00:04.049 --> 00:15.668 [SPEAKER_00]: On radio, on YouTube, streaming live on investtalk.com and for our podcast subscribers, this is Invest Talk, independent thinking, shared success.

00:17.796 --> 00:26.504 [SPEAKER_00]: Invest talk is made possible by KPP Financial, a registered investment advisor firm, serving clients throughout the United States.

00:27.344 --> 00:33.590 [SPEAKER_00]: Here is KPP Financial Chief Executive Officer, Financial Advisor, Justin Klein.

00:36.754 --> 00:40.035 [SPEAKER_03]: Good afternoon fellow investors and welcome back to Invest Talk.

00:40.055 --> 00:43.816 [SPEAKER_03]: This is our Wednesday, August, six, twenty, twenty, five edition.

00:44.617 --> 00:46.377 [SPEAKER_03]: And we here we are in August.

00:46.737 --> 00:49.338 [SPEAKER_03]: It's been a choppy couple of weeks Labor Day.

00:49.358 --> 00:52.099 [SPEAKER_03]: It's just about four weeks away.

00:53.400 --> 01:00.682 [SPEAKER_03]: Some are moving fast and we are getting into the late innings of this economic expansion.

01:02.191 --> 01:07.813 [SPEAKER_03]: something that's starting to focus a bit more on is where are we?

01:07.913 --> 01:09.594 [SPEAKER_03]: Where are we in the growth cycle?

01:10.454 --> 01:14.295 [SPEAKER_03]: And where are the potential road bumps ahead?

01:15.316 --> 01:24.459 [SPEAKER_03]: That's always a challenge to find the right time, but you can kind of understand how the economic cycle works and make smart risk versus reward.

01:24.499 --> 01:28.601 [SPEAKER_03]: It says, right now the risk versus reward tends to be lean on reward.

01:29.607 --> 01:31.849 [SPEAKER_03]: But we know that the tide will turn.

01:31.869 --> 01:32.809 [SPEAKER_03]: I'd always turn.

01:34.170 --> 01:38.493 [SPEAKER_03]: And we'll get to some of that more depth later in the episode.

01:38.993 --> 01:46.858 [SPEAKER_03]: But really, this hour is not just about that economic cycle, but about you and your questions, your concerns.

01:47.159 --> 01:50.421 [SPEAKER_03]: And that's what's we are here to address today.

01:51.662 --> 01:52.642 [SPEAKER_03]: And every day, I'm a best doc.

01:53.623 --> 01:56.065 [SPEAKER_03]: So your calls are a number one.

01:57.127 --> 02:05.255 [SPEAKER_03]: Whatever's on your mind, money related, whether you're listening live, four to five specific time, or after hours, doesn't matter.

02:06.156 --> 02:07.697 [SPEAKER_03]: We welcome your questions.

02:07.857 --> 02:09.159 [SPEAKER_03]: You will be put ahead of.

02:10.680 --> 02:14.742 [SPEAKER_03]: The topics that I want to hit on, there'll be a few things for me to discuss.

02:15.343 --> 02:18.705 [SPEAKER_03]: But most of all, this is about you and your question.

02:18.725 --> 02:21.607 [SPEAKER_03]: So don't hesitate to reach out and give us a call once again, eight, eight, nine, nine chart.

02:22.207 --> 02:22.727 [SPEAKER_03]: No, just a bit.

02:22.747 --> 02:25.269 [SPEAKER_03]: We'll talk about today's Mark performance and run another show topics.

02:25.289 --> 02:27.090 [SPEAKER_03]: But first, let's tackle this color question.

02:27.110 --> 02:27.670 [SPEAKER_03]: Yeah.

02:28.831 --> 02:29.912 [SPEAKER_08]: Hi, this is Jackie.

02:29.972 --> 02:30.632 [SPEAKER_08]: I'm Wisconsin.

02:30.652 --> 02:38.637 [SPEAKER_08]: And I'm calling about I as an Eglue Y H. I just wanted to hear a little opinion on the CTF and

02:39.127 --> 02:42.369 [SPEAKER_08]: If it was a good buy point right now, I'll listen to your answer on the podcast.

02:42.549 --> 02:43.049 [SPEAKER_08]: Thanks, bye.

02:43.069 --> 02:50.233 [SPEAKER_03]: All right, looking at the I shares US healthcare ETF, I, Y, H is the symbol.

02:51.134 --> 02:55.776 [SPEAKER_03]: Now, if you take a look at the chart, it does not look good.

02:56.757 --> 03:05.442 [SPEAKER_03]: And today was another relatively weak day down one and a half percent on the day when the market was up, nicely.

03:07.783 --> 03:19.088 [SPEAKER_03]: And the consistent downtrend, we pull back to a weekly chart here, that started when was that September-ish of last year?

03:19.748 --> 03:24.490 [SPEAKER_03]: So you're talking about an entire year of just pretty much straight down.

03:26.711 --> 03:29.192 [SPEAKER_03]: And I think there are multiple factors here.

03:30.973 --> 03:36.175 [SPEAKER_03]: Number one, it's something I've been saying for a long time, and it actually manifested in United Health when it

03:37.742 --> 03:38.222 [SPEAKER_03]: collapsed.

03:39.503 --> 03:43.384 [SPEAKER_03]: And if you go back to shows many years, I've got a lot of calls about UNH.

03:44.084 --> 03:50.447 [SPEAKER_03]: And what I said was, the healthcare system in this country is not sustainable.

03:51.607 --> 04:01.771 [SPEAKER_03]: You can't have healthcare inflation outpacing inflation, broadly forever, because what happens eventually is healthcare becomes the entire economy.

04:03.591 --> 04:04.111 [SPEAKER_03]: Tell it works.

04:04.611 --> 04:05.892 [SPEAKER_03]: There's engulfs the economy.

04:06.552 --> 04:08.913 [SPEAKER_03]: And in many ways it has, but it's just simply untenable.

04:10.233 --> 04:26.139 [SPEAKER_03]: And so what you have is push back both from a government level, as well as the citizens who, for the most part, are unhappy with the healthcare system, the high cost of insurance, et cetera.

04:28.780 --> 04:29.640 [SPEAKER_03]: And eventually they have breaks.

04:32.855 --> 04:48.765 [SPEAKER_03]: And now we have RFK in the White House or in government, right, head of HHS pushing on, you know, tougher, tougher regulations, less drugs being passed, et cetera.

04:48.826 --> 04:55.550 [SPEAKER_03]: And then on top of that, you have cuts from Medicare when it came to, you know, the recent budget proposal.

05:00.156 --> 05:10.799 [SPEAKER_03]: And on top of that, you have higher cost of capital, which tends to pressure the biotech space, which are your classic Ponzi stocks that are heavily reliant on low cost of capital.

05:13.139 --> 05:18.200 [SPEAKER_03]: So you have multiple headwins to this sector as a whole.

05:20.641 --> 05:23.942 [SPEAKER_03]: Now, it does not mean that you should healthcare completely.

05:24.760 --> 05:26.742 [SPEAKER_03]: But you have to be very selective.

05:27.242 --> 05:30.625 [SPEAKER_03]: There are certain companies that can continue to thrive.

05:32.146 --> 05:37.531 [SPEAKER_03]: And others that will just face those head ones in struggle.

05:41.975 --> 05:46.438 [SPEAKER_03]: And so this is the epitome at way H is the epitome of just broad base exposure.

05:49.441 --> 05:50.282 [SPEAKER_03]: So what I would say is,

05:51.560 --> 05:54.843 [SPEAKER_03]: No, I wouldn't buy this particular ETF, especially with this performance.

05:55.543 --> 05:57.324 [SPEAKER_03]: I would be more select, I would have to do the work.

05:57.605 --> 06:03.149 [SPEAKER_03]: You know, we own some healthcare names in our managed accounts, but it's underweight.

06:03.809 --> 06:09.354 [SPEAKER_03]: You know, it's an underweight sector in our portfolio.

06:10.775 --> 06:18.801 [SPEAKER_03]: If you look at the S&P-five hundred, and it's sector waiting for healthcare, you're looking at, where are we?

06:20.700 --> 06:23.001 [SPEAKER_03]: Healthcare is nine percent of the portfolio.

06:24.201 --> 06:27.183 [SPEAKER_03]: We typically are in the two to six percent of each.

06:27.723 --> 06:27.983 [SPEAKER_03]: Okay.

06:28.483 --> 06:29.484 [SPEAKER_03]: So it'd be first selective.

06:29.524 --> 06:37.587 [SPEAKER_03]: I would not be I would I would buy some individual names that can hopefully side step some of the headwinds within the sector.

06:38.689 --> 06:41.751 [SPEAKER_03]: Now, we all have a lot of ground to cover over the next forty five minutes or so.

06:42.432 --> 06:47.496 [SPEAKER_03]: And our main focus point is about what you should invest your emergency fund.

06:48.096 --> 06:56.002 [SPEAKER_03]: Simple concept, but certainly something to always go over, especially in times like this, where times are good, right, markets are up.

06:56.242 --> 06:57.203 [SPEAKER_03]: It had a big rally.

06:58.464 --> 07:03.007 [SPEAKER_03]: Love people have that inkling to go in chase.

07:03.788 --> 07:05.569 [SPEAKER_03]: And a lot of times that came to the emergency fund.

07:05.609 --> 07:07.191 [SPEAKER_03]: So we'll look at that story.

07:08.227 --> 07:10.390 [SPEAKER_03]: In addition, we'll talk about corporate profits.

07:10.550 --> 07:22.845 [SPEAKER_03]: We're mostly through earnings season last week was roughly forty percent of the S&P five hundred earnings were last week and obviously you had a bunch before then and a few more this week as well.

07:22.885 --> 07:26.349 [SPEAKER_03]: So we'll look at what the earnings look like and then also

07:27.768 --> 07:41.658 [SPEAKER_03]: Investor bias, not just something that the average investor deals with, but financial managers, fund managers, have the same type of bias by C's.

07:41.838 --> 07:44.420 [SPEAKER_03]: And we'll go into that as well.

07:45.220 --> 07:47.901 [SPEAKER_03]: That's all on the on the on the back for me topic wise.

07:47.941 --> 07:52.062 [SPEAKER_03]: We also have your voice bank questions as usual paypal dividend reimbursements.

07:52.122 --> 07:55.783 [SPEAKER_03]: We also have questions that came in via the best talk to YouTube channel as well.

07:56.143 --> 07:59.604 [SPEAKER_03]: But most importantly, we'll be your live goals at eight and eight ninety nine chart.

08:00.185 --> 08:02.725 [SPEAKER_03]: But we're going to head into a break and please remember that you call any time.

08:02.825 --> 08:08.967 [SPEAKER_03]: Leave your question on the investment voice bank or if you listen via the live stream or an aim twelve twenty in the Bay Area.

08:09.468 --> 08:10.268 [SPEAKER_03]: You can call right now.

08:11.029 --> 08:12.296 [SPEAKER_03]: at eight and a nine and a nine chart.

08:12.497 --> 08:15.111 [SPEAKER_03]: Up next, that will comment on today's market activity.

08:20.573 --> 08:22.615 [SPEAKER_01]: Okay, gotta get serious with my finances.

08:23.035 --> 08:28.720 [SPEAKER_01]: I've been working a long time and I know there's still gotta be more that I can do to build my wealth quicker.

08:28.740 --> 08:30.761 [SPEAKER_01]: I don't wanna have to work forever.

08:31.242 --> 08:37.507 [SPEAKER_03]: If you are not maximizing your employer's sponsor retirement plan, KPP Financial can help.

08:38.168 --> 08:46.534 [SPEAKER_03]: With our professional oversight, you can potentially enhance your investment performance by an average of three percent annually.

08:47.415 --> 08:55.604 [SPEAKER_03]: At KPP Financial, we provide a comprehensive four-of-one K-management program designed to optimize your retirement savings.

08:56.224 --> 09:02.911 [SPEAKER_03]: Our approach includes creating custom investment allocations tailored to your goals and risk tolerance.

09:03.432 --> 09:06.175 [SPEAKER_03]: That can make a big difference in your favor.

09:06.695 --> 09:09.378 [SPEAKER_01]: and maybe it's time to tune up my retirement plan.

09:09.739 --> 09:19.630 [SPEAKER_03]: For more information on how you can take control of your retirement savings, visit our website KPPFinancial.com KPPFinancial sounds good.

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09:41.632 --> 09:42.472 [SPEAKER_02]: In Vestock.

09:43.193 --> 09:45.455 [SPEAKER_03]: Let's take a look at the market today.

09:45.695 --> 09:48.098 [SPEAKER_03]: It was overall a positive day.

09:48.138 --> 09:56.245 [SPEAKER_03]: Now as they got one point three percent, you had the S&P up seven, uh, point seven percent, the Dow up point two percent.

09:56.645 --> 10:00.649 [SPEAKER_03]: The Russell, two thousand, however, was down, was down.

10:01.069 --> 10:07.936 [SPEAKER_03]: And if you take a look at the heat map, you had a names like Apple at five percent on the news that they're investing.

10:08.556 --> 10:17.601 [SPEAKER_03]: A lot of money here in the United States, so I think the market is believing that they make it a carve out on tariffs, and that seems to be what the positive reaction is.

10:18.161 --> 10:26.025 [SPEAKER_03]: A broad come up over three percent Netflix positive as well, but it seems like AMD down six percent on weaker earnings expectations.

10:27.368 --> 10:30.892 [SPEAKER_03]: And then, really, the weakest part of the market could be health care.

10:30.932 --> 10:34.616 [SPEAKER_03]: We just talked about IYH, health care itself down, one point five percent.

10:34.636 --> 10:35.317 [SPEAKER_03]: It's the thing about that.

10:35.397 --> 10:37.219 [SPEAKER_03]: And the NAS, that got one point three.

10:37.940 --> 10:41.164 [SPEAKER_03]: And health care itself down one and a half percent in one single day.

10:41.484 --> 10:46.169 [SPEAKER_03]: Materials also down one point one percent energy down point nine, utilities down point nine.

10:47.111 --> 11:01.071 [SPEAKER_03]: The strength was really in consumer discretionary consumer staples of one point four there two point one consumer discretionary technology up one point one so pretty interesting day in markets a big mixed on

11:02.361 --> 11:04.882 [SPEAKER_03]: you know, what areas of the market were strong.

11:05.202 --> 11:06.763 [SPEAKER_03]: So it wasn't certainly broad-based.

11:06.803 --> 11:10.865 [SPEAKER_03]: We're in this choppy period, and we are starting to in my mind.

11:10.885 --> 11:13.506 [SPEAKER_03]: I think we're getting late cycle.

11:13.807 --> 11:16.468 [SPEAKER_03]: Now, not end of cycle, but late cycle.

11:16.488 --> 11:20.130 [SPEAKER_03]: You know, it's a typical baseball analogy with any Korean.

11:21.328 --> 11:24.329 [SPEAKER_03]: I think we're somewhere between the bottom of the seventh and the bottom of the eighth.

11:24.789 --> 11:28.611 [SPEAKER_03]: So that means that there's like there's more game left, right?

11:28.651 --> 11:34.973 [SPEAKER_03]: There's more time left in this cycle, but it's getting along on the tooth.

11:35.614 --> 11:46.018 [SPEAKER_03]: And you see that with the economic data, you see that with earnings that are relatively meager outside of some of the big tech names that are really driven by AI.

11:48.672 --> 11:57.844 [SPEAKER_03]: infrastructure spending, which obviously is good, but you know, how sustainable are a lot of those, a lot of those spending habits, etc.

11:58.865 --> 12:00.447 [SPEAKER_03]: What else did you get today?

12:00.527 --> 12:02.589 [SPEAKER_03]: You had treasuries were mixed.

12:03.731 --> 12:07.755 [SPEAKER_03]: Overall, yields at the back end were up two to four basis points.

12:07.795 --> 12:11.098 [SPEAKER_03]: So long end up shorter and flat to down.

12:11.559 --> 12:13.481 [SPEAKER_03]: Dollar index was down point six percent.

12:13.521 --> 12:23.570 [SPEAKER_03]: So the little rally you saw in the dollar over the past few weeks is starting to fizzle out pretty quickly, which is very interesting.

12:24.231 --> 12:32.953 [SPEAKER_03]: Gold finished flat, but gold miners continue to be very, very strong hitting a fifty-two-week high in the GDX, so that's a note.

12:33.633 --> 12:45.516 [SPEAKER_03]: WTI was down one point two percent fifth straight decline there, so oil names certainly lagging oil prices, certainly lagging, and I think that's a growth scare type of issue.

12:46.476 --> 12:53.681 [SPEAKER_03]: On the economic front, there's that announcement around India tariffs that look like they're going from twenty five to fifty percent.

12:54.501 --> 12:56.943 [SPEAKER_03]: But didn't really hit Indian stocks that much.

12:57.083 --> 12:58.704 [SPEAKER_03]: So I thought that was of note.

12:59.424 --> 13:01.746 [SPEAKER_03]: And then you had the deal from Amazon.

13:01.826 --> 13:03.247 [SPEAKER_03]: It looks like the name's like Apple.

13:03.327 --> 13:05.448 [SPEAKER_03]: It looks like they're investing six hundred billion dollars.

13:05.468 --> 13:09.010 [SPEAKER_03]: Obviously, it's a positive reflection point for the economy.

13:09.771 --> 13:13.433 [SPEAKER_03]: And that's why the market reacted positively to Apple stock.

13:14.408 --> 13:17.650 [SPEAKER_03]: But if you look at buybacks, this is an issue of a port from Bank of America.

13:17.670 --> 13:32.121 [SPEAKER_03]: And what they said was, they're typically for the fifth straight week, buyback levels compared to total market cap is actually decelerating as a percentage of the market up since early March.

13:33.497 --> 13:38.941 [SPEAKER_03]: So, you know, that typically is a consistent buyer of underlying stock.

13:39.302 --> 13:45.106 [SPEAKER_03]: So they're slowing down that on the margins can mean a lot, especially as you go into the back half of the year.

13:45.186 --> 13:58.737 [SPEAKER_03]: So that was the market today, very interesting mix of movements from both small caps, large caps, the different asset classes, et cetera, and we continue to move through this earnings season.

14:00.112 --> 14:03.294 [SPEAKER_03]: Now, every day we see questions from the comments section over on the YouTube channel.

14:03.974 --> 14:04.734 [SPEAKER_03]: Let's get to one now.

14:05.515 --> 14:08.076 [SPEAKER_03]: You guys says, hello, it is a good idea.

14:08.196 --> 14:08.916 [SPEAKER_03]: Is it a good idea?

14:08.936 --> 14:10.977 [SPEAKER_03]: It's own visa for the long term.

14:11.858 --> 14:14.039 [SPEAKER_03]: Now, this is interesting.

14:14.359 --> 14:21.523 [SPEAKER_03]: This kind of reminds me of what I said earlier with the healthcare space and the fact that their business was good.

14:22.853 --> 14:25.615 [SPEAKER_03]: But there's a lot of risks to that business.

14:25.996 --> 14:29.018 [SPEAKER_03]: Over the not short-term, but medium-term.

14:29.619 --> 14:31.800 [SPEAKER_03]: There's always long-term risks to businesses.

14:32.461 --> 14:36.925 [SPEAKER_03]: And then a lot of times those long-term risks start to become more and focus.

14:38.106 --> 14:42.950 [SPEAKER_03]: And then the risk of major problems become

14:44.847 --> 14:49.169 [SPEAKER_03]: elevated, because at some point, those medium term risks suddenly become short term risks.

14:49.789 --> 14:51.430 [SPEAKER_03]: And that's what happened with United Health.

14:52.130 --> 14:55.471 [SPEAKER_03]: And I think I'm seeing similar issues with Visa MasterCard.

14:56.832 --> 15:06.876 [SPEAKER_03]: The longer term risk was, the other's regulatory issues, and eventually somebody will come up with a different payment system that is more widely used.

15:07.556 --> 15:13.779 [SPEAKER_03]: And there's Zell, and there's Venmo, and there's these ways to transfer money and transfer payment, transfer value.

15:15.061 --> 15:26.706 [SPEAKER_03]: But those are always minor and relatively far off in anything that gained consistent traction, especially when it comes to commerce, online, et cetera.

15:28.086 --> 15:40.651 [SPEAKER_03]: But I think the recent stablecoin idea that looks to be gaining traction, I think that is the start of getting out of the whole visa and mastercard game.

15:40.691 --> 15:42.932 [SPEAKER_03]: So I would not be on a visa long term.

15:43.758 --> 15:45.984 [SPEAKER_03]: Bring to a break, give me a call now, eight, eight, nine, nine chart.

15:51.493 --> 15:54.276 [SPEAKER_02]: Have you heard about the new Invest Talk store?

15:54.817 --> 15:55.377 [SPEAKER_02]: That's right.

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16:03.986 --> 16:09.991 [SPEAKER_02]: And now Justin Klein is here and taking your finance and investment questions live.

16:10.452 --> 16:11.473 [SPEAKER_02]: Call Invest Talk.

16:17.433 --> 16:21.634 [SPEAKER_03]: Our main focus point on today's show is about why you shouldn't invest your emergency.

16:21.934 --> 16:25.455 [SPEAKER_03]: But now we all know we need to emergency fund in the typical.

16:27.956 --> 16:34.918 [SPEAKER_03]: Advice from advisor including ourselves is thirty six months of expenses for a fully funded emergency account.

16:36.813 --> 16:43.358 [SPEAKER_03]: And then what to most people do with it, they should put in a savings account, or probably better is a high yield savings account.

16:43.659 --> 16:58.030 [SPEAKER_03]: Something is still FDIC and shared, but you can go on bankrate.com and find what makes sense for you, whether that's a markets or an ally, or many of the other ones that are out there, just make sure it's FDIC and shared.

16:58.050 --> 17:00.672 [SPEAKER_03]: So that's where we want to put your emergency fund.

17:00.712 --> 17:02.013 [SPEAKER_03]: But in times like this,

17:02.898 --> 17:07.542 [SPEAKER_03]: You might look at a market, which right now is yielding in about three point six five percent.

17:08.282 --> 17:12.906 [SPEAKER_03]: And you might say, I'm doing much better in the markets.

17:15.588 --> 17:17.090 [SPEAKER_03]: Why don't I invest that money?

17:19.772 --> 17:25.717 [SPEAKER_03]: Well, the simple answer is you don't know when that emergency will rise.

17:27.043 --> 17:32.765 [SPEAKER_03]: And you also don't know how your performance will be for those risky assets when you need that money.

17:34.266 --> 17:51.533 [SPEAKER_03]: So really what this is trying to do, and this is the way you want to think about broader bucketing of assets, of investments strategies, et cetera, is matching your assets with your potential liabilities.

17:54.195 --> 17:56.736 [SPEAKER_03]: Know what that means is, when might I need that money?

17:57.776 --> 18:01.118 [SPEAKER_03]: And then what is, how long can I keep my money in that investment?

18:03.039 --> 18:03.299 [SPEAKER_03]: Okay.

18:04.399 --> 18:14.043 [SPEAKER_03]: So for example, that's why in retirement accounts, you typically want to be aggressive, own equities, invested long-term.

18:14.964 --> 18:16.344 [SPEAKER_03]: Because you're not touching it for a while.

18:16.404 --> 18:20.566 [SPEAKER_03]: And if there's some generations in the short-term, no big deal, this is the long-term game.

18:20.586 --> 18:22.207 [SPEAKER_03]: You're not meeting, you're not touching that money.

18:22.627 --> 18:22.807 [SPEAKER_03]: Soon.

18:23.895 --> 18:36.105 [SPEAKER_03]: But for emergency funds, and then maybe longer than six months if you are a retiree, for example, you are going to need that money, potentially need that money rather quickly.

18:37.466 --> 18:46.914 [SPEAKER_03]: And so you don't want a volatile, long live asset with a long duration, with a lot of duration risk.

18:46.954 --> 18:49.996 [SPEAKER_03]: And that could be frankly, the duration, the duration risk there.

18:50.497 --> 18:51.498 [SPEAKER_03]: What I mean by that is,

18:52.870 --> 18:56.251 [SPEAKER_03]: Just like a bond, the long-term bond has future cash flows.

18:57.852 --> 19:05.635 [SPEAKER_03]: And when you are discounting those future cash flows to the present, you're discounting many years out.

19:07.176 --> 19:09.857 [SPEAKER_03]: For bond, it's how many years are left on it.

19:10.917 --> 19:14.199 [SPEAKER_03]: For an equity, you're talking infinitely, right?

19:14.919 --> 19:18.500 [SPEAKER_03]: So equities are long duration assets.

19:20.181 --> 19:22.182 [SPEAKER_03]: But emergency fund is a short duration

19:24.830 --> 19:25.750 [SPEAKER_03]: asset type of vehicle.

19:27.311 --> 19:32.312 [SPEAKER_03]: So that's why money markets, cash, even short-term T-Bills.

19:32.372 --> 19:33.532 [SPEAKER_03]: You could do that, right?

19:33.552 --> 19:39.934 [SPEAKER_03]: They're ETFs that buy very, very short-dated T-Bills, and that could be a good way of doing it as well.

19:40.934 --> 19:46.475 [SPEAKER_03]: Maybe get better than a market, so any of these other high yield savings accounts.

19:47.235 --> 19:53.097 [SPEAKER_03]: That's one path as well, more cumbersome typically, because it's at a brokerage firm, whatever, but maybe

19:54.514 --> 19:55.375 [SPEAKER_03]: That's fine.

19:55.395 --> 20:00.898 [SPEAKER_03]: It doesn't matter really where it's held as long as it's, you know, insured and it's invested appropriately.

20:03.459 --> 20:11.864 [SPEAKER_03]: And another aspect to consider when to say, well, you shouldn't invest your emergency fund is when you do need that money.

20:12.745 --> 20:13.765 [SPEAKER_03]: Let's say you got lucky.

20:14.446 --> 20:15.206 [SPEAKER_03]: And things will well.

20:15.226 --> 20:21.090 [SPEAKER_03]: You have to remember you are selling that asset at a game, luckily.

20:22.223 --> 20:24.546 [SPEAKER_03]: But you're also triggering capital gains.

20:24.586 --> 20:25.987 [SPEAKER_03]: And it may be short term capital gains, right?

20:26.027 --> 20:27.228 [SPEAKER_03]: You might own it for a full year.

20:28.350 --> 20:36.138 [SPEAKER_03]: And so that can lower your overall return extensively, especially if you're in a higher tax bracket.

20:38.679 --> 20:47.161 [SPEAKER_03]: That's one way to think about your emergency fund and why investing it aggressively is not the way to go.

20:47.201 --> 20:57.423 [SPEAKER_03]: You want to make sure that it is safe, secure, keeping the high sealed, especially in today's market, you're still earning above inflation for the most part.

20:58.223 --> 21:03.125 [SPEAKER_03]: Even if you're getting three point six, five of markets, inflation's roughly two and a half to three.

21:03.145 --> 21:04.805 [SPEAKER_03]: So you're still coming out ahead there.

21:05.831 --> 21:08.452 [SPEAKER_03]: But make sure you don't take too much risk with that account.

21:08.993 --> 21:10.854 [SPEAKER_03]: Let's see if we can squeeze in one quick question.

21:11.074 --> 21:11.234 [SPEAKER_03]: Yeah.

21:13.715 --> 21:16.436 [SPEAKER_04]: I had a question on Schwab, the bank.

21:16.917 --> 21:19.558 [SPEAKER_04]: Take her symbol SCHW.

21:19.998 --> 21:24.961 [SPEAKER_04]: I just wanted to know your guys thoughts where they're not mentioned as much as some of the other bigger banks out there.

21:25.361 --> 21:27.562 [SPEAKER_04]: Thanks look forward to hearing and take care.

21:28.936 --> 21:34.058 [SPEAKER_03]: All right, looking at Charles Schwab, this is the name that we've owned for clients for a long period of time.

21:34.498 --> 21:41.500 [SPEAKER_03]: We like the consolidation within the industry that allows them to kind of have this dual opalina.

21:41.560 --> 21:47.282 [SPEAKER_03]: I'm trying to probably say it with basically them fidelity and each trade.

21:47.302 --> 21:48.803 [SPEAKER_03]: Those are kind of the three big brokers.

21:48.843 --> 21:50.203 [SPEAKER_03]: The others interact with brokers.

21:50.223 --> 21:55.365 [SPEAKER_03]: There's some other ones, but those are kind of the three main ones and it allows them to really

21:56.105 --> 21:59.869 [SPEAKER_03]: Keep a solid profitability return equity is fifteen percent.

22:00.710 --> 22:05.935 [SPEAKER_03]: Historically, that's over the last ten years, that's about the midpoint of their profitability range.

22:06.195 --> 22:07.977 [SPEAKER_03]: Once again, it's a consolidated industry.

22:08.898 --> 22:14.203 [SPEAKER_03]: We use them for our clients, our clients hold their assets at Schwab.

22:14.884 --> 22:17.526 [SPEAKER_03]: We like the business, about ten billion dollars in free cash,

22:18.607 --> 22:28.837 [SPEAKER_03]: fifty-one billion dollar market enterprise value to pretty nice six seven percent free cash for yield and a dividend we continue to like Charles Schwab.

22:29.598 --> 22:32.541 [SPEAKER_03]: Dominic's actually we're heading to a break.

22:33.662 --> 22:34.282 [SPEAKER_03]: I'm Justin Clyde.

22:34.302 --> 22:36.845 [SPEAKER_03]: I'm ready to take your calls now at eight and a ninety nine chart.

22:47.124 --> 22:51.530 [SPEAKER_02]: Invest talk downloads have now surpassed sixty-one million.

22:52.071 --> 23:00.342 [SPEAKER_02]: Justin Klein and Luke Guerrero provide unbiased answers to your finance and investment questions.

23:01.003 --> 23:04.868 [SPEAKER_02]: Invest talk eight eight eight ninety nine chart.

23:11.442 --> 23:13.183 [SPEAKER_03]: Now, the next investor talk will look into this question.

23:13.443 --> 23:16.784 [SPEAKER_03]: Can millennials ever catch up to boomer wealth?

23:17.204 --> 23:23.646 [SPEAKER_03]: Thanks to the historic economic advantages, baby boomers still contribute, still control over half of US wealth.

23:23.686 --> 23:29.468 [SPEAKER_03]: But millennials are rapidly closing the gap through ironings, rising on equity and smart investing.

23:30.208 --> 23:31.288 [SPEAKER_03]: We get to that story tomorrow.

23:31.308 --> 23:34.429 [SPEAKER_03]: But for now, let's roll into a fresh listener question.

23:35.690 --> 23:37.890 [SPEAKER_05]: Hey, Justin, I'll leave it to Jason from Atlanta.

23:38.170 --> 23:40.031 [SPEAKER_05]: I'm trying to get some information on PayPal.

23:40.698 --> 23:43.799 [SPEAKER_05]: I bought a few shares after the earnings.

23:43.859 --> 23:47.180 [SPEAKER_05]: I know I went down, but I mean, the results looked good.

23:47.501 --> 23:48.401 [SPEAKER_05]: You know, they looked good.

23:48.981 --> 23:50.582 [SPEAKER_05]: This kind of cash flow looks good.

23:50.602 --> 23:53.423 [SPEAKER_05]: I mean, everything seems fine, but it's pulling back a lot.

23:53.743 --> 23:57.144 [SPEAKER_05]: I was trying to get some information from you guys to see what you think about it.

23:57.344 --> 23:58.585 [SPEAKER_05]: I'll be listening in on the podcast.

23:58.645 --> 23:59.145 [SPEAKER_05]: I appreciate it.

24:00.855 --> 24:01.716 [SPEAKER_03]: No problem.

24:01.756 --> 24:08.781 [SPEAKER_03]: Looking at PayPal, and this is the name that we've bought for clients a year, year and a half ago, something like that.

24:08.801 --> 24:14.326 [SPEAKER_03]: I don't know the exact date, but somewhere around that range, to get was down today.

24:14.366 --> 24:16.847 [SPEAKER_03]: It's at sixty nine dollars and forty one cents.

24:16.867 --> 24:19.710 [SPEAKER_03]: I think we started buying it in the fifties of a member correctly.

24:20.507 --> 24:26.388 [SPEAKER_03]: So it's been a good dribbler yet has pulled back on this earnings nice up to point three percent today.

24:26.808 --> 24:27.529 [SPEAKER_03]: But we agree.

24:27.849 --> 24:31.149 [SPEAKER_03]: I think the earnings announcement was solid.

24:31.789 --> 24:42.072 [SPEAKER_03]: Analyst continued to upgrade earnings for this year and next year, thirteen percent this year, eleven percent next year to five eighty five dollars and eighty cents on a sixty nine dollar stock.

24:43.052 --> 24:43.732 [SPEAKER_03]: You're talking.

24:46.142 --> 24:48.104 [SPEAKER_03]: A thirteen times multiple.

24:48.484 --> 24:53.647 [SPEAKER_03]: That's very cheap, especially when you take a look at the fact that they have no debt.

24:54.428 --> 24:55.769 [SPEAKER_03]: It's a company that has no debt.

24:56.229 --> 25:00.552 [SPEAKER_03]: They're taking that roughly five billion dollars in free cash flow training twelve months.

25:01.113 --> 25:01.593 [UNKNOWN]: And they are.

25:06.587 --> 25:22.618 [SPEAKER_03]: By point nine billion is their free cash flow now that has come down from its peak around seven billion, but still that's very very robust right five billion on a market cap of sixty six billion.

25:24.359 --> 25:29.122 [SPEAKER_03]: You're talking about a seven half percent free cash for you somewhere in that range.

25:30.223 --> 25:30.983 [SPEAKER_03]: No dividend, but

25:31.845 --> 25:32.425 [SPEAKER_03]: What are they doing?

25:32.485 --> 25:33.226 [SPEAKER_03]: What's that cash flow?

25:33.586 --> 25:35.267 [SPEAKER_03]: Because they have no debt to pay off.

25:35.487 --> 25:37.948 [SPEAKER_03]: They're just buying back shares.

25:38.588 --> 25:39.749 [SPEAKER_03]: Had a pretty rapid clip.

25:41.049 --> 25:42.510 [SPEAKER_03]: And then you look at the profitability.

25:43.510 --> 25:45.651 [SPEAKER_03]: You have twenty three percent return and equity.

25:47.852 --> 25:48.713 [SPEAKER_03]: Looks pretty good to me.

25:48.733 --> 25:53.495 [SPEAKER_03]: Enterprise value to even is at nine point one.

25:54.636 --> 25:55.516 [SPEAKER_03]: Nine point one.

25:57.040 --> 26:01.563 [SPEAKER_03]: They might point to, oh, you know, they're, they're, growth isn't that high, revenue growth is only five percent.

26:02.123 --> 26:02.443 [SPEAKER_03]: Not bad.

26:02.924 --> 26:04.184 [SPEAKER_03]: But earnings grew a team percent.

26:05.965 --> 26:10.948 [SPEAKER_03]: So to us, this pullback is just a buying opportunity.

26:11.369 --> 26:16.572 [SPEAKER_03]: So I would continue to buy PayPal, PYPL on the reason.

26:16.972 --> 26:17.092 [SPEAKER_03]: Yep.

26:18.268 --> 26:20.449 [SPEAKER_03]: Those touch a bit on corporate profits.

26:20.769 --> 26:23.111 [SPEAKER_03]: We are mostly through earning season.

26:24.311 --> 26:30.254 [SPEAKER_03]: And historically, it's very hard to head into a recession with profits growing.

26:31.535 --> 26:38.258 [SPEAKER_03]: And when you look past the, I think we're at eleven percent profit growth for the quarter of an average.

26:40.039 --> 26:44.642 [SPEAKER_03]: For Q two, we look past that past the very large tech companies especially.

26:45.742 --> 26:46.763 [SPEAKER_03]: It's more worrying sign.

26:48.032 --> 26:58.778 [SPEAKER_03]: Those analysis, this is from the Financial Times, and it looked at large companies who have reported earnings in the second quarter.

26:59.438 --> 27:02.680 [SPEAKER_03]: They excluded financial companies and energy companies.

27:04.821 --> 27:06.862 [SPEAKER_03]: Because that's more financials are

27:08.103 --> 27:19.688 [SPEAKER_03]: those can have in flow based on whether they write up or down earnings, for example, or up or down assets, excuse me, energy is just a product of where oil prices are.

27:20.648 --> 27:28.772 [SPEAKER_03]: And when you stripped all that out, there are two hundred sixty four large companies, and they look at sales and operating profits.

27:32.514 --> 27:35.795 [SPEAKER_03]: Then we look at the mag seven, growth rates are good.

27:38.644 --> 27:41.145 [SPEAKER_03]: And when you look at sales, sales are fine as well.

27:43.305 --> 27:50.067 [SPEAKER_03]: All companies you're talking about nearly eight percent growth, excluding the Mac six, Mac six.

27:50.087 --> 27:55.009 [SPEAKER_03]: I think they excluded, they excluded in video because it hasn't reported yet.

27:56.789 --> 27:57.910 [SPEAKER_03]: It was at about seven percent.

27:58.650 --> 27:59.230 [SPEAKER_03]: That was cute too.

28:01.411 --> 28:06.052 [SPEAKER_03]: But then if you look at profit, wasn't nearly as strong.

28:08.653 --> 28:33.187 [SPEAKER_03]: seven percent growth in operating profit versus day percent sales growth and if you exclude the max six in this case operating profit goes all the way down to roughly four percent which it hasn't been that slow since Q four of twenty twenty three

28:35.813 --> 28:40.396 [SPEAKER_03]: So this is the large companies, about two hundred sixty four different ones in the S&P, etc.

28:42.737 --> 28:43.558 [SPEAKER_03]: What about the smaller ones?

28:47.640 --> 28:54.365 [SPEAKER_03]: Well, it's hard to gauge A because there's still a lot of small companies that have a report, but there's a lot of small companies that are private.

28:57.567 --> 29:04.091 [SPEAKER_03]: Now, if you look at the profit, you can estimate profits from these companies by looking at the national account.

29:06.870 --> 29:12.795 [SPEAKER_03]: It aims to catch all companies public private large and small and what their profit is.

29:18.139 --> 29:22.682 [SPEAKER_03]: And what it's showing is that corporate profits hardly grew in the second quarter from year before.

29:24.444 --> 29:27.466 [SPEAKER_03]: And the recent pattern was about a mid-singled digit growth.

29:29.327 --> 29:33.531 [SPEAKER_03]: So small businesses are struggling, which this

29:35.355 --> 29:38.776 [SPEAKER_03]: really backs up the data that we're seeing from ADP for example.

29:39.856 --> 29:49.438 [SPEAKER_03]: ADP jobs numbers have been relatively weak, especially every month of June where they showed negative job growth and is really driven by small companies.

29:50.938 --> 30:02.240 [SPEAKER_03]: Nothing, none of this is outright recessionary, but it's clear that profit levels throughout the economy have taken a stair step lower.

30:03.870 --> 30:05.451 [SPEAKER_03]: And it's not sales, right?

30:05.571 --> 30:07.112 [SPEAKER_03]: Sales growth is fine.

30:07.132 --> 30:10.414 [SPEAKER_03]: It actually accelerated in Q to versus Q one.

30:12.035 --> 30:19.641 [SPEAKER_03]: Those two hundred sixty four companies in Q one had sales growth around six percent and an accelerating Q to to eight percent.

30:22.222 --> 30:29.547 [SPEAKER_03]: But in Q one, earnings growth corporate operating profits were about nine percent.

30:32.029 --> 30:33.570 [SPEAKER_03]: And that decelerated to about seven.

30:35.531 --> 30:36.952 [SPEAKER_03]: And he strip out the max seven once again.

30:36.972 --> 30:41.035 [SPEAKER_03]: Q one, it was closer to seven and now it's closer to four.

30:43.157 --> 30:43.958 [SPEAKER_03]: So it's a cost thing.

30:45.479 --> 30:46.800 [SPEAKER_03]: Costs are going up.

30:46.920 --> 30:47.781 [SPEAKER_03]: Now is that tariffs?

30:48.381 --> 30:49.902 [SPEAKER_03]: Is that the higher cost of labor?

30:50.943 --> 30:53.145 [SPEAKER_03]: Whatever it is, these are the numbers.

30:55.376 --> 31:05.624 [SPEAKER_03]: And so the big question is, how we're recovering Q three or is this just kind of a slide towards a recession in twenty twenty six and that's the way I'm leading.

31:06.104 --> 31:07.105 [SPEAKER_03]: Let's take a live call.

31:08.026 --> 31:11.148 [SPEAKER_03]: We're going to Paul in center of IEL looking at sprouts.

31:13.650 --> 31:22.297 [SPEAKER_06]: I just and I've been watching it for a while and just want to get your take on what you think might be a good entry point if any if you like that stock I've been.

31:23.852 --> 31:30.247 [SPEAKER_06]: wanting to possibly add it to a long-term position that I might want to add.

31:30.307 --> 31:31.450 [SPEAKER_06]: So just want to get your take.

31:32.683 --> 31:34.545 [SPEAKER_03]: Look at Sprouts Farmers Market.

31:35.726 --> 31:37.247 [SPEAKER_03]: This is a name that we own for clients.

31:37.367 --> 31:38.428 [SPEAKER_03]: We've owned it for a long time.

31:38.488 --> 31:39.970 [SPEAKER_03]: This is one of our biggest winners.

31:40.250 --> 31:42.652 [SPEAKER_03]: We, uh, SFM is a symbol.

31:43.293 --> 31:46.156 [SPEAKER_03]: And we bought it around twenty dollars per share now.

31:46.196 --> 31:48.458 [SPEAKER_03]: It's at a hundred and fifty in a change.

31:49.138 --> 31:50.820 [SPEAKER_03]: So, big, big winner for us.

31:50.860 --> 31:53.222 [SPEAKER_03]: We just saw the secular trends around health.

31:54.023 --> 31:58.825 [SPEAKER_03]: There's a lot here in Southern California, a lot of Sprouts Farmers markets, and they've been growing.

31:58.865 --> 32:15.531 [SPEAKER_03]: They happen to have four hundred forty stores and twenty-four different states, natural organic foods, no dividend, but earnings have gone from a dollar or twenty-nine in twenty-eighteen, so it's supposed to be five dollars and twenty-eight cents this year, and six-to-four next year, and analysts continue to upgrade those earnings.

32:16.472 --> 32:19.593 [SPEAKER_03]: However, we have, I will say this.

32:21.647 --> 32:27.512 [SPEAKER_03]: We have, I've not added it to new clients in about six months.

32:28.653 --> 32:28.953 [SPEAKER_03]: Why?

32:29.013 --> 32:34.998 [SPEAKER_03]: Because there's a big sell-off back in February of this year.

32:36.259 --> 32:42.784 [SPEAKER_03]: And we've actually been trimming it in, you know, anything above kind of one, sixty.

32:43.643 --> 32:48.145 [SPEAKER_03]: So we're looking for a bit of a correction.

32:48.546 --> 32:50.026 [SPEAKER_03]: And we still like the name long term.

32:50.667 --> 32:54.048 [SPEAKER_03]: So I don't want to sit here and say, I want to sell it.

32:54.389 --> 33:00.572 [SPEAKER_03]: But let me give you a number that we're targeting for to add to new client, shall we say.

33:01.412 --> 33:05.474 [SPEAKER_03]: And that's around one to one to one to one to one to one to one to you.

33:05.494 --> 33:07.596 [SPEAKER_03]: So I think I do think it gets there.

33:09.076 --> 33:11.998 [SPEAKER_03]: And that's where I'd be buying more sprouts, SFM.

33:13.042 --> 33:14.103 [SPEAKER_06]: Good, thanks Justin.

33:14.583 --> 33:15.284 [SPEAKER_03]: Thanks for the call.

33:15.724 --> 33:17.065 [SPEAKER_03]: Let's go take a live call.

33:17.085 --> 33:19.087 [SPEAKER_03]: Thomas from Santa Cruz looking at Best Buy.

33:19.487 --> 33:23.450 [SPEAKER_07]: Hey Justin, thank you as always for taking my call.

33:23.791 --> 33:25.392 [SPEAKER_07]: I am asking about Best Buy.

33:25.532 --> 33:32.237 [SPEAKER_07]: I know that you guys talked about it over the last few years and you guys usually are pretty fond of it.

33:32.658 --> 33:33.859 [SPEAKER_07]: I know that it's been struggling.

33:33.919 --> 33:40.964 [SPEAKER_07]: I know that as a sector, it would be a consumer sentiment, not the greatest for like a general

33:42.438 --> 33:44.099 [SPEAKER_07]: people purchasing things in general.

33:44.940 --> 33:59.628 [SPEAKER_07]: But it's like a long-term hold potentially, where you guys are liking best buy, as well as, I mean, I called last week asked about Adobe and you mentioned put options, so it totally dove into the world of selling puts.

34:00.569 --> 34:05.592 [SPEAKER_07]: What would you think about selling a put for the low sixties for best buy?

34:06.452 --> 34:09.074 [SPEAKER_07]: Seems like the premium availability

34:09.878 --> 34:18.080 [SPEAKER_07]: that you can get on this name in the low sixties, even forty to sixty days out, you can get, I mean, three, four percent.

34:18.220 --> 34:21.360 [SPEAKER_07]: It seems like I might be doing my math wrong, but you can check me on that.

34:22.341 --> 34:32.103 [SPEAKER_07]: But so sorry for the multi-tiered question, but basically best by the company, and then how would you feel about selling a put for Best Buy?

34:33.323 --> 34:37.824 [SPEAKER_03]: I'm looking at Best Buy, this is a name that we had owned for clients, BBY, and

34:39.094 --> 34:40.676 [SPEAKER_03]: We like the business.

34:41.016 --> 34:46.201 [SPEAKER_03]: The problem is that with tariffs, it's just a lot of headwinds, right?

34:46.261 --> 34:52.287 [SPEAKER_03]: With the import costs and the uncertainty around the business.

34:52.447 --> 34:57.252 [SPEAKER_03]: And I think as long as Trump is an office, there's going to be a lot of headwinds.

34:57.292 --> 35:02.598 [SPEAKER_03]: And you're seeing, you know, flat to negative earnings growth now, expected going forward because of this.

35:03.198 --> 35:04.219 [SPEAKER_03]: And it's in a downtrend.

35:04.259 --> 35:16.270 [SPEAKER_03]: And so we ended up exiting it and moving, you know, on the back of the bounce from the April lows, we started to sell into that rally and and reallocate the money elsewhere.

35:17.151 --> 35:21.315 [SPEAKER_03]: And that's the way I would continue to think about it.

35:21.355 --> 35:23.637 [SPEAKER_03]: Now, longer term, I like the business.

35:25.002 --> 35:31.388 [SPEAKER_03]: But I think it could continue to go lower and I think that those premiums are there because there is a lot of near term risk.

35:31.928 --> 35:38.454 [SPEAKER_03]: And I would imagine I don't know if they've reported earnings yet do you know what the earnings date is?

35:39.175 --> 35:39.716 [SPEAKER_07]: I do not know.

35:40.636 --> 35:41.377 [SPEAKER_03]: Okay.

35:41.858 --> 35:45.001 [SPEAKER_03]: So that's probably why you're getting a lot of

35:47.772 --> 35:54.817 [SPEAKER_03]: A lot of premium for selling put options is that risk that they will miss in a big way, right?

35:56.038 --> 36:03.943 [SPEAKER_03]: So that's my main concern is that if they miss in a big way that you're going to be underwater.

36:04.283 --> 36:12.028 [SPEAKER_03]: Now, what I sell it closer to the lows in April around fifty five, you might not get as good of a premium, but I would want a little more cushion.

36:12.048 --> 36:13.449 [SPEAKER_03]: So I'm going to sell put options.

36:13.909 --> 36:16.051 [SPEAKER_03]: I'd want that to be closer to fifty five.

36:16.431 --> 36:19.633 [SPEAKER_03]: Once again, you probably need to get three or four percent, but make it one or two percent.

36:19.973 --> 36:23.656 [SPEAKER_03]: And I think that's a better risk versus reward decision if you're going to sell put options.

36:23.676 --> 36:30.700 [SPEAKER_03]: Because I do like the business long term once the malaise and problems of the the Trump administration are behind them.

36:31.120 --> 36:34.743 [SPEAKER_03]: The problem is is that there's still three and a half more years of the Trump administration.

36:35.610 --> 36:38.871 [SPEAKER_03]: dealing with the volatility of tariffs and uncertainty around tariffs.

36:39.211 --> 36:42.732 [SPEAKER_03]: Because we know that a deal in Trump's world is not a deal.

36:42.752 --> 36:48.394 [SPEAKER_03]: Like, you know, we's renegarn it and go back on it and renegotiate and that could create, you know, more volatility.

36:49.114 --> 36:57.536 [SPEAKER_03]: But there may be good volatility to sell once again in the low fifth, you know, mid fifties, low fifties and try to pick up premium in that way.

36:57.616 --> 37:00.137 [SPEAKER_03]: Make sure you have a hefty cushion if you're going to do that.

37:00.582 --> 37:24.180 [SPEAKER_03]: and you like thirty to forty days out or yeah that's typically when you're selling options you want to keep them relatively short dated so I was a sixty days and in is a good time frame thirty is kind of ideal but you know between that thirty and sixty day range is where you want to live and so yeah right now you would probably want to be selling these September

37:26.155 --> 37:28.096 [SPEAKER_03]: put options in this case.

37:28.176 --> 37:34.201 [SPEAKER_03]: So that'll allow you so a lot of time decay between now and then and still get plenty of premium.

37:34.541 --> 37:34.722 [SPEAKER_07]: All right.

37:34.762 --> 37:35.342 [SPEAKER_07]: Thank you, Justin.

37:35.602 --> 37:35.923 [SPEAKER_03]: No problem.

37:35.943 --> 37:36.563 [SPEAKER_03]: Thanks for the call.

37:37.224 --> 37:41.907 [SPEAKER_03]: But from time to time, we receive investment like questions via web form from investor.com.

37:41.947 --> 37:43.088 [SPEAKER_03]: So let's tackle that now.

37:43.909 --> 37:45.270 [SPEAKER_03]: Hello, says hello.

37:45.750 --> 37:47.091 [SPEAKER_03]: And thank you for the great show.

37:47.211 --> 37:48.951 [SPEAKER_03]: I own UPS for a few years now.

37:48.971 --> 37:50.752 [SPEAKER_03]: And I was wondering if it's good time to add more.

37:51.273 --> 37:53.073 [SPEAKER_03]: My position since it's on the downtrend.

37:53.454 --> 37:54.614 [SPEAKER_03]: Look you forward to your answer.

37:54.634 --> 37:55.274 [SPEAKER_03]: Thanks so much.

37:55.535 --> 37:56.235 [SPEAKER_03]: And what you guys do.

37:57.235 --> 37:59.817 [SPEAKER_03]: UPS, I think long term.

37:59.897 --> 38:00.557 [SPEAKER_03]: It's a good business.

38:01.617 --> 38:03.678 [SPEAKER_03]: However, it's still a downtrend.

38:03.819 --> 38:05.619 [SPEAKER_03]: So you have to be very patient.

38:05.679 --> 38:06.480 [SPEAKER_03]: I like the idea.

38:08.721 --> 38:09.401 [SPEAKER_03]: in this case selling.

38:09.441 --> 38:21.084 [SPEAKER_03]: But options, picking up, picking up shares around these levels that I do think long-term, it's still a good business, it's still cheap, it has a good balance sheet, et cetera.

38:21.464 --> 38:28.105 [SPEAKER_03]: So a lot of positive aspects to UPS's business, but near-term, a lot of headwinds, why?

38:28.145 --> 38:35.447 [SPEAKER_03]: Because tariffs, simply, tariffs simply as just with that's by,

38:36.725 --> 38:42.931 [SPEAKER_03]: Create headwinds to importing and moving physical products, which UPS does.

38:43.672 --> 38:56.243 [SPEAKER_03]: So I still think that the malaise and problems that tariffs are bringing to the physical product markets are here in the near term.

38:57.090 --> 38:59.030 [SPEAKER_03]: but we'll debate over the long term.

38:59.791 --> 39:03.831 [SPEAKER_03]: So, I like it a long term, and make sure you have a long term plan for it.

39:04.291 --> 39:05.111 [SPEAKER_03]: Now we're heading to a break.

39:05.131 --> 39:06.852 [SPEAKER_03]: Give me a call now at eight and eight and nine chart.

39:13.293 --> 39:20.054 [SPEAKER_02]: Twenty, twenty, five rolls on, and you might have some fresh questions for Justin or Luke.

39:20.494 --> 39:24.355 [SPEAKER_02]: Call in Vestock, eight, eight, eight, ninety, nine chart.

39:28.582 --> 39:32.644 [SPEAKER_03]: It hit ninety nine chart, it hit nine nine two four two seven eight.

39:33.984 --> 39:41.988 [SPEAKER_03]: Let's lastly talk a little bit about the biases that everyone has, but it is not just the average investor.

39:42.068 --> 39:44.209 [SPEAKER_03]: It's fun managers as well.

39:44.289 --> 39:55.674 [SPEAKER_03]: And this is an interesting study of a hundred eighty six thousand funds across all asset classes using data from nineteen ninety to twenty twenty two.

39:56.993 --> 39:59.754 [SPEAKER_03]: And they looked at two different types of behaviors.

39:59.934 --> 40:00.955 [SPEAKER_03]: One is loss of version.

40:01.675 --> 40:02.775 [SPEAKER_03]: So I try to avoid loss.

40:03.436 --> 40:11.479 [SPEAKER_03]: And then risk seeking behavior when a confiner loss is basically saying, we know there's risk here, but we're willing to take it.

40:12.179 --> 40:18.342 [SPEAKER_03]: Now, managers of hedge funds and other alternative investments as well as money market funds.

40:19.585 --> 40:23.808 [SPEAKER_03]: They're the most risk-averse, which are you to imagine, right?

40:23.828 --> 40:30.753 [SPEAKER_03]: If hedge funds, they tend to attract investors that are looking to void losses, money market funds, they don't want to break the buck.

40:30.874 --> 40:32.975 [SPEAKER_03]: So that's obvious, okay?

40:33.956 --> 40:38.159 [SPEAKER_03]: But it's not just about seeking less risk.

40:38.219 --> 40:48.047 [SPEAKER_03]: It's also about the ability to find good versus good risk versus reward, decisions and no, which is which.

40:50.112 --> 40:53.354 [SPEAKER_03]: But it's not about just taking risk.

40:54.274 --> 41:00.917 [SPEAKER_03]: If you're just always putting the gas pedal, you know that you're eventually going to crash with sometimes you have to use the brake.

41:02.718 --> 41:04.219 [SPEAKER_03]: Right, the gas, and there's brake.

41:04.779 --> 41:12.603 [SPEAKER_03]: And this isn't about market timing, but it's really about understanding when dodging your favor.

41:14.804 --> 41:17.645 [SPEAKER_03]: And whether you take the foot off the brake or the gas.

41:20.814 --> 41:31.840 [SPEAKER_03]: Now, managers of the largest funds, with over a hundred billion dollars of assets in their management, seem to be less loss of verse than the rest of the group here group.

41:35.922 --> 41:37.123 [SPEAKER_03]: And also, less risk of verse.

41:39.904 --> 41:48.109 [SPEAKER_03]: They tend to take more risk than their peers when these risks are likely to be rewarded with positive returns, meaning good risk versus reward.

41:49.276 --> 42:10.182 [SPEAKER_03]: But don't fall into a trap when the odds are not in their favor, which is what you want from a good fun manager, advisor, that knows that hey, the chips are not really stacked in your favor.

42:10.862 --> 42:14.163 [SPEAKER_03]: For example, you call it all the time, and it's a measurement I

42:16.032 --> 42:19.733 [SPEAKER_03]: I use a lot, especially for a growth year name, so it's price sales ratio.

42:21.774 --> 42:23.815 [SPEAKER_03]: The numbers are very clear.

42:24.995 --> 42:35.079 [SPEAKER_03]: If you ever pay over twenty times sales, the odds of it working out for you in the long run are very, very small.

42:37.775 --> 42:46.138 [SPEAKER_03]: You pay over ten times sales, the odds of that working out for you are low, shall we say?

42:47.619 --> 42:48.099 [SPEAKER_03]: They're low.

42:50.560 --> 42:53.521 [SPEAKER_03]: And that's the way, that's one example, right?

42:53.541 --> 42:54.762 [SPEAKER_03]: It's overly simplified.

42:55.682 --> 42:57.203 [SPEAKER_03]: There are other metrics to look at.

42:57.783 --> 43:03.365 [SPEAKER_03]: There are other factors, you know, think of the meme stocks recently that have gone crazy.

43:05.186 --> 43:11.788 [SPEAKER_03]: like crispy creams and, you know, a lot of the ones that was the QS one up a bunch.

43:12.508 --> 43:26.853 [SPEAKER_03]: I remember the most recent ones, but these are names that don't make money, their Ponzi stocks, they can go up over short periods of time, but we know that you don't chase those things for longer than a few days.

43:27.954 --> 43:29.094 [SPEAKER_03]: And you have to be ready to jump shit.

43:30.819 --> 43:41.907 [SPEAKER_03]: Now, good manager or good trader would recognize that, and maybe they take advantage of that in the short term, but they have the discipline to know that this is not a game that you stick around very long with.

43:42.747 --> 43:51.173 [SPEAKER_03]: And that's a constant theme that shows up with good fund managers, good investors, good advisors.

43:51.833 --> 43:57.017 [SPEAKER_03]: This isn't about maximizing gains over the short term.

43:58.258 --> 43:59.679 [SPEAKER_03]: It's about the long game.

44:00.873 --> 44:11.777 [SPEAKER_03]: And unless you have the discipline to understand the difference, then you're just always gonna have your foot on the gas or the brake.

44:13.418 --> 44:21.040 [SPEAKER_03]: And we know that one takes you nowhere, which is the brake, and the other ends up causing a crash.

44:22.261 --> 44:27.563 [SPEAKER_03]: So you have to be a smart driver of your portfolio and understand when to apply each.

44:29.943 --> 44:30.623 [SPEAKER_03]: Well, I'm Justin Klein.

44:30.643 --> 44:32.544 [SPEAKER_03]: This completes another in Best Talk program.

44:32.604 --> 44:43.190 [SPEAKER_03]: And if today's show made you think about your own financial picture in any way and whether you should be stepping on the gas more or the break, you don't know that.

44:43.210 --> 44:48.692 [SPEAKER_03]: You don't feel you have a good gauge of which one you should be pressing.

44:49.033 --> 44:55.856 [SPEAKER_03]: I encourage you to do head over to invest.com, click on that portfolio review button and schedule a no-cost portfolio review with myself.

44:55.876 --> 44:59.558 [SPEAKER_03]: Will you come over and clarity and confidence to your strategy?

45:00.875 --> 45:12.441 [SPEAKER_03]: So we thank you for listening once again and telling your friends and family about our free podcast downloads, which will find any time at iTunes or Spotify and watch our videos and post your questions on our YouTube channel as well.

45:13.082 --> 45:15.323 [SPEAKER_03]: Please be sure to review and rate us on iTunes.

45:15.583 --> 45:16.063 [SPEAKER_03]: We love that.

45:16.203 --> 45:16.563 [SPEAKER_03]: Thank you.

45:17.064 --> 45:18.324 [SPEAKER_03]: Independent thinking should success.

45:18.344 --> 45:19.245 [SPEAKER_03]: This is the best talk.

45:23.668 --> 45:31.279 [SPEAKER_00]: Invest talk is a trademark of KPP financial, because of the nature of the interactive dialogue inherent in the format of this program.

45:31.659 --> 45:35.865 [SPEAKER_00]: It's important for the listener to understand that not all comments may will apply to them.

45:36.265 --> 45:39.510 [SPEAKER_00]: Specifically, nothing sets shall be taken to be investment advice.

45:39.910 --> 45:44.332 [SPEAKER_00]: or shell statements on this program be considered an offer to buy or sell security.

45:44.672 --> 45:52.434 [SPEAKER_00]: Because such advice is rendered solely on an individual basis, and at times will require that the investor review a perspective before investing.

45:52.915 --> 46:00.817 [SPEAKER_00]: Invest talk is a copyrighted program of Plyne, Pavles, and Peasley Financial, a registered investment advisor firm, which retains all rights.

46:01.157 --> 46:08.160 [SPEAKER_00]: For more information regarding KPP's investment advisors, call one eight hundred five five seven fifty four sixty one.

46:08.700 --> 46:15.799 [SPEAKER_00]: Thank you for listening and your comments and questions are welcome on our twenty four hour listener line at eight eight eight ninety nine chart