Listen to this if you’re avoiding investing at the moment

Maddy: [00:00:20] Hello and welcome to You're In Good Company, a podcast that makes investing accessible for everyone. I'm Maddy Guest and as always, I'm in some very good company with my co-host, Sophie Dicker. 

Sophie: [00:00:30] Hello, Maddy. How are you today?

Maddy: [00:00:32] I'm good. How are you? I'm feeling a bit tired. 

Sophie: [00:00:35] I was I've been told by Tiktok that you should just respond to the question. How are you? How are you, actually feeling'. [00:00:40][4.6]

Maddy: [00:00:40] Okay.

Sophie: [00:00:41] So I'm going to tell you, I'm a bit tired today. Yep. You actually good? Do you actually feel good?

Maddy: [00:00:46] Not really. Okay. Well, what are your thoughts? What do you feel? Just do it flat. Okay. So you need to talk about it in this form. Yeah. And for Jesus. How are you feeling? What are you saying? Well, I just like how it is going. 

Sascha: [00:01:11] I just thought it smelt a bit. 

Maddy: [00:01:12] So with this spray. So are you going to say?

Sophie: [00:01:15] It's like, calming to make us feel.

Maddy: [00:01:17] Better, but it is.

Sascha: [00:01:18] Coming at the same time and it also comes up the slight like, sure, you smell from the dew.

Maddy: [00:01:23] So it's all love loving Jimmy's.

Sophie: [00:01:25] You, by the way. 

Maddy: [00:01:26] Yeah.

Sophie: [00:01:28] So I don't. 

Maddy: [00:01:29] Smell. 

Sascha: [00:01:30] Yeah, I went to the gym, so that's why I. An answer to your question. I'm fine, because I think I've got all the happy exercise and it's nice. 

Sophie: [00:01:39] Yeah. Before we got into today's episode, I wanted to have a little chat about something I saw on my email the other day, which was Stan Lee is bringing out NFT collection clothes to be worn in the metaverse. What are your thoughts on that?

Sophie: [00:01:56] It feels a bit early. 

Maddy: [00:01:58] I don't like her at.

Sophie: [00:02:00] Yeah, I don't know. I mean, we're not in the metaverse. 

Maddy: [00:02:03] So I get it any day.

Sophie: [00:02:06] The first thing I thought of when I saw it was like, how? Because Donnelly is a melbourne brand fair or Australian brand. 

Maddy: [00:02:12] Really? 

Sophie: [00:02:13] They're Australian? Yeah. For anyone that hasn't heard of them before and they're quite expensive. The clothing is very expensive. And so I was wondering, do people in the metaverse see value in it and then like, how. Well, I don't know. How how would they price it?

Maddy: [00:02:29] My next question was like, is it equivalent expensive in the metaverse or is it like you can't afford it in real life? Be kind of in your in your avatar. 

Sophie: [00:02:36] Maybe we'll have to track that and let everyone know what happened.

Maddy: [00:02:41] Oh. If anyone knows, please get in touch and let us know. 

Sophie: [00:02:44] Anyway, so, Maddyy, what is today's episode about? 

Maddy: [00:02:47] Well, today's episode is all about one of our favourite sessions from FinFest, and that was Emma Fisher's session, which was all about risk versus uncertainty and how uncertainty can be your friend. Now, I guess one of the reasons why we really wanted to do this episode actually came off the back of a conversation that I had one with one of my best friends the other day and I was chatting to her. She's recently moved overseas. We're on a call and I was asking catching up and I said, Oh, by the way, are you still investing? And she was like one of the biggest, most diligent investors before she left. She was so into it, really fascinated by all of it. It was great. We had lots of good converse. 

Sophie: [00:03:25] And two time frames, when was that? When she was still doing Investor Lite. 

Maddy: [00:03:29] So over the last couple of years and moved away early this year. Yeah. And her response to that was, no, I'm not investing. And this is like zero shame. And oh, by the way, it was just a really interesting conversation that prompted. She was like, I'm not investing at the moment because I feel like I've lost so much money and I don't feel confident to do it again until I'm back in the grain. Yeah, and it was a mind frame that I could like. It made a lot of sense to me, but it also I liked. Oh, like, there's so much wrong talk here. 

Sophie: [00:04:01] Yeah. I feel like even I understand that. I feel like I've been struggling a little bit when you look at your portfolio and it's down. But then on the same token, when you go to talks like Emma Fisher, it's like, Oh, this is and I know we've said it 100 times, it's like it's time of opportunity in times of uncertainty. 

Sascha: [00:04:19] And I think also it's just like luck about when you started investing, because I know I started investing enough time before a downturn that I, I got enough dividends to kind of what's the word like cushion me from then going into the red, the next downturn, I was still, I wasn't making huge amounts of money, but it just like kind of reassured. Yeah, I can kind of go like, Oh, I see that the process works because I've had enough dividends. But like if you just started investing and now you've had this slight dip in the market, it must be really hard to keep enthused about it. Yeah. 

Sophie: [00:05:00] And we had this conversation, Maddy and I said, we said, oh, we can like hop on about this all the time. It's like it's a time of opportunity. Time of opportunity. But you and I are speaking about this on a daily basis through like our research and doing this podcast above. So I feel like we've really enforced the messages in our head that it's a time of opportunity. But then I guess when I do speak to friends because they're not as engaged and are in the hearing, you know, once a week or, you know, less, they're like, Oh, I got to hear it again. Got to hear it again. 

Maddy: [00:05:28] Yeah. 

Sophie: [00:05:29] So today's lesson is. 

Maddy: [00:05:31] Let's look for opportunity. Okay.

Sophie: [00:05:34] So I think just set up the conversation, something that Emma did really beautifully, which she, I guess, distinguish between risk and uncertainty. So a couple of quick definitions. Risk is the chance of permanent capital impairment, which basically just means you invest in something and it goes to zero. Have you ever had that, by the way?

Sophie: [00:05:51] No. Like close to. Yeah. Which will be one of my examples later.

Maddy: [00:05:56] Same.

Sophie: [00:05:57] But there's still some money in there. And technically I haven't lost anything until I've sold. Right? Yeah.

Sascha: [00:06:02] I've definitely had it with crypto, but not with stocks. 

Sophie: [00:06:07] And then uncertainty on the other hand. Yeah. 

Maddy: [00:06:10] So uncertainty is this concept or the idea that you don't know what's going to happen next. But that is part of life, that is part of investing, and that is where we can find the opportunity.

Sophie: [00:06:21] Okay, so risk is money going to zero? You risk of losing all your money and uncertainties. Not sure what's happening in the future. Is there an opportunity there? 

Maddy: [00:06:31] Exactly. Cool. So one example that Emma gave, which I thought was super interesting, just to sort of frame the conversation in terms of stock market movements. Yeah. So she picks the New Year 2019 and we had a bit of a laugh about this. She said that 2019 was the last year that nothing happened. I agree to have you like so much more may happen in 2019. 

Sophie: [00:06:49] Well, it's when I quit my job and travelled for like five months. Yeah. I so it being a really good.

Maddy: [00:06:53] Yeah, yeah. And I was like, I couldn't tell you one thing that having this nice game. But the point was, I guess in 2020 and 2021 there was so much happening on in markets with COVID and things like that, whereas who you sort of can really tell us what actually happened in markets in 2019 when our big catastrophic event. Yeah. So she looked at the top 50 companies on the ASX in 2019 and their biggest highs and their biggest lows of those top 20 companies and you know, asks big companies, Janet, like generally speaking they're going to be pretty boring. Like there's no, you know, major tech stocks or anything crazy in that. Yeah, we're.

Sophie: [00:07:28] Talking your banks, BHP, Coles and Woollies. 

Sascha: [00:07:32] There's no rug pulls from crypto.

Maddy: [00:07:33] Yeah. Like it should.

Sascha: [00:07:35] Be nice and stable.

Sophie: [00:07:36] Exactly. So what she told us was the share price of those companies changed by 54% on average in 2019.

Sophie: [00:07:45] And so that means like, you know, you're BHP, for example. I don't have figures in front of me, but it could have, you know, gone up 54% during the year or dropped 54% during the year, even though it was just a stable normal in one of the money is. 

Maddy: [00:07:59] These are normal. Yeah, you know you love to have events. 

Sophie: [00:08:03] So I think what the example is trying to say is that in the stock market there's uncertainty and you can use it to your advantage because of the movement. 

Sascha: [00:08:12] Yeah, that shocked me, that stat. Did that surprise you too as well? 

Maddy: [00:08:17] Completely like I can't believe that, you know on the ASX such big stable companies would actually move that much without sort of responding to anything that is, that is that memorable even a few years later. 

Sophie: [00:08:27] So what her main lesson was then I guess for the chat was we want uncertainty because it can give us opportunity. So she gave us four different lessons that we can minimise our risk. So we don't want the risk, but we want the uncertainty and there's four ways to minimise your risk will help you, I guess find that opportunity in the stock market.

Maddy: [00:08:48] Exactly. And that is what we're going to go through today. 

Sophie: [00:08:50] Numero uno. 

Maddy: [00:08:51] Number one. Focus on financial strength. Okay. Got I have to actually. I'm just going to recap this really quickly because I found it fascinating and I was literally walking out of my office at LAX today, telling all of my friends about this, and they found it fascinating. 

Sascha: [00:09:08] You sound like. Such a fun. Commodity.

Maddy: [00:09:12] So Emma's number one or number one takeaway that she wanted us to have from this session is don't buy companies that are loss making, have to buy companies to turn a profit.

Sophie: [00:09:21] And when we say turn a profit, that means we're simple maths. We're saying that they're the amount that they're bringing in is more than the amount that they're spending. 

Maddy: [00:09:30] Exactly. To introduce this concept, which is the Beds Without Wings portfolio. And it's basically the idea behind it is that the companies are the equivalents of beds without wings or arc lacking the means to fly. So basically what it was, is a broker picked or created this portfolio and bought all the loss making companies on the ASX from the year 2000. And he said basically the outcome is if you invested $100 in this portfolio in the year 2000, it would be worth $0.24 today. Massive loss, massive loss. But if you invested in the A-300 in the index, your hundred dollars would be worth almost $600 today. 

Sophie: [00:10:10] And I think the point that I really took away from this is that the volatility and the risk in loss making companies is so high because there are factors that happen around the world, around us. And, you know, the year 2000, it's a long 20 year period. But right now, for example, interest rates are so high, inflation is going up. And if you've got a company that's not actually making money and they're having to use a lot of debt to finance their activities, like you don't know what's going to happen with that company. And so a lot of them do go bankrupt or insolvent, but if you're making money, you have enough to kind of buffer through these hard periods. 

Maddy: [00:10:45] Totally. 

Sascha: [00:10:45] Did you guys look at your portfolios after this? Because, of course, this is just Emma saying like this is a way to minimise, not like you shouldn't be buying loss making companies. These are just tools, right? Yeah. Did it make you go back and look at your portfolios about whether you had too many loss making companies in there?

Sophie: [00:11:02] I mean, when are strange, the fact that I bought like. So many tech stocks in. 2020 so yeah hello I mean the red but I also know that it's just how the market is at the moment and if you've got your conviction with your stocks and great. And if you don't, you know when it gets you know if a couple of mine when it gets back to zero, it's something I want to sell. 

Sascha: [00:11:21] Yeah. Okay. 

Maddy: [00:11:23] Emma did say that there are just great periods of time in which the beds without wings portfolio were actually performed super well. It was up 60% from the 12 months when the market's bottomed in 2020. So there are periods in which loss making companies can perform really well. It's just sort of over the long term I guess they're considered more high risk. Yeah. 

Sophie: [00:11:41] Is there any companies Mads that you have in your portfolio that aren't making any money at the moment? Yeah, loss making. 

Maddy: [00:11:48] Yeah. I mean, listeners will know that I've invested in zip and that is still I think I should actually this morning. So zip actually this was quite shocking to me. I looked it up earlier. They made they reported a $1 billion. Loss like, you know, just loss making. Lost $1,000,000,000. 

Sophie: [00:12:06] Yeah. That's a lot. 

Maddy: [00:12:08] But my zip shares are down 80%. 

Sophie: [00:12:10] Yeah, yeah. Make sense. But as we said, it's not always that they always going to be at a loss. Sometimes companies are loss making in their Start-Up Phases because they're spending so much money on an investment and growth. So just understanding why they're thinking loss like a good example actually is my pointsbet shares. They're making a loss, but they have been doing crazy expansion in the US, so they're spending a lot of money trying to grasp that market because they're big in Australia but not the US. So, you know, the reasoning behind the loss, it can make it a little bit, you know, easier to digest. 

Maddy: [00:12:43] Yeah, I guess it can just be something to prompt you further research. 

Sophie: [00:12:46] So lesson number one focus on financial strength. Make sure your company is making money. Lesson number Numero Duo. 

Maddy: [00:12:58] Traders change languages? 

Sophie: [00:12:59] Yeah, it was Spanish. Now Italian. We're bilingual here. Yeah. 

Sascha: [00:13:02] Trilingual, trilingual. 

Maddy: [00:13:04] Yeah. Go to that English. 

Sophie: [00:13:07] This lesson is don't overpay. So not only can you permanently lose your money by it going to zero, by the stock turning like going completely out of business bust, bust. 

Maddy: [00:13:22] Bankrupt bank is not fucking fall. But you can also, I guess, lose your money if you buy the share at a price that it never returns to you too much.

Sophie: [00:13:33] So is that like when you die? Like what? 

Maddy: [00:13:36] Well. 

Sophie: [00:13:37] Well, because if it never hurts, like, you know, you could hold on to the stock to six years old and then 70, 80. 

Maddy: [00:13:42] Yeah, I guess it's when you decide to sell your. Shares, especially when you die buying hold by hold. All right.

Sophie: [00:13:52] To be honest, I would love to rehash what Emma said in. Spit. But honestly, she did it so eloquently that I think it's just best that we put a snippet in of the live recording itself and you guys can hear it from her directly. So Sash will pop that in now. I think she will describe it much better than we do. 

Emma: [00:14:10] So if we think about that initial definition of risk as permanent capital impairment, i.e. you don't get your money back, that can happen because the equity is worthless, like the painful experience I had. Or it could happen because you just never see the share price that you paid for the shares again. So this risk is really elevated at certain times in the market. And I'd argue probably a year ago this risk of overpaying across the board was quite elevated. And so, you know, these were good companies, but they were swept up in a bit of a mania. The good news is when the flip side of that is when markets are falling and everyone's really, really pessimistic, you've got a much better chance over the long term of making good money. You know, if you read the headlines, you'll convince yourself not to invest. You convince yourself that you've figured out that the global financial system is about to go down the gurgler and you're better off sitting on the sidelines. But the reality is, if you are, you know, if you're if you're planning on investing for decades, just buy the companies you like. And don't worry too much about whether or not you're going out to pick the bottom. You won't be able to pick the bottom. I won't be out to pick the bottom. None of us will. But I think right now there are some good valuations available in the ASX. I think there are a lot of companies that you're going to make good money on a 3 to 5 year view, probably very good money on a ten year view because of the pessimism that's everywhere in the markets. So things could get worse in the short term, you know, as long as you don't need the money back. That's what the power of personal investing is. You know, you don't have to pick the bottom. You can just sort of set and forget. And I think that the valuation opportunities right now, you know, across the board sort of let us avoid the risk of overpaying.

Sascha: [00:15:39] I just love hearing Emma talk. She's so compelling and she's just got every time I hear her, I just want to go and research all these businesses and be like, Oh. 

Maddy: [00:15:49] Is that link?

Sophie: [00:15:51] So she was saying that over the past couple of years, you know, prices have been rising, etc.. But she also said what we spoke about at the beginning is that there is a lot of mispricing in the market, even in a normal inverted commas, 2019 type of year. So what's your take on when she says don't overpay for a company? 

Maddy: [00:16:09] Yeah, I always like it sometimes, to be honest. I feel a bit disheartened when people tell me that because I'm like, How am I really going to know what the right price is? I feel like sometimes of investing, I really rely on the fact that I'm doing it for the long term and I'm relying on the fact that the share price is going to go up. But I don't actually know what the right price is. So to say.

Sophie: [00:16:29] One thing I think I took away from the talk is that what we said at the beginning is that the market does mispriced price a lot, so sometimes it's just being patient and watching for a little while. For example, I have a good friend who was watching regroup and she had a price target on it. I think it was something like 100 bucks per share and it was sitting at these figures could be wrong, but it was sitting at say like 110. She said go to one or four, then to 115. It was moving, jumping around a bit and eventually after four months of watching it, it got to a price target of 100 and that was just the number she said that she'd be comfortable buying in. So I think when Emma says Don't overpay, what I took from it was prices move a lot. If you think something's super expensive, it's at that peak, you know, watch your for a couple of months if it keeps going up and up and you still want to buy in, amazing. But it might go down.

Maddy: [00:17:20] I guess. It's kind of like when you buy clothes and you might have your eye on a blazer or on a new dress that you know will be a great investment work. But you know that eventually it will come on sale. You know, things in the market at the moment are very volatile, so maybe it is kind of about waiting for it to cool off a little bit and then buying. 

Sascha: [00:17:41] And then are you someone who's very good at waiting for sales, Maddy?

Maddy: [00:17:45] No. Well, so I guess a bit. Like. Literally in my head, I'm like, how can I relate this back to my dollar cost averaging strategy? But I think I am someone I don't shop with very often, so I buy a few pieces, but when I find something I like, I pull the trigger. 

Sascha: [00:18:05] Yeah, I'm terrible. When I do, I do have the 24 hour rule that like I'm not allowed to buy it then and then I have to sleep on it. 

Maddy: [00:18:12] Yeah.

Sascha: [00:18:13] And I try to do the same. I just think it's so much of the way that you shop is like your psychology with money and spending is so connected because the way that I shop with shares is the same way that I shop with everything else.

Sophie: [00:18:25] Well, maybe that's a good way to summarise it then with the don't overpays have you 24 hour rule, but your 24 hours could be a bit more extended period. And it's just I think what she was saying is she's been in this game for a very long time and you do see the market go up and down. It's not always going to be a trajectory upwards. So just just be aware of it. 

Maddy: [00:18:44] Yeah, I guess taking a step back from the first point that you start looking at a stock and researching it, maybe take that extra steps, note the price and actually sort of monitor how it does track and respond to different things in the market and. That can sort of be encapsulated in the whole process.

Sascha: [00:18:57] So lesson two is.

Sophie: [00:18:59] So lesson two is do not overpay if you can and know how. 

Maddy: [00:19:08] We are going to take a quick break for our sponsors, but we'll be right back to hear the final two lessons from Emma.

Sophie: [00:19:18] Okay. Let's do French Numero Trois. I'm going to offend some people because that just sounded shocking. Maddy, is that right? 

Maddy: [00:19:28] Well. You know French really is not my strong suit. 

Sascha: [00:19:32] Know, I did French in high school, but I was a terrible student.

Sophie: [00:19:37] It's lesson number three.

Maddy: [00:19:38] Okay, great. Lesson number three is buy quality businesses. 

Sophie: [00:19:43] What do you mean by quality businesses?

Maddy: [00:19:46] So quality businesses is when competitors aren't able to come in and eat the profit pool. In other words, like they have a barrier to entry, they have a bit of an economic moat is, I guess, what we've talked about last.

Sophie: [00:19:58] I love the idea of an economic moat because my analogy is you think of a genuine castle with water around it, with alligators, and that is the moat and your competitive companies are trying to get across, but they can't because of the moat with alligators and looking for a company that's really isolated.

Maddy: [00:20:16] You know.

Sophie: [00:20:17] Alligators in my mind have always been mythical creatures. 

Maddy: [00:20:20] Are they real? Yeah. I think that the U.S. based, you know, Florida. Do you know, unicorns are actually you? Now, they're not bloody. I'm pretty sure. Are you joking? Are you taught you are tired from my day? But I have just go over it and says getting real about unicorns. It may come as a shock, but unicorns don't exist. Sorry.

Sophie: [00:20:44] Yeah, I don't know. How are you been saving me? Maybe cut them out of your life.

Sascha: [00:20:47] 5 year old Sasha would have been really happy if unicorns were real.

Sophie: [00:20:52] Anyway, we digress.

Sascha: [00:20:56] Quality. I always get confused about quality as a concept because I think I have a real personal bias that as soon as I decide I like something, it must be quality. How do you actually find out what's quality? 

Sophie: [00:21:09] Well, I guess this rule is kind of in contention with the previous rule, which is I don't pay too much. Generally, the businesses that are high quality businesses are the ones that are more expensive. Think about your apples, your Microsofts, you Alphabet's or Google. They are the most some of the most expensive companies on the stock exchange. But that's where you come in, I guess, with quality, if you look at something like Apple, even though that is an expense. Well, I mean, when we say expensive inverted commas, you know, it's above the hundred dollar mark. It's that is continually gone up because people see it as a quality business. And so say for me, I would say, look at Apple. What's quality about Apple? Their products, everyone uses them. They've got a system where you have to buy the AirPods, their phone, the Mac, for whatever reason, everything's into intertwined. And so they've got a great business model that is very sticky for their customers. So like bring back to your point, economic moat, you've got sticky customers. [00:22:04][55.4]

Maddy: [00:22:06] Yeah, other ones like the network effect. So you think about products that I guess are more valuable as the number of users increase or for example, Google like we're not all just going to stop using Google one day or you know, Airbnb people list their homes on Airbnb, people start it's a network stop. 

Sophie: [00:22:22] It doesn't happen. Travelling to that area of other businesses get money from that. 

Sascha: [00:22:26] Airbnb has become a verb. That's what you do. It's no longer like a brand name. It's amazing how powerful that brand has become in travel. 

Sophie: [00:22:36] So a couple of things that Emma brought into her speech about quality businesses were finding like good businesses in an unloved sector, which I thought was quite interesting because sometimes people just ignore sectors completely, like, let's say mining. You know, you might be like, I prefer to invest in ESG assets, but then it might mean that you just completely ignore looking into if there's a good business in that sector. So one of her points was look for businesses that are doing things that align to your values or have good business models, but they're just unloved because it might be underpriced because no one's looking there.

Maddy: [00:23:13] Yeah, another tip was find under the radar businesses. So Emma talked about the company PWI, which she actually brought up on the episode that she did with us right back at the start of You're In Good Company. 

Sophie: [00:23:22] And I like episode six go listen or don't. Yeah, this was a great story about P.W. Ah, which is a Queensland business that do all the cooling systems for the F1 cars.

Sophie: [00:23:34] So crazy to think that an Aussie business is actually like any drive by fans out there. You know how big of a business is it? 

Sophie: [00:23:43] So what she was saying was like, if you have. 

Sascha: [00:23:45] To survive, sorry, Formula One Fan. [00:23:47][1.3]

Maddy: [00:23:47] Cycle Sport is a Netflix. Series that is. Often what it is kind of. 

Sophie: [00:23:53] She was saying that, you know, if this business out of Queensland which you know, we're an island, we're isolated whatever is supplying all these global companies and they must be doing something right. 

Sascha: [00:24:04] And it's great in the sense of under the radar because what like Porsche appeared the other month, F1, the publicity company is listed like there's so many other companies in F1 that you could go and buy, but. It's really interesting how she's found like this specific niche. 

Sophie: [00:24:20] Yet such a little nation of Queensland. I'm from Queensland. No, I. Think well. Let's not go through those again. 

Maddy: [00:24:27] The lesson number three is by quality businesses, and I think this leads us nicely into lesson. Sorry. So if you do. It, what. 

Sophie: [00:24:33] Language can I. Do? I mean, have we not done English? Lesson number four. 

Maddy: [00:24:39] Lesson number four. Which is management. 

Sophie: [00:24:42] Yes. And I was going to say something about Peter, you are just linking back is that it's a founder led business. And what Emma says is that if you've got founders running the business, they've got skin in the game. They wanted to see it grow, you know, for her and pretty much for their own personal gain. So looking for who's running the business doesn't always have to be a founder, but what they're doing, how they're involved, what they care about, their values. I think we've said before that one of the places we go to research is LinkedIn. Yeah. 

Maddy: [00:25:16] Or Glassdoor. Yeah. Say what the employees say about us. 

Sophie: [00:25:19] Oh, that's such a good one. 

Sascha: [00:25:20] And most brokerage apps, too, like if you are in your shares, like they'll issue reports when someone inside the company is buying a lot of shares or selling a lot of shares. So you can often see if something's changing because someone's just suddenly like selling thousands and thousands of shares on the market.

Sophie: [00:25:37] You're like, okay, example Maddy owns. 50% of you are in good company. You got to say on the brokerage app that she sells 49 shares too. Who knows? Not sure. 

Sascha: [00:25:50] I'd be getting where I.

Maddy: [00:25:51] Get. Yeah. So, like, he'd be like, wait, Maddy. 

Sophie: [00:25:55] And so if you break up, there's some serious turmoil in the business. There is.

Maddy: [00:25:59] Infighting, but not only does it conceptually make sense. Emma's fund actually screens the market for businesses that had over ten years of listed history that were still run by the original founders. And the performance of that index or that group of companies is up 11 fold since 2008, whereas the Nobel Index or ASX companies is up two fold. So the fact says that founder led businesses actually lead to, I guess, excess hire, higher returns, better. Return, crushing return. 

Sophie: [00:26:31] So lesson number four is the people who run your business actually make a difference in the stock prices. 

Sascha: [00:26:38] Makes so much sense. Just even on a personal level, I think of the entrepreneurs, you know, in your life versus like there's always workaholics who are your friends with you like to give their all to bit to the companies they work for. But the people who run their own businesses like no one work harder than them. I would say on average probably offending people. 

Sophie: [00:26:57] I have like spamming if you're listening, listening like a serious worker. 

Maddy: [00:27:02] So I think in summary, you know, uncertainty, although it can make us nervous and although in times like this it can be really hard to look at your portfolio, say all of that red, and still have that conviction and confidence to keep investing. You know, Emma really talks about leaning into that fear. And of course, as long as it doesn't make you too uncomfortable equipping yourself with the facts and knowing that when you have a long term on your side, uncertainty can create opportunity. 

Sophie: [00:27:32] 100 % And like I know if I harped on about it, but like even if I'm looking at my portfolio being like, come on, look at that dip, like what are the businesses like? I'm readjusting, I'm moving away from the companies that are making so much money at the moment, looking towards good businesses. We can all do it together. 

Maddy: [00:27:48] We can do it. Financial advice. 

Sophie: [00:27:50] I think that leads us nicely to recommendations. 

Maddy: [00:27:54] Let's do it.

Sophie: [00:27:55] What's your recommendation? 

Maddy: [00:27:57] I Have actually been a bit of an internal wreck for you this week. So if I'm recommending an episode of The Dive by our very own Sascha Kelly. 

Sascha: [00:28:05] Hello. 

Sophie: [00:28:08] Sascha did an episode called The Business of Taylor Swift. It was an awesome episode. Give us a quick 10/2 rundown on one. Yes. 

Sascha: [00:28:18] Can I play my theme music while I do it? Yes, sir. Essentially. Taylor Swift. This is her 10th album, but it's only the fourth that she earns or the master's two. And I know that there's been a lot of conversation about why she's rerecording hamsters, but I did a music degree, and I'm really fascinated by the business of musicians. And so we just kind of pulled all that copyright ideas apart and tried to really get to the nuts and bolts of why someone would want to do that and what the implications are, and also like why it's something. That I think goes into the act. Respect Taylor for. 

Maddy: [00:29:07] Am a big fan of the job and this was one of my favourite episodes. I know you're a big Taylor Swift fan. I am definitely a big Taylor Swift. Fans Soph, are you?

Sophie: [00:29:14] No, Oh, I'm sure. 

Maddy: [00:29:15] Get out. 

Sophie: [00:29:17] I feel like everyone either is and they love it or they're not. And I don't know, fans. I don't like music at all. I really hate her music. [00:29:24][6.8]

Maddy: [00:29:26] Like, I'm sorry. I'm not the.Type that's not going to be dancing. That's just not the music. 

Sophie: [00:29:29] I agree to disagree. But you would hate my music. 

Maddy: [00:29:33] What's my recommendation do you have for us? Let's move on before things get heated.

Sophie: [00:29:37] This is really random. So sorry, but this podcast called Help I'm a parent. What I need. Hey, we have parents listening and I have. Okay, I'm not. I'm not a parent and I'm not pregnant. But my favourite is my favourite Instagram couple. It's named Proudlock and Oliver Blue. Oh yeah. And I'm allergic.

Maddy: [00:30:02] I love them. 

Sophie: [00:30:03] They have made in Chelsea. Yeah, well, yeah, I. He was a man in Chelsea, but I fell in love with him after like after that they've got cool shop, full house. Anyway they've. Started. Podcast about their baby bunny and it's just has no relevance to me because I love them so much. It's just the way they talk. He's so funny. Anyway, if you need something so random to dissect your day. I'm a parent. 

Maddy: [00:30:27] Coming up with a follow up, which is a similar vein made in Chelsea, Jamie Laing and Robert have. Yeah, they. Have a podcast, The Newlyweds and it's hilarious. It's all over my TikTok and I love it. 

Sascha: [00:30:37] I've gotten into that lately as well. So. Tony Yeah, I didn't want to, but I've fallen down the rabbit hole. 

Sophie: [00:30:43] I think we should leave things there. I've been chatting for a long time. 

Maddy: [00:30:46] If you have any recommendations, jump into our Facebook group at YIGC investing podcast discussion group. I'm just going to take it away with all the extras. Check it out. Join us on Instagram. Why I just say podcast we love chatting to you and our and also just to call out we have been getting quite a few damns recently. We know unfortunately there are a lot of accounts imitating us. We will never message you. We will respond to your messages and we love chatting with you, but we will never message you, all right. And we definitely won't give you crypto advice. So if you're getting that, it's not our place blocking report, which am.

Sophie: [00:31:19] And if you loved this episode, please share with a friend and we'll hear from you you'll hear from us next week. 

Maddy: [00:31:27] Talk to you then. 

Sophie: [00:31:27] Bye.