WEBVTT - Quick bite: Are investors getting braver?

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<v Speaker 1>You're listening to a Sheerseise podcast. I've been really hardened

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<v Speaker 1>to see the response to this period of volatility, where

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<v Speaker 1>the latest figures from the Cheess's Index over the quarter

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<v Speaker 1>January to March showed again continuing strong netbuying through this period,

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<v Speaker 1>and then also a shift away from sort of more

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<v Speaker 1>individual companies and into more ETFs and diversified funds as

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<v Speaker 1>well as into defensive individual companies as well. And I

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<v Speaker 1>do think that reflects the fact that we are probably

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<v Speaker 1>in for a period of continued volatility, and diversification is

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<v Speaker 1>a really sort of important thing to make your portfolio

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<v Speaker 1>more resilient to sort of withstand with send that period.

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<v Speaker 1>I also think actually even before this tariff war and

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<v Speaker 1>these geopolitical events that we're seeing play out, you know,

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<v Speaker 1>if I look at twenty twenty four, in the year,

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<v Speaker 1>the S and P five hundred was up, I think

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<v Speaker 1>about twenty five percent, but about half of those companies

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<v Speaker 1>had losses so had a negative return for that period.

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<v Speaker 1>And actually it's a very few number of companies that

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<v Speaker 1>accounted for the majority of that return. And I think

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<v Speaker 1>that is a trend that we're seeing more and more,

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<v Speaker 1>particularly as you have large tech players with high operating leverage,

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<v Speaker 1>and you're seeing some more global companies and unless you

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<v Speaker 1>can you know, really pick who those winners will be,

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<v Speaker 1>it's got to be hard to even beat the market

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<v Speaker 1>return if you haven't got decent exposure to those very

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<v Speaker 1>few sort of fewer and fewer stocks that are driving

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<v Speaker 1>the big outcomes. And so I do think that moving

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<v Speaker 1>more to that diversified approach is really helpful as we're

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<v Speaker 1>seeing that trend even beyond you know, the volatility we're

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<v Speaker 1>seeing off the back of the Trump saga.

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<v Speaker 2>It's hard to look at say like QQQ, the Nasdaq

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<v Speaker 2>ET or the S and P five hundred and really

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<v Speaker 2>consider either of those to be diversified, given the concentration

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<v Speaker 2>of Magnificent seven and you know, just thinking about like

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<v Speaker 2>you know, people on shares this platform, this is key

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<v Speaker 2>we investors being drawn more to US stocks and they're

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<v Speaker 2>going down this. You get told to diversify your portfolio.

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<v Speaker 2>This American market should be one that you should go into.

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<v Speaker 2>But if you're only going into seven companies that are

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<v Speaker 2>making up the dominance of it, it's hard to wrap

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<v Speaker 2>your head around how you're actually diversifying your investment there,

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<v Speaker 2>or if you're just trying to ride the wave that

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<v Speaker 2>we've all been doing for what last seven eight nine

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<v Speaker 2>years now.

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<v Speaker 1>I remember a time on the ins oft X fifty

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<v Speaker 1>where I think it was fishing, Facal, Healthcare, and A

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<v Speaker 1>two milk collectively we're something like thirty percent of the index,

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<v Speaker 1>and so unless you had for fund managers that didn't

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<v Speaker 1>have a massive exposure to those two, they almost always

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<v Speaker 1>underperformed index at that time. What we are also seeing

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<v Speaker 1>because we call a lot of our KEYSAB members and

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<v Speaker 1>we are are tornture investors all the time. And another

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<v Speaker 1>thing we're seeing is we're actually finalarging investors, not disengaged.

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<v Speaker 1>They're not going I just put my head on the

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<v Speaker 1>set end and try and just forget about this period.

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<v Speaker 1>We are seeing investors actually continue to check in with

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<v Speaker 1>their balances, but also they're saying, actually, this is just

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<v Speaker 1>part and parcel of being an investor. And I think

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<v Speaker 1>that really is a shift in mentality of what we've

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<v Speaker 1>seen in previous periods, particularly amongst retail I'm talking to investors,

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<v Speaker 1>I've seen a really big shift in psychology where where

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<v Speaker 1>it is much more volatility is the price of investing,

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<v Speaker 1>and it's not a penalty. It's not for doing something wrong,

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<v Speaker 1>it's literally the price of being in the market. And actually,

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<v Speaker 1>when I do talk to investors, the things that they're

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<v Speaker 1>worried about is not volatility in the short term and

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<v Speaker 1>they shouldn't be like for investors taking a long enough

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<v Speaker 1>time horizon and advertiate. Volatility in in itself shouldn't be

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<v Speaker 1>the issue. The issue is, you know, can I lose

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<v Speaker 1>some all of my money or am I going to

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<v Speaker 1>get inadequate returns for the risk I'm taking on. Those

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<v Speaker 1>are the issues that investors need to be concerned with,

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<v Speaker 1>not that short term volatility. Investing involves the risk you

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<v Speaker 1>might lose the money you start with. We recommend talking

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<v Speaker 1>to a licensed financial advisor. We also recommend breading products

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<v Speaker 1>displosure documents before deciding to invest.