BIO: Chris Kendall is the CEO of the Australian outsourced accounting group Aretex. Aretex helps businesses grow and scale with best-practice accounting, bookkeeping, and real-time access to accurate financial information.STORY: Chris invested in the idea of a reality TV show piloted around finding baseball players. Chris believed in his friend’s vision and was so caught up in the emotional attachment that he didn’t do any due diligence on the idea.LEARNING: If you’re going to fail, fail quickly, be honest about the failure, figure out what happened, and then move on to the next step. Don’t underestimate the funding needed to go big time. “There’s a balance between raising enough money to reduce dilution and raising enough money to ensure you can get to the next hurdle.”Chris Kendall Guest profileChris Kendall is the CEO of the Australian outsourced accounting group Aretex. Aretex helps businesses grow and scale with best-practice accounting, bookkeeping, and real-time access to accurate financial information.He is also the host of The Anti-Failure Podcasts, which examine the lessons from failure in business and life that ultimately allow us to succeed.Worst investment everChris’s worst investment is the one he didn’t make, which was not buying property in the ’90s before he left Australia. His advice to anybody out there is to find a way to get into the property market as early as possible, go through the struggle of pulling together all of the resources you’ve got access to, and put them in a property.Chris shares one investment he made through passion and emotional attachment. The investment was a reality TV show piloted around finding baseball players. The TV show was created by a friend who envisioned creating a reality show intended to describe how professional athletes look through the ringers to determine where they end up playing a professional sport. The friend had some of the big names in baseball. He needed money to make the pilot, and his friends (including Chris) and family put some money in and gave it a shot. But he couldn’t get the traction to turn it into the TV show that everyone thought it was capable of.Chris believed in his friend’s vision and was so caught up in the emotional attachment that he didn’t do any due diligence on the idea.Lessons learnedWhen looking at property, ask yourself: Does this appeal to you? Does it meet your immediate needs? Is there an opportunity to leverage that in a growing market?There’s a balance between raising enough money to reduce dilution and raising enough money to ensure you can reach the next hurdle.If you’re going to fail, fail quickly, be honest about the failure, figure out what happened, and then move on to the next step.Andrew’s takeawaysDon’t underestimate the funding needed to go big time.No.1 goal for the next 12 monthsChris’s number one goal for the next 12 months is to continue working with small business owners and helping clients get the best information they need to run their businesses.Parting words “Have the courage to turn up and give your best.”Chris Kendall [spp-transcript] Connect with Chris KendallLinkedInFacebookInstagramPodcastWebsiteAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramThreadsTwitterYouTubeMy Worst Investment Ever Podcast

BIO: Riggs Eckelberry is a nationally renowned entrepreneur who deploys his personal Break To Build™ process to help rebuild the water industry, which has reached a critical breaking point in recent years despite being essential to the planet’s survival.STORY: Riggs met this wonderful lady who asked him to sit down with her money manager. He showed up at this money manager’s office, who told him he had a great business going and advised him to go public. Riggs said that would be impossible because he wasn’t profitable yet. Turning down this opportunity turned out to be Riggs’s worst investment.LEARNING: You have to get that monthly recurring revenue. Don’t enter any industry unprepared. “Your greatest expense is the money you don’t make, the opportunity cost.”Riggs Eckelberry Guest profileRiggs Eckelberry is a nationally renowned entrepreneur who deploys his personal Break To Build™ process to help rebuild the water industry, which has reached a critical breaking point in recent years despite being essential to the planet’s survival. As the founding CEO of OriginClear, Riggs has developed innovative solutions to help businesses face rising water bills by tapping into new investment markets. He is even pioneering the development of “water stablecoins,” a cryptocurrency backed by water assets. With a diverse background in nonprofit management, oceangoing navigation, and technology disruption, Riggs is uniquely qualified to bring change to an outdated and overrun industry.Worst investment everIn the early 1980s, Riggs realized that technology was going to be the linchpin for all change, and he wanted to be a part of it, so he moved to New York City. This was the period when companies were moving from the old safeguard ledger to microcomputer-type accounting systems. A lot of people needed help making that migration. Riggs created a series of companies that tried to help these people.Riggs happened to meet this wonderful lady who asked him to have a sit down with her money manager. He showed up at this money manager’s office, who told him he had a great business going and advised him to go public. Riggs insisted that would be impossible because he was yet to be profitable. Turning down this opportunity turned out to be Riggs’s worst investment. Unfortunately, Riggs didn’t know that in this industry, they’re not very profitable at the outset, but the real money is in the monthly revenue.Interestingly, Riggs gave the business to his best salesman. Years later, he told Riggs that he still had some of the accounts they opened together, and he’d become a millionaire from that recurring monthly revenue.Lessons learnedYou’ve got to look for that monthly recurring revenue.Wall Street bets on the future.Don’t enter any industry unprepared; get to know the space first.If you have a great team, you’ll have a life.Put an engineer’s mind to the scaling problem.Andrew’s takeawaysYou’ve got to be able to paint a vision of the scalability of your venture.Actionable adviceYou need to like what you’re going into because you will be stuck with it for years, especially if you succeed. Also, have a strong familiarity with the trade’s ins and outs.Riggs’s recommendationsRiggs recommends reading The Innovator’s Dilemma. The seed of the destruction of every enterprise is in that enterprise, and the existing business model is actively suppressing it. The book will help you liberate this seed and even create a new business.No.1 goal for the next 12 monthsRiggs’s number one goal for the next 12 months is to pivot the mother company OriginClear, to an incubator role and move to the NASDAQ.Parting words “Today is the best of times as the world globalizes and becomes completely chaotic. That’s an opportunity. Grab it.”Riggs Eckelberry [spp-transcript] Connect with Riggs EckelberryLinkedInTwitterFacebookYouTubeWebsiteAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramThreadsTwitterYouTubeMy Worst Investment Ever Podcast

In this episode of Investment Strategy Made Simple (ISMS), Andrew gets into part two of his discussion with Larry Swedroe: Ignorance is Bliss. Today, they discuss two chapters of Larry’s book Investment Mistakes Even Smart Investors Make and How to Avoid Them. In this series, they discuss mistake number 28: Do You Fail to Compare Your Funds to Proper Benchmarks? And mistake 29: Do You Believe Active Management Is a Winner’s Game in Inefficient Markets?LEARNING: Don’t choose a fund by its name. Active management is highly unlikely to outperform even in inefficient emerging markets. “Don’t choose a fund, even an index fund, by its name. Instead, you should carefully check its weighted average book-to-market and market capitalization levels.”Larry Swedroe In this episode of Investment Strategy Made Simple (ISMS), Andrew gets into part two of his discussion with Larry Swedroe: Ignorance is Bliss. Larry is the head of financial and economic research at Buckingham Wealth Partners. You can learn more about Larry’s Worst Investment Ever story on Ep645: Beware of Idiosyncratic Risks.Larry deeply understands the world of academic research and investing, especially risk. Today, Andrew and Larry discuss two chapters of Larry’s book Investment Mistakes Even Smart Investors Make and How to Avoid Them. In this series, they discuss mistake number 28: Do You Fail to Compare Your Funds to Proper Benchmarks? And mistake 29:Did you miss out on previous mistakes? Check them out:ISMS 8: Larry Swedroe – Are You Overconfident in Your Skills?ISMS 17: Larry Swedroe – Do You Project Recent Trends Indefinitely Into the Future?ISMS 20: Larry Swedroe – Do You Extrapolate From Small Samples and Trust Your Intuition?ISMS 23: Larry Swedroe – Do You Allow Yourself to Be Influenced by Your Ego and Herd Mentality?ISMS 24: Larry Swedroe – Confusing Skill and Luck Can Stop You From Investing WiselyISMS 25: Larry Swedroe – Admit Your Mistakes and Don’t Listen to Fake ExpertsISMS 26: Larry Swedroe – Are You Subject to the Endowment Effect or the Hot Streak Fallacy?ISMS 27: Larry Swedroe – Familiar Doesn’t Make It Safe and You’re Not Playing With the House’s MoneyISMS 29: Larry Swedroe – The Shiny Apple is Poisonous and Information is Not KnowledgeISMS 30: Larry Swedroe – Do You Believe Your Fortune Is in the Stars or Rely on Misleading Information?ISMS 34: Larry Swedroe – Consider All Hidden Costs Before You InvestISMS 35: Larry Swedroe – Great Companies Are Not Always High-Return InvestmentsISMS 36: Larry Swedroe – Two Heads Are Not Better Than One When InvestingISMS 37: Larry Swedroe – Pay Attention to a Fund’s Proper Benchmarks and TaxesISMS 38: Larry Swedroe – The Self-healing Mechanism of Risk AssetsMistake number 28: Do You Rely on a Fund’s Descriptive Name When Making Purchase Decisions?According to Larry, most investors tend to rely on the name of a fund and its descriptive value. So they’ll look at a small-cap fund and assume it invests exclusively in small or mid-cap stocks. However, the SEC allows sufficient leeway that can cause dramatic differences in that a large-cap fund can own a large-cap value fund and even some small-cap growth stocks. In such a case, you’ll not get the asset allocation you think you should and desire. And that’s especially true, of course, of active managers who have freedom to roam.Several academic studies have concluded that asset allocation determines the vast majority of the returns and risks of a portfolio and its long-term performance. Larry says that once investors decide on their investment policy (asset allocation), they must choose which funds to use as the building blocks of their portfolio. One choice involves implementing the strategy with active or passive managers. If investors choose passive managers, they can be highly confident that the specific investment style will be adhered to, as the fund will replicate the asset class or index it represents. There is no such assurance with active managers. With active managers, you cannot even rely on the fund’s name when making a choice.Larry advises that you should not choose a fund, even an index fund, by its name. Instead, you should carefully check its weighted average book-to-market and market capitalization levels. That’s the simplest way to tell the true nature of a fund.Mistake number 29: Do You Believe Active Management Is a Winner’s Game in Inefficient Markets?The efficiency of the market for U.S. large-cap stocks is so great that attempting to add value through active management is unlikely to produce positive results. However, investors cling to the idea that active management will likely add value in less efficient markets. Unfortunately, research shows that active managers in emerging markets tend to lose over whatever period, and the longer the horizon, the worse the performance.The asset class for which the active management argument is made most strongly is the emerging markets — an “inefficient” asset class if there ever was one. Many myths are perpetuated by the Wall Street establishment and the financial media, and that active management is the winning strategy in less efficient markets is just one of them. As the historical evidence demonstrates, active management is highly unlikely to outperform in even the allegedly inefficient emerging markets. In fact, the evidence suggests that active managers perform just as poorly in the “inefficient” markets as they do in the more efficient markets of the developed nations. Larry concludes that active managers don’t lose because they’re dumb; they lose because they’re expensive.About Larry SwedroeLarry Swedroe is head of financial and economic research at Buckingham Wealth Partners. Since joining the firm in 1996, Larry has spent his time, talent, and energy educating investors on the benefits of evidence-based investing with an enthusiasm few can match.Larry was among the first authors to publish a book that explained the science of investing in layman’s terms, “The Only Guide to a Winning Investment Strategy You’ll Ever Need.” He has authored or co-authored 18 books.Larry’s dedication to helping others has made him a sought-after national speaker. He has made appearances on national television on various outlets.Larry is a prolific writer, regularly contributing to multiple outlets, including AlphaArchitect, Advisor Perspectives, and Wealth Management. [spp-transcript] Connect with Larry SwedroeLinkedInTwitterWebsiteBooksAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramTwitterYouTubeMy Worst Investment Ever PodcastFurther reading mentionedLarry Swedroe and RC Balaban, Investment Mistakes Even Smart Investors Make and How to Avoid ThemPhilip E. Tetlock, Expert Political Judgment: How Good Is It? How Can We Know?Gary Belsky and Thomas Gilovich, Why Smart People Make Big Money Mistakes and How to Correct Them: Lessons from the Life-Changing Science of Behavioral EconomicsLarry Swedroe, Think, Act, and Invest Like Warren Buffett: The Winning Strategy to Help You Achieve Your Financial and Life GoalsLarry Swedroe and Kevin Grogan, Reducing the Risk of Black Swans: Using the Science of Investing to Capture Returns with Less Volatility

BIO: Lark Davis is the Founder of the weekly crypto newsletter Wealth Mastery, which combines insider insights and in-depth market analysis to offer cryptocurrency investors the best opportunities to grow their wealth, stay ahead of the curve, and avoid costly mistakes.STORY: Lark invested in the Terra Luna cryptocurrency, which had a famous implosion. The volatility of the crypto market saw him lose all his profits and part of his capital.LEARNING: Never put your profits into something that could go down. Fully understand all aspects of risk exposure. “The learning curve is massive in crypto, and even after years in the industry, I still get surprised by how I can get screwed.”Lark Davis Guest profileLark Davis is the Founder of the weekly crypto newsletter Wealth Mastery, which combines insider insights and in-depth market analysis to offer cryptocurrency investors the best opportunities to grow their wealth, stay ahead of the curve, and avoid costly mistakes.The newsletter has 100K+ subscribers and covers DeFi, NFTs, Altcoins, Technical Analysis, and more. Lark has been a crypto investor for more than seven years and has made millions of dollars—while also suffering significant losses—in the markets.He has been featured in leading digital currencies media platforms, including Coinpedia and CoinDesk, providing insights that help audiences consistently make money from cryptocurrency investments.You can find him on Twitter and YouTube.Worst investment everLark invested in the Terra Luna cryptocurrency, which had a famous implosion. The currency went up, and the investment was worth hundreds of thousands of dollars. The company also had a stable coin worth $1 linked to the Luna cryptocurrency. The more stablecoins were minted, the more the Luna token was taken off, and the market price increased. The reverse eventually, of course, applied as well. But this was the big hype coin everybody was talking about. Big venture capital firms were in it, and the Founder was the poster child on social media.It all came tumbling down eventually. Interestingly, shortly before Lark invested, his research assistant, who does the deep dives for the Wealth Mastery reports, did a report on the Luna crypto and concluded that it smelled fishy and didn’t like the idea of investing in it. Lark, however, went ahead and invested.By the time the coin started going on a downward spiral, Lark’s Luna position was around $100,000. That went to zero in about three days. Luckily, he didn’t ride them to zero. He sold them for around $6, but his profit fell to zero. He also had about $700,000 of stablecoins, in which he took a 20% loss.Lessons learnedNever put your profits into something that could go down.Take your profits, put it in your bank, and run away.Fully understand all aspects of risk exposure.Crypto’s learning curve is massive.Andrew’s takeawaysSeparate your wealth or profit from speculation money and put it in a safe place that won’t go down.When it comes to human behavior, always expect a herd mentality.Actionable adviceGo slow on-chain and test the waters first before you put 100% of your money into it. You’re not missing out on anything; there’s always going to be something new happening tomorrow.Lark’s recommendationsLark recommends reading his newsletter, Wealth Mastery, for updates on the latest market trends. He also recommends checking out various local exchanges to learn how trading indicators and coin mechanics work and all sorts of things regarding cryptocurrencies.No.1 goal for the next 12 monthsLark’s number one goal for the next 12 months is to 10x his crypto portfolio in this bull market.Parting words “With crypto, remember to take your profits, or the market will take them for you.”Lark Davis [spp-transcript] Connect with Lark DavisLinkedInTwitterYouTubeWebsiteAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramThreadsTwitterYouTubeMy Worst Investment Ever Podcast 

BIO: Sam founded FasterFreedom to teach people like him to quit their jobs, become successful real estate investors, and achieve that same freedom and financial independence.STORY: Sam and his partner invested in a self-storage. They fixed the property a bit and built a couple more facilities. They didn’t know this space, and the investment has cost them about $500,000 of potential loss and probably more than they could have gained in revenue.LEARNING: Be intentional about what you invest in. Stick to what you know. Think through every expansion. “Be intentional about what you invest in. You can’t be good at everything.”Sam Primm Guest profileSam Primm was born and raised in St. Louis, MO., to a father who was an engineer and a mom who was a teacher. He followed the path you’re told to do and ended up working a corporate job in the area and making a decent enough living. But there were a couple of problems.Sam was working a stressful 50-hour-a-week job for someone he didn’t like, and most of all, Sam wished he had more time and freedom for himself and his family. They deserved better. His wife deserved him to be around more, and he wanted more time to be around his daughters as they grew up.Eventually, Sam got into Real Estate, and after trying and failing—several times—he got some wins and started to learn what worked with consistency. This led him to own $45 million in assets, have 150+ single-family rentals, flip over 1,000 properties, and run his own property management company. Sam did it all in under nine years without using his money. But the best part is that it’s given Sam the time and freedom he has always wanted for himself and his family.Sam founded FasterFreedom to teach people like him to quit their jobs, become successful real estate investors, and achieve that same freedom and financial independence. Sam prides himself in practicing what he preaches, meaning all his lessons and tips are constantly updated and based on the real investing he’s doing right now- so you only learn what works and not through theory or outdated practices!Worst investment everWhen the idea to add a self-storage facility to their assets was first brought to them, Sam and his partner said no. Then COVID hit, and they said yes. They didn’t know much about storage facilities, but the numbers looked ok, so they took it. They fixed the property and built more facilities because they had open land.They didn’t know this space, so they didn’t raise enough funds or manage properly because their mind was focused elsewhere. The property is now not generating income nor growing in value like it should. This investment has cost the partners about $500,000 of potential loss and even more in missed revenue.Lessons learnedBe intentional about what you invest in.Don’t try to be good at everything; you can’t.Stick to what you know.Have proof of concept in what you want to invest in.Andrew’s takeawaysTake good care of your cash flow.Focus on minimal investment and maximum cash flow.Think through every expansion.Don’t think your evidence of the existing success relates to your new idea, even if it seems like it’s the same thing. That’s not proof.Actionable adviceDon’t just buy something because it’s cheap. Focus on what you’re good at and what’s proven.Sam’s recommendationsSam recommends taking advantage of the many available resources, such as his podcast, Professor Freedom. These resources will give you base-level knowledge to create a base-level confidence that allows you to take action.No.1 goal for the next 12 monthsSam’s number one goal for the next 12 months is to scale his education business to its greatest potential.Parting words “You’re not going to be successful without failing. Failure is literally a stepping stone on the path to success. So, figure out how to fail. Just don’t make the same mistake again. Learn from it. So if you avoid failure, you avoid success.”Sam Primm [spp-transcript] Connect with Sam PrimmLinkedInTwitterFacebookInstagramYouTubeWebsitePodcastBookAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramThreadsTwitterYouTubeMy Worst Investment Ever Podcast 

BIO: Dr. Marc Faber, renowned for his unconventional expertise in investment strategies, is a fund manager and author. He serves as the editor of the “Gloom Boom & Doom Report” and the “Monthly Market Commentary,” earning international recognition as the pessimistic stock market expert “Dr. Doom.”STORY: In the late 1990s, Marc became convinced that the Dotcom bubble would burst. However, at the turn of 2000, Greenspan injected liquidity into the system because everyone was talking about the millennium. This caused the NASDAQ to go another 30% between January 1 and March 21. Marc was heavily short throughout this vertical rise.LEARNING: Diversify in stocks, bonds, cash, precious metals, and real estate. Don’t be overly bearish. “When you lend money to friends, you risk losing everything. You may lose your money and your friends.”Marc Faber Guest profileDr. Marc Faber, renowned for his unconventional expertise in investment strategies, is a fund manager and author. He serves as the editor of the “Gloom Boom & Doom Report” and the “Monthly Market Commentary,” earning international recognition as the pessimistic stock market expert “Dr. Doom.”Born in Switzerland in 1946, Faber pursued economics at the University of Zurich and achieved a magna cum laude doctorate in economics at just 24 years old.His career took him to White Weld & Company Limited in New York, Zurich, and Hong Kong between 1970 and 1978. From 1978 to 1990, Faber was instrumental in establishing the Asia business for Drexel Burnham Lambert (HK) Ltd.In 1990, he ventured into his own business. Faber’s monthly publications offer investors insights into potential market trends. While he maintains an office in Hong Kong, he has lived in Chiang Mai, Thailand, since 2001.Worst investment everIn the late 1990s, Marc became convinced that the Dotcom bubble would burst. So he went overly bearish. However, in 1999, the NASDAQ doubled within just a few months. Then, at the turn of 2000, Greenspan injected liquidity into the system because everyone was talking about the millennium. This caused the NASDAQ to go up another 30% between January 1 and March 21. Marc was heavily short throughout this vertical rise.Marc had assumed that more companies would go out of business than survivors. He overlooked that you could be short ten stocks and nine go down 100 percent. The nine will go bankrupt, but the one that survives can go up 100 times. So, being on the short side made it difficult for Marc to make money.Lessons learnedDiversify in stocks, bonds, cash, precious metals, and real estate.Andrew’s takeawaysDon’t be overly bearish.Actionable advicePractice true diversification by owning investment assets in different regions, say in America or Europe, but also some properties may be in China, Hong Kong, Singapore, Thailand, Indonesia, or Latin America, and some assets held with a custodian in these countries.Marc’s recommendationsMarc recommends reading The Economics of Inflation and Capitalism and Freedom.No.1 goal for the next 12 monthsMarc’s number one goal for the next 12 months is to understand the details of the decline of the Roman Empire.Parting words “Understand what inflation is and that it can shift from one sector to another sector.”Marc Faber [spp-transcript] Connect with Marc FaberLinkedInTwitterWebsiteBookAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramThreadsTwitterYouTubeMy Worst Investment Ever Podcast

BIO: Coach JV believes that what you believe in your heart and what you think in your mind will eventually become your words and reality.STORY: Coach JV was introduced to cryptocurrency and decided to invest without an exit plan. In just a year, his investment had fallen by 85%.LEARNING: Diversify inside and outside the asset class. Pull out your money and play on the house money. When you make massive gains, take some profit. “Always take 24 hours to make a decision. When somebody comes to you very excited about something, stop for a moment, listen, use discernment, and also seek wise counsel.”Coach JV Guest profileWhat you believe in your heart and what you think in your mind will eventually become your words and your reality. If you can see it in your mind, eventually you can hold it right here in your hand; what you repeatedly do gets ingrained in your subconscious mind, and what gets ingrained in your subconscious mind becomes your unconscious activity.Worst investment everCoach JV left corporate America super excited about entrepreneurship. However, he didn’t understand the ins and outs of entrepreneurship and scaling. So, at the very beginning, Coach JV lost all his money.Then, this great promise of cryptocurrency came into Coach JV’s life. But he had this deep-rooted indoctrination around those types of things. Nonetheless, when Coach JV was introduced to a coin called XRP, he got curious and started researching it. He saw the excitement of all the money being made in cryptocurrency. He also decided to invest heavily.Coach JV made a lot of money from his investment and couldn’t even keep up with all the different coins being pumped at him. Coach JV even became influential in the space.Unfortunately, he got into this speculative asset with no game plan. Then, suddenly, and it seemed like overnight, he woke up and was down 85%. Coach JV went from a millionaire to a thousandaire between 2021 and 2022.Lessons learnedDiversify inside and outside the asset class.Pull out your money and play on the house money.Andrew’s takeawaysWhen you make massive gains, take some profit.Actionable adviceAlways take 24 hours to make a decision. When somebody comes to you very excited about something, stop for a moment, listen, use discernment, and also seek wise counsel.No.1 goal for the next 12 monthsCoach JV’s number one goal for the next 12 months is to stay non-emotional about what’s happening in America, remain focused on his fundamentals, and be as keen as possible not to get caught up in the greed gene.Parting words “Remember what you believe in your heart and think in your mind will eventually become your words and your reality. If you can see it in your mind, eventually, you can hold it in your hands. What you repeatedly do gets ingrained in your subconscious mind. What gets ingrained in your subconscious mind becomes your unconscious activities.”Coach JV [spp-transcript] Connect with Coach JVTwitterFacebookInstagramYouTubeWebsiteAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramThreadsTwitterYouTubeMy Worst Investment Ever Podcast

In this episode of Investment Strategy Made Simple (ISMS), Andrew gets into part two of his discussion with Larry Swedroe: Ignorance is Bliss. Today, they discuss Larry’s recent piece, The Self-healing Mechanism of Risk Assets.LEARNING: Don’t engage in resulting because there will be periods when an investment will underperform and others when it outperforms. Resist recency bias. Avoid performance chasing. “You don’t want to engage in resulting because there will be periods when an investment will underperform and others when it outperforms.”Larry Swedroe In this episode of Investment Strategy Made Simple (ISMS), Andrew gets into part two of his discussion with Larry Swedroe: Ignorance is Bliss. Larry is the head of financial and economic research at Buckingham Wealth Partners. You can learn more about Larry’s Worst Investment Ever story on Ep645: Beware of Idiosyncratic Risks.Larry deeply understands the world of academic research and investing, especially risk. Today, Andrew and Larry discuss two chapters of Larry’s book Investment Mistakes Even Smart Investors Make and How to Avoid Them. Today, they discuss Larry’s recent piece, The Self-healing Mechanism of Risk Assets.Did you miss out on previous mistakes? Check them out:ISMS 8: Larry Swedroe – Are You Overconfident in Your Skills?ISMS 17: Larry Swedroe – Do You Project Recent Trends Indefinitely Into the Future?ISMS 20: Larry Swedroe – Do You Extrapolate From Small Samples and Trust Your Intuition?ISMS 23: Larry Swedroe – Do You Allow Yourself to Be Influenced by Your Ego and Herd Mentality?ISMS 24: Larry Swedroe – Confusing Skill and Luck Can Stop You From Investing WiselyISMS 25: Larry Swedroe – Admit Your Mistakes and Don’t Listen to Fake ExpertsISMS 26: Larry Swedroe – Are You Subject to the Endowment Effect or the Hot Streak Fallacy?ISMS 27: Larry Swedroe – Familiar Doesn’t Make It Safe and You’re Not Playing With the House’s MoneyISMS 29: Larry Swedroe – The Shiny Apple is Poisonous and Information is Not KnowledgeISMS 30: Larry Swedroe – Do You Believe Your Fortune Is in the Stars or Rely on Misleading Information?ISMS 34: Larry Swedroe – Consider All Hidden Costs Before You InvestISMS 35: Larry Swedroe – Great Companies Are Not Always High-Return InvestmentsISMS 36: Larry Swedroe – Two Heads Are Not Better Than One When InvestingISMS 37: Larry Swedroe – Pay Attention to a Fund’s Proper Benchmarks and TaxesCommon biases in investingOne of the biggest problems Larry has found working with advisors and investors is certain biases that lead to mistakes. One is recency bias, which is the tendency to extrapolate the recent performance of assets into the future as if it’s inevitable.Resisting recency bias is critical to earning the premiums available from all risk assets, including reinsurance. Wise investing, as Warren Buffett noted, is simple but not easy. That’s because investors must overcome all the behavioral biases, with recency among the most powerful. It’s tempting to sell out of an investment that has suffered losses because it’s easy to think losses will keep happening.Another bias is performance chasing. This is buying after periods of strong performance when valuations are higher and expected returns are lower and selling after periods of poor performance when valuations are lower and expected returns are higher. What disciplined investors do is the opposite—rebalance to maintain their well-thought-out allocation to risky assetsLarry identifies engaging in resulting as another big issue. This is making the mistake of judging the quality of a decision by the outcome—which is unknown—versus judging it by the quality of the decision-making process.The self-healing mechanism of risk assetsProblems usually arise when stocks or any asset class perform very poorly, and investors flee the costs of these mistakes that they make. However, Larry points out that they fail to understand that a self-healing mechanism is generally in place.An excellent example of the self-healing mechanism at work is that value stocks underperformed by wide margins during the late 1990s technology/dot-com boom. For example, from 1995 to 1999, the S&P 500 Growth Index returned 33.6% per annum, outperforming the Russell 2000 Value Index by 20.5 percentage points per annum. That outperformance led to valuation spreads widening to historic levels. Over the following eight-year period, 2000-07, the Russell 2000 Value Index returned 12.6% per annum, outperforming the S&P 500 Growth Index’s return of -1.7% by 14.3 percentage points per annum. Over the full period, the Russell 2000 Value Index outperformed the S&P 500 Growth Index by 2.2% percentage points per annum (12.8% versus 10.6%).The self-healing mechanism works not only with stocks and value versus growth but also with bonds, credit, insurance, and virtually any risk asset. Thanks to the self-healing mechanism, Larry cautions investors against engaging in resulting because there will be periods when an investment will underperform and others when it outperforms. Instead, he advises that they understand why certain investment vehicles are in their portfolios in the first place.About Larry SwedroeLarry Swedroe is head of financial and economic research at Buckingham Wealth Partners. Since joining the firm in 1996, Larry has spent his time, talent, and energy educating investors on the benefits of evidence-based investing with an enthusiasm few can match.Larry was among the first authors to publish a book that explained the science of investing in layman’s terms, “The Only Guide to a Winning Investment Strategy You’ll Ever Need.” He has authored or co-authored 18 books.Larry’s dedication to helping others has made him a sought-after national speaker. He has made appearances on national television on various outlets.Larry is a prolific writer, regularly contributing to multiple outlets, including AlphaArchitect, Advisor Perspectives, and Wealth Management. [spp-transcript] Connect with Larry SwedroeLinkedInTwitterWebsiteBooksAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramTwitterYouTubeMy Worst Investment Ever PodcastFurther reading mentionedLarry Swedroe and RC Balaban, Investment Mistakes Even Smart Investors Make and How to Avoid ThemPhilip E. Tetlock, Expert Political Judgment: How Good Is It? How Can We Know?Gary Belsky and Thomas Gilovich, Why Smart People Make Big Money Mistakes and How to Correct Them: Lessons from the Life-Changing Science of Behavioral EconomicsLarry Swedroe, Think, Act, and Invest Like Warren Buffett: The Winning Strategy to Help You Achieve Your Financial and Life GoalsAndrew L Berkin, Your Complete Guide to Factor-Based Investing: The Way Smart Money Invests TodayLarry Swedroe and Kevin Grogan, Reducing the Risk of Black Swans: Using the Science of Investing to Capture Returns with Less Volatility

BIO: Solomon Thimothy is an entrepreneur with over 17 years of experience in marketing and sales. As the co-founder and CEO of OneIMS, a leading inbound marketing and sales agency, and Clickx, he has helped businesses double their revenue using the 10X Framework.STORY: When Solomon started his service business, he built software unique to his business. The problem was it cost thousands of dollars, and he was a broke out-of-collage kid. His model was terrible; nobody would invest in his business.LEARNING: Every entrepreneur fails, so give yourself permission to fail. “Make sure that whatever you invest in is what you want to spend your next decade trying to figure out.”Solomon Thimothy Guest profileSolomon Thimothy is a highly accomplished entrepreneur with over 17 years of experience in marketing and sales. As the co-founder and CEO of OneIMS, a leading inbound marketing and sales agency, and Clickx, he has helped businesses double their revenue using the 10X Framework. Solomon is also an expert in lead generation and customer acquisition, and a USA Today and Wall Street Journal best-selling author.In addition to his work, Solomon is also an angel investor and startup advisor. He has helped numerous startups grow and scale, leveraging his marketing, sales, and business strategy expertise.Worst investment everSolomon started a service company building websites right off college. He hired other college kids with zero experience, and the process was terrible. Due to their inexperience, Solomon and his staff spent much more time on the work, which led to less money at the end of the day. Solomon decided to create some systems to try and reduce this time wastage.Being a techie, he thought of building software to help onboard customers and enable them to see their reports from the lead gen ads. The software would allow Solomon to automate the process.This meant Solomon would build his own software. All this cost tens of millions of dollars, and he was just a kid out of college with barely enough money to pay the bills and now had to hire developers and pay thousands of dollars—money he didn’t have. On paper, this model was terrible; nobody would invest in his business.Lessons learnedEvery entrepreneur fails, so permit yourself to fail.Andrew’s takeawaysNever develop your own app or software; use what already exists and has been tried and tested.Actionable adviceMake sure that whatever you invest in is what you want to spend your next decade trying to figure out.Solomon’s recommendationsSolomon recommends reading 10x Is Easier than 2x: How World-Class Entrepreneurs Achieve More by Doing Less to understand and apply the 10x framework.No.1 goal for the next 12 monthsSolomon’s number one goal for the next 12 months is to impact the business and income of 10,000 entrepreneurs.Parting words “Keep taking risks. I know you want to reduce them, but there are those that will win big.”Solomon Thimothy [spp-transcript] Connect with Solomon ThimothyLinkedinTwitterFacebookInstagramYouTubeWebsitePodcastAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramThreadsTwitterYouTubeMy Worst Investment Ever Podcast

BIO: Tony began a career in equity sales in varying capacities, including running sales and trading at Bank Hapoalim for three years and a team of sales traders at Dahlman Rose for five years. In November 2016, Tony launched the Morning Navigator, a macro trading newsletter distributed to over 800 professionals worldwide.STORY: Tony invested six figures into a small ophthalmic company his friend told him about. He didn’t know much about the company besides what his friend told him. He lost investment when the share price collapsed.LEARNING: Understand the nuts and bolts of the business you want to invest in. Be patient and willing to get rich slowly. The stock markets are for growing wealth, not creating it. Time is the only surefire thing on your side. “Live to trade another day.”Anthony Greer Guest profileAfter graduating from Cornell University in 1990, Anthony Greer began his trading career in the foreign exchange market for Sumitomo Bank and Union Bank of Switzerland, where he began running large bank books. He joined the J. Aron division of Goldman Sachs in 1994, where he learned the rigor of risk management in trading gold and the Goldman Sachs Commodities Index. Tony left the commodity desk at Goldman Sachs to launch his equity trading operation in 2000, surfing the dot.com crash for two years. Tony began a career in equity sales in varying capacities, including running sales and trading at Bank Hapoalim for three years and a team of sales traders at Dahlman Rose for five years. In November 2016, Tony launched the Morning Navigator, a macro trading newsletter currently distributed to over 800 professionals worldwide.Worst investment everWhen Tony was at Goldman Sachs in the ’90s, he managed to get into the Dotcom bubble. His love for music led him to discover Amazon. Tony would order records he was dying to have on Amazon, which would be delivered to his door in a few days. This business model fascinated Tony so much that he invested in tech stocks.During that period, Tony decided to expand his portfolio. A friend of his put a name in front of him. The friend insisted that he knew a lot about the company and that it would be a nationwide chain where everybody went to check their eyes and buy glasses. He said that PE funds were investing in it. Tony amassed a massive position in this company, whose shares sold at 20 cents a share. Tony had six figures worth of this little ophthalmic company that he didn’t know much about. Suddenly, the bottom dropped out, and the PE companies sold their shares, causing the share price to collapse even further.Lessons learnedAlways consider the total dollar value of money invested, no matter what percentage of your portfolio it is.First, understand the nuts and bolts of the business you want to invest in.Starting early is very valuable. Be patient and willing to get rich slowly.Andrew’s takeawaysPosition sizing matters most, no matter how much you want to make your investment a big bet.The stock markets are for growing wealth, not creating it.Time is the only surefire thing on your side.Actionable adviceLive to trade another day by trading carefully without greed.Tony’s recommendationsTony recommends subscribing to his Morning Navigator newsletter and reading No Worries: How to live a stress-free financial life. The book is about getting the three big ones right, i.e., education, home, and car. You’ll learn how to live a life without worrying about your finances.No.1 goal for the next 12 monthsTony’s number one goal for the next 12 months is to immerse himself in his business.Parting words “If you’re interested in getting some help looking for trades and taking risks, contact me; that’s what I do.”Anthony Greer [spp-transcript] Connect with Anthony GreerLinkedinTwitterWebsitePodcastAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassThe Become a Better Investor CommunityHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleFVMR Investing: Quantamental Investing Across the WorldBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsAchieve Your GoalsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramThreadsTwitterYouTubeMy Worst Investment Ever Podcast