Guided Path 3-2 Stocks

The Financial Call

Guided Path 3-2 Stocks

Learning to better understand the stock market and investing as a whole should be a key part of everyone’s retirement plan.

In this episode, Zacc Call and Laura Hadley talk with Matt Johns, CFP®, to share his vast knowledge about the stock market which will help you better understand how you can make your money work for you prior to and during retirement.

Matt discusses:

  • How easy it is to purchase stocks in the current day
  • Why you should fully own assets to keep up with inflation
  • What currency risk is and how you can take it into account when investing
  • The difference between value, blended, and core stocks
  • And more

Read the Full Transcript:

[00:00:00] Welcome to the Financial Call. We are financial advisors on a mission to guide you through the financial planning everyone should have, whether you're doing it yourself or working with a financial advisor. These episodes will help you break down complicated financial topics into practical, actionable steps. Our mission is to guide motivated people to become financially successful. Welcome back to The Financial Call. This is guided. Season three, episode two. So we're just getting started with investing. Our last episode was all about the basics, what we're talking about during this investing season. We like this season because it's very applicable to everyone, no matter what stage they're in. Everyone needs to have basic information, you know, basic knowledge of investing. So today we're talking all about stocks. We brought Matt back in, he's our stock expert. We brought him in for the web and the GBO penalties. We've brought him back here. I feel like Matt knows all the random facts about stocks. Random and basic. Random, and not 

[00:01:00] super helpful with being successful . But yeah, I love looking at stocks, so I'm excited to talk about some of the basics of it and hopefully yeah, add. Good commentary with it. No, this will be great. Next episode we'll be talking about bonds and then we'll go on to talk about funds, real estate and options, futures in private markets. To give people a recap. Last time, I think it was last time, we're doing some of these out of order. Yeah. So it's throwing us out, so it's throwing us off, but at some point in time we talked about. The order of investment decisions. I'm going to recap that really quickly. So you should be choosing things like first the account type and tax type, and then the investment type, which is what we're talking about today. So don't forget, you need to make the decision of am I investing in my 401k, a Roth IRA, a regular IRA, a normal brokerage account. Mean, what is the account type? Then all of those have different tax structures. Make sure you get that right. And now we're finally talking about what to put inside the garage. You know, what kind of vehicle are you going to drive as you enjoy the ups and the downs, or don't enjoy the ups and the 

[00:02:00] downs of investing. Right? And stocks are one, it's a category that's a little bit more volatile. So we're gonna talk about that today. But I mean, wouldn't you say, it seems like just about everybody we meet. It's rare. It happens every once in a while, but just about everybody we meet should have some sort of ownership or stock exposure. We talk about this as a way to keep up with inflation, right? In order to keep up with inflation, you need to own things. It's why a lot of people have made a lot of wealth in their home. Because they owned their home and you know, if you rent your house, you're not accumulating value the same way. So stocks are ownership in a company. And I guess we'll dive right in right there. Yeah, that's it. Basically, you are buying a piece of the company. You're buying something that makes you money. Which is nice. So if I'm thinking about it in this regard, if I wanted to buy a share of Apple or stock of Apple, I'd get a stock certificate. They would tell me this is the price to buy it in the open market. I would pay that price and then that would get added to my account and 

[00:03:00] then I'd be a minority share owner of Apple. This is one of those neat parts of stock ownership that I think is neat from a standpoint. When you think of stock ownership, people think of Robin Hood trading their account, or you've got a relative that seems to really be a wiz and knows how to make money at it, right? So everybody says something like that. I think more people, Warren Buffet was one that always talked about, he said one thing to be aware of with stocks that can be trouble is that. They're almost bad because with most types of ownership, you get something like what Zacc was talking about. You get something that is not priced daily. Okay, so let me go further. So if you buy your house, You just live in your house, that's your home. You're not literally trying to sell that home every single day. You're just gonna sit in it. And because of the nature of you sitting in it and just staying in it and allowing it to accumulate more, scarcity and become more rare in its region. You start to appreciate and gain value. Stocks are the same way. The torment that people are faced 

[00:04:00] with stocks is that we can log in every single day at any part of the day, and we can get a price of what our stocks are worth. And this is, Warren Buffett says, we would be more benefited to not be able to see that price. Cause if you could see that on your house, I just had a client earlier today to have a land up in Bear Lake. I said, if you had 24 hours every single day and you had to sell it to somebody for, in that 24 hour window, your range of prices would. Astounding. If you had 24 hours to close and record, you couldn't just list it for 30 days. We don't think of real estate in that regard, so we give it a little bit more of a pass. People tend to micromanage their stocks. It lowers their risk tolerance because they'd forget its ownership. You own something that's appreciating, that's cash flowing. That's good business. And sometimes we just think, Well, did you see what it's just doing? It's down. It's down 10%. It's down 10%. Are you kidding me? At this rate, in 10 days, we're gonna be at zero. Isn't that the over-extrapolation? Correct. That's, that's the, that's a common error in investing is to assume that the current path will be the forever path. 

[00:05:00] Hundred percent. And it goes down a little bit. We over extrapolate and say, I'll be poor in no time when normal volatility is, is there? So Laura, how do we take and take us to the basics of this? It's ownership in a company, but what do you think are the basics? Someone, because we have listeners that probably understand what stocks are, but commonly say, I don't understand a stock market at. So basically you can buy ownership in a company, not ownership. You can buy ownership in a company and as the value of that company goes up, the value of your stock goes up. Something else that's interesting, lots of stocks will pay out dividends. So if the company's earning a lot of money and they're not just putting it back into the company, they will pay out their shareholders a portion of that cash. So you get a little dividend on top of your owner. Something to be aware of. With stocks, they are the most volatile. If you buy into a company and it doesn't do well, it's not like a, you know, a bond or a debt where they have to pay you back. You know, if there's nothing left, you're the last to get paid out in bankruptcy, and it's gonna fluctuate more than 

[00:06:00] a bond. Typically, I would assume, right? Typically, yeah. I mean, there are, there are exceptions to that, but generally stocks are a little more volatile than bonds and we'll go over bonds next time, so we're not gonna do a ton of comparing and contrasting. But bonds, you're, you're lending people your money, stocks, you're owning something. Right? And people probably are listening to this thinking, Oh, this is simple. You know, it's not that complicated to buy and own some stocks, but they are organized in lots of different ways. So people probably hear these terms that we're gonna touch on, and that's what gets 'em confused. So we're just gonna talk about the basics of how they're organized. So, you know, one way to organize it, we have domestic or US stocks, and then we have foreign stocks or inter. This is typically based on where they're headquartered. Because you think about a company like Matt mentioned, Apple, Microsoft, large institutions have a global footprint, so they have exposure. Even if you're buying a US stock inside the business, it's probably has a decent amount of its sales if it's 

[00:07:00] a large company that is coming from other countries. Right? So just buying a US portfolio will give you international exposure. That's something that, this is where the nuance comes in, right? It starts to get a little bit tricky. Um, but there are companies that, like Nestle's a great example, that is a foreign headquartered company and that subjects it to a little bit different risks as well as their sales and operations may be in a different currency. So you may be experiencing two things, the price fluctuation of the investment. As well as the difference between the US dollar and the Euro might be fluctuating at a certain pace, and that can also impact your portfolio. I remember there was a year, gosh, it's been probably like six or seven years back, where the international investments actually performed really well. They had a positive return, but their currency fluctuated so poorly against the US dollar. That many investors actually had a negative return, even though their company's price in the opposite currency went up. It was really, really tough to swallow. Just currency 

[00:08:00] risk there. Yeah, so domestic versus international. Another way to organize stocks is by size, and this is kind of silly thinking about it. We'll explain. You have large companies, these are companies you know, with the Capitalization over $10 billion. These are the huge mega companies that most people have heard about. And then you have mid-size companies. That's usually 2 billion to 10 billion. And this is the funny part, the small companies are the companies that are $2 billion. Which you don't think, you know, a $2 billion company is small, but relatively it is. No. And then in the way, they get that number, that 2 billion, that 10 billion, they take all the outstanding shares of stocks, they times it by the number of outstanding shares, and that gives you what they view as their market Capitalization. I always think of this like when they talk about having value and blend and. We just talked about large, mid, and small. Well, within those, you've also got different types of companies in each of those. 

[00:09:00] And when I think about like, why did the market start to do this? Why did we have to start signifying small things like these? This is a small company. You only make. A billion dollars a year, that's not doing very well. It's like, I think they're killing it. Right? But I think it's partly because there needed to be a way for us to be able to get to what we wanted to invest in. And so there had to be categories. So all of these things that we're talking about are just ways that the industry has identified ways to categorize stocks so that you're able to get what you want. And to help you evaluate the risk of it, right? If you have a large company, they're probably more well established, not as volatile. So the risk is relatively less than a small company, and that's the reality of it, is people are going, Well, I don't want that much in small companies. So it defined the parameters of what is a small company so that you could try to limit or control some of that risk with some diversification. So spot on. So you touched on it, Matt, the other way. Briefly though, the other way to organize it, we have value stocks, blended stocks or core stocks, and 

[00:10:00] then growth stocks, growth companies. This one's funny because people always say, Well, I want the ones that are growing. Yeah. Don't confuse growth with the ones that are growing. Growth is actually probably an expensive group of stocks to buy. The price of the stock is a little bit high relative to its. But the earnings of those companies are growing so fast, it's the earnings of the underlying companies. So examples like this might be Amazon, Facebook, Apple, Netflix, you know, a lot of your tech companies fall in this category. Tesla is a great example. If you do a valuation is what they call it. Basically, if you say, How much should this business be worth based on its sales? It's buildings, it's assets, it's it's value as a company in terms of its people and the business and its cash flow. Do an assessment of all of that and figure out how much it's worth and divide that per share. That's outstanding. And if the price is pretty close to that, that's a value stock, which we'll jump to, back to that in a second. But these prices. 

[00:11:00] Tesla and Amazon have been crazy expensive relative to their underlying value, but they just keep growing and so it's a little bit difficult. I heard a manager once say, It's like buying a Toyota Camry for $140,000 and hoping that someone else will buy it off of you for 160. That was his relative reference for how much it costs to buy Amazon at the. So people are paying more now because they know it's gonna grow more. Oh, they hope it's gonna grow more. They hope it's gonna grow more. Let's exactly. Let's throw that number word in there, right? But yeah, value's a little bit different. That name actually feels more true. The concept is, is this a good value? Am I getting the stock at a price that's relatively close to what it should be valued at? Companies like at and t, Verizon General Electric, maybe Ford, Phillips 66. You get the idea. These are companies that oftentimes don't sound as exciting, right? They're not. They're not growing as fast, but they might be a fair deal. And there are 

[00:12:00] times like 2022. Here we are in the first half of 20. Our managers and just across the board, the managers who operate in the value space and the indexes that measure the value space have absolutely just done so much better than the growth managers because finally, the companies that are fairly priced or co, more closely, fairly priced, have really benefited from this market. And then Blend is where those two things come together in the. You've heard of the s and p 500. If you were to take a dot and say, what is the average of the s and p 500? It's right in the center of that large cap core box, and then the stocks inside the s and p 500, those 500 stocks. If you were to then take a dot for every single one of 'em, you would have that spread out over the value and the growth boxes as well. It's like a tic tac toe grid, if you can imagine that in your head. And usually they put value on the land column, growth on the right column and core down the middle, and then large at the 

[00:13:00] top, row, mid, and then small. That's your tic tac toe grid. So if you ever see that, we're trying to help people who may. Be as familiar with these categorizations to be able to understand what you're looking at. If you ever see that anywhere where you read like this is a, this is a mid-cap growth fund, you know, you're on the right middle box of that tic tac toe grid because you've, you're in the growth category, but mid-sized companies. You can have large value companies, you can have small value companies, or you can have large growth companies or small growth companies. So we touched on this. Basically, the more growth oriented it is, the more risky it's going to be, relatively right? Not always their exceptions, but for the most part, more value is a little bit more stable, a little less risky than we talked about size. The larger it is, the lower the risk. Smaller, it is a little more risky. So your small growth companies are gonna be where we're in the highest. Category, your large value is at the other end, that's probably gonna be your lowest risk. There are managers out there that subscribe to very 

[00:14:00] specific philosophies around this. Like there's one out there that we know of, haven't used them as much, but they really strongly believe. In small cap value. That small cap value will outperform the other eight boxes over long periods of time. And, in the short last couple of years, it doesn't seem, and this, this year's been great, but prior to that, it's been a long, rough road for that, that particular investment philosophy. Because in fact, large cap growth, which is the opposite corner of the tic tac to grid, has been the darling for 2021 and back five to 10 years. So it's hard to know, but d. Different beliefs around which of these styles and caps definitely persist and managers are pretty stubborn about it. They'll say, Ah, it's just, it's just not our time. And it's like, well those are five year cycles sometimes that it takes to go back and forth. Yeah. And you find too, a lot of it's just based on prior research that's been done that has 'em going that route. But you'll find if you'd go to buy individual stocks off. Hearing a conversation like this, it's always gonna be good to buy at least a handful 

[00:15:00] just because you wanna have more than one in there for sure. Because if you're wrong, if that doesn't work out and you inevitably are, PayPal's a good example of one that would be in the nasdaq. It's a technology based company. It's been doing great. Can you explain NASDAQ though, just so that if somebody's not understanding what you mean so Well, how far do I want to go? So it's , It's good point. It's a platform that they use to trade stocks over the counter with how, if Zacc wants to sell his share of PayPal, he can sell it. On the NASDAQ and I can go and buy it. It's another exchange besides the New York Stock Exchange. I think everybody thinks that the New York Stock Exchange is the only one, but, But to your point, that's an electronic market that you and I could transact over without even touching the nyse. Correct. And since it is all electronic with it too, and all the stocks that are in it are basically supposed to be technology based stocks, so then. Have, you know, the nightly news doesn't quote it quite as much. Actually, it's on their Nasdaq and s and p 500 and a Dow are gonna be 

[00:16:00] what you hear most of, and the NASDAQ is gonna have PayPal in there. Well, PayPal, if you went back last year, it was within the top 10 of the positions in the nasdaq, meaning that it had a high waiting period. It was a big stock, and if you looked at it now, it'd probably be in the middle of it because of how poorly it's done so far this year. The NASDAQ's not down as much as PayPal is. It's not down 50%, it's down 30. But that's because of a diversification to where usually if you're gonna look to buy one individual stock, oftentimes a really good way to allocate funds is you can always make a bet just in one category, and that's gonna be your biggest swing. And if it goes well, that's gonna be your biggest return because it has that risk reward. The bigger the risk, the bigger the reward. I like that you brought this up, Matt. Cause I bet a lot of people are listening thinking, Okay, well, you know, which section should I buy into the large growth or the small value. And you nailed it on the. Maybe a little bit of everything. Diversification, you know, don't put all your eggs in one basket, Buy a little bit of each. I totally agree. And I feel like this is where your personality can come out and how you like to invest. There's 

[00:17:00] certain stocks that you like. I like to tease a guy we work with. We're gonna leave him unnamed. There's a gentleman that we work with and I say gentleman loosely. He's a young guy and he loves dividend stocks. I don't know who this is. I was thinking the same thing. I'm to figure out who, who this is afterwards can get it to, But I like, I kind of teased him, like for how he was allocated. Like, cause that's typically considered to be a stereotypical like retiree mental Yeah. Mentality I should say. Cause you think about it like a company like at and t that was on the value base, that's a phenomenal business. Ask me if my wife and I are gonna cancel our at and t bill. We're not, if we do, we're going to Verizon or T-Mobile. So it's like, if you own those three, Wow, you're really diversified in a nice area of value. That's good, That's probably not gonna be tarnished. And I don't know if we brought this up. Value stocks tend to pay more dividends than other companies because they're not, They can't grow. They're not reinvesting in themselves. Yeah. They have the extra money and they just paid out to their shareholders. And that became super valuable this year because people said, Well, what's king? King is cash and not just cash that they get to go and reinvest.

[00:18:00] Cash is king that gets sent to me. Right. So those became really popular right now and they'll always have. That's a great way to invest, but sometimes it's better to have different strategies. I just teased him cuz I was like, it's like on the, if he was like on the freeway, he was in the slow lane. Or maybe just one lane over for like his age group. And I was just like, Come on man. Live a little bit. Go buy some Google. I love it. . I love it. So that's the style box. So we talked about the size and you know, the value growth in Blend. Another way that they separate or organize stocks is through market sectors. This is interesting because it's the same stocks. It's all the same stocks that we were talking about 3000 or so individual stocks, like on the New York Stock Exchange that they reorganize. in just a different way, and this is by the type of business in terms of its industry or sector. So just real quick sectors are the broader categorization, so let's pick one. So financials, for 

[00:19:00] example, inside financials, that's a whole sector. Then there are multiple industries within finance. You could have banks, brokerage firms, insurance companies, different types of financial services, and those would all be within the financial sector, but they are different industries. So that's something to understand. Those two terms kind of get thrown around as if they are the same. We're trying to help you so that when you come across things within your portfolio, If you're reading out or just if someone's talking to you that you know what's going on sectors, these broader categorizations. Typically have more to do with how the stocks perform than how big or small they are, or whether they're value or growth. So let me see if I can explain that a little bit differently. If you have a stock that is in the healthcare sector and another one in the energy sector, And one of 'em is large and one of 'em is small. The fact that one of 'em is large and one of 

[00:20:00] 'em is small, is not defining why they're performing differently. The reason they're performing differently is because one is energy and one is healthcare. Now that sounds pretty, pretty simple. But here's the problem. If you look at portfolios, very few portfolios out there are really that focused on the sectors. They're way more focused on cap and style, which has always blown my mind a little bit because it's interesting that the managers focus so much on cap and style. When sectors drive the the's, a higher correlation around sector to performance. I still haven't found a great answer. There are some sector managers out there and you can definitely. Pick and, and highlight certain sectors. We have investors that want to overweight a particular sector. We watch the sectors across our portfolios, but, but that's something that individuals can really pull certain levers and I think most people tend to invest in the sector in which they work more. Yeah. You feel like,

[00:21:00] like I know oil and gas employees are very heavy in. And finance employees of banks and financial institutions are really comfortable with that. And I think it's just because they're more comfortable and they understand the metrics of the industry and part of me says, That's okay. I think that's really good to go back to my colleague that I tease and I'll let these guys in on it so they can tease 'em afterwards too. It's all about conviction. If you have a great deal of conviction on something, there's a good probability you'll be able to stick to it. And a lot of the time, a ticket to making money is being able to stick to something for a long time and not panic and make a change. So if you like energy, it could perform wonderfully like it has over the past two years, or it could perform really poorly like it did the 10 years prior to that. But if you can stick to it, you can do really well. I was just gonna say your same point of diversification works in the sectors as well. We ran some charts before to evaluate the different sectors compared to each other and. Tech. You know, tech has done great in the last three years since 2019. Just killed energy. Energy was kind 

[00:22:00] of lagging, but this year, 20, 22 by like eight times, right? Yeah. Tech, if you started with $10,000 and it went up to maybe $82,000 or something like that in tech, $10,000 might go to like, Almost 11. It was like 10,000 in change in energy, right over that time period. So we're not talking about a minor performance difference between these two, the top and the bottom. It was very, And then looking just since January of 2022, it's completely flipped. Energy's just destroying everything else. Right? Right. So here you have a $10,000 investment going up to maybe, you know, is that $50,000 or so? Yeah. And so then well maybe, No, sorry, that would be like $15,000, but, or having your tech go down and. You know, 10,000 down to 7,000. So it's been a rough, it's been a rough year for some of the high flying, high growth investments and some of those boring investments that our, apparently, our colleague is in is probably doing great this year. Yeah, 

[00:23:00] Doing wonderful. He's way better. Happy as a clam. Yeah, I still will tease him, It's totally, That's good. It's good for him. It's a good workplace, , but that's, you know, it's so hard to choose stocks based on historical data. You can't always look and be like, Well, the last year, the last three months, this stock's been killing it. I'm gonna buy that. Put everything in there. I totally agree. I was just saying like, I feel like if you haven't dabbled in stocks, I feel like we always talk about tuition. We pay, like as advisors, like, Oh, I went and bought this and you know, I just paid a little tuition to the market because I lost money on it. I think if you're gonna do something like where you wanna buy individual stocks, you're, you're good to maybe buy some obvious names. Names that you're like, Oh, we go to Costco. Every month we can't get out for less than $300. It's like, okay, well then maybe that's a decent stock for you to hold cuz you consume it, you're watching it. A lot of the times you'll find though, for individual investors to just go buy individual stocks. We're gonna talk about other segments in here as we go into our next episode, 

[00:24:00] that will give potentially a better way to maybe access how to invest in these that'll be less risky because the market's created products that allow us to buy a basket of 'em. Right? So those are funds. We'll talk about that in a couple episodes, I think. But say someone knows of a stock they wanna buy, how do they go ahead and do it? So this has become easier, which is great. But just about any of the major brokerage firms, the discount brokerage firms, so we're talking about places like TD Ameritrade and Schwab, which are on track to merge by then. And then Fidelity e-Trade, and then places like Robinhood have popped up. That's like the idea of investing for all. So that one's a little bit, probably even easier to understand. But for the most part, these are pretty straightforward. We have an old episode. Of buying a stock. Do you remember this, Laura? I think maybe you were back when we opened a Roth mm-hmm. account. Yeah. Yeah. We opened up, so I think it was The Dummies or Back and Want to Roth or something like that. One of our most listened to and downloaded episodes is 

[00:25:00] Finances for Dummies, and then we put dot, dot, dot, I mean millennials, but that one gets a lot of downloads. But anyway, we had them back and went over buying stocks. But it's pretty easy to do online. Place a couple of clicks and you put in the ticker, which is the three letter symbol, typically 1, 2, 3, sometimes four letters for the individual stocks. And you just push buy and it's, it's actually pretty simple, you have to put cash in the account prior. Yeah. Pretty easy. If you use an online platform like Robin Hood, you'll have to be totally on your own placing it. But if you use somebody like a TD Ameritrade, a Schwab, or a Fidelity, , you can get online and you could literally call their customer service and say, I'm online, I wanna purchase this stock. Can I just have somebody walk me through it? And for the first time they can do it? Yeah. They'll walk you through it. They'll walk you through it. So, Something to be aware of here. When we manage a stock portfolio, we're not doing it like that. We use software that hooks up to places like TD Ameritrade and Schwab. And then we have a target. So we, we work with professional money 

[00:26:00] managers that provide, So like for example, we're gonna talk about funds in the future, and we'll cover this a little bit more in the episode that covers funds. But instead of paying for the fund cost, we often times just get their trade signals directly from them at a cost that we pay. And then we might be buying 50 stocks with one click, which is very different. And there's a very set target for each of those stocks. So it's not like your advisor is in there pushing, I'm gonna buy three shares of Apple and one share of Google, and, and go through and place these trades individually. It's more like, we want a target allocation. X percentage in these 30 stocks and I'm gonna queue it up in my software, push a button, and that gets executed across the whole portfolio all at once. And trades happen in a fraction of a second. Now, literally it's in and done and fulfilled in less than a second once you push click. So it's, it's pretty quick, pretty easy. And we can trade thousands and thousands of positions in a day. Our traders are busy all day doing this stuff, but that gives you like 

[00:27:00] an idea. Of how that gets executed. What else would you add, Laura? Anything else to understand about stocks? I think just understanding that the stock market is not some strange thing that your uncle or your cousin's really good at. Understanding the stock market is our everyday economy that we're living in. You know, Apple, Amazon, everyone's going to Costco and well, if they're a member, I guess that was who is not a member? I was about to like, I feel like she's trying to sell us at Costco. She's. One day we'll get there, whatever, but just knowing the stock market isn't as scary. You know, you guys talked about when you're in a certain industry, you're more familiar with it, you have more conviction. Understanding the stock market makes it a little bit less scary. And when, when we remind people, you know, the stock market does go up and down, it has volatility. Understanding. Oh, do we really think, you know, FedEx is going outta business. They just drove by. So it made me think of it. MasterCard, visa, Apple. Do we really think they're going outta business? Most people will probably say no. No, not really. So if you understand the stock market 

[00:28:00] that it's our economy, it can make it a little less scary and intimidating. And then too, like we're gonna, at some point, everybody's hopefully gonna get to a point where you're gonna stop working. And the reality is, is that you have to invest at such a, into something that allows you to, Zacc's very first point. Outpaces inflation allows you to grow your wealth, and this is really one of maybe two areas that's proven you can do this over the past 130 years and do it successfully. So for that reason alone, it's definitely worth Getting involved and it's so much more accessible, you know, everybody can do it. We'll talk a little bit more about the different ways that you can own stocks and you know, a little bit about bonds and other investments, but I think we covered it. I'm gonna give everybody a little bit of context as we wrap up here. And it goes to what you were saying about you really shouldn't be too afraid if you were to talk to people right now. The markets have come down a fair amount in 2022. If you. You invested $10,000 in the s and p 500 a year ago, and by the way, you know, per 

[00:29:00] compliance, we can't say it, We're not saying do this right. We're just saying, we're not saying buy any stock. We've said hold anything today. Let me, I'm writing this down. I know, right, Right. Okay. I'm placing the orders, placing an order. Okay. So if you had purchased the s and p 500 a year ago, If you ask somebody, how much do you think that $10,000 would be worth today? I would assume we'd get numbers all over the place, but people are pretty pessimistic about what's gone on over the last year, the actual, including dividends and everything. You would have $9,509. So you would be down just shy of $500 over the last 12 months. That's really not that much volatility in spite of a pretty rough market for the last little while. If you push it out three years, your 10,000 would be 14,530. So this is, to your point, Matt, if you're willing to get rich slowly, it works pretty well. It's not get rich fast and it can be really painful in the short term, but I mean, if you push it out 10 years, your 10,000 is now 36,000. So you get the idea. But hopefully 

[00:30:00] everybody understands. Normally the news makes it sound way worse than it is normally. The people who quietly buy and invest for the long term and believe in the businesses that they own, with a little bit of monitoring, rebalancing, and tweaking and adjusting along the way, and Uno. Adjusting along the way, right? Mm-hmm. , if they can handle that, they do fantastic. I have met so many people who have multiple millions of dollars in my career, and it mostly has to do with owning stocks or starting a business. Those are the only two. Obviously, business owners usually are the wealthiest, but if you take business owners out, The second best wealth creation tool I've ever, I've ever come across in, at least in my career after business owners is owning stocks. So if you're not starting and running your business yourself, you should be owning something else. And this is a great way to do it. Totally agree. Especially to it. It doesn't take skill from a standpoint of like, I've gotta learn to do a side job. Right? It allows you to compound your wealth. 

[00:31:00] You just gotta do it. All right. Thanks for joining. Thank you. This podcast is intended for informational purposes only and is not a substitute for personal advice from Capita. This is not a recommendation offer or solicitation to buy or sell any security. Past performance is not indicative. Or for future results, there can be no assurance that investment objectives will be achieved. Different types of investments involve varying degrees of risk, including the loss of money invested, therefore, It should not be assumed that future performance of any specific investment or investment strategy, including the investments or investment strategies recommended or proposed by 

[00:32:00] Capita will be profitable. Further Capita does not provide legal advice. Tax advice. Please consult with your legal or tax professional for advice prior to implementing any strategies discussed during this podcast, certain of the information discussed during this podcast. Is based upon forward looking statements, information and opinions, including descriptions of anticipated market changes and expectations of future activity. Capita beliefs that such statements, information and opinions are based upon reasonable estimate eight and assumptions. Forward looking statements, information and opinion are inherently uncertain and 

[00:33:00] actual events or results may differ materially from those reflected in the forward looking statements. Therefore, Undue reliance should not be placed on such forward looking statements, information and opinions. Opinions. Registration with the C S E C does not imply a certain level of skill or training.

Learn More

Education Center

A roadmap to financial success, our education center puts you on the right path. Filter through our outlined subjects and find the content you are looking for with ease.

Learn More

Get Started

The network you need. Reach out and have our team align your goals with a proven strategy!

Learn More
Join The Community!

Sign up for our newsletter and learn more.

Financial Education •  Offers & Updates •  Join the Community