The Weekly: Mortgage rates hit 6%, the US$200bn pill race and why we hold on to bad investments

0:01Coming up in today's episode, we talk about peptides. This is an industry that it looks like is going to absolutely boom. And we're not just talking about GLP-1s, the weight loss drug. We're talking about an industry that's about to experience huge innovation and potentially huge growth. So what does that mean for investors and how could we get access to it if we're interested? We're also going to be talking about interest rates, which really do matter even if you don't own a property. So it may not be so exciting, but it does matter. This is The Curve Weekly, where we read the finance news so that you don't have to.

0:35I'm Sophie Hallwright, XTV and radio producer, who is sick and tired of not understanding investing or the economy, so we started this podcast. Hi, I'm Nicole Bremner, and I'm an investor in a number of different assets, including The Curve and properties and stocks and shares, and I'm filling in for Vic today. And before we get into it, we have a quick word from today's sponsor. Thank you to Pathfinder's KiwiSaver Plan, who is the proud sponsor of this Curve Weekly episode. It's important to us to encourage anyone who wants to to invest alongside their values, to make money via investments without compromising on their morals.

1:09If you don't know how to do this or you have a specific question for the ethical hotline, submit it via the link in the podcast show notes. Pathfinder Asset Management Limited is the issuer of the Pathfinder KiwiSaver plan. A product disclosure statement is available at pathfinder.kiwi. Nicole, what an absolute treat it is to have our lead investor back on the podcast. How exciting. Thank you so much for filling in for Vic. Thank you. Thank you. I will try, Vic. I will try. I know. She better listen. Nicole, before we get into today's headlines, because there's some really good ones that we're going to be covering.

1:42Personal perspective, are you in the red or green this week? Oh, that is a very good question. And it's a very easy question to answer. I'm in the red. Oh my goodness, am I in the red. Why? I just bought flights to Australia. And it is so expensive. You could buy a really nice new car for the amount that it's costing for me and five of my family to travel to Australia. I can give you numbers if you want. Please, love, love. Okay, so economy for six people to Australia and then flying business back is just over£33 ,000. And that's economy one way and business back. No way. Business was going to be around£50 ,000 to get us all there.

2:34So it's been such an expensive month to do that. yeah so I've chosen because my children have to go back to school I felt okay I'm gonna treat them and we'll do economy on the way over there and then we're with family we can kind of relax and sleep and get over our jet lag and then we'll do business back but it's just the time of the year it's Christmas you know what it's like you go back to New Zealand or Australia at that time and everything is so expensive oh my god and that's the problem right because like now I'm engaged to my beautiful fiance, her, God, I hate saying fiance. I really need to just like, I'd love to skip to the husband part.

3:13But because we're obviously from different sides of the world, I'm going to be going home every year for sure. If we're lucky enough to have kids and then I'm doing that trip with, I mean, I don't know how on earth we would be able to afford that. There is no way in hell I will be sending kids on business class flights. What I will say is goals. The reason that you are able to spend nearly£30 ,000 on flights is because you have invested in many things, property, stocks, private companies like The Curve. So like amazing inspiration for anyone listening who's wondering how the F are you spending that amount of money on flights?

3:48Do you know what it is? Investments, guys. It's a very successful career and it's investments. I'm not really in the red. Oh, do you know what? I bought Luke's dad two bottles of Tattinger for his birthday. It was his 72nd birthday and we're in Spain at the moment for his birthday, working remotely for the week. And it is divine and gorgeous and I'm so lucky. But my God, am I in the red. Not only has my phone been sitting in a bowl of rice trying to bring it back to life, but I, yeah, presents, presents are just so expensive and it's made me realize in the lead up to Christmas, I'm going to have to probably give everyone a bit of a talking to and say, guys, it's going to be a light Christmas for me.

4:32I love spending money on other people, but also I should not have spent£100 on champagne. That's slightly out of budget. I'm sure he appreciated it. And it got you some daughter-in-law points, so that's good. For anyone that's wondering why did we get Nicole in for Vic while she's travelling home, is Nicole has spent probably, would it be right in saying your entire career in the financial sector. So not only are you always reading the news and you know what's going on, but she's got a really unique insight into investing in companies and businesses and property. And so today we thought, who better than Nicole?

5:13So we've got three stories and the first one we're looking at is actually to do with mortgage rates. And I want before we get into this for everyone to know that whether you own a house or not, we're going to be looking at what the headline is and what's going on, but it is a global story. It's a really important thing to understand with regards to the broader economy. So why don't you give us an overview on what is happening and why we wanted to talk about this today? Yeah, sure. So what has happened is for the first time in a very long time, the UK fixed mortgage rate has reached 6%. So it hasn't been that high since Liz Truss's mini budget three years ago.

5:54And what's even more interesting about that, I think, is that the Bank of England rate is still at 3.75. So there's quite a difference now between what banks are charging people for their mortgage and what the Bank of England rate is currently. So before we get into this, I think it would be really helpful to explain what the difference is between mortgage rates and interest rates? Because I, when you were like, we need to talk about mortgage rates being so high, I was confused. And it would be really helpful to explain the difference between the two and why they move differently. So what happens is we have the Bank of England and the Monetary Policy Committee or the MPC at the Bank of England.

6:42And they're the ones that are tasked with keeping the economy in check. So what happens is think about it as a thermostat. And the MPC use interest rates to turn up or down that thermostat depending on what's happening in the economy. So if the economy is running really hot and inflation's running quite high as it is now, So currently it's at 3.1 % and the Bank of England aims to keep it around sort of 2%. So if that happens, they turn up interest rates and that slows the market. If the market's a bit sluggish and inflation is dropping because people are not spending, then they can drop interest rates, which will encourage people to spend.

7:29And that's really what's happening at the moment. But there's another problem here, and that is that we've got this cost of living crisis. And while there is inflation, it's not because people are spending too much because they want to, it's because they have to. Everything's just increased in price with the war in Ukraine and then the knock-on effects of that with our food and our fuel. And now with Iran as well, that's really having an impact. So we've got this really unusual time. And that's why, as you said, this is a global story because this is happening in all of the Western world at least, where we have really high inflation because things just cost a lot.

8:11And so therefore interest rates are going up and it's really hitting consumers from every angle. When we look at the state of the world, and this is global, as you say, everything is expensive right now. To do anything is expensive. So I understand that the cost of living crisis. What I'm sort of confused by is the difference between whether it's the Bank of New Zealand, the Bank of America, that the main people that control interest rates and look at that thermostat to say, should we make them, should we turn it up or down? And I love the way that Vic explains it like a seesaw. If inflation is low, interest rates are high.

8:46So they work in opposite ways. But if inflation is just inherently high and everything is inherently more expensive right now, what difference does it even make to move interest rates around? Like, does it do anything? And is it working in the same way as it always has? Or is it actually just like kind of new territory? And that's why mortgage rates and interest rates are being hiked up. Yeah, no, it is exactly right. We are in new territory. And I'm sure historians can pull up examples of where we have been here before, but at least in our time, this is all new. And the Bank of England, New Zealand, Australia, America, they all need something to bring this inflation down because if everything just costs more and more, then we don't trust prices.

9:33We've had these experiences in, say, Zimbabwe and Turkey and many countries like that where they had such high rates of inflation that you couldn't put a price on anything because by the end of the day, the price of that item would be more than it was at the beginning of the day. They could not buy or sell things with any certainty. And so that's why it's really important that these central banks do keep a rein on that inflation. And the main lever that they've got for that is interest rates. But I think what's interesting here as well is that we've got this 6 % rate in the UK versus the Bank of England rate at 3.75.

10:14And what that's telling you is that the market expects that the interest rates are going to rise. We're seeing that trend actually globally. So if we look at America, they just increased their interest rates for the first time in a while and it looks like that's going to continue. Australia, they've increased. New Zealand's increased. There's an election in New Zealand shortly, so they're probably going to keep things on hold for now until after that, because it's very political, of course. The UK was three out of the nine people on the MPC voted to increase interest rates. So we could see the October or the November meetings where they do increase interest rates up to, say, 4 % for the Bank of England.

11:01But it just means that the markets expect it to go up. And that's why the rate that banks are now charging people who have a mortgage is 6 % and not somewhere just above that 3.7 % Bank of England rate. If we were looking at the Bank of England or US or whatever, and standard interest rates within the country are, say, 3%, why or how would a mortgage rate move differently to that. Wouldn't the whole point be that a mortgage rate would be pegged to interest rates? There are different types of mortgages, remember. So there's your fixed rate and there are tracker rates. So what's hit 6 % this month is the five-year fix and the two-year fix.

11:47But if you're on a tracker, then your interest rate is still the Bank of England rate plus whatever margin and they add to it. So let's just say it's a 0.25 % tracker, then you're paying 3.75 plus the 0.25%. So it's only the fixed rates that have hit the 6%. So anyone that wants some certainty over their current rate will usually fix their mortgage. But right now, it seems like it's cheaper. And this is not financial advice at all, but it seems like it's cheaper to have a tracker because it's just so much lower than the fixed rate at 6%. But as someone who is an absolute property extraordinaire, would you not say if you're looking at a fixed rate for five years and it's way higher and it's 6%, isn't that the bank factoring in that it thinks probably it's actually the floating would go above that?

12:48Yeah, it's definitely something that you would have to run the numbers on And a good broker will run the numbers on a fixed versus a tracker or floating rate and work out exactly for you what's going to be better. And also, you've got to look at the fees, the upfront fees. Often, if you've got a more flexible mortgage, you're going to have higher upfront fees as well, which you can add to the mortgage balance and then it becomes more expensive anyway. But also, I think that there are a lot of people who want certainty in their incomes and outgoings every month. And for them, it might be more palatable for them to take that 6 % fixed for five years if they've got the view that the rates are going to increase.

13:31And then at least they know what their outgoings are going to be rather than taking that 3.75. Now, it's not for everyone. And I think if it were me right now remortgaging my property, I'd probably be looking at a tracker because the five-year fix just is so high at 6%. But then I very rarely take a five-year view on a property anyway. For me, I want the flexibility of being able to move more freely than that. So it does really depend on your situation. But yeah, anyone looking, anyone who has to fix or refinance their mortgage right now, it's pretty painful. And I can give you some numbers, actually.

14:09Before you get into this, actually, Nicole, we have a community question that I was going to bring up today, which is, it actually fits in perfectly with the story. So I'm just going to read it out. Okay. So she said, hello, I was wondering if I could please request a topic or maybe you've done it, but if you could point me in the right direction, that would be amazing. I've bought a house with my brother in 2021 without realizing the market was at the peak. We've had five years of declining house prices where we've bought the house. And although it's rented out, interest rates are so high that we have to top it up monthly.

14:37For context, I have to put about 600 towards it to top up my share of the shortfall. So she only owns 40%, which means that's over 1 ,000. She has to top it up. We've decided to try and sell it. The reality is that we're probably going to take a huge loss. But if we don't sell, we will be continuing to pour money into it with no reward in sight. And it's just feeling like it's draining both of us, to say the least. All of this is to say, could you talk about the idea of investments not working out, the toll that it takes mentally and how to pick yourself back up, how to continue moving forward or to get back into a good mindset or even to know when it's right to cut your losses?

15:13I know, Nicole, you actually had an example that you wanted to use with regards to a property that you own. So maybe that's a really nice way to answer this question. So I've got a buy-to-let property that I have owned since 2015. And this particular one, when I bought it, interest rates were close to zero. So I was paying about£1 ,000 a month in interest and it's interest only. And I was receiving about£2 ,500 a month in rent. So lovely gross revenue there. Now, what's happened now is interest rates of what tripled since that time or more even. And my mortgage payments are now over£3 ,000 a month.

16:02And guess what my rent is? £3 ,500 a month. And so, of course, after you take out service charges and all of the other costs, not to mention tax, not that there's much right now, but I'm losing money. I'm actually paying for my tenants to live in that because my mortgage payments have gone from around$1 ,000 a month to$3 ,000. So a three-time increase on what it was. And this is something that people are experiencing across the board in Australia, New Zealand, America. That's just the trend. And it's the idea of having to crystallize your losses or accept the fact that an investment that you've made is not working out and it's not making money and it doesn't make financial sense to hold on to it would be so hard.

16:49And I guess if I zoom out and think about all the advice that I've heard from Vic, from many different people when it comes to investments is that you can't fall in love with an investment. and if it made sense at the time and you did your best to invest money in something that you thought was going to be a good investment, make you money, and then it just doesn't, and it doesn't make sense anymore, re-evaluating and making a different decision is actually a really empowering, amazing thing to do. And I don't know, maybe it's working through the guilt or the, maybe you feel quite spiteful or angry, and that's so normal and natural.

17:25And I think I would feel the same if I'd lost a lot of money but it doesn't mean it's the best thing to hold on to it and obviously this isn't financial advice it's you've got to make a decision that's right for you but I know if I was in that position I'd find it really hard to accept it was time to let go of something. Investing with her brother adds another dimension to that because there's the the family dimension and I hope they haven't fallen out over it I hope that they just see it as a lesson learned but obviously there was so much excitement going into this as siblings and wanting to make it a success.

18:01So it's a really difficult one. I'm one of the newspaper headlines that are saying that landlords are selling up and I'm selling this property as soon as I can. I had two wonderful tenants from New Zealand. They're both moving back and so the property is now on the market. Oh my God, who were your tenants? I bet we know them. It's New Zealand. I bet you do. They're probably cousins or like friends. That's so funny. They're lovely. They've just been such wonderful tenants. And it was, yeah, when they said, yeah, we're leaving. Oh, actually, it was a fixed tenancy and they were always due to leave.

18:32But of course, I kept joking with them and saying, oh, you'll meet someone over here. But no, they're heading back. What we do, and this is a slightly changing topic, but what we do as humans is we tend to hold on to loss-making investments far longer than we should because the feeling of losing money hurts so much that we often sell our well-performing assets. far sooner than we should while holding on to the underperforming assets. And that's something that's definitely happened for me in this. So I'm taking the emotion out of it and I'm just, I'm looking at it as an underperforming asset that needs to be removed from my portfolio because it's no longer serving me.

19:11And had I invested that in even just an S &P tracker, for example, I would be up so much more than I am now. And now I'm probably going to have to take less for that property than I even bought it for in 2015. Oh, that is so devastating. Yeah. And it's down to interest rates. So while people might say, well, I haven't got a mortgage, interest rates don't impact me. They actually do. Because if you own property and the overall interest rates are high, anyone buying from you, well, most people are going to have to get a mortgage, which means they can't afford to spend as much on your property. Do you know what I mean?

19:52So it impacts everyone, whether you've got a mortgage or not. The only people it doesn't impact on, I guess, is if you're going to hold that property forever. And then it impacts the people that you leave it to eventually. So it all impacts everyone at some point. It's honestly such a hard one. And I'm kind of in a position at the moment with Luke because he bought his house a few years ago and he has quite a significant amount tied up in the deposit that he put down and it's such a gorgeous home and we love living in it and it's it's so great but it's really hard to look at the numbers and look at what you're spending and look at your interest rates and mortgage rates and then realize oh gosh like if that money had been in a as you say S &P 500 how much it would have increased but at the same time the feeling of renting is so different to being in a home that you own and not that I own this house but it is a luxury that I think you can't quantify in dollars so it's different for you because the one you're talking about is quite clearly an investment property it's quite different if you're looking at a home that you live in so I think it's just something people should keep in mind with regards to this story exactly and I rented for years and hated every moment of it and could not wait to buy a property.

21:11And then I bought a property without a mortgage because I just did not want that outgoing each month. It's lovely and it's a lovely position to be in and not everyone is able to do that. But buying a home is an emotional decision and you can't discount that because emotions mean something. And yeah, it's so lovely to be able to feather your own nest, but at the same time, having the flexibility of renting is also an incredible feeling. If there's the right rental properties and you've got good landlords. it's worth saying for anyone that's listened to this and are interested in investing in property it might be something to do with the home that you're in or you're looking to buy your first home second home the property podcast is such a great place to get lots of diversified thoughts on property and what's right for you because yeah everyone has different goals everyone's trying to do different things and I for sure have made a lot of money in property you can still make money in property if you do it the right way.

22:06But being as educated on what those options are and knowing how to run the numbers is so, so, so important to be able to make that decision as to what's right for you. Coming up after the break, can you invest in things you love? There is a peptide boom going on right now. I have had so many different thoughts around peptides. I can't even explain. There's peptides in my bloody lip gloss at this point. So if you are buying or investing in peptides as a consumer, maybe something interesting to look at as an investor. We're going to dive into the space right after the break. But first, we have a quick word from today's sponsor.

22:40Pathfinder isn't about philanthropy. They're about generating returns for their investors in a way that they and you can feel proud of. The Pathfinder KiwiSaver plan compares itself to a traditional benchmark when it comes to returns, not just an ethical one. They believe ethical investing can hold its own against mainstream options that focus solely on returns. Thanks so much to Pathfinder for making this episode of The Curve Weekly possible. Pathfinder Asset Management Limited is the issuer of the Pathfinder KiwiSapper plan. A product disclosure statement is available at pathfinder.kiwi. To learn more about how they invest ethically, you can read the Ethical Investment Policy and Exceptions Register, which is on their website.

23:17Nicole, there is something that we are going to talk about right now, which is, it's essentially an investing trend, isn't it? It's an investing opportunity or a way to look at how we are consumers, but we could also be investors in a space that is in the most uneloquent way ever popping off right now. It's jacked. It really is. It's absolutely jacked. It's popping off. It's absolutely jacked. I feel as though the peptide boom has been happening without me really realizing what's going on because it feels as though there's peptides in everything and there's so many different peptides. So can we just talk about, yeah, what is happening and why you thought the story would be an interesting one to talk about today?

24:02Sure. Yeah. As you said, there are so many different types of peptides and I have collagen peptides in my coffee every morning and apparently they make your hair and skin and nails great. I don't know, but I do it just as an insurance policy because maybe it will. So they're so widespread, as you say. And what they are is short chains of amino acids that can be used in medicines and food. The ones that you hear of, other than the collagen, which I'm sure all through your Instagram feed, are the GLP-1 drugs such as Wegovia and Azempic. And these are peptide-based medicines. Apart from the ones that you stir into your protein shakes and things, they're actually really difficult to deliver because the digestive system actually breaks them down before they get to your muscles.

24:47And so that's why there's been a lot of talk about people injecting peptides. And I don't know about you, but I'm sure nearly every person on my feed right now, especially in Australia, seems to be injecting peptides. It's just such a big thing. But how are you with needles, Sophie? I mean, I'm terrible with needles. There's no way I'll be optionally injecting anything. that's actually such a lie I definitely have had Botox but in terms of peptide injections I don't really understand how it works how is there a peptide that you're putting in your coffee that is for hair skin and nails but you can inject peptides because GLP-1 is a weight loss drug and why have I got peptides in my lip balm that's what I'm a bit confused is there's just is it a new science craze that people are jumping on board with to create lots of different products to sell outcomes, whether it's juicy lips or you get skinny or you have longer, thicker hair.

25:48Is it almost like this new buzzword that people just say this has peptides in it and therefore everyone sees dollar signs? Yeah, absolutely. And actually there's no research that shows that the collagen peptides actually work. But on the flip side, the GLP-1s definitely work. And everyone's seen stories about people who've lost so much weight off the back of those. And that is because they're injected. And that's the efficacy of them. Whereas whether we're stirring it into our coffee or not, there's no research that shows it actually works. It's kind of like, do you remember amino amino acids.

26:24And think back, I'm sure every five years, there's been something that's been a trend that's been all throughout in our beauty products or we've added it to things. What we do know, though, is that the GLP-1s work. They're being heralded now as well as longevity treatments. And so as long as your weight height ratio is over about 23, then you can get access to those, which seems a bit unfair because if you want to have access to them for a longevity treatment, then you can't if you're under that. Is there research saying that GLP-1s could be used as a preventative or to lengthen lifespan as well as lose weight?

27:02Yes, exactly. And that's what's come up with David Sinclair. He's an Australian scientist that's based in Harvard. He's written extensively about this. His latest podcast talked about that as well. Brian Johnson, who I know you've spoken about before, he's the man that wants to live forever. He takes them as well. And I've been looking at them thinking, well why can't I get GLP ones I don't necessarily want to lose any weight I mean I'd love to have a visible six-pack but hey I love my wine and food too much for that but if they are longevity drugs then why can't we all take them but I mean I'm still don't know if I could inject like the idea of even going through a fertility treatment or egg freezing does freak me out a bit because I'm not good with needles even doing I did a fertility hormone test I had to do a tiny little prick on my finger to get blood out.

27:53And even that, I was like, don't like it. I could be slightly off with this, but I'm fairly sure there's about 3 million UK adults that are using GLP-1s now. And the concept behind this being in the headlines so much right now is that there's conversation about it moving away from an injection and moving towards a pill, which I'm imagining the increase of people who would feel comfortable using it if they could just swallow it rather than use a needle would probably mean that the market size and the potential customers and therefore the amount of money businesses could make would increase enormously if that was the case.

28:31That's right. PwC have said that 3 million UK adults are currently using GLP and that would rise to around 7 million if the pill format became available because they found that 83 % of those who are eligible to use them would only take it if they could take it in a pill form. And so just the money involved in this is massive. So again, JP Morgan estimates that this market could reach$200 billion by 2030. So$200 billion. Because how much is it valued at today? Like how much of an increase would that be? Right now, that market's worth$16 million. Oh my God. So it's an enormous, enormous jump. Just in the US, actually.

29:19So just in the US, the user base is around 16 million. And so that's expected to over double by 2030. And that's just in the US. But yeah, 24 % of people were unwilling to take it if it was a weekly injection, even though that's what's going to work with them. And you think about people saying, I would do anything to lose weight. And actually, they wouldn't because they wouldn't inject. Whereas if it was a daily pill or a weekly injection that will take the daily pill every day. I'd be so interested to know how many of those people who have said they would take it if it was a pill form are wanting to take it for weight reasons or for longevity because I don't want to like beat the same drum of a lot of people do not need to lose weight from a health perspective.

30:04I think that the whole game completely changes if there is health benefits that are increasing someone's lifespan. I mean, if someone said you take a GLP-1 and you could take it in this dosage, but it's not going to impact your weight, but it would increase your likelihood of living over 95 or something, I would so do it. I mean, I guess it depends how expensive it is, but most of us are chasing how can we be healthier and live for longer. Absolutely. And I think that there's probably an important differentiation is that those who need it for weight loss are probably not thinking about the longevity benefits of it.

30:44They're probably just thinking about the weight loss. They're two entirely different markets. And so at the moment, it's only available to people who meet the requirements. But you imagine how big this market could be if people like you and I who don't need it, who wouldn't qualify, but would take it for the health benefits. If we opened it up to that, then this could be even bigger. If we look at this purely from an investing lens, so whether or not someone is interested in this drug or taking peptides as an injection, as a pill for weight loss or for longevity, how would you encourage anyone listening to think about this industry or this trend with their investor cap on?

31:25Because this to me feels like it's kind of an amazing opportunity. Yeah, I think it is. but I think a lot of the price is already in the stocks that are exposed to this. But let's think about it in layers. I think this is the best way of visualising it. So first of all, the most obvious thing that you think about investing in is the drug. So who creates these drugs? Let's go and invest in those and that will be the best way to make money. And yeah, that's true. But I think by the time we've heard about it, it's already been priced into the price of these particular stocks that you invest in. So when you say price it in, you mean that the way that or what the share price has done, because a share price is already looking at the future projection or the future growth or the future earnings, where GLP-1 companies like Eli Lilly, I can't remember any of the other names off the top of my head, where those share prices currently are, they're already, like when you say priced in, they know about the fact that this pill could be coming and therefore that's why the stocks are doing really well already.

32:34Yeah, absolutely. So when you are looking at the price of a company, you factor in what the future growth of that company and the future profits are going to be. For that reason, it's already priced in. If you think that this company is going to be more valuable in the future because their profits are going to increase, then you increase the price based on that expected outcome. And it's the same as if you think that a company is going to do really badly because their product is no longer in demand, then the price goes down and it's all about expectations. So that's what I mean when I say that these expected profits or the expected growth within this industry are often already priced into these companies.

33:17And it's not to say that there's going to be more growth because Because what happens if they open up the market to longevity, to those who want to use it for longevity? All of a sudden, that just greatly increases the number of people who can take it. So these things are not always priced in. There are sometimes these outliers that can cause these stocks to skyrocket because they're opened up to a new market. So yeah, there are always opportunities. And so then back to the layers analogy. So you have like Pfizer, for example, who creates the drug. But is what you're saying, there's layers beneath that.

33:53So you could get creative about how or what you decide to invest in. If you're wanting to get exposure to this trend or this potential growth within peptides, you don't just have to look at the basic who's producing the drug. There's actually other places that you can investigate or think about with regards to making money off this industry. Yeah, absolutely. When Victoria is looking at funds management, there are four main areas actually within the medical area. You've got your pharmaceutical companies and that's the first layer. So that's the companies that are making these drugs and distributing.

34:30Then you've got the biotech. These are the companies that sit above that, that they're coming up with the science. They're developing these. They're developing the way that they're, how they are delivered. and that's the biotech. Biotech companies tend to be highly highly volatile because they'll have something that works and so the price shoots up and then they'll have 10 years of nothing working so they're highly highly volatile stocks and then you've got your medtech and medtech can include all sorts of things but often it includes this third layer which is the IP who owns this intellectual property because the biotech company might have licensed it out they might receive royalties.

35:13They might have these licensing agreements with the big pharmaceutical companies. So that's that third layer. And then the final one is often the retail or this ecosystem about what other businesses benefit if so many more people are using this. And this is when you can get really creative and think of not just the retail distributors, but also things like nutrition and protein. We know that with GLP-1s, it dampens your appetite. So you need to ensure that you're eating the right macros. So of course, this means that people are going to be interested in all the supplements. They're going to be interested in having a good nutritionist to ensure that they are getting their right macros.

35:52All these business and fitness industries, as you're losing weight, you're probably going to want to work out. There's a huge gym craze, as you know. So gyms are doing really well. And then there are all the healthcare practitioners who are administering these, monitoring them. So yeah, there is just this huge ecosystem. Then you could even think about gym wear and people, if they're going to the gym, if they're losing weight, they're going to need clothes, aren't they? They're going to need shoes to train. So, yeah, it's about being really creative. So you don't just have to buy the pharmaceutical company.

36:25You don't just have to speculate on the biotech company, which is highly volatile. I would say the key message of what you're explaining is you don't just have to follow the product, the thing that's at the top. you want to follow the problem that that industry is trying to solve and all of the different threads that come off of that are contributing to the whole so it's almost like we I know Vix used this example a few times and for anyone that's missed it I'll just explain quickly with AI it's really easy to think what are the big companies like whether it's open AI or Anthropic or any of these obvious obvious ones but AI needs so much to be able to work properly in terms of so much water, there's a lot of power, the chips, there's lots of different things that make up AI.

37:12It's almost like, what is the hot zone? The hot zone right now is peptides. What's happening around peptides and how can you get exposure to it in a less obvious way? And I actually, I kind of love the analogy of thinking of it creatively because you normally would never think of investing as creative. You know, it's one of those things that you think, like, oh, investing is numbers, it's business, it's boring. It's actually really not. There's so much psychology and creativity and thinking about where opportunities are and investing in that way. Absolutely. And that's what Vic's role is, is now thinking about that in a really creative way and not just buying the most obvious, but trying to think about the secondary repercussions of any of these trends.

37:54So yeah, it's very fascinating and it's all about picking trends. Nicole, thank you so much for looking into both those stories for us. It was really fun to get your perspective, especially as an investor who knows New Zealand, Australia and the UK. Hearing about those stories and how you interpret them is so fascinating. Yeah, it makes me feel really excited as well for all the people who are applying to be a voice on the curve. We put out on socials a couple of weeks ago because obviously Vic's moving to New Zealand, but also we've got the fund. There's just so many things going on. We really wanted to get more voices involved in the podcast to find more experts, but also just like hearing from you today, your insights from a completely different perspective and the things that you're seeing, it's just so valuable.

38:38So thank you so much for joining us. And yeah, really loved this episode. Thank you. Oh, it's been fun. Thank you so much for listening to this episode of The Curve. Feel free to leave a comment to let us know what you thought. We always love hearing your feedback. New episodes are out Monday, Wednesday and Friday. So make sure you're subscribed to be notified whenever a new episode drops. In the meantime, we're around on social so you can find all the links in the show notes. Hope you have a great week and we will see you for the next episode. Okay, quickly, the Curve was created to empower and educate you about investing, but we are not financial advisors.

39:10Our platform exists for educational purposes only and it doesn't provide personalized investing advice for your individual needs and should not be relied upon to make an investment or financial decision. And always remember to do your own research before making any investment or financial decision. We're here for any knowledge and support you need, but the final call is always yours. And thanks for being here. You got this. Yeah, we know you got this.