60. An Expert Reviews Our Trades | Stake Competition Wrap

July 17, 2018

"This is not mission impossible!" - Matt Leibowitz, CEO of Stake

This episode is a cracker.

As many of you are aware, we were invited to participate in a trading competition, hosted by Stake, to beta test their new trading app. The rules were simple. We were given $500 (USD$370) to trade through Stake, in American stocks. We had two weeks to make as much money as possible, and we had to trade at least three different companies.

Mission accepted!

However, for Equity Mates, this was going to be a massive challenge, because our view on investing is much, much longer-term than two weeks. We had to radically change our mindset.

We sat down with Matt for what was going to be a short wrap-up of the competition, and reveal of the results. However, as we got started we couldn't help picking Matt's brain further and further with questions about his trading during the competition and his views on technical analysis. We had a very open conversation with him about the tricks and habits of being a successful trader.

In this episode you will learn:

  • How much money we won or lost in the competition, and where we placed
  • What our biggest learnings were from the two weeks
  • The stocks we picked, and why we picked them
  • The stocks Matt picked, and why he picked them
  • About the importance of using a stop loss, and how to best manage them
  • The basics of volatility, and how Matt used it to his advantage
  • How to "be a lion in the jungle, and wait for your prey to appear"
  • Why money drives markets and not the news cycle
  • Why everyone has the ability to manage their own money
  • Why investing is not about being right, it's about making money
  • The best books for technical analysis

Stocks and resources discussed:

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59. Finding Strange and Surprising Companies

July 12, 2018

This episode is a little different to most. When the rumours first broke about football superstar Christiano Ronaldo going to Juventus, the Juventus share price jumped 8%. We didn't realise Juventus was publicly traded and started doing some researching. This episode is the result of that investigation - an exploration of some of the strangest and most surprising companies out on the market. 

In this episode you will learn:

  • About sports teams that are publicly traded, including one from Australia
  • How you can invest in stadiums 
  • If owning a sporting league is better than owning a sports team
  • About a company that searches for lost treasure 
  • Some of the strangest futures markets that have been banned by the US Government

Stocks and Resources Discussed:

  • Juventus (Italy: JUVE)
  • Machester United (NYSE: MANU)
  • Brisbane Broncos (ASX: BBL)
  • Madison Square Garden (NYSE: MSG)
  • Churchill Downs (NASDAQ: CHDN)
  • World Wrestling Entertainment (NYSE: WWE)
  • Formula One (NYSE: FWONA)
  • Odyssey Marine Exploration (NASDAQ: OMEX)

 

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58. Portfolio Deep Dive

July 8, 2018

Following on from the last episode, where we discussed three important elements for building an investment portfolio, we deep dive into our own portfolios to compare our strategies and see if they align with our investing goals.

We both have similar long-term goals, yet the way we approach constructing our investment portfolios are quite different, based on our risk appetite, asset classes and our short-term view of the market.

One of us is heavy in cash, expecting the market to turn, and wanting to be in a position to pounce. The other is well diversified across direct stock picks, hybrids and gold. We look at what the strategies are behind our portfolios and what our next moves are.

In this episode you will learn:

  • How we have approached our portfolio construction over the past few years
  • How our portfolio reflects our long-term investing goals
  • What a hybrid is, and why Alec has invested in them

 

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57. How To Build A Great Investment Portfolio

July 3, 2018

How to build a great investment portfolio? - it's easier than you think! There is no real hidden secret that only the professionals know about when it comes to building a successful investment portfolio. A portfolio is the total collection of assets that you invest in to create wealth. Now, it doesn't have to always be shares. Many portfolios of the best investors around the world are made up of different asset classes, from cash, to bonds and property.

This episode we debunk the myth that you need to be an expert to start building a great portfolio. The truth is, it's simple, as long as you're dedicated, do your own research and are prepared to have some fun. We discuss the three building blocks that we think are fundamental to building a portfolio and that are achievable for the beginner.

In this episode you will learn:

  • What the three components are that make the foundations for a strong investment portfolio
  • What Bryce and Alec's investing goals are, and if their portfolios are set up to achieve them
  • The difference between Growth, Income and Protection portfolios
  • Some of the most common asset classes that make up many investor's portfolios

 

 

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56. Own More by Doing Less | Stock Buybacks

June 28, 2018

Stock buybacks are all the rage these days. Fuelled by tax cuts, low cost of capital and not a lot of growth opportunities on the horizon, companies have been buying back their shares by the bucketload. In fact, since 2010 there has been $3.5 trillion in shares bought back in the US alone. Buybacks are great for shareholders in theory - one day you owned 5% of the company, the next day you owned 7% without lifting a finger. How good! However, in reality buybacks haven't always been great for investors or for the companies buying back the shares.

In this episode you will learn:

  • What a buyback is and how it is done
  • The theory behind buybacks
  • Notable examples of recent buybacks - Apple, Boeing, Cisco, ANZ just to name a few
  • Why Australia doesn't see as many buybacks as other markets
  • The downside of buybacks, including some notable examples of buybacks gone wrong

Stocks and Resources discussed in this episode:

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55. We’re In A Trading Competition! | Wall St History

June 24, 2018

This is an exciting episode for us! We've been invited to join in a trading competition, hosted by our friends at Stake (if you haven't already, you must sign-up - you can trade stocks in the US without paying brokerage, and they'll swing you $25 to start you on your way, just head to www.equitymates.com/stake), and we're up against some of the best financial journalists in Australia.

The rules are simple. We've been given a small amount of money to trade through the Stake platform, and can only buy sticks from the US. We have 2 weeks to make as much money as we can (all money going to charity, chosen by the winner). We must make a trade everyday, or be able to justify why we have decided not to trade, and we must trade at least 3 stocks over the two weeks.

We know nothing about technical analysis trading. We invest with a long-term approach so we've never had to think about how to make trades that will get us a return in 2 weeks! It's going to be so fun! We're going to record the whole two weeks. Each conversation we have together about what to do, our strategy, which stocks to buy, we are going to record, and by the end we'll have an awesome package to share with you guys about an intro into technical analysis. So stay tuned!

In this episode you will learn:

  • How we came to choose our first stock for the trading competition we are in
  • How competent we feel with technical analysis
  • Where the 'ticker' originated from
  • About the capitalist of all capitalists - JP Morgan
  • About the history of one of the most famous finacial streets in the world - Wall Street

Stocks and resources discussed:

  • Avalara Inc
  • Stake

 

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54. Managing Risk & Protecting Your Downside

June 19, 2018

“Rule number 1: Never lose money. Rule number 2: Never forget rule number 1” - Warren Buffett

Managing risk is critical to long term investing success. To fully enjoy the effects of compounding it is critical you don’t lose your money in the first place. Similarly, concerns around losing money are what stops a lot of people from ever investing in the first place.

This episode will help you protect your downside, and manage your risk. We discuss strategies both of protecting your downside in individual trades and also across your portfolio as a whole.

 

What you will learn:

  • Where Bryce has been and what he was doing.
  • What we mean when we say ‘protecting your downside’.
  • Key ways to protect your downside in individual trades
    • Stop losses
    • Trailing stops
  • Key ways to protect your downside across your portfolio
    • Shorting or inverse ETF’s
    • Counter-cyclical assets
    • Holding cash

Stocks and Resources Discussed:

  • Inverse ASX 200 ETF (ASX: BEAR)
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53. End-to-end investing process | Andrew Brown: Part 2

June 14, 2018

Something we wanted to understand through this podcast is how expert investors find, evaluate and make decisions on stocks. End-to-end, what is their process?

Andrew Brown, Executive Director of East 72 Holdings and first repeat podcast guest, agreed to spend some time walking through his process for a company he recently invested in. If you want to understand how expert investors think and understand what they look for, then this episode is for you.

[If you haven’t listened to Part 1 of our interview with Andrew Brown (episode 52 here), we’d suggest checking that out first]

In this episode you will learn:

  • How Andrew identified Cabcharge as a potential investment.
  • Andrew’s research process to study the company.
  • Why Andrew drove Uber for 3 months, and what he discovered.
  • How Andrew identified and valued ‘non-core’ assets the business owned.
  • The questions Andrew took to the Cabcharge auditor at their Annual General Meeting.
  • How Andrew then looked at Cabcharge’s balance sheet and valued the business.
  • What happened with Cabcharge between our first interview and now.
  • Andrew’s approach to managing his investments and staying on top of information once he’s made a trade.

Stocks and Resources Discussed:

  • Cabcharge (ASX: CAB)
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52. Finding insights in a sea of information | Andrew Brown: Part 1

June 10, 2018

This episode marks a first for Equity Mates. Our first repeat guest! Who better to have back on than Andrew Brown, the Executive Director of East 72 Holdings.

Andrew is one of the most insightful investors we’ve met in our time doing Equity Mates, and is a true contrarian. Do you think the internet has made old media a bad investment? Not Andrew, who since our first interview last year has done extremely well investing in legacy media companies like News Corp, Fairfax and Channel 9.

Or do you think Uber’s rise means we should avoid investing in the taxi industry? Not Andrew, who has been investing in Cabcharge (he takes us through his logic behind the Cabcharge investment in great detail in part 2 of this interview, to be released Thursday).

So we hope you all enjoy listening to Andrew as much as we enjoyed talking to him.

In this episode you will learn:

  • Who Andrew is and how he invests at East 72 Holdings.
  • How Andrew’s stock tips from our last interview are going.
  • Andrew’s thoughts on McGrath Real Estate’s struggles.
  • Why Andrew’s old-school media picks have done so well over the last year.
  • Why Andrew isn’t backing down from his Apple short (Even after Warren Buffett has invested in the American tech giant).
  • Good ways to manage investing information.
  • The information sources Andrew doesn’t consider valuable.
  • Where you can find client letters from some of the world’s best hedge funds.
  • How Alec managed to overload his inbox trying to keep up with information.
  • How Twitter helped build the case against Blue Sky

Stocks and Resources Discussed:

 

[We know the audio isn’t perfect in this interview (especially with the background noise between 30min - 33min). Trust us, it’s worth persevering. Every time we speak to Andrew we leave as better investors and we’re confident listening to him will have the same impact on you.]

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51. Investing For Tomorrow | Tech, Hackers, Sustainability

June 5, 2018

Can you believe that a casino got hacked via a digital thermometer in one of it's fish tanks?

Our final episode in our three part series on exchange traded funds (ETFs) with BetaShares is a cracker! We sit down with Adam who is Manager of Distribution and Capital Markets to discuss Investing In Tomorrow - Technology, Hackers and Sustainability.

The beauty of ETFs is that you don't have to choose one company, or stress or about picking the right one. If you have identified a theme in society, a trend that you think is going to do well, then it's more than likely an ETF will exist that will give you the opportunity to invest in that trend.

We discuss three big themes with Adam that we believe are themes of the future, and have companies that are, and will be, the biggest in the world going forward.

Technology - we look at how technology is shaping our world, and which companies are right there in the middle of it.

Cybersecurity - this was the most exciting part of the conversation as it opened our eyes to the huge possibilities that exist in investing in cybersecurity. This industry is already huge, but it's going to get drastically bigger, and fast. We look at the best ways to get access to this industry and some of the companies leading the charge.

Sustainability - investing in companies that are engaged in sustainable activities is becoming increasingly important to many investors. Some don't want to invest in businesses who use fossil fuels, or fund mining companies for controversial projects. We dive into investing sustainably and look at the surprising success of this theme.

In this episode you will learn:

  • How you can access the NASDAQ via an ETF, and get access to the top 100 tech stocks
  • How big tech companies are evolving and changing the world
  • What impact privacy regulations may have on the likes of Facebook and Google
  • How and why cybersecurity is growing very quickly
  • Some of the more elaborate ways that companies have been hacked
  • What sustainable investing is, and why it's important
  • How companies are screened for the sustainable funds
  • The returns for the sustainable funds are quite surprising

Stocks and resources discussed:

Head over to our Basics ETF 101 page for more information

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