MI340: The Art of Studying Markets w/ Shawn O’Malley and Matthew Gutierrez

24:05To begin getting smarter about investing, just visit theinvestorspodcast.com slash get started with stocks. That's theinvestorspodcast.com slash get started with stocks. And for a limited time, you can use code stocks 15 for a 15 % discount at checkout. All right, back to the show. It sounds like your mom has made a big impact with the book on her nightstand and buying Apple early on. I think it's great to have a parental influence. Sean, I'm curious, were your family, were they investors and did you guys talk investments around the dinner table? Did you have that kind of influence growing up?

24:44No, I wouldn't say quite the same way. My dad has always been very supportive of my journey with investing and wanting to learn about it. And he certainly did everything he could to, I guess, kind of feed my appetite and make sure that I was learning and growing productively. And he did do some things like when I was in high school, he gave me a little bit of my college fund to try my hand at investing with stocks. For me, I do remember I had an uncle who was a banker. And I remember that he would sit around and he'd read the Wall Street Journal in the morning and drink his coffee and then he'd watch CNBC.

25:19And so I remember almost looking up to the success he'd had in life and wanting to mimic some of his daily habits. And so I thought, yeah, let me just start reading about the markets in the mornings and let me watch CNBC and I'll have a successful life as well. So I certainly had a number of positive influences in my life that allowed me to have those early touch points with investing in finance and approach it honestly and just being allowed to learn and make mistakes and fail, which is the most important part. I think unfortunately, a lot of people don't have those positive role models in a financial capacity to look up to sometimes.

25:51And so you're not always allowed to fail. And all of a sudden, investing becomes this overwhelming and kind of scary thing that, again, people are afraid to, you're afraid to make mistakes. Like, what if I invest in the wrong thing? Or, you know, I don't know what I'm going to be doing. And then you almost get paralyzed by paralysis by analysis, right? And you get paralyzed and there's an element of inaction that comes into it, or even just a fear of, you know, rebalancing your portfolio and checking back up on it. Because it's like, oh, well, I put everything together and let me just leave it.

26:17I don't want to mess with it anymore. One of my favorite chapters, Matthew, you mentioned the psychology of money. My favorite chapter, and I've said this before on previous episodes is the last chapter called Confessions, where he just kind of takes a look under the hood of how he manages his own money. So I kind of wanted to talk a little further about that, Matthew. You touched on it to some degree, but I really wanted to talk about money moves that you specifically have made coming out of college, what you're doing now. You mentioned the 20 punch ticket kind of theory that I really like a lot, but talk to me more about some money moves that you're making that you think somebody that is just starting out that's listening to this and investing would be smart to consider?

27:01Yeah, well, I'm certainly no expert and I'm always open to learning new things. But from what I've learned, both from mistakes and some successes here and there is, you know, I guess it starts simple with living below your means and trying to invest the difference. As silly as that sounds, it's amazing. My mom's influence was a blessing, but also on the other end of the token, had I not had that, I don't know where I would be investing wise because it's not taught in public school, at least where I was. And really in business school, I don't know if anyone really even threw up like a basic compounding chart of just like, you know, SMP the last hundred years, like that was not part of the repertoire of the coursework.

27:36So that's just to have, you know, to both of the points to have those role models is in a way unfair because, you know, it's just kind of luck and who were surrounded around when you're growing up. But that was the biggest thing is just surrounding myself around those people. And that was her motto as well. It's just, you know, anytime she got a bonus or a little bit of extra money, it was invested. It was not, it was not, here's a new car. Let's go to the Bahamas. It was, you know, let's just put a little bit away and let compounding work. It's magic. And that's the biggest thing. Like we can get into allocation and everything, but.

28:04Yeah. I kind of was curious. Do you strictly, are you more of an active investor or do you siphon off funds into index funds? I kind of wanted to talk about passive versus active investing, what you personally do? So personally, I have a small allocation to S &P 500 and the Qs basically. But most of it is, like I said, Apple, Microsoft, Amazon are my biggest players, which kind of boring, but that's what I've stuck to and incredible companies. And then the last probably three plus years, the dollar cost averaging into Bitcoin, part of that is Preston to blame, read his insights and just still have a lot to learn on Bitcoin, but the technology is fascinating.

28:43And thankfully, the dollar cost average approach has worked for people the last, you know, call it 10, 15 years, really excited to follow it as well. So Apple used to be a sizable part of the overall portfolio and slowly Bitcoin is making up a much larger part of that, both by appreciation and then just by adding a little bit every month. So I think it's somewhere around almost 50 % right now. Bitcoin, I feel pretty strongly about that. It used to be under 20%, and we'll see where it goes from here. But I'm just going to keep adding no matter if rises 30 % tomorrow or drops 30%. The dollar cost averaging is really a great way to go.

29:17And I think I was listening to a podcast this morning. There's not too many people that are sitting in a loss on Bitcoin at this point. It's worked out pretty well. And the whole Michael Saylor micro strategy strategy that he's pulled off is pretty remarkable to watch and what's been going on. And I know Preston's a big fan of what he's been doing the last, well, last four years or so that he's been in Bitcoin. But Sean, what about you? I want to take a look under the hood. What do you personally recommend and some of the moves that you're doing in your own portfolio? Yeah. Well, just to echo Matthew a little bit too.

29:49I mean, it is so easy to get lost in the individual stock picks. And for some people, that's where they start with their personal finances. And so I would just say generally, what's going to be most important for most people is make sure you have an emergency savings fund. Are you matching out your 401k up to your employer match? Are you taking advantage of IRAs, Roth or traditional? Do you have health insurance? Those are the basic questions. And then once you set those basic standards and you figure out how to budget, you figure out that you're allocating to your retirement, then the question is with this 20, 30, 40%, whatever it is, what fraction of my income that I'm going to be investing with, what decisions am I going to make with it?

30:26And generally, this is something I've talked about before, but there's an illusion of passive and active. And I guess in the traditional sense, I would call myself a blend of passive and active, but I would also push back on that and say, in a way, there's no such thing as passive investing. There's really just, are you aware of the decisions and trade-offs you're making, or are you not aware of the decisions and trade-offs you're making? For example, people will say passive investing is buying the S &P 500. Well, the S &P 500 is an index that's formulated by S &P Global, right? And so there are active decisions as to what companies get included and cut from that.

31:00And then you say, well, I buy the entire market. And then I would say, okay, well, how is that index listing every publicly traded stock? Is that equally weighted? Is that market cap weighted? So for me, one of the things has just been over the last couple of years, learning about those trade-offs and not just saying, I'm going to be a passive investor. I'm an active investor and I only pick Warren Buffett's out of stocks. It's just at every step of the road, trying to understand the trade-offs that I'm making with my finances and why those might be important. And then another point I want to make too is connecting back to antifragile.

31:30And something that Nisim Taleb talks about is this concept of via negativa. And so we often, when we think about whether it's with our health, the relationships, with our money, we think about how can we add more? And somehow we're going to add something that's going to help us. And it's going to be some new supplement or some vitamin, or we're going to add more exercise into our routine, or we're going to add this stock to our portfolio, and it's going to dramatically improve things. And the principle of via negativa is first, let's focus on what we should avoid, what should we not do? And so maybe with health, it's like, okay, well, rather than trying to train to run a marathon, well, let's start with cutting out the junk food or whatever it is.

32:06And literally the via negativa and just removing the things that are weighing on you or killing you or whatever it is. And instantly you could have order of magnitudes improvement and the structure of your portfolio or your health or whatever it is. So in my portfolio, for me, my question often is that quote unquote passive tilt where I try to most of the market generally in various ETFs. And then I think a lot about what do I want to avoid? And so for me, that's I don't invest in Chinese stocks. You can say that I'm missing out on the world's second biggest economy, that I'm missing out on perhaps some of the best tech companies in the world.

32:45But for me personally, it's not a place that I've thought through a lot of. I don't feel comfortable with the ownership rights there, the governance, the tensions of being a US citizen and trying to invest in a place like that. There's just trade-offs that I don't want to make with my money there. And it's a place that I avoid. And so I only invest in, for example, emerging market ETFs that don't include at all or greatly minimize their exposure to Chinese and Taiwanese equities. So for me, to some extent, it's a question of that via negativo with my portfolio, where I start with the premise of let's own everything and then let's cut out the things I don't want to own.

33:19And of course, there are times where I see opportunities to zoom in on specific things and kind of tilt my portfolio weights in favor of things like Bitcoin or, for example, commercial real estate has been beaten down a lot over the last two years. And I wouldn't necessarily say anybody go out and buy commercial real estate ETF or buy V &Q or whatever it is, just because, again, there's a lot of nuance out of these different strategies. We're talking about commercial real estate. Are we talking about warehouses? Are we talking about office buildings? and what are we talking about? What type of office buildings, like grade A or grade C?

33:52So there's just a lot of nuance to these types of things. But again, that's an example of where I have a few different ETFs with large commercial real estate exposure that I've been looking at and probably trying to tilt my portfolio towards what's a pretty beaten down section of the market. So it goes both ways. But like I said, I start with this premise of trying to own everything, figuring out what I want to cut out and don't want to own, short-term treasury bonds, I don't want to own Chinese stocks and also figure out where I want to tilt in favor to it. There's a big sell-off in a certain sector of the market I might load up there.

34:23And that's kind of my general framework that I operate from. I like that idea of via negativa and what to avoid. I remember you sharing with me kind of this idea of political risk. You had invested, I think, in like a Russian ETF, like maybe right before the Russian-Ukraine conflict. Can you share a little bit about that? Yeah. Yeah. No, it's a lesson I learned the hard way. This is, applying via negativa for my portfolio is unfortunately not something that I was born intrinsically with the inclination to do, right? This is something that I've learned from experience. And so, I think in 2020, 2021, I was looking around at actually what caught my attention specifically was this headline that oil prices had gone below zero and how could they be negative?

35:06And I didn't think I understood anything about the oil market and interest trading. And COVID was a crazy time and we were a few months into lockdown, whatever it was, but I knew enough about finance and economics that oil prices are not going to be negative forever. And this seems like a pretty good time where you could buy in and they're certainly not going to get more negative over the next six months or a year. This is a good time to buy in and look for the upside. So that initial train of thought, I started looking at buying individual oil and gas stocks and ETFs. And then I came across gas, Gazprom and some of these Russian oil and gas companies that were trading at PEs of like five to 10, even back in 2020, 2021.

35:47And they would have massive dividend yields, massive earnings yields, and also all the upside of the potential price appreciation of whenever we do recover from this kind of COVID induced recession, and we have more global demand for energy and gas and oil and gas prices surge again, they're going to have that bonus upside And there are some other dynamics I was looking at where the interest rate differential between the rates that would be paid on the Russian ruble versus the interest rates in the US were at zero. There were a lot of attractive elements in theory about why one should invest in Russia.

36:23I mean, there were so many things that seemed like no brainers to me. And it sounds, I'm almost embarrassed to say now that I made those investments, but in 2020, it seemed like there were a lot of upsides in my favor. And obviously I've held onto those into 2022, where when you had the Russian invasion of Ukraine, it essentially became illegal to own any stocks and bonds in Russia. And so I was only 22 or 23 at the time. And so the amount of money that I was investing is ultimately inconsequential, but it was still a fraction of my net worth that essentially just went to zero immediately. And when you read John in Bogle and Vanguard and the kind of passive investing and ETF approach to investing, you don't ever expect that you could just truly go to zero.

37:06That was not an idea. You're always sold, oh, well, the S &P 500 has fallen 80 % or 50 % and it's fully bounced back. And the NASDAQ, you always eventually bounce back. In this case, I don't want to say because of a technicality, but because of political risk and geopolitical tensions, regardless of whether So those companies are good to own. And the fact that I own them in an ETF, right? It wasn't like I picked two or three stocks. I owned like 30 or 50 Russian oil and gas companies in this ETF. Unfortunately, yeah, because of that war, the geopolitical risk completely outweighed any of the upsides that I had thought were so attractive.

37:43And so I certainly didn't have an understanding of the geopolitical risks that I was taking, the nuances to owning international equities, and even the fact that in theory, sometimes you can be right. Objectively, I was right. Betting on oil and gas at that time was the right thing to do. And Russian oil and gas stocks were the cheapest ones to bet on. But there's a clash between the theory and reality. And so having appreciation for political risk, it's just something that I've come to think a lot more about over the last couple of years. And so, for example, like I said, when I look at China, I'm not necessarily saying that I think there'll be an equivalent fallout in relations between the US and China.

38:20But when you're talking about the chance of your portfolio being zeroed out, then you have 30%, right? Most emerging market ETFs, it's dropped now because Chinese equities are down a good bit. The average emerging market fund, the MSCI index is like 30 % or 40 % Chinese plus Taiwanese stocks. And so if you're putting a substantial chunk of your net worth into that, there's a chance that could get zeroed out for similar reasons. And so those are the kinds of concerns. And that's where I say, this is just something that's a too difficult pile, as they say, that it's just not worth the downside risk of owning and also the stress of trying to constantly monitor and think about how those risks are evolving over time.

38:59Let's take a quick break and hear from today's sponsors. Hey, it's Sean O'Malley, just popping in with a quick message. If you like this podcast, well, I've got great news for you. We've got a handful of other shows for you to explore, from learning about Bitcoin to embracing a richer, wiser, happier lifestyle. Just go into your podcast app and type in We Study Billionaires to find our collection of shows. We Study Billionaires is our flagship podcast, and we've made a name for ourselves over the years by interviewing the best investors in the world, including Ray Dalio, Howard Marks, Joel Greenblatt, and many, many more.

39:34My colleagues Stig Brodersen, Clay Fink, Kyle Grieve, Preston Pysh, and William Green each hosts their own We Study Billionaires episodes and bring their own unique perspectives. A whole new world of insights awaits you. Just go ahead and type in We Study Billionaires into your podcast app and see what you've been missing out on. Seriously, go ahead. I promise you'll like what you find. Bonus points if you show your support for our work by clicking follow. If something piques your interest, just start listening. No hard feelings. I'll be waiting for you back here. Just like everybody else, there was a time when I was a beginner investor, and I have to say, investing is particularly filled with jargon that can just make it so difficult for new investors to understand what is going on.

40:14But it's never too late to get smarter about stock investing from the ground up. At The Investors Podcast Network, we've made a habit of studying the world's best investors, and now I'm distilling those learnings into a simple course for you, or for anyone in your life who you might want to share the gift of knowledge with. With my How to Get Started with Stocks course, you can master the principles of excellent lifelong investing with valuable insights for both beginners and pros. The course covers 10 different sections, beginning with the basics of what a stock actually is and how the stock markets work, to strategies to optimize your retirement savings, how to pick great companies for the long term, what to look for in ETFs, and how to monitor your investments, plus so much more.

40:52To begin getting smarter about investing, just visit theinvestorspodcast.com slash get started with stocks. That's theinvestorspodcast.com slash get started with stocks. And for a limited time, you can use code STOCKS15 for a 15 % discount at checkout. Not to be cliche, but building a market-beating portfolio really doesn't have to be a mystery, at least with the right tools. If you've listened to our podcast for a while, then you know we spend a lot of time learning from savvy investors. So why not use the same tools we do? With TIP Finance, you can. Screening for great companies, calculating intrinsic value, keeping up with legendary investors' portfolios, and more are all not just possible, but easy to do.

41:39TIP Finance was created by investors for investors. It's quite literally the tools we wanted to use ourselves when researching investments in a simple to use interface. You can get started by creating an account for free. Who knows, maybe TIP Finance will help you find your next 100 to 1 investment. Between the screener and Legend Investment Portfolios to reference, I've gotten a ton of ideas from TIP Finance. What are you waiting for? Take the next step in your investment journey today with the right tools at your fingertips. Grab your device and type into your browser, theinvestorspodcast.com slash tip-finance to get started.

42:17That's theinvestorspodcast.com slash tip-finance. All right, back to the show. And I think it's such a good learning lesson to have this experience at a pretty young age in your investing career. I mean, this is a lesson that you'll never forget, right? That you'll carry forward for the rest of your life. It's really a Pretty good lesson. Matthew, I wanted to kind of segue a little bit into your experience at TIP. You said you were listening to We Study Billionaires and some of the podcasts, but I wanted to hear a little bit more about how you found out about TIP and the newsletter and the process of applying and then coming on board to TIP and just what the experience has been like for you.

43:01Sure. Yeah. It's don't remember, honestly, the exact specifics of how I came across the job posting. I think I had just been a big listener and ended up going to the site and I want to say just saw one of the postings and submitted the application. I believe the sample S sample writing piece was a, was reflections on a Warren Buffett interview on one of the podcasts might've been a Robert Hagstrom interview who wrote the, you know, he wrote the Warren Buffett way and probably should have mentioned that as an informative book. Love how he talks about quote in there where Warren says, Robert, we're just focused investors.

43:33And I just, that was like, just really well articulate so much of what Warren's about in that mentality. So that was the application and ended up speaking with a former podcast host and Robert and then Sean and Stig as part of the interview process was challenged during that process, I think a couple of times. And they asked really great questions. It was not a breeze hiring process by any means. Fortunately, they brought me on, which I'm so grateful for. This has been the, by far the most exciting, education-filled, peaceful, happy work environment that I've been a part of. And I'm not just saying that.

44:07It's really been, as Stig says, optimizing for happiness. And you can see that this is not a work around the clock environment. This is a, for the most part, work when you want and how you want. And really just putting us in the driver's seat, sort of giving the point guard of the team sort of the reins to run the offense the way they want too. So I love that we can just get up every day and look at that blank newsletter, Sean and I, you know, 7, 8, 9 a.m. and try to make a, you know, work with that blank canvas and just make something that will resonate with people in such a clickbait headline, crowded media space overall.

44:42Right. And I'm just speaking generally of newsletters as part of the media and really just trying to differentiate ourselves, educate readers, inform them. And as Sean and Stig have sort of laid it out in some of our emails every day, we're getting feedback from Stig. And I think one of the lines that stood out was, we're taking care of the reader. And I really like that phrasing and just sort of serving the reader and just trying to walk them through a scenario and explain a financial concept beyond just the stock moving up or down or an energy market doing XYZ, really explaining why and telling the story behind them.

45:17Sean, how about you talk a little bit more about your experience of coming on? You shared a little bit about early on that you were listening to a lot of podcasts, but I want to talk. You trained me on the newsletter and I learned a ton from you and kind of onboarded me in many ways. So I want to hear a little bit more about your experience coming on into TIP. Yeah. Well, it was funny. I think I joined February, 2022 or March, 2022. And there was this three or four month gap, right? We didn't start to actually start publishing the newsletter until July, But the whole purpose that I was hired for was to write the newsletter.

45:51But because of some advertising arrangements we had in place, we weren't going to start until July. And so I had almost three or four months of kind of empty time to fill. And so I spent a lot of the time just reading and learning and it sticks guidance to some extent. And then also we kind of thought, hey, we've been looking for a YouTube post, which is actually the job I originally applied for. And I said, why do you have some time to kill? Why don't we send you a camera and start making some videos? and it was almost full circle because like I said when I originally applied to work at TIP I had applied to be a YouTube host and over the course of several rounds of interviews they decided that there'd be a better fit to be a newsletter writer but yeah so I ended up with cameras and it was quite a process to get everything you wouldn't believe the amount of work that goes into a YouTube video and also you know even just our newsletter each day just to get everything looking and sounding right and so I know as a podcast host Patrick you can also appreciate that So I had a several month stint just making basic YouTube videos about finance and book reviews before I settled in full time on focusing on our newsletter, We Study Markets.

46:52And I know I had the privilege of working with you pretty early on, Patrick. And one of the kind of lasting messages that one of our colleagues told me of how to think about the newsletter is, let's create something that's of the same quality of our flagship podcast, We Study Billionaires, and let's do it in newsletter form. And so I brought that to the newsletter very seriously of being a longtime fan of TIP and wanting to feel like I could recreate the same quality and value and trust with people that had been built up over our podcasts over the years in this new media format. And I'd like to think that we've accomplished it or we put a lot of work into just getting better every single day.

47:31And I mean, I know we look back at the early editions of the newsletter And on a day by day, a week by week basis and month by month basis, I mean, it has just gotten exponentially better. And that's not because we're brilliant people, but that's just because we've been so humble of every day. We say like, what can we do? How can we improve this? Should this be shorter? Should this be longer? Can we do a better job explaining it? Would this font look better? Should we bold this? Where should we add in links? And just every day, we're being willing to change and being flexible and having an open mind for how you can improve things.

47:59And so sometimes I look back at some of the first newsletters I wrote and that also we wrote jointly together. And I cringe. And then I also kind of see the beauty of that progression that we've made along the way. And it's certainly busy. As Matthew said, you start every day with a blank slate, which is scary to an extent. When you're focused primarily on writing the newsletter, every day is a new day. And it's not really like any other job. I've had other jobs and plenty of friends who work in insurance and banking and regular types of jobs. And your work carries on day to day, right? You might have projects you do for weeks or months, but with a daily newsletter, it's kind of something you craft and curate.

48:39It exists for a single day and you spend all day working on it and then you send it out. And then by the next day, it's already outdated and you're onto the next one. And there's not necessarily a continuity of newsletters, right? Every day is kind of a new day when you're trying to provide current market news to keep people informed about what's happening. So even just that process of starting anew every single day has been humbling because sometimes you say, hey, I wrote a killer newsletter yesterday. And then it's like, on to the next. And so it's very humbling. Your ego can't latch on to success too much because you're always turning a new page constantly.

49:15Yeah. It's like you're creating a baby every day and releasing it out into the world and moving on to the next baby. Right. It's like the sand mandalas. I'm not sure what they're called. These intricate artworks that are drawn in sand. And then they're just immediately cleared away as soon as they're finish. It's kind of what, not to compare our newsletter writing to the beauty of that type of art, but it is the same idea of you put so much effort into something and then you just wipe the slate clean. It's a great analogy. It's really true. There's so much work that goes into a newsletter. I don't know that the average person can really, when they see the finished product, appreciate how much work that actually goes into each day producing that much content.

49:54And I remember the early days, their newsletter was way longer and it was a lot more content to produce. And yeah, it's interesting to see the evolution. For our listeners, though, that aren't current subscribers, Matthew, can you talk a little bit about more in depth about what the newsletter is geared toward, what you're trying to accomplish, the mission, that kind of thing? Yeah, sure. Well, basically, in a nutshell, the biggest stories in financial markets every day, that's how I think Sean came up with that tagline. And that just speaks to what we're after. We're not necessarily chasing every stock that's moving around or what some pundits said on TV, but really just what are the big market movers or in some ways, what is the story that's being overlooked, but we think is substantial, generally long-term, even though it's a daily newsletter, we're trying to think about things that are going to have bigger effects down the line.

50:43So that's what we're after. We also obviously keep track of S &P, NASDAQ, Bitcoin, oil, gold, all that's in every newsletter. We usually try to sprinkle in a little fun in the intro and some charts as well, which we've really doubled down on the last, call it what, maybe a year, Sean, of really just adding more visuals so that people who, you know, realistically are commuting home or in line at the grocery store on their phone, reading it, they might be skimming or scrolling. So we do want to have, speaking to the mission point, we do want to have something accessible, something where you don't need an MBA to understand something that, you know, in all honesty, probably a college student would be able to understand virtually every word because we're really spelling it out.

51:21credit to Sean for financial terminology, really just spelling that out for readers, which you don't always get when you're reading the Wall Street Journal or Bloomberg, which are great platforms. But we really try to educate and inform and add those definitions, add those examples, add those stories to the headlines. So that's it. In a nutshell, we'll have some pop quizzes, some polls for fun as well, and just to sort of put a cherry on top. Yeah, it's good stuff. I look forward to getting it every day. Sean, I wanted to hear a little bit more from you about just how the newsletter, how you think about the evolution of it.

51:53You were there at the very start of it, started it. I mean, you're the founder in many ways. How has it changed over time? How would you say it's kind of progressed and you said it's gotten a lot better and it has. Talk to us a little more specifically about that. It was one of those things where we truly started with the newsletter, with an open canvas. I was just asked to take... We built up this email list over years of doing a podcast, but we weren't necessarily emailing people and communicating with folks who had signed up to hear from us. And so the mission was kind of just, hey, let's build a daily newsletter.

52:27And then Sean, you can figure out what it should look like, how it should read, how it should sound. And so it wasn't this kind of thing where from day one, I didn't even really know who I was writing for. You're trying to figure out who's actually going to read this? Who is this going to be valuable for? And that's kind of one starting place. And then from there, you have to figure out, okay, how should this actually look? How should it flow? What should the tone be? Should it be more casual and fun or should it be very serious and professional? So there's a lot of different ways we've gone. I would say we've pushed in those different directions over time.

53:00And I would probably say at the beginning, I thought I almost took it more seriously than I needed to. What do you say more about that? Serious in what way? The tone of the writing was more serious? Yeah. Just having fun, making jokes, linking to interesting things, even in pop culture and stuff. But when I first started, I think I thought I needed to have this very strict financial markets focus and just talking about numbers and treasuries and stocks and exactly what's happening at a very technical level. And over the course of doing it daily for nearly two years, this is something Matthew and I have talked about.

53:34We just want to have fun with it. When you're having fun with what you're doing, life is a lot better. And so, So in some ways, the newsletter has, I would say, become more casual. It's become more fun to write and hopefully to read and hopefully just easier to read too. And so, yeah, like I said, it's been a constant work in progress, but we've ended up in this place where we realized, when we first started, I think about, okay, I'm writing it for this person, John Smith, 40 years old, who lives in Maryland, and you'd have some idea of who you're writing for. And over the course of time, And it took me a little bit to learn the wisdom of, you know, just put something out that you want to read and that's interesting to you.

54:16And so that's ultimately where we've leaned into is me. I think really it's gone from me thinking about trying to make something that would make other people happy and to just creating, you know, knowing that I'm an investor and somebody very interested in finance myself and just figuring out, you know, what would I enjoy reading? And yeah, that's where we've ended up. And, you know, along the way, we've learned some small things that just like that I've thought about is how exclusionary a lot of the language is in finance and business in general. And even you open up CNBC, which is considered the most mainstream and accessible business and financial media company.

54:47And there's just still so much jargon that's used. And sometimes people don't ask the first questions first and the principles of like, what does it actually mean? What is actually inflation? And what is an interest rate? And why is it important? And so we don't always go through it at such a basic level in every single newsletter. But if you're reading every day, I think you'll see that we take a lot of those opportunities to just zoom in ways that other people don't and answer those principal questions of like, sometimes you just take for granted that you think you understand something and you have to have somebody else push you and remind you to question something you just assumed that you understood about financial markets.

55:24And this is why IPOs happen the way you do and you just take it for granted. That's the way it is. And I think, well, hey, maybe there's a different way to do an IPO. right? And so just those are a few examples of how we've tried to, as Matthew said, try to make things as accessible as possible to people and retaining the sophistication of the concepts while removing the exclusionary jargon that makes people feel like they're not qualified to read business and financial news. Matthew, I wanted to hear a little more about as you're going through the process of writing, what are some of your favorite resources that you're turning towards to craft the newsletter?

55:57Yeah, so certainly mainstream news like Sean said, we're reading just sort of, we probably get, I don't know, Sean might get a bunch as well. I probably get at 1.20 newsletters in my inbox a day. And part of that was just sort of seeing what other people are doing. I've since unsubscribed and clean out the clutter a little bit, but we're just reading all of those, you know, scanning CNBC. Sometimes I'll scan CNN and CNN business just to get a pulse. We're not necessarily writing anything based on those articles, but just to sort of get a feel for what's going on in the day, both financially and not.

56:28I think the main ones, Sean and I keep coming back to our Bloomberg Financial Times, Wall Street Journal, occasionally New York Times and Washington Post. Those are the, let's just call it four or five that I'm reading every single day that we have accounts with. And we're reading the financial market stories, but some of those publications also have more business and tech stories as well that we might sprinkle in. The newsletter occasionally we'll throw in a sports story, whether it's LeBron James's holdings or Michael Jordan being a how does he look about markets and NBA ownership, for example, or brand deals.

57:02So we try to have fun with it, certainly primarily looking to those publications for traditional market stories, but we will branch out a little bit and anything just sort of with the ancillary business and financial stories as well for some people. Sean, talk to me a little bit about the vision of where you want the newsletter to go. Currently, you're at, tell me again, with number of subscribers and just kind of your vision for the future for the newsletter. Yeah. Well, we're at about 32 ,500 subscribers and I'd like to grow into hundreds of thousands and millions. And I was actually looking back at a publication we've learned a lot from, and that's Morning Brew.

57:40And I think they're at several million folks who read that and they just celebrated their 10 year anniversary. And so sometimes I frustrated, I had my head down and I'm thinking, why are we not getting more people to read this? How can we get it to grow faster and that stuff? And then other times I think about, it's just a long journey to really truly... I think of it as we're building a business with the newsletter. It's a long journey to build trust with people and add enough value to them that they'll recommend reading it to others. And you just build that sort of following organically. So it's a work in progress.

58:09We're almost two years in and I'm proud of a lot of what we've accomplished. And I think there's plenty of room to, as we've been talking about, I think that our message resonates with a lot of people who want to keep on top of the biggest stories in financial markets and they don't want the jargon and they want easy to read charts that be cliche, right? A picture is worth a thousand words. And sometimes you can convey so much more in a simple chart than you can in a thousand word write-up. And so we just try to blend as many of those elements as possible of coming up with jargon while also touching on the nuance of financial stories.

58:39Because what kills me sometimes too is that when there are plenty of folks who do try to very dumb down what's happening in the economy or in the stock market. And some of that stuff is just hard to read because there's no appreciation for the nuance and coloring between the lines of how complicated some of these stories can be. And unfortunately, the gap that we're trying to fill is that for more of that nuance, oftentimes you have to go to these legacy financial publications that are very technical and very filled with jargon. And so kind of the opportunity we see with folks is to go deeper than most mainstream media goes on financial and investing topics, while also not having the same jargon that you would get if you picked up a Wall Street Journal or a Bloomberg.

59:22So the message that I hope resonates with a lot of people. And so far, it seems like we had a chance to meet up with some readers when we were in Omaha last year for the Warren Buffett or to the Berkshire Hathaway shareholder meeting. And so from what I can tell people, it resonates with them. And also for me, it's just a message that is compelling because sometimes I read things and there's so much jargon in it. I'm like, God, I know a lot about finance, but I feel dumb reading this. I have no idea what they're talking about. And then you look up the terms and the language that's being used and you realize, oh, this is actually very basic concepts that are just being packaged in this way that, coming back to that word exclusionary, I think, honestly, for a long time, Wall Street money managers have built up a reputation of they want everything they do to be as esoteric as possible.

1:00:05They don't want the average person to understand what they're doing. Because if people understood the actual money moves that your average mutual fund or hedge fund manager are doing, you wouldn't pay them the type of fees that you're paying them, right? I mean, the average money manager is not doing anything extravagant and they're not some brilliant Wolf of Wall Street type of person. They're just making very basic moves for the most part. And they try to use, I think there's a culture of language that's been perpetuated over several decades of making yourself sound more important and kind of self-flattering language of just making things very technical and they don't need to be.

1:00:43So, So that's kind of my rant about it. But the more I've peeled back the onions of the financial world and each layer I go through, I realized just like there's a lot of that element of people wanting to sound like they're more sophisticated than they are so they can justify charging higher fees. And that's the unspoken truth. And I'm not going to say that we're going to peel back every layer of the onion for everybody who reads We Study Markets, but we really make a deliberate effort of to just shine a light on dynamics like that and also just to cut through the BS and cut through the jargon and just put things out there plainly.

1:01:15And also just a respect for people in that we don't need to tell them what to think, right? We think of it as truly like we're presenting information for people to decide on their own what they think about different matters in the financial markets. You guys are doing a great job at it. I know one of the key metrics is open rate. And the last time I checked, it was over 50 % open rate, which is just testament to the high quality nature of the newsletter and the quality content that you guys are putting out every day. I think it's rare to get that kind of number of over 50 % is fairly rare in the newsletter world.

1:01:50Matthew, I've been reading lately about We Study Markets Pro. So can you talk to me a little bit about that? I'm curious about what the new developments are with the newsletter and We Study Markets Pro. Yeah, well, thank you for the kind words, Patrick. Certainly, we're not about clicks. We're about information. And of course, we want people to read our work. No doubt, we're not going for high traffic just for the sake of traffic. We're really going for the educational component. As Sean said to me the other day, we'd rather have fewer subscribers who are really engaged and educated and learning than a list way bigger, but people aren't really opening it or they're just skimming it or not interacting with them.

1:02:25So there's to close that loop there. Yeah. As far as the We Study Markets Pro, we're excited to roll that out. It's$67 a month. And you get one weekly strategy report featuring market charts and historical data to inform and educate investors on their decisions. That's weekly. We have an occasional signal report as well based off of an economic release, like an inflation print, for example. We'll have something right shortly after those releases. We'll have quarterly webinars. And then we might roll out some other features as well. But everybody gets a free trial to start. Cancel anytime if you don't like it.

1:03:01And we'd love to have you on board. We welcome you to a one-on-one intro call and hear about what you're looking for, how you think about markets, how you like to invest, what you like to read, and that can help shape our product as well. So we're very much listening and interested. Yeah. And just to add to that too, right? You have the daily newsletter that we normally put out just with study markets. It is free for everybody to read and access. And the aim of that, as we've talked about the last few minutes, is to educate and inform people. And that certainly doesn't change at all. But the idea with We Study Markets Pro is to go and take the kind of information that's being provided, generally keeping people up to date on markets and We Study Markets.

1:03:39And We Study Markets Pro provide actionable insights and actionable institutional level, hedge fund level data that the professionals are honestly paying big money for to access. And we're taking some of that data and the hope is to distill it and deliver it into weekly actionable reports for folks that they can actually make decisions off of. It sounds like good stuff. I mean, one of the great things about TIP is it is super entrepreneurial. I mean, Sean, you've started a newsletter and you guys have run with it. And this is like a new development that will be exciting to see how it unfolds. And I just want to thank you guys.

1:04:14This has been a lot of fun for me, fun to learn more about you and just your insights on things are really helpful. And Sean, for people that want to get in touch with you, talk about how they can do that, and a little bit more about how to subscribe to We Study Markets too, if you could touch on that. Yeah. Yeah. Well, you could just go to theinvestorspodcast.com. It's our home-based website for all of our podcasts and our newsletter. There should be a few pop-ups that you'll see in different places for you to input your email. You can also go into, under the Academy tab, there's a dropdown and you can click on Newsletters.

1:04:46You can see our whole archive of recent newsletters. You can subscribe and you can also So check out WeStudyMarketsPro from there as well. So yeah, I really appreciate you having us on, Patrick. And if you do have questions about WeStudyMarkets or WeStudyMarketsPro, you can just email us at newsletter at theinvestorspodcast.com. And we open every email that comes in there and we make an effort to respond to everybody who writes in. Awesome. Matthew, how can people get in touch with you? And if they want to reach out and have questions about anything, whether it's market related or We Study Markets Pro or just a rap about some of the books you mentioned?

1:05:22How can they get in touch with you? Yeah, best way is email. Like Sean said, we read every email. We love sharing from our readers. So I'm Matthew at theinvestorspodcast.com. And you can also check us out on Twitter slash X or at We Study Markets there. We post a lot more regularly of late. So check us out there. And we do have some presence, like Sean said, of course, TIP on YouTube generally and Facebook as well. Awesome. Gents, thank you so much. This has been a lot of fun. Thanks for having us. Okay, folks, that's all I had for today's episode. I hope you enjoyed the show and I'll see you back here real soon.

1:06:17work. Written permission must be granted before syndication or rebroadcasting.