,119 Speaker 3: Always this. 559 00:23:54,440 --> 00:23:56,400 Speaker 5: So at the end, so and they're six month later, 560 00:23:56,440 --> 00:23:59,560 Speaker 5: I realized that the operating d leverage is very significant 561 00:23:59,600 --> 00:24:02,119 Speaker 5: for a retil and for a retailer. By then, I 562 00:24:02,520 --> 00:24:05,320 Speaker 5: have realized that there is something that whatever I thought 563 00:24:05,320 --> 00:24:07,160 Speaker 5: it was special about the company, it was not there. 564 00:24:07,440 --> 00:24:10,639 Speaker 5: I should have really visited the store. Really see what 565 00:24:11,200 --> 00:24:13,960 Speaker 5: was the value driver why people walk into that store? 566 00:24:14,160 --> 00:24:15,960 Speaker 3: There was no reason. That's why when things are tough, 567 00:24:16,000 --> 00:24:16,720 Speaker 3: people don't walk in. 568 00:24:17,359 --> 00:24:19,040 Speaker 4: Do you remember how much money you might have lost 569 00:24:19,160 --> 00:24:19,880 Speaker 4: with that investment? 570 00:24:20,560 --> 00:24:20,720 Speaker 1: Oh? 571 00:24:20,760 --> 00:24:23,320 Speaker 3: I think I lost like twenty thirty percent of the investment. 572 00:24:23,400 --> 00:24:25,159 Speaker 5: Yeah, okay, all right, but it stuck with you all 573 00:24:25,200 --> 00:24:29,159 Speaker 5: this time. Mistake forever. It's just to do the homework right. 574 00:24:29,240 --> 00:24:32,359 Speaker 5: It's about really truly understand the business instead of what 575 00:24:32,560 --> 00:24:33,240 Speaker 5: management tell you. 576 00:24:33,880 --> 00:24:36,000 Speaker 2: Seeing as we're going down back to two thousand and five, 577 00:24:36,080 --> 00:24:38,200 Speaker 2: maybe if you could go back sort of twenty years 578 00:24:38,320 --> 00:24:41,680 Speaker 2: or so, if there was a financial habit that you 579 00:24:41,800 --> 00:24:43,560 Speaker 2: could have picked up back then, do you know what 580 00:24:43,680 --> 00:24:44,280 Speaker 2: that would have been? 581 00:24:44,480 --> 00:24:46,440 Speaker 4: Just layering a good. 582 00:24:46,280 --> 00:24:47,960 Speaker 3: Habit, financial habit. 583 00:24:48,280 --> 00:24:50,320 Speaker 5: I think it's probably back then I was at the 584 00:24:50,359 --> 00:24:53,639 Speaker 5: early stage of I do think reading financial publication is 585 00:24:53,760 --> 00:24:54,360 Speaker 5: very important. 586 00:24:54,520 --> 00:24:55,480 Speaker 4: Excellent, you can all read this. 587 00:24:56,119 --> 00:24:58,920 Speaker 3: The Australia is the best. Well, that's right, that's right. 588 00:24:59,440 --> 00:25:03,160 Speaker 5: I actually it's really important. And these days that's where 589 00:25:03,200 --> 00:25:06,720 Speaker 5: we read about the mergers and acquisitions, the rumored deal 590 00:25:06,840 --> 00:25:08,960 Speaker 5: that's coming through. We'll get it from the paper. And 591 00:25:09,080 --> 00:25:11,560 Speaker 5: in those days, still early days, a scheme through every 592 00:25:11,600 --> 00:25:12,760 Speaker 5: now and then, but then you miss things. 593 00:25:13,200 --> 00:25:15,480 Speaker 2: Also you want as dedicated to reading and making sure. 594 00:25:15,480 --> 00:25:17,000 Speaker 2: So if you could go back in time. 595 00:25:17,000 --> 00:25:20,120 Speaker 5: You would actually just read more consistently absolutely every single 596 00:25:20,200 --> 00:25:23,720 Speaker 5: day like as information, and process the information much earlier 597 00:25:23,720 --> 00:25:26,240 Speaker 5: in the day. So how I process information these days? 598 00:25:26,400 --> 00:25:30,520 Speaker 5: All the reading everything is done before a thirty, So 599 00:25:30,920 --> 00:25:33,280 Speaker 5: everything is done before a thirty. So all the and 600 00:25:33,359 --> 00:25:35,280 Speaker 5: the a thirty we have our team meeting, we talk 601 00:25:35,320 --> 00:25:38,760 Speaker 5: about what we have absorbed. This includes everything what happened overnight, 602 00:25:39,000 --> 00:25:41,320 Speaker 5: what happened to, what happened in the US market, what 603 00:25:41,680 --> 00:25:43,920 Speaker 5: sort of things that's change, which company said well, which 604 00:25:43,960 --> 00:25:46,640 Speaker 5: company had done great, and what's this. And they're also 605 00:25:46,680 --> 00:25:50,320 Speaker 5: absorbing newsflow in Australian market before it opens, so all 606 00:25:50,359 --> 00:25:53,480 Speaker 5: the morning news knowing what's going to change, and by 607 00:25:53,560 --> 00:25:56,440 Speaker 5: a thirty we almost know how our market will open, 608 00:25:56,520 --> 00:25:58,720 Speaker 5: which sector will do well, which company will go up 609 00:25:58,760 --> 00:26:02,600 Speaker 5: and down, which announced meant to earnings down and all that. 610 00:26:02,840 --> 00:26:04,960 Speaker 5: So by a thirty everything's processed. 611 00:26:05,640 --> 00:26:14,200 Speaker 4: We'll return to our chat following this small breakthrough, Jinbai, 612 00:26:14,480 --> 00:26:16,760 Speaker 4: is there a piece of advice for someone like me 613 00:26:17,040 --> 00:26:21,040 Speaker 4: or someone listening about how they can is the one 614 00:26:21,080 --> 00:26:23,600 Speaker 4: thing that they should be doing that can make them 615 00:26:24,600 --> 00:26:28,000 Speaker 4: a better investor or at least start to build that wealth. 616 00:26:28,040 --> 00:26:30,560 Speaker 3: I feel like we're just all very busy, that's right. 617 00:26:30,680 --> 00:26:32,800 Speaker 4: What can people do? You sort of juggling? People are 618 00:26:32,840 --> 00:26:33,400 Speaker 4: juggling a lot. 619 00:26:33,640 --> 00:26:36,520 Speaker 5: Oh absolutely, and it's a never ending I've got kids myself, 620 00:26:36,600 --> 00:26:39,399 Speaker 5: it's just constantly juggling. So look, I think the advice is, 621 00:26:39,440 --> 00:26:42,920 Speaker 5: therefore someone wants to really learn about investing, because I 622 00:26:43,080 --> 00:26:46,000 Speaker 5: do all of these beforehand. Because I'm a professional farm manager, 623 00:26:46,200 --> 00:26:48,760 Speaker 5: I'm meant to know everything about what's happening in the market. 624 00:26:49,000 --> 00:26:50,600 Speaker 5: Then I can change my bed so I can be 625 00:26:50,720 --> 00:26:53,960 Speaker 5: more active. I can respond to different things. But you know, 626 00:26:54,040 --> 00:26:56,560 Speaker 5: if you're an individual, you're buying peel to your own portfolio, 627 00:26:56,840 --> 00:26:59,520 Speaker 5: you don't A lot of these things are noise. As individual, 628 00:26:59,560 --> 00:27:01,600 Speaker 5: we just want want to grow your own wealth. You 629 00:27:01,760 --> 00:27:03,440 Speaker 5: may one year you do a bit worse than the 630 00:27:03,600 --> 00:27:06,639 Speaker 5: share market, but it doesn't matter. You pick the company 631 00:27:06,720 --> 00:27:09,080 Speaker 5: that's still gone up. So it's a very different dynamic. 632 00:27:09,280 --> 00:27:12,480 Speaker 5: But for individual it's really about I feel it's about 633 00:27:12,600 --> 00:27:16,280 Speaker 5: the find the company you really understand and its quality, 634 00:27:16,640 --> 00:27:19,040 Speaker 5: so they get much less headache when you find a 635 00:27:19,080 --> 00:27:22,040 Speaker 5: spivvy stock. When you get a hot tip from somebody, 636 00:27:22,440 --> 00:27:25,000 Speaker 5: usually hot tap are bad because somebody told you the 637 00:27:25,040 --> 00:27:27,200 Speaker 5: hot tip would probably means that many other people already 638 00:27:27,240 --> 00:27:29,119 Speaker 5: got that hot tip a long time ago, and then 639 00:27:29,160 --> 00:27:31,240 Speaker 5: you might be the last person before it become not 640 00:27:31,320 --> 00:27:33,600 Speaker 5: so hot. And a lot of hot tip is fine, 641 00:27:33,720 --> 00:27:36,040 Speaker 5: but it just means they've probably it's gone up a lot, 642 00:27:36,160 --> 00:27:39,040 Speaker 5: gone very expensive. One of the example is recently there's 643 00:27:39,080 --> 00:27:42,439 Speaker 5: all these difference companies, Yeah, gone through the roof, that's right, 644 00:27:42,560 --> 00:27:44,640 Speaker 5: trying to sign up and everything, and I would say 645 00:27:44,720 --> 00:27:46,240 Speaker 5: a lot of them has a lot of hot air 646 00:27:46,280 --> 00:27:48,720 Speaker 5: in it, so they're not really training on how much 647 00:27:48,800 --> 00:27:51,159 Speaker 5: earning is multiple and the traditional things you're looking at 648 00:27:51,280 --> 00:27:53,120 Speaker 5: they're training are it's hot, we just got to get 649 00:27:53,160 --> 00:27:55,120 Speaker 5: in because there's only a few of them. So these 650 00:27:55,200 --> 00:27:57,639 Speaker 5: companies when they it's just risky, right, you got to 651 00:27:57,680 --> 00:28:00,800 Speaker 5: watch them because if suddenly one day people go, oh, 652 00:28:01,440 --> 00:28:04,399 Speaker 5: you're maybe it's not spending as much, or maybe actually 653 00:28:04,400 --> 00:28:06,840 Speaker 5: a company didn't win quite that many contract because the 654 00:28:06,960 --> 00:28:09,520 Speaker 5: shapprice the amount of share price gone out. People waiting 655 00:28:09,760 --> 00:28:11,879 Speaker 5: for a lot of contract to come through, So that's rial. 656 00:28:12,040 --> 00:28:14,480 Speaker 5: So I just think stayed with the company, especially you 657 00:28:14,560 --> 00:28:17,119 Speaker 5: can touch and feel, you understand the product and in 658 00:28:17,440 --> 00:28:20,919 Speaker 5: the quality larger blue tip. It's just much much easier, 659 00:28:21,320 --> 00:28:23,399 Speaker 5: less headache, you don't have to be on call suddenly 660 00:28:23,480 --> 00:28:26,280 Speaker 5: something happens, share price down twenty Just invest is that 661 00:28:26,400 --> 00:28:29,760 Speaker 5: the message you have to get started. Don't invest in 662 00:28:29,840 --> 00:28:32,080 Speaker 5: ETF for ETF is his least lazy. 663 00:28:31,920 --> 00:28:36,600 Speaker 3: Way of doing so. Atfs are booming. Yeah, there's now 664 00:28:36,840 --> 00:28:37,880 Speaker 3: active ETF coming. 665 00:28:37,920 --> 00:28:40,280 Speaker 5: Actually were launching it active ETF as well, So that's 666 00:28:40,320 --> 00:28:43,720 Speaker 5: with active manager ETF is fine, but you're not really learning. 667 00:28:44,160 --> 00:28:45,760 Speaker 3: So if you really want to learn. 668 00:28:45,640 --> 00:28:48,600 Speaker 5: About investing, when we talk about understanding company, you're doing 669 00:28:48,640 --> 00:28:51,120 Speaker 5: all that homework. That's a big part of the treasure hunting, right, 670 00:28:51,200 --> 00:28:51,960 Speaker 5: that's the fun part. 671 00:28:52,320 --> 00:28:53,600 Speaker 3: So that's when you. 672 00:28:53,960 --> 00:28:56,640 Speaker 5: If you pick a company, it forces you to learn 673 00:28:56,680 --> 00:29:00,040 Speaker 5: about it. So that's actually investing part. But if we 674 00:29:00,080 --> 00:29:03,320 Speaker 5: put in the ETF, that's more grow wealth part. So 675 00:29:03,560 --> 00:29:05,200 Speaker 5: because if you want to just an easy way just 676 00:29:05,200 --> 00:29:07,440 Speaker 5: say okay, I just want to go with the share market, 677 00:29:07,640 --> 00:29:08,440 Speaker 5: put in the ETF. 678 00:29:08,560 --> 00:29:09,840 Speaker 3: That's an easy way to do it as well. 679 00:29:09,960 --> 00:29:12,400 Speaker 2: Say we were talking defense stocks, so I might not 680 00:29:12,440 --> 00:29:13,720 Speaker 2: be able to pick the winner of who's going to 681 00:29:13,720 --> 00:29:16,320 Speaker 2: get the contracts. But I would think my logic would 682 00:29:16,320 --> 00:29:18,880 Speaker 2: say by the defense ETF, so you can spread the risk. 683 00:29:19,240 --> 00:29:21,080 Speaker 5: So the challenge with that is that you've got to 684 00:29:21,120 --> 00:29:23,239 Speaker 5: be early, right because when the hot air comes out, 685 00:29:23,320 --> 00:29:26,160 Speaker 5: the whole thing goes. Yeah yea, So it doesn't matter 686 00:29:26,240 --> 00:29:28,640 Speaker 5: which one you're in, so it's just the whole thing goes. 687 00:29:28,920 --> 00:29:31,520 Speaker 5: So I always feel the thematic there is a lot 688 00:29:31,560 --> 00:29:34,480 Speaker 5: of thematic ETF. But when you look at your own portfolio, 689 00:29:34,720 --> 00:29:36,640 Speaker 5: you don't want to have a big part of it 690 00:29:36,760 --> 00:29:36,920 Speaker 5: in it. 691 00:29:37,040 --> 00:29:37,760 Speaker 3: You have a small part. 692 00:29:38,000 --> 00:29:39,960 Speaker 5: It's almost like part a little bit on this. But 693 00:29:40,080 --> 00:29:42,840 Speaker 5: my core portfolio are these things. We know the core 694 00:29:42,960 --> 00:29:45,360 Speaker 5: things because the other one can be very volatile. 695 00:29:45,760 --> 00:29:48,200 Speaker 2: Juinbe we are fast running out of time, So I 696 00:29:48,320 --> 00:29:50,680 Speaker 2: do want to put our fast five to you, five 697 00:29:50,760 --> 00:29:53,200 Speaker 2: sort of rapid fire questions just to see. 698 00:29:53,000 --> 00:29:53,480 Speaker 3: How we go. 699 00:29:54,160 --> 00:29:55,800 Speaker 4: First up, morning or night. 700 00:29:56,200 --> 00:30:00,200 Speaker 2: When do you make your best financial decisions? Morning morning, okay, 701 00:30:00,240 --> 00:30:02,200 Speaker 2: before thirty, before thirty, when you've. 702 00:30:02,040 --> 00:30:03,080 Speaker 4: Done all the digesting. 703 00:30:03,360 --> 00:30:05,280 Speaker 3: Yeah, that's offee is fresh. I'm assuming this' coffee in 704 00:30:05,320 --> 00:30:06,560 Speaker 3: the morning. Yeah, less of coffee, okay. 705 00:30:08,000 --> 00:30:11,520 Speaker 2: If you could invest in one thing for the next 706 00:30:11,640 --> 00:30:14,720 Speaker 2: ten years. So you're only forget about the diversity, forget 707 00:30:14,720 --> 00:30:16,760 Speaker 2: about the I'm only allowing you to invest in one 708 00:30:16,840 --> 00:30:17,920 Speaker 2: thing for the next ten years. 709 00:30:17,960 --> 00:30:21,600 Speaker 3: What would it be? Yeah, you miss stock stock. Yeah, 710 00:30:21,680 --> 00:30:22,280 Speaker 3: maybe that's. 711 00:30:22,160 --> 00:30:24,000 Speaker 4: Trying to be a little bit specific. You get up. 712 00:30:24,000 --> 00:30:25,240 Speaker 4: I'm only get I'll. 713 00:30:25,080 --> 00:30:25,680 Speaker 3: Got plenty of that. 714 00:30:25,760 --> 00:30:27,560 Speaker 5: But I think I'm just going to give a very 715 00:30:27,760 --> 00:30:31,120 Speaker 5: high quality one, which is Cochlear. We know Cochlear, great 716 00:30:31,120 --> 00:30:34,200 Speaker 5: company in Australia, a huge, huge amount of years of that, 717 00:30:34,440 --> 00:30:38,400 Speaker 5: strong execution globally, not expensive relative to others. Yeah, I 718 00:30:38,480 --> 00:30:40,160 Speaker 5: think it's it's going to continue to grow. 719 00:30:40,400 --> 00:30:42,880 Speaker 4: Okay. Is there any investment app you can't live without? 720 00:30:43,720 --> 00:30:45,160 Speaker 3: Investment app? Bloomberg? 721 00:30:45,760 --> 00:30:50,400 Speaker 2: Okay, the terminal Bloomberg is a thing you can't live without, 722 00:30:50,400 --> 00:30:52,080 Speaker 2: Like if I took it away, you would actually have 723 00:30:52,160 --> 00:30:52,880 Speaker 2: a difficult day. 724 00:30:53,320 --> 00:30:56,479 Speaker 5: Yeah, I think yeah, because Bloomberg is a professional one 725 00:30:56,480 --> 00:30:58,200 Speaker 5: where we get all the life pricing and the like. 726 00:30:58,280 --> 00:31:00,720 Speaker 2: Here, what's the one thing you want your kids to 727 00:31:00,840 --> 00:31:02,960 Speaker 2: learn about money or to know about money? Something you 728 00:31:03,040 --> 00:31:04,200 Speaker 2: want them to really take away. 729 00:31:04,960 --> 00:31:07,280 Speaker 3: Oh okay, that's a really hard one. So I want 730 00:31:07,320 --> 00:31:07,720 Speaker 3: my kids. 731 00:31:07,800 --> 00:31:09,680 Speaker 5: I think the key thing I want my kids to 732 00:31:09,760 --> 00:31:12,040 Speaker 5: start really understanding the value of money. 733 00:31:12,360 --> 00:31:14,720 Speaker 3: I think every probably doing that. I want them to. 734 00:31:14,880 --> 00:31:16,760 Speaker 5: Actually the key thing is I want them to understand 735 00:31:16,880 --> 00:31:19,680 Speaker 5: how to grow money. Actually already created lots of those 736 00:31:19,720 --> 00:31:21,960 Speaker 5: savings to help them to understand you grow your money, 737 00:31:22,040 --> 00:31:24,000 Speaker 5: the compound, the effect of money. 738 00:31:24,280 --> 00:31:25,760 Speaker 4: And are they so how old are you kids again? 739 00:31:25,800 --> 00:31:26,560 Speaker 3: Eleven? Then fourteen? 740 00:31:26,600 --> 00:31:28,800 Speaker 2: Eleven and fourteen? And do they have their own investments? 741 00:31:28,840 --> 00:31:30,320 Speaker 2: Are you letting them invest themselves or that? 742 00:31:30,520 --> 00:31:32,520 Speaker 5: Yeah, I've been telling them about so they do so. 743 00:31:32,840 --> 00:31:35,440 Speaker 5: But obviously they always pick the easiest, the Tesla, the 744 00:31:35,560 --> 00:31:38,200 Speaker 5: Apple and these ones. So I'm trying to get them 745 00:31:38,240 --> 00:31:40,560 Speaker 5: to whenever they see go to Woolworth and the like 746 00:31:40,640 --> 00:31:42,560 Speaker 5: and then tell them that the shares that's listed and 747 00:31:42,720 --> 00:31:45,120 Speaker 5: everything else. So that's how I get them, essentially, the 748 00:31:45,200 --> 00:31:47,120 Speaker 5: things that they touch and feel every day. The more 749 00:31:47,160 --> 00:31:48,560 Speaker 5: the consumer goods product. 750 00:31:49,000 --> 00:31:50,640 Speaker 4: Hey, what's the one thing money can't buy? 751 00:31:51,680 --> 00:31:52,200 Speaker 3: Happiness? 752 00:31:53,760 --> 00:31:56,160 Speaker 5: And look, I think the money one thing money come by. 753 00:31:56,320 --> 00:31:59,280 Speaker 5: I think lots of things money come by. Even in investing, 754 00:31:59,480 --> 00:32:02,400 Speaker 5: always feel it's actually I do it for I just 755 00:32:02,480 --> 00:32:05,120 Speaker 5: think it's so much fun in doing so because of 756 00:32:05,200 --> 00:32:09,200 Speaker 5: that treasure hunting that journey, the resilience. You get things wrong, resilience, 757 00:32:09,320 --> 00:32:11,720 Speaker 5: come back and learn, then do it again. So more 758 00:32:11,800 --> 00:32:15,120 Speaker 5: than just money, it's actually for me, it's character building. 759 00:32:15,520 --> 00:32:17,680 Speaker 5: It's incredible experience. 760 00:32:17,880 --> 00:32:20,800 Speaker 2: A lot of people find investing quite intimidating. So is 761 00:32:20,840 --> 00:32:22,880 Speaker 2: there a piece of advice you have for people who 762 00:32:23,040 --> 00:32:24,880 Speaker 2: look at the success that you've got and think, oh gosh, 763 00:32:25,160 --> 00:32:26,000 Speaker 2: how do I replicate that? 764 00:32:26,320 --> 00:32:26,480 Speaker 3: Yeah? 765 00:32:26,520 --> 00:32:29,120 Speaker 5: Look, I think I just get started. It's not intimidating 766 00:32:29,120 --> 00:32:31,160 Speaker 5: at all, and it's not. And remember you don't have 767 00:32:31,240 --> 00:32:33,120 Speaker 5: to be accountant to do really well, but if you're countan, 768 00:32:33,160 --> 00:32:35,920 Speaker 5: you'll still do it. It's not just numbers. It's actually 769 00:32:36,000 --> 00:32:37,840 Speaker 5: so much more than that. We talk about some of 770 00:32:37,920 --> 00:32:40,960 Speaker 5: those thematic and things. Every company is so interesting, and 771 00:32:41,440 --> 00:32:44,160 Speaker 5: just have the curiosity and just get started. 772 00:32:44,680 --> 00:32:46,720 Speaker 4: I think people think they need a finance degree or 773 00:32:46,760 --> 00:32:48,840 Speaker 4: some sort of education in this. Is that sort of 774 00:32:49,040 --> 00:32:50,160 Speaker 4: a big miss? Do you think? 775 00:32:50,480 --> 00:32:51,360 Speaker 3: I think you don't need it. 776 00:32:51,560 --> 00:32:54,280 Speaker 5: But remember when you build a portfolio for the first time, 777 00:32:54,600 --> 00:32:56,760 Speaker 5: you first you pick the blue chip, the larger company, 778 00:32:56,960 --> 00:32:59,360 Speaker 5: and diversify. You need to have at least ten to 779 00:32:59,440 --> 00:33:02,600 Speaker 5: fifteen stock and don't just pick them out of one sector. 780 00:33:02,840 --> 00:33:04,400 Speaker 5: So if you pick a bank, and then you could 781 00:33:04,440 --> 00:33:07,200 Speaker 5: pick a growth company, you pick a gold company, picker 782 00:33:07,360 --> 00:33:10,240 Speaker 5: just a bit of everything, just so your portfolio is diversify. 783 00:33:10,320 --> 00:33:12,160 Speaker 3: It takes away a lot of risks when you do that. 784 00:33:12,520 --> 00:33:14,520 Speaker 4: JIMBEI, thank you so much, Thank you so much for 785 00:33:14,640 --> 00:33:16,480 Speaker 4: having me, Thanks for joining me. 786 00:33:16,640 --> 00:33:20,280 Speaker 2: I'm Julianne Sprague, Wealth editor at The Australian. We'll have 787 00:33:20,320 --> 00:33:23,360 Speaker 2: another bonus episode of the Money Puzzle next week. We'll 788 00:33:23,360 --> 00:33:26,520 Speaker 2: sit down with Roger Montgomery, a leading fund manager, a 789 00:33:26,600 --> 00:33:30,600 Speaker 2: firm favorite at The Australian, a regular columnist. He wasn't 790 00:33:30,600 --> 00:33:33,360 Speaker 2: always a great investor, and so we'll go back and 791 00:33:33,520 --> 00:33:36,960 Speaker 2: learn how he launched the trade, some of the mistakes 792 00:33:37,120 --> 00:33:39,360 Speaker 2: he made, and his advice for us.