0:02

Hey there. And in today's show, we're gonna be embracing

0:05

diversity in modern training strategies. My pronouns,

0:09

officially long and short. Rebel Traders takes

0:13

you inside the world of 2 underground master traders who take an entertaining

0:16

and entertaining and contrarian look at the markets to cut through the

0:20

noise of Wall Street and help you navigate the trading minefield.

0:23

Together, Sean Donahoe and Phil Newton are on a mission to give you the

0:27

unfair advantage of a rebel trader. And now, here are your

0:31

hosts, Sean Donahoe and mister Phil Newton.

0:35

Alright. We we we were skirting along there. Well, we were

0:38

skirting it, danced upon it, and and kicked it kicked the dirt over it

0:42

there. We're gonna offend someone today with this show because I

0:45

just can't help myself. But, I think, mister

0:49

Phil Newton is here as always, and he's chomping at the bit

0:53

as well. He was telling me some funny stories that I won't share

0:57

before we go, or before we went live here, but

1:00

we're kind of doing a double duty, podcast today because we're

1:04

releasing 2 episodes on the same day because

1:09

we had a little technical snafu with last week's publishing. The

1:12

recording was fine. It was the publishing and processing that went

1:16

askew. But, so we're gonna we're gonna drop

1:19

2 for the price of 1. It's a it's a 2 for Tuesday even

1:23

if this is recorded on a Wednesday. So, Phil, how are you

1:27

doing, sir, before I go off on a Doing fine. I'm resisting the

1:30

urge to stop this session giggling like a little schoolboy

1:34

again. Or is it schoolgirl, school schoolperson, a

1:37

schoolmate then? Yeah. There's so many so many You started this show. You started this on this

1:46

soapbox. Don't even get me on this, whole cancel culture,

1:50

you know, woke soapbox because I should have been canceled freaking years

1:53

ago. I don't care about offending anyone was not

1:57

our intent. I'm just gonna be very clear about that, but we are who we

2:01

are. We're all farts. You know, we're not part of this whole bloody

2:06

new gen. We are not part of the Woke Brigade, unfortunately. Or

2:09

fortunately. It depends on your perspective. I'd

2:13

say bloody fortunately for that one because I got Fortunate. I'm too bloody

2:17

busy to to worry about all that stupid shit. But,

2:20

anyway, we are talking about the concept of diversification,

2:25

which is all about you know,

2:28

look. It's going to be beyond the whole 60,

2:32

40 stop bond split and all that stuff, you know, when, you

2:36

know, as a seasoned trader, you know, we've come to appreciate the

2:39

value of mixing things up, diversifying in

2:43

different areas, not just the

2:47

market, but also, I would say, time frame, strategy, environment, and

2:51

a lot of different things. So, Phil, where do you

2:55

wanna start with this one? Because, I mean, this is continuing our

2:58

12 rules of rebel trading, and this is number 8

3:02

in the series. Yes. We're on the 12 rules of rebel trading. We're

3:06

currently on rule 104. Sounds about bloody right too. Does it I

3:14

was thinking about this kind of after the fact as Scott was

3:18

reviewing these kind of this particular mini series.

3:22

And there's always a number one rule, and

3:26

it's the first rule, then the the next first rule. And

3:29

there's quite literally a long list of first rules of trading.

3:34

So, yeah, take away the pinch of salt. 1 to 12, currently

3:38

on rule 104. But this one

3:41

revolves around, diversification

3:45

when it comes to financial assets in the markets.

3:50

And it it it really is

3:54

I've never understood, Sean, that the 60 40 stock bond

3:58

splits that traditional way of doing it. So I can't wrap

4:01

my head around it, to be honest. And I know for a lot of people

4:05

applied in the fifties, but you hate not I mean, for for a lot of

4:08

people at work, I know people that do it, and they make it work. But

4:13

it's a place to park cash when you've got that strategy, when you've

4:17

got nothing else to do with it. That's what you're allegedly

4:20

supposed to do. But if you look at the performance of

4:24

that over the last couple of years, it's kind of

4:27

broken down. It's not worked the way that it was

4:31

expected to work because the the logic behind it is that the stock market's

4:34

underperforming, bonds will start to perform and vice versa.

4:38

You've got this hedged

4:42

portfolio with a very loose and basic interpretation of it. So

4:46

I don't necessarily believe in diversification in the traditional

4:49

sense. I would rather be looking at other

4:53

things to do with my money when it comes

4:57

to strategy. And kind of both our defaults have been just

5:00

by a happy little accident, Sean. Because what we I think the funny thing is

5:04

before we actually met and became friends, we were kind of going this

5:08

parallel track with our own journeys of

5:11

trading. And then when we kind of met up oh oh oh, yeah. Oh, yeah.

5:15

Oh, yeah. Oh, I do that. It was that whole Spider Man meme right there.

5:19

Yeah. We don't point it to each other. So

5:23

we kind of came to a lot of similar conclusions. That's probably, I mean,

5:26

to be fair, with similar personalities, probably not unsurprisingly involved in a very

5:30

similar way when it comes to strategies and what we want, our likes and dislikes.

5:34

So a a lot I suppose as well, a little bit of

5:38

a a a detour as well, Sean, before we get right into it, is

5:42

a a lot of these things are driven by your personality.

5:46

And I'm emphasizing your, you know,

5:49

underscore it a few times because my preferences

5:53

are, to be fair, while similar, are different to Sean's

5:56

preferences. Simply put, we're in different

6:00

locations, and Sean's just moved, so his priorities have just

6:04

changed. So based on just some basic

6:07

geography, the way that you

6:11

deploy your assets is gonna be a little bit different

6:15

because of, hey. Maybe the legal structure's gonna be a little bit different so that

6:18

it's more tax efficient. And just those things are personality

6:23

or personal preference driven. So,

6:27

again, these are the things that kind of influence, what

6:30

we do and how we do it. Again, my, again, default stance when

6:34

it comes to diversity is strategy diversification. For many,

6:38

many, many years, I've always ran multiple

6:42

strategies. And you can have the

6:45

same strategy on different assets as well and across

6:49

different time frames. So just a few illustrations of you know, you

6:52

can be, for example, like I'm

6:56

reduced the number of assets that I'm looking for in the short term, but I've

7:00

also kept that diversity with the time horizons that

7:04

I'll trade essentially the same strategy. So let's for example,

7:07

2 or 3 strategies on 2 or 3 instruments with 2 or 3

7:11

time horizon. You know, 3, 3, and 3, you've got 9 different iterations. So you

7:15

can be long in the, kind of the the let's just

7:18

call it the long term. You can be flat in the short term, and you

7:22

can be bearish in the medium term. You know, you know,

7:26

any combination of all of these things. So it just gives you a little bit

7:28

of diversification for what the markets

7:32

are doing. And that's how I like to start the conversation

7:36

with diversification, Sean. Absolutely. Well, I think about

7:39

my diversification. Not only do I diversify in strategies,

7:43

but I have I call it the the triangle.

7:46

I have stock and options, obviously. I

7:50

trade, mainstream crypto. And right now, I've even

7:54

stripped that down from 20 assets I look at down to the main

7:57

4. And then there was liquid ones that have momentum

8:01

and, you know, trend very nicely. It's Bitcoin, Ethereum,

8:05

Solara, and BNB. Those are my 4 that I look at.

8:09

And then from that, I've also got micro caps. And the

8:13

thing is if one is lagging behind the others, well, I switch

8:17

my focus to those other assets.

8:20

You know? You talk about the the 6040 bond split. Funnily

8:24

enough, mine is 60% stock and options,

8:27

30% mainstream crypto, 10% micro

8:31

caps. That's my you know, I wouldn't say it's it it it it's

8:35

a happy accident. It's that kind of 6040, but it's

8:38

not intentional. It's just the way it's naturally flowed and

8:42

ended up in that kind of same ballpark. But I'm using,

8:47

crypto, which again is blowing up more recently since, you

8:50

know, 2023 into to now and has gone absolutely

8:54

bloody crazy. But with that, you know, it doesn't matter if

8:58

it's the the market's going up, down, sideways. There's money being made

9:01

everywhere, and I can put my focus and attention in those

9:05

different diversified sectors. And

9:09

one's always moving very nicely in my direction or

9:12

sometimes altogether. And, again, you know, that's

9:16

that just allows me to amplify because some markets have more

9:20

volatility like micro caps. Shoot. I could do,

9:24

anywhere from a 1000% return on capital in a day

9:28

on depending on the the stock or also the actual coin or what have you

9:32

I'm I'm doing. I mean, my my record is 32,000 percent

9:36

return on capital. That's a happy bloody day. Doesn't happen

9:39

often. But when it does, great. I'll take that cash and

9:43

sweep, move it into the other asset classes for longer

9:46

term returns as well. So that's why there's a You raise an

9:50

interest in point there, Sean, as well. Those the big wins

9:53

happen. The the undeniable. They've happened for you. They've happened for me.

9:57

But you're not aiming for that every trade, are you? It's it's one of those

10:01

we'll let the market give what it gives us or take what it takes from

10:04

us. You know, that that that's how we kind of view our trading. But

10:08

then from time to time, there will be the big win. So you've gotta have

10:11

a finger in the pie to see how to see how how much filling there

10:15

is in it. You know, I don't know where that best of all is going,

10:17

but you got so many ways we could take that. Yes. Let's move on from

10:21

that one quite quickly. But it's an interesting point, Sean, isn't it?

10:24

It's you're not hoping to swing for the fence yet. I think that's

10:28

also an important thing to consider

10:32

when it comes to the the the the trading

10:36

opportunities, the diversification, if you like. You know, you're not putting a

10:39

huge allocation in a higher risk asset

10:43

to, you know, win big on every trading

10:47

choice. No. You know, it it's not a realistic prospect. I

10:50

suppose to, you know, the real world business, Sean,

10:54

it would be like starting up business today,

10:57

with, you know, a few $1,000. And then this time next

11:01

month, you've got a couple 100,000,000, you know, in revenues and

11:05

turnovers. And while it has happened in the past, it

11:08

doesn't happen with every business. You know? So the the the

11:13

you understand that when it comes to the real world of bricks and mortar

11:17

businesses. But for some reason, as soon as you step into the world of

11:21

trading, that reality just gets completely forgotten

11:25

about. It really does. I mean, we, you know, we talk about

11:28

how we I mean, at one stage, Phil and I were

11:32

starting to consider diversifying back into brick and

11:36

mortar businesses, taking large swaths of capital that we've accrued

11:40

in our different trading accounts and our capital management asset

11:43

portfolio. And thinking, okay. Let's go buy up businesses. Let's

11:47

go buy up brick and mortar businesses, which I had done

11:51

in the past and, you know, done, turnaround business and

11:54

consultancy, got equity in different businesses and all sorts of other

11:57

things. But it became a major pain in the ass. Now that's an

12:01

option for diversification, but then

12:05

a lot of what we decided and I think, you know, me personally, certainly, I

12:09

think Phil did as well, was we have our rule of

12:13

thumb. Is is this unhustled? And the answer is Is this No. We're just

12:16

buying time solids. Yeah. Yeah. Is this is this just buying

12:20

headaches or buying hassles and bullshit? And for me, it's like,

12:24

no. I had to divest myself. Certainly post COVID,

12:28

I'm not dealing with brick and mortar anymore. Just it's just the way of

12:31

it. It was a painful lesson during that time. And,

12:35

yeah, I I got out of it. Exactly. During that time,

12:38

everything everything was up in the air, Sean. So we were exploring

12:42

to to be fair, pre COVID, we were exploring the concepts and ideas anyway.

12:46

But then COVID obviously hits hard and hit everyone. And so it was all up

12:50

in the air. You know? What what's the world gonna be like? You know? And

12:53

you're just trying to figure out what was going on at that time. So, yeah,

12:55

we're both exploring a variety of different new ideas and

12:59

concepts that, you know, we'd never really considered before just because, hey, you

13:03

know, we're all we're all stuck in the house together, and we've all got to

13:05

thinking about ways of ways of, you know, living in this, you

13:09

know, new world. And we didn't know how long it was gonna last. It was

13:13

a crazy, crazy time. So diversification, Sean, I think we're

13:17

both in agreement. Some sort of strategy

13:20

diversification. And I think it's also interesting to consider. It

13:24

could be nonstop markets

13:28

diversification can be included in this category. You could be

13:31

buying physical businesses, which seems to be a hot button at the

13:35

moment. I'm sure you've seen a lot of adverts and promotions for

13:39

various people saying, hey. You know, we've got this, you know,

13:42

business buying 0 money down, you know, on I've been in

13:46

a few of those programs and and to see what they're doing. Doing due diligence.

13:50

I think it's fair to say that while they do happen, you know, it's no

13:53

money out of pocket might be a better phrase, not necessarily no money

13:57

down. You can use other people's money. Anyway,

14:01

Steve don't get us started. Soapbox time.

14:05

So so diversification, it can come in a variety of

14:08

forms, you know, whether you're buying a share of a company,

14:13

in the stock market or a share of an asset when it comes

14:17

to, cryptos. You were saying that, Sean,

14:20

you've got a high risk allocation. You could also diversify

14:24

with actual businesses and, you know, getting a portion of,

14:28

what essentially is private equity, a private share, or a percentage

14:32

of performance. Again, that's gonna depend on your skill sets. You know, if you've not

14:36

got the the skill set to offer consultancy and performance based

14:39

returns, then, you know, maybe it's not a a a fact that you wanna consider

14:43

at this stage. But you can look at other things. I I've been

14:47

looking at so I I I tend to get, a mailer about,

14:50

whiskey investments for some reason, Sean. So

14:54

you can you can do this nonclassical

14:57

asset class of alternative investments.

15:01

I think that's also worth considering. So I I think just at this high

15:05

level, Sean, we've got this broad spectrum of things that

15:09

we could do. But then as we started off our conversation,

15:13

it's what you want to do, and that's gonna be

15:16

flavored by personal preferences. You know, do you want

15:20

to be, you know, involved or passive? You know, do you want

15:24

a payout cycle in 50 years or

15:28

5 years? That might depend on your age. You know, you know, as

15:31

I kind of, you know, crest another,

15:35

hill in life, you know, my time

15:38

horizon is getting shorter, but at the same time,

15:42

my patience is also longer. You You know, in an ironic twist, yeah, I might

15:45

be prepared to wait 30 years for a pay, but at the same time, you

15:49

know, like how I got 30 years left. You know?

15:53

You know, you start thinking about these things. So you've a

15:57

lot of these diversification issues, they're all flavored

16:01

by the preferences, what you want. And to be fair, what you know about could

16:04

also be a fact. I mean, that there's new technology, Sean. I mean,

16:08

certainly the US tends to get the the the the the first round of

16:12

things. You could certainly be a fractional investor

16:16

in property. Now let me say that a fractional investor, you don't need

16:19

100 of 1,000. And a lot of these things are US based, which is

16:23

great. You could go and invest couple $100

16:27

like you might, put a couple $100 every month

16:31

when you do this, you know, buy the S and P

16:34

500 or the Global Equity Index. You know? And you just put a couple $100

16:38

every month. You could do the same thing with property, but you rather than put

16:41

a lump sum in, you can again be a fractional investor

16:45

as a part of a, I'm trying to remember the name of this company, Sean.

16:49

But, you know, there's a variety of them where you can, you know, go

16:53

and invest in property schemes. You don't have to be hands on, and it's

16:56

super passive in that regard. Yeah. And one of the things Are you

17:00

thinking of talking about REITs or the different variants on that? I can't I can't

17:04

it probably is REITs again. The the terminology is a little bit different in the

17:07

UK to the US. But, yeah, there's

17:11

websites and there's directories, etcetera, of

17:15

companies that you can go and invest in that will go

17:19

and then manage that on your behalf. But you can get the buy

17:22

ins minimal, Sean, is all I'm trying to get to. Mhmm.

17:26

Again, nonstandard asset classes, you can buy

17:29

and sell debt. Again, there's platform in the this is revolutionary stuff, Sean,

17:33

compared to when we started out. The the opportunities for

17:37

starting out as an investor, were very minimal

17:40

unless you had a huge buy in. But I remember

17:44

the, peer to peer micro investing, Sean. You know, that you

17:48

know, pretty common these days, you know, to get a a payday

17:51

type loan, but you can do it peer to peer, which is,

17:56

you know, revolutionary. If you wanna lend 50 quid to someone

17:59

via this, you know, portal, you can do it, and you can collect

18:03

interest. Same thing with, tax liens is something

18:07

that always fascinates me, Sean. Again, completely unique to the

18:10

US. No one else in the world has this. It's, you know,

18:14

fascinating. So, again, diversification

18:18

comes down to what you want, what you know about, how much time do you

18:22

wanna invest. Do you wanna be elbows deep and actively managing, or

18:25

do you want to be passive? And then that's going to then dictate

18:29

what you go, further into, investigate, and kind of map out

18:33

the next the 5 years, the next 10 years, the next 15 years of what

18:36

you want for your, asset allocations. You know, I

18:40

would also, like to take a a little bit of a step back

18:44

is why would you want diversification if you're, you

18:47

know, in one area and you're doing very well. Why would you

18:51

want this kind of diversification? Some investments move

18:54

slower. Some diversification

18:58

creates, you know, different risk profile. But why would

19:02

you want to do it in the first place? What is diversification at

19:06

the end of the day? What does it do for you? What are the benefits?

19:10

So a lot of people, listeners, talking about hate REITs and buying and

19:13

selling debt and flipping out. They're like, this is a fucking trading

19:17

show. What what are you all about? Why aren't you talking about trading? Well, the

19:20

thing is and this is something that Phil said years ago, and

19:24

I've always laughed about it is, I don't care what

19:28

we do if it's making money. And one thing Phil

19:32

flippantly threw away is, I don't care if it's whimsical way of saying

19:35

this. Yeah. I've I don't care if it's more profitable putting

19:39

any bears on eBay. That's what we would be doing.

19:43

And it's not so much the vehicle, so to speak.

19:47

It's the what's the return and the speed of return?

19:51

That's 2 critical factors for me, which is why brick and

19:55

mortars and even real estate right now. I mean, I had my fingers in

19:59

a lot of different real estate, commercial real estate. And

20:03

that, again, slow rate of return, It can

20:07

accrue big numbers. You can leverage that debt. There's all sorts of different tax

20:10

advantages you can do from that. But at the end of the day,

20:15

it was a pain in the ass. And my rate

20:19

of return could be 12% a year. You

20:23

know, 12% a year. And that was with cash flow and all the rest.

20:28

I'm like, I could do that in a week. What the

20:32

fuck? Why am I why am I worried about that? And

20:35

then, you know, swinging swinging a big dick just saying, hey. Look. I've

20:39

got all this real estate portfolio. Who gives a shit? It's

20:43

only 10% a year. What can I do with that money that's

20:47

fucking faster without all the overhead liability,

20:50

the dealing with tenants, dealing with property management, dealing with

20:54

banks, dealing with all the paperwork and the tax headaches is

20:58

like, I'll just go put it over here? I'll watch it go up 10%, you

21:01

know, in a couple of days and take my money out. Okay. Good. Now

21:05

what? I'll do it again. Okay. I'll do it. Lay claim. Can't lay

21:09

claim to this this phrase, Sean, But, I'll try and dig

21:13

out so we can give the the attribute to it. But I heard it a

21:16

few times over the years in a variety of different ways. But it's

21:19

like the response to all of this is

21:24

all all of that sounds really great, Phil. You know? But I realized that I

21:27

like making money more than faffing around with all of that.

21:33

So, you know, what and again, it comes back to this is the personal preferences.

21:37

You know, if you if if your expectation is, you know, I'll make some money

21:40

in 3 months, 6 months, 12 months, 5 years, 10 years, that's great. But if you have got a system that can pay out quicker, that's the benchmark. But if

21:45

you have got a system that can pay out quicker, that's the benchmark, you

21:49

know, and we've heard we said last week, and not all, it's we've heard this

21:52

week, if it depends on when you listen to us. When you listen to us in the future, on the previous episode, we commented

21:57

on, like, we've just been through quite a revolutionary shift in our own trading,

22:01

you know, because with new products that come in the

22:05

financial markets, new ways of trading that were just never

22:08

previously available 5 years ago in the way that they are

22:12

today. You know, 6 months ago, I made a radical change. Sean's done a

22:16

similar radical change to shift from,

22:20

essentially swing trading over 30, 60, 90 days, which we still

22:24

do, but the allocation is switched from that's the primary

22:27

vehicle. Now it's daily and weekly SPX,

22:31

income options. That's now the primary driver. It took several months to kind of

22:35

unwind all my other positions and reallocate. But it's just

22:39

literally flipped everything on its heads. You know? And instead of

22:42

waiting 30, 60, 90 days for a possible payout

22:46

on 30, 40 positions and trying to juggle and manage

22:49

that, to be fair, by comparison headache, I can now do 2 or

22:53

3 positions every other day or

22:57

every week, you know, and by comparison make the same type of

23:01

results in a very short space of time, you know, 3 to 5 days

23:04

versus 3 to 5 months. You know, it's a very different situation.

23:08

And the the effort involved is significantly less.

23:12

So, of course, I'm going to make the shifts because the lens that myself and

23:15

Sean are always filtering through is, is it going to be more of a headache

23:19

or less of a headache? Is it more time or less time? And that really

23:22

is the first kind of filter that we do. Is this gonna suck all of

23:26

my time? Okay. Well, the returns might be like you said, I might be making

23:30

10% a year passively, or I'm making

23:33

10% a year doing 60 hours a week. You know,

23:37

which which is which is better for you? You know? Well, hey. Well,

23:41

you know, if you if you're a workaholic and you like, you know, being involved

23:45

elbows deep all day every day in the thing that you're doing to get the

23:48

return that you want, Great. Go for it. I'm not saying don't do it,

23:52

but it's not for me. You know, and that's what we're trying to figure out

23:56

when it comes to diversification. We've got alternative investments,

23:59

cryptocurrency, real estate. We've got strategy diversification, data

24:03

trading, swing trading, long term investment approaches. You can dance the same

24:07

strategy up and down the time frames, which is usually what I like to do.

24:10

And then you've got geographical considerations, tax considerations, global

24:13

marketing. What do you wanna be involved within this

24:17

modern diversification, opportunities, I suppose, is probably a better way of describing it rather than

24:24

put a pin in any one individual thing. Yeah. Absolutely. I

24:28

mean, at the end of the day is where is your money

24:32

best served based on the outcome of McGuire, Sean. You missed it.

24:37

I know. I know. I'm just I'm just thinking because the impact here is

24:42

it it really comes down to, like you said at the very start, personal preference.

24:46

Where and, you know, I'm think it's funny. There's,

24:51

a And I think most new traders just to put the contrast in sorry, Sean.

24:54

Just to jump in. Just put that contrast in. Most new traders

24:58

go, what's making money? And great. You know, everything

25:02

works some other time, and they don't have that appreciation. But, well, what do you

25:05

wanna do? You know? And that just changing the priority

25:09

of the questions, is gonna have a radically

25:13

different outcome. No. It's very

25:17

true. And it's funny because the for

25:20

me, it's what do I wanna do with my time

25:24

and my money? And time and money are the

25:28

two elements that create wealth. You can have all the time in the world and

25:32

no money. That's not great. You can have

25:36

all the wealth and the money and no time. That's not great. But if you

25:39

have the 2 together, the time to do whatever you want and the

25:42

resources to do it, that's true wealth. And,

25:47

there's a gentleman who used to be a client of mine,

25:51

Pretty popular in the, I would say,

25:55

the woo woo space. Joe, I knew you were gonna talk about

25:58

this. I was thinking, is he gonna go woo woo? Yeah. Yeah. It's,

26:02

it's He's gonna say woo woo. 90 books. He's been on if you've read the

26:06

movie, the secret and everything else. I won't name drop because it's not cool. But

26:09

there's one thing that he talks about a lot, and it just popped in my

26:12

head. And I don't know if he was the original creator of this, but I'll

26:16

give Joe Vitale, you know, thread it where credit's due and he can pass

26:20

it along. But one of the things he talks about is

26:24

money loves speed. You know, is

26:28

how far do you wanna push? And there are always

26:32

the problem is a lot of people get stuck in the quicker,

26:37

you know, they they do the they they they want really, really fast

26:41

returns, so they'll take really, really big risks and get really, really

26:44

burnt in the ass. There's the really, really slow traditional

26:48

methods, which are a lot safer, but, again, slower rate of

26:52

return. Trying to find that balance of reality in the

26:56

middle and the strategies that work, strategies that don't,

26:59

again, that comes down to personal preference and flavors and all the other things that

27:03

we've talked about, plus your psychological, acumen, so to speak, your mental toughness, and what your risk

27:11

profiles are. And, you know, some of

27:14

that, you also need that helping hand and guidance

27:18

to show you how to do it without getting burned and stuff like that,

27:22

without getting your panties in a bunch every time something goes

27:26

right or wrong. And you know what? It's it's no one can

27:29

no one can tell you what's gonna be best for you. All you can do

27:33

is stick your toes in the water and see if the temperature's

27:36

okay. You know. And then, it's a little cold, but I can deal with

27:40

it. Now it's getting a little warmer and okay. Fine. So

27:44

for a lot of people is while money loves speed, I personally, you

27:47

know, what is the quickest but proven way

27:51

to get to a certain point? For me,

27:55

I'm not a patient person. I don't wanna wait. You know, the the

27:59

rule of 7, which is, you know, hey, if you get 10% return, you'll double

28:03

your money within 7 years add compounding and all that kind of bullshit.

28:08

I don't wanna wait that long. I wanna see, okay. Well, what is

28:12

within my higher risk tolerance able to

28:15

flow? How aggressive can I be?

28:19

If I lose that, do I have a Sounds like a new character on DuckTales

28:23

Shop. It does. Doesn't it? Yeah. Does

28:27

funny shit. I have been called

28:30

worse than Scrooge McDuck. Yes. But, there's a lot of

28:34

different things that you have to decide for yourself is what is

28:38

your outcome you want and what with the strategy

28:43

strategies you have available or that you know or you can apply

28:47

is gonna get there. And then what has to happen within that

28:50

framework to make that happen in a measurable,

28:54

progressable way that you can track, build

28:57

on, compound into, and

29:01

accelerate that. I mean, a good example, and it's a

29:04

mathematical example, is okay. Some people start their

29:08

trading and they have, like they they'll do a cash allocation. Say, I'll

29:12

just use simple numbers. $1,000, that's their starting

29:15

pot, and they're gonna trade that and grow it over time. But the

29:19

way to 10 x that is add in an

29:23

extra 1,000 every month just like you're adding into your own

29:26

retirement plan. Now the compounding effect of that

29:30

over 3 years, 5 years, 10 years is

29:34

insane. You get to, you know, if you were

29:38

just having a consistent 10% return, just to use simple mathematical numbers,

29:42

this is a mathematical example. And this is the principle of dollar

29:45

cost averaging that we were kind of bouncing around a little bit and actually say,

29:49

isn't it? Yeah. Yeah. Every month, you put in an allocation. You do the same

29:52

thing with your strategy. And if you've got something that works, you know, you can

29:55

book $100 in, $500 in, whatever your number is,

29:59

whether it be real estate investing strategy. But if you do

30:02

that, you've got the, you know, the double effect of

30:06

compounding, is it? It's a yeah. It's a force multiplier for compounding, and

30:09

you will get to whatever your number is 10 times faster. Most people

30:13

don't think about treating and I'm waving a pen like it's a magic freaking

30:17

Harry Potter wand here. But the at

30:20

the end of the day, people don't consider investing more into

30:24

their business to help accelerate the growth. They just wanna

30:28

do the initial allocation. That's it. You know? And

30:31

and I'm just like, it's a business. Invest in it. Treat it like and this

30:35

is this is one thing, you know, from a money management set. And I do

30:38

this in in businesses. I do this for personal finance as

30:42

well, is pay yourself first. Tax yourself.

30:46

You know? The government's quite happy to tax you. Tax yourself.

30:50

Don't think of it as a tax, though. Think of it as an investment. It's

30:53

an allocation to your future. Take 10% off the

30:56

top, put it over here, you know, find a way to, you know,

31:00

take 10% and and of your gross income

31:04

and put it over here. Cut back on a couple of things if you need

31:07

to. Make a couple of sacrifices because that will pay you so much

31:11

more dividends in the future that, you know There was a price of coffee at

31:15

the moment. You can brew it yourself. You know? Bloody

31:19

right. Since since the, the mock down

31:22

that we had, literally, the price of coffee

31:26

has almost doubled in the UK. Then you've also

31:30

got, I don't know if they have it in the US, but

31:34

we've just, again, jacked up the sugar tax. Now I don't

31:37

know about you, Sean, but on the rare occasions that I do buy a can

31:41

of Coke, all the products are available, I might ask. But on the rare

31:44

occasion that I do, it's like I want proper

31:48

Coke. I don't want the diet nonsense because it's

31:51

it it it it doesn't doesn't make sense. You're

31:55

it's still full of shit. You might

31:59

as well put the put the the proper shits in. That's all I'm saying.

32:03

But then you get chance for the privilege of it. So anyway, the put the

32:06

point is did you save a cup of coffee? You know, it it it it's

32:09

a silly little thing. Cup of coffee a day. What is it? 5 $5, $8

32:13

a a cup in the US. It's it's almost £4,

32:17

like shiny pennies in the UK. So that's about 6, $7.

32:22

In a you know, say say book instead of 2 cups of coffee a day

32:26

out, you know, but, you know, buy 1 and save 1. You

32:29

know, it it can be a simple little thing just to get the

32:33

ball rolling. And you'll think about those little

32:37

$5 here, $10 there. You know, one of the things I

32:40

like, Sean, is I I sign up for these, these money apps, and everything

32:44

I do goes on cards. I hate carrying cash. I always have them.

32:48

But you've got this save the change feature on

32:51

most banking apps now. So if it's, you know, 495,

32:56

it'll round it up and save the change. You know?

32:59

And you can be surprised at how how much

33:03

those those little $3, $4, 5 that, you know,

33:07

those 50 pennies here and a dollar there, you know, they

33:10

adds up quite dramatically. And then you can do

33:14

something with that. You know, just save that change. Start small,

33:18

and then you can kind of have that compounding effect for

33:22

maybe not necessarily the trading show, but maybe that can be the

33:26

start of the, the alternative investments, you know, the the other stuff

33:29

that you could do. Because there's a a a mountain of things that, you know,

33:33

to be fair, interests and fascinates me. And the criteria, as we've

33:37

always said, is is it worth my time? Is it worth my money? And

33:41

if the answer's no, then, obviously, it just goes in the idea pile

33:44

for me, Sean. Yeah. No. That's exactly right. I mean, I have stacks and

33:48

stacks of books. I I use Evernote as as my

33:52

second brain. And every time I have this great idea or a synoptic, I thought,

33:56

this is a great idea. And then, you know, after the excitement of

33:59

who's new, which we all have,

34:03

it's it's like, okay. Well, I've slept on it. You know, it's been a few

34:06

days later. Is it time, money? You know, what what's better. Okay.

34:10

Carry on doing what I'm doing because, okay, it's gonna take time to build them.

34:13

You know, maybe maybe I'll do something with it. I mean, to be fair, the

34:16

one thing that does interest me, Sean, just simply because it's not available anywhere else,

34:20

I keep coming back to tax liens and tax re the is it the liens

34:24

and certificates? I find that fascinating because

34:27

it's I and, you know, if you're familiar with this in the US,

34:31

forgive a complete noob in the UK who's just heard about it

34:35

because it doesn't exist anywhere else in the world. You can

34:38

lend money to someone temporarily and have it

34:42

government backed. That's that's seems rebel. Why

34:45

wouldn't you do that, Sean? And it's completely

34:49

passive is what I like about it. Yeah. There's all sorts of

34:52

different things that crack me up in terms of what you can,

34:56

what you can't do, what vehicles are available. And half of

35:00

it, you know, I kind of like, is this legit? Is

35:04

is there what what's the catch? Because, you know, I I I'm

35:08

a I'm like the world's greatest bloody skeptic in in a

35:11

lot of these because I've seen every level of bullshit, something with

35:15

financial instruments come through my desk. And you're just like,

35:19

this is just a Ponzi. It's a wrapped Ponzi with a new name, you know,

35:23

and stuff like that. And it's a case of,

35:26

alright. Okay. Is there a real thing here? Then I start, you know, I'll

35:30

start talking to some smarter friends. Because here's the thing.

35:34

I wanna surround myself with people who are far smarter than me in financial

35:38

instruments. I don't wanna be the smart if I'm in the smartest person in the

35:41

room in regards to that, I'm in the wrong fucking way. Room. Yeah.

35:45

Exactly. And so I wanna find out who knows more. I mean, this

35:48

is why I got into real estate was I started networking with millionaires and

35:52

billionaires who had a quite a large

35:56

real estate portfolio. And I'm looking at them. It's like,

36:00

what are you doing? Like, here. I've even dabbled with it

36:03

here. Okay. And I'd say dabble with the idea. I'm not dabbling

36:07

because for a a flying, you know, a foreigner here can't

36:10

own property, but companies can.

36:14

So create companies and look at that. But I'm looking at cash flow because

36:18

a lot of the American real estate methodologies

36:22

don't exist here in Thailand. So my

36:26

brain's going, what if

36:30

I look at what was going on in America, what I can do in America,

36:33

and the methodologies and that? How would they apply here if

36:37

no one's thinking about it or no one's doing it? First of

36:41

all, why? What's the opportunity? Is there an

36:44

opportunity? What kind of financial lending is available for

36:48

this kind of thing, and I started down that rabbit hole. 6

36:51

months later, it's not really possible here. That's why because

36:55

of financial market regulations, government controls, and all sorts of other

36:59

things, it makes it a lot more difficult than it is in America.

37:03

Okay. But now I am aware of what the situation is. And

37:07

if that situation changes, then guess what? Sean's already got a

37:11

battle plan to gobble up massive amounts of,

37:15

you know, small real estate here. Single family

37:19

homes. You'll draw your swords and shout at the top of your voice by the

37:22

power of Grayskull and charge head first into the opportunity.

37:27

Yeah. It's it's it's not He Man. It's Batman. But, yeah, there you

37:31

go. I've got the kittens instead of battle cat. It's not gonna work out

37:35

very well. But, you a full kitten. Yeah. But funny

37:38

enough If you you're in just selling, though. The funny thing is

37:42

here, just as a just as a kind of sidebar, is what's

37:46

called house shops. They're 4 story,

37:50

single column. They've got a shop in the bottom and then 4

37:54

stories of, homes available. But

37:57

you you buy the house, cost a lot of money

38:01

because land here in Bangkok is fucking expensive. It's about 4

38:05

times. And center of Bangkok, it's, like, a 100

38:08

times like in Texas where I was.

38:12

But that land, the cruise doesn't tend

38:15

to go down, but you but you lease the shop, you lease the

38:20

houses, and continuous cash flow. And it's just

38:24

continuous cash flow and equity forever. And you you can you

38:28

don't have, like, 1031, lien exchanges with, you know, tax

38:31

exchanges where you don't get taxed on that. You move it into other properties. You

38:35

don't have that per se here, but you can get really good

38:39

financing opportunities, and the banks don't like

38:42

foreclosing. They will work with you on different payment terms.

38:46

Very lax here in that regard. So I was thinking, okay. Where's the

38:50

opportunity? There's an opportunity, but now

38:54

where's the headaches? Where's the hassles? And it comes down to regulation and

38:57

some of the stuff. Yeah. Speak up. Speak. Yes. So, yeah, I mean, there

39:01

there's a lot of different things that when you start looking into learning,

39:05

I use it as my spare time analysis of which I've got

39:09

plenty. Is, you know, is is okay. What else

39:12

is an opportunity, and what's the rate of return? And, funnily enough, I

39:16

end up coming back to the stock market and just saying, yeah. I'll just I'll

39:19

just change my allocation or I'll just add more to the portfolio here because

39:23

it ends up being a lot less hassle. But it's

39:27

it's interesting rabbit holes that we dive down. And we've gone completely off the

39:30

bloody script and the plan for the show. I hadn't noticed, and I

39:34

I thought we're completely on track, with our

39:39

But I think it's a good point to kind of I don't think it's a

39:41

bucket. Okay. I think it's good to explore. Looking back at the show notes, is

39:44

there anything you wanna pull from that that we haven't covered?

39:48

Yeah. I I I think just generally speaking, it

39:52

it's sometimes more than trading.

39:56

As we've said several times in the last few, editions of

40:00

this short miniseries, it's sometimes that the

40:04

the decisions that we make are not necessarily trading related

40:07

directly. You know? A lot of things are,

40:11

you know, personal preferences. They're gonna be situation. They're gonna be geography that

40:15

you know, there's a whole variety of things that influence it. So we can

40:19

still all be doing the same thing, but it's going to be approached in

40:23

a different way at these higher levels, the decisions that we make. Again, we always

40:26

filter through time. And, you know, is it going to be a time so

40:30

called not? You know, that is the first priority for everything that we do and

40:33

the decisions that we make. So diversification, Sean, you

40:37

know, it it's there's a lot of stuff out there. Do you wanna do

40:41

it? Do you have to do it? Do you need to do it? What are

40:44

the time horizons to consider? And then then you

40:48

can explore what might be the right thing for you. And again,

40:52

in the US, we've already established. There's lots of opportunities in the US compared

40:56

to just Europe. And then there's there's there's equally other

40:59

opportunities that are not available elsewhere depending on where you're in the world. So

41:03

do you wanna be, you know, allocate time to it,

41:07

or do you wanna allocate resources to it? A little bit of both. And then

41:10

you can turn those dials, as we like to say. You can kind of speed

41:13

things up, slow things down. That's gonna flavor to swipe

41:17

Sean's thing, which I quite like it, Moe. That's your flavor of ice cream, baby.

41:21

That's a bloody word, mate. So alright. Diversification. It doesn't

41:25

matter what you're doing, recognizing where you are,

41:29

what your needs are, what your requirements are

41:32

for risk diversification, money diversification,

41:37

you know, geographical diversification, time diversification,

41:41

what you're looking at in terms of where you are in the world environmentally,

41:46

governmentally, regulatory, you know, technology

41:50

available, behavioral, situations. There's

41:53

so many different ways to diversify not only your

41:57

portfolio, but also your risk and your brain as well.

42:01

One thing, I'll just put, you know, before we wrap up and

42:05

and a last thought that popped in my head is I like

42:09

diversification to keep my interest.

42:12

Because trading is boring as shit. It really should be. I mean, we

42:16

try and put a laugh and a spin on it, but training trading

42:20

should be boring. It shouldn't be an excitement driven,

42:24

avid because that leads to bad psychology as far as I'm concerned.

42:28

It should be boring. It should be functional. It should be a production line process.

42:31

You know, effort in, money in, profit out, and

42:35

that's it. It shouldn't be anything more than that. But because it

42:39

does get boring, I also like to just be aware

42:43

of different areas of finance and opportunity just to have my

42:47

finger in the pie, so to speak, and see what is out there,

42:51

from just a an educational standpoint as well.

42:55

So for me, there's all sorts of different reasons to diversify,

42:59

but as Phil reminded me,

43:02

depends on what flavor of ice cream you like. So go stick

43:06

a, what's it, a flake 99 on the top, little bit of

43:10

sprinkles, little bit of cherry syrup, and enjoy.

43:13

Don't get to hold the nuts. Yeah. There you go. Absolutely.

43:17

Absolutely. So with that being said, rock and roll, see you same bat

43:20

time, same bat channel next week. And, Phil, as always

43:24

See you same time next time myself, but, Tulu Trader, bye for now. There

43:28

you go. Adios, amigos. For more cutting edge trading advice and a free trader workshop to help you

43:36

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