February 16, 2025 • 49 mins
Suze sits down with special guest, Keith Fitz-Gerald to answer more of your questions about Value Cost Averaging, when the “right” time to invest is and so much more!
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Suze (00:28):
February 16, 2025. Welcome everybody to the Women and Money podcast,
as well as everybody smart enough to listen. I hope
you had a good Valentine's Day. Did you?
I did, but we'll have to wait until Thursday when Ms.
Travis can tell you all about it. But for now,
(00:51):
I think you all should get out your little Suze notebooks,
and today's Suze School is going to be very, very different.
Because today Suze School, we're gonna have a guest. It's
not gonna be just me. I'm gonna pretend like I'm
KT and I'm going to be asking the true expert
(01:11):
when it comes to certain things about value cost averaging
dollar cost averaging, and oh, all kinds of other things
that you wrote in and asked about before I introduce
the most extraordinary and amazing.
You have to wait till I say his name, but anyway,
(01:32):
last Sunday I did an episode on value cost averaging.
On the Women and Money Community app, I put up
an example of how it works. Boom, there goes my
email and I'm in the Women and Money community app,
and you had question after question and I'll be honest
(01:53):
with you,
I'm not good enough at that because it isn't my concept. Remember,
I was taught it by somebody, our guest, and I decided,
you know what, all of you always deserve the best.
You deserve the most knowledgeable in certain areas, in fact,
(02:15):
in all areas and in this particular area that we're
about to talk about today, which isn't just about value
cost averaging, but it's about the markets overall, it's about
individual stocks. It's how to make your money, make more
money when it comes to investing.
(02:35):
There's, in my opinion, the one and only Keith Fitz-Gerald,
and he is with us right now. Good morning, boyfriend.
Keith (02:47):
Well, hello there. Thank you so much for having me.
I've been looking forward to this all week and thanks
to everybody listening for spending a few minutes of your
time with us today. This could be great.
Suze (02:56):
This is great and you know so many people, Keith
wrote in and they said, we wish this could be
on video. We want to see both
of you and then they would write in and they said,
Why don't the two of you always do a podcast together?
Oh my goodness. All right, so maybe we'll have to
do that.
Keith (03:15):
Let's think about it. That would be so much fun,
wouldn't it? All right.
Suze (03:18):
So everybody, if you don't know about value cost averaging,
then you need to go back to last Sunday's podcast
and listen to it. You just do. But so many
of you have already listened to that podcast.
Therefore, I'm gonna ask you, Keith, some of the questions
(03:38):
that were on the wall and people wrote in. They
want to know about it, but then we're gonna switch
because people are also writing in and going, Keith, I
bought Palantir at 20. Should I buy it more now?
I mean, we have questions all over, but then I
also want to give you a little time
(03:59):
for you to tell everybody what you want to tell them,
they're also asking about is a program going to come out?
Is it not gonna come out? So let's answer all
their questions today. Outstanding. And let's hopefully make them happy.
Now I'm going to start off easy here for you. OK.
(04:19):
All right. The first question, which I find fascinating is
kind of generic.
Doesn't everything depend on the day that you invest your
money and where the stock is on that particular day?
Keith (04:34):
That is a very interesting question with a very simple answer,
and it's no. And here's why the actual day you
buy or the time of day you buy or the
method by which you buy doesn't matter. The key with
something like value cost averaging or even dollar cost averaging
is to do it consistently. So if you look at
(04:56):
the data, and this is what we do for a living,
and we look at all this data, if you look
at all the data for hundreds of years.
If you're consistent, you are getting around market timing risk.
You are harnessing volatility that others fear, so it doesn't
matter whether you pick your birthday, whether you do it
on Christmas, whether you pick another holiday, whether you do
it even every Monday morning as long as you do
(05:18):
it
consistently.
Suze (05:19):
Great, there's one next.
Looking forward to hearing from both of you together. Yeah, baby,
here we are together. I know. Is there a more
and you kind of just answered this, but I'm gonna
keep drilling this in because I'm telling you people blew
their minds with the details and really the minutia and
(05:42):
it's really a little bit ridiculous. I have to tell you.
Because they think you have to stick to a certain formula.
You can't, it's like they've put themselves into this little
box that they're afraid to come out of now. So ready,
looking forward to hearing from both of you together. I
don't blame you. Is there a more ideal time of
day to invest the market open?
(06:06):
The close and for VCA does it matter what time
of month? Also, what about dividing funds for weekly or
biweekly or stick to monthly? See how what they've done here?
Oh sure, sure. So it's like they're thinking that.
Everything has to be a certain way. Like when I
gave the example last Sunday of $12,000 and $1000 a month,
(06:30):
they literally took it that they needed $12,000 and they
had to put in $1000 a month. So first of all, everybody,
that was just an example last week.
It's just an example. So you could do it with
any amount, but that's the question. What's your answer?
Keith (06:48):
Well, there's two elements at work here, right? And they're
both counterintuitive, and, and there's also some fun to this
because like anything in the stock market, there's there's always
rhyme or reason or some history. So when I started
my career 45 years ago, I mean, I've been doing
this for a long, long time.
There used to be very definitely a time of day
where you could swoop in and and have an advantage.
(07:09):
And funny enough, that was roughly 10:35 in the morning
and roughly 2:38 in the afternoon. And the reason why
had nothing to do with the stock exchange.
In the morning, the donut truck would show up and
everybody run off the floor to go get donuts. In
the afternoon, the hot dog truck would show up and
everybody run off the floor to get hot dogs. So
if you were trading or you're looking for just a
little bit of an edge, you knew that there was
(07:30):
going to be a lull in activity and frequently you
could get a better price either buying or selling. So,
you know, that used to be true, but now what's
happened is we have this tremendous shift to computerization.
And so most if you go to the New York
Stock Exchange today, it's a very quiet place and people
are walking around with iPads and there's very little open
pit trading left in Chicago anymore. In fact, you go
(07:52):
to the Hong Kong Exchange, which is one of the
busiest in the world, and it's dead silent. So this
idea that is there a better time to buy or
a worse time to buy really is moot now because
the computers have eliminated all of that. But if you
really want to try.
What we're seeing lately is that the first 30 minutes
and the last 30 minutes are interesting because there's additional
(08:14):
volatility and interesting can be good or bad. It just
depends on how you approach it. So, so I would
get that out of your head. The big key is
consistency number one. The other thing is you're falling if
you're thinking that way, there's nothing wrong with that. That's natural, right?
A lot of people do that, but you're falling right
into Wall Street's trap, OK? Wall Street wants you
(08:37):
to think in smaller and smaller and smaller and smaller
details because that's how you're easier to separate from your money.
If you're constantly off balance, if you're focused on the minutiae,
you're gonna get squeezed every time. The counterintuitive thing to
do is to take a deep breath, take a step
back and understand that investing as much as they want
(08:59):
you to think it's a game of precision.
Is a game of being close enough. You find great stocks,
you invest in them consistently, you hold for as long
as you can, you leave your money alone for as
long as you can. That really is the key in
today's markets. It's counterintuitive, so it's, I would encourage everybody listening. A,
that's normal what you're feeling, but B, take a deep breath,
(09:22):
step back, that's the real key to success.
Suze (09:25):
And the thing is, is that, does it matter if
it's weekly, biweekly, or should they stick to monthly?
Keith (09:32):
OK, that's another wrinkle. Now that's really my encouragement is
once a month is probably just fine for most investors.
And and the reason is that if you start going
down into weekly or biweekly, suddenly you're getting into market timing,
you're getting into, you know, the world of very sophisticated
traders who are out to separate you from your money
(09:54):
and you don't want to play that game. The way
to beat Wall Street is not to engage in fights
you can't win and not to pick battles that they
have an interest in fighting.
And so again, counterintuitively, if you're investing consistently and you're
doing it once a month, you are far more likely
to make money over time than you are to lose it.
You are also far more likely to harness the volatility
(10:16):
they want you to fear.
And finally, you are far more likely to sleep better
at night, and I like that
part.
Suze (10:24):
Yeah, but you see what I mean, how they're like
getting into the how often whatever this next one is
kind of about the what ifs. Do you have to
then assign how much money you're allocating to each share
in your portfolio at the beginning of the year?
So people are confused about, well, I gave an example.
(10:46):
You have $12,000 to invest, and again they freaked out.
So the question is, here we are, maybe it's March,
maybe it's April. How do you start doing this and
how do you know how much to allocate to do
this with?
Keith (11:03):
Well, again, this is like cooking a great recipe, right?
You wanna know what ingredients you need before you get
started because the last thing you want to do is
if you're making great cookies, find out you're short of
flour or maybe you're missing the chocolate chips you were
counting on or something like that, right? My suggestion again is,
is you want to think in as long a time
frame as possible, 12 months a year, most of us
(11:23):
can handle. Most of us can say, oh, you know, where,
where am I gonna be 12 months from now? We
actually call this the painted picture.
And what we do is we test it out at
the beginning of the year and we paint a picture.
Where do I want to be in the year? What
does my cash flow look like? What, what reasonably am
I gonna have to invest? And that depends on your job,
that depends on your family support. Do you have an
emergency fund built up, all the things you constantly encourage
your listeners to listen to and focus on and do.
(11:46):
And once you got those decisions out of the way,
it's simply, OK, how much can I realistically invest per month?
What do I want my account to grow?
And all you gotta be is close enough. You don't
have to be to the penny and, and if your
circumstances change during the year, then guess what? You can
change your thinking too. The math still works. So you know, I,
I liken this to holding my thumb up and looking
(12:08):
at the horizon and if I can see the horizon
around my thumb.
That's about right.
Suze (12:12):
So it's not like you have to have a specific
amount of money like $12,000 that you divide by 12,
so you have to invest $1000 a month, whether it's
dollar cost averaging or value cost averaging.
You can change as time goes on, correct?
Keith (12:32):
Absolutely, and that's a vitally important concept to think about and,
you know, I, I, I talk like you to tens
of thousands of investors a year around the world, and
one of the mistakes that everybody makes is they box
themselves in.
And in today's world, you can't do that. Today's world
is constantly fluid, it's very dynamic. We live at one
of the most exciting times in human history, which means
that being flexible is exactly what you want to do
(12:57):
because if you're being rigid and uncertain.
And if you're being living in fear as opposed to
investing in optimism, you've already doomed yourself to to bad performance.
What you want is to build your wealth and your
confidence and your knowledge as the markets do that.
Suze (13:12):
Where everybody seems to be confused because of the example
that I gave.
Keith (13:19):
Welcome
to my world,
Suze (13:20):
right? Which
is with value cost averaging you look at the value
that you intended to have as you know, every single
month and you invest according to that depending on the
stock price. Again, for those of you who don't know
what I'm talking about, listen to last Sunday's podcast or
look at the example on the Women and Money community app.
(13:43):
So this now.
Is using that example of $1000 a month, $12,000 at
the end of the year for your target value. Here
is the question.
I'm getting a little confused around month 6 because everybody
obviously in month 6, your target value at $1000 a
(14:05):
month would be $6000 for that month. All right.
I thought the target portfolio amount for month 6 would
be $6000 which I think is the actual portfolio value.
If the stock is at $120 a share, which we
said it had gone back up to.
Then that means that it's already at $6000 and we
(14:30):
don't need to add any more money for that month.
So what do we do?
Keith (14:37):
OK, so let's take the the model and the example
out of the equation for it. Let's imagine we're going
to the grocery store, and let's imagine we've got lately
$100 for eggs, but I mean, you know, let's let's
just imagine we've got $20 and we want to buy
some eggs, right?
If we see the price of eggs go on sale
and we know we're gonna need them, it's very likely
(14:58):
you're gonna buy something that's on sale, right? You're gonna
take that extra amount of money and you're gonna buy
a few extra eggs because odds are good that the
price of those eggs is gonna go higher next week.
That is value cost averaging in a nutshell. If you
have a sale in front of you, you spend a
little bit extra money to buy whatever stock it is
you want to get your hands on. If the price
of eggs goes higher and you've already got your eggs
(15:18):
on the shelf, guess what? You don't need to buy them.
The value of your eggs is already there. You've got
them on your shelf, they're already in your pantry. Value
cost averaging with stocks is the same way. If you
have a sale, if the markets come down on you,
if the price of that stock drops.
What you want to do is think about your target
in terms of, OK, my portfolio is worth $100 next
(15:40):
month I want it worth $110 so I'm gonna add
a little extra money to bring the value of my
portfolio to 110 regardless of what the stock has done.
So you buy a few extra shares and the advantage
to doing that, Suze, is that you buy low, you
sell high over time.
That dramatically accelerates your profit potential, particularly if you're working
(16:01):
with dividend stocks and you're leaving your money alone for
a long time. You will come roaring out of the
basement and turn around 4 or 5 years from now
and go, wow, I had no idea because suddenly you've
bought lower and sold higher.
Suze (16:16):
The main difference that I think I have right, you'll
have to tell me, but that most people aren't quite
grasping is that dollar cost averaging was very simple for them.
They picked a specific amount of money and they pushed
automatic and every month that amount of money was taken
(16:36):
out of their money market accounts to buy stock. What
they're missing, however, is with value cost averaging, even though
in both cases as the stock goes down you're buying more.
And obviously as the stock goes up, you're buying less,
(16:56):
but with value cost averaging, you're getting a little bit more.
Than with dollar cost averaging because you're not sticking to
the same dollar amount every month.
Keith (17:08):
Bingo.
Suze (17:09):
Say that again.
Keith (17:10):
Bingo.
Suze (17:11):
Say it again...
Keith (17:12):
Bingo bingo bingo bingo bingo bingo bingo bingo bingo.
Suze (17:15):
And that's what they're missing. You want to get more
value for your money, everybody. You don't want to go
on automatic and just oh,
I'm going to invest $1000 a month or $100 a month.
When if you just invested $120 a month, you would
be getting a few more, even if it's a half
(17:38):
a fraction of a share more, that half a fraction
of a share more will make you a whole lot
more money in the long run, and that is what
they are missing.
Right, so again, just to repeat like another question, maybe
I missed something. What if month 4, the value is
at $4000 and you don't buy any more shares. So
(18:01):
in fact you might not actually invest the whole $12,000
in one year because the account value has increased. They forget,
well, you tell them what they forget, what they could
do with that money.
Keith (18:14):
Well, you forget two things, right, because if you've got
a stockpile of cash and it's sitting on your pantry
shelf and the eggs go on sale, number one, you've
got the flexibility to go ahead and buy them if
you want, but number two, if you're used to dollar
cost averaging and you're disciplined and you already got that
under control, here's where this gets really cool and really interesting.
(18:37):
Because if you're used to putting in $500 a month
and you're already mentally disciplined, you're paying yourself, you're doing
all the things Suze encourages you to do constantly, then
go ahead and do it anyway. But put it in
a short term Treasury fund. Now all of a sudden
you're earning 4%, 3%, 5%. Your cash is stockpiled. It's
not sitting there. You're not tempted to spend it because
you've already paid yourself, you've already invested.
(18:58):
And then when you get the chance and the market
will inevitably hand you several chances during the year to
do
this.
Suze (19:06):
Or you could take that extra money that you're not
investing in stock A and possibly start to do the
same thing with stock B or another ETF. So there's
you don't have to just stick with one stock and
just go, oh, now what do I do? Do you?
Are you starting to get this, everybody?
(19:28):
You've put yourself into a box, and the last thing
both Keith and I want you to do when it
comes to investing is limit yourself. Investing is about expansion.
The investing is about understanding your own emotions and really
keeping them at bay and thinking, oh, I've done something wrong,
(19:49):
I da da da, no.
Just keep listening and you'll get it. Last one on this,
which is maybe I'm not completely understanding it, but it
seems that in this example.
Why did I give this example anyway of having $12,000
to invest that if the stock price is decreasing for
(20:13):
several months or there is a steep drop, would you
deplete your $12,000 before month 12?
Keith (20:24):
OK, that is A, a very smart question, B, a
very logical question, and C, I love it because it
means you're thinking ahead. You're really beginning to understand how
this works. The markets go through protracted downturns.
But here's the thing, and this is where you've got
to really again I've been doing this a long time.
(20:44):
One of the hardest lessons for me to learn as
I came up through the ranks is you've got to
learn to trust the numbers. You've got to learn to
trust human psychology and let me give you a data
point that will really drive this home is the markets
since 1871 have a very defined upward bias. If you
look at other markets for even far more ancient periods
(21:05):
in history, they all have an upside bias.
But our stock markets today since 1871, have spent 83%
to 85% of the time at or within 10% of
new all-time highs.
Meaning that there are a lot more bulls than bears
over time and if you buy the right companies, if
you're DCA or VCA into the right companies, you are
(21:27):
automatically putting the odds in your favor. That's roughly if
we look at it again since 1871, there's 1300 new highs.
That's roughly one new all-time high a month for a
long period of time, so...
The idea that you're playing not to lose is where
everybody's mindset is.
(21:48):
But where your mindset should be is playing to win.
And and that's a very different mental calculus. And again,
if you're thinking I'm playing not to lose, there's nothing
wrong with that, that worked for a long time, diversification
worked for a long time, but you're falling into Wall
Street's trap.
What you want to think about is flipping that around,
playing to win, playing to get those great companies, playing
(22:12):
to build your wealth. This is not a competition, it's
about what you want to achieve with your life and
your world and your money.
Because if you work hard for your money, there's gonna
come a day where your money works hard for you
and that's what VCA is all about. It's, it's like taking,
you know, buying holds good DCA is better, but VCA
really now you're cooking with some hot sauce. It gives
(22:32):
you the opportunity for bigger returns, less risk, and discipline.
Suze (22:37):
So to answer his question though, the chances of him
being told
Keith (22:42):
I forgot about that part.
I got so excited. I forgot about that part. I mean,
I love what I do. Yes, to answer your question,
that is absolutely possible in a protracted downturn. However, we've
done a lot of research in this area.
That's not a bad thing either, because what it means
is you have now invested deeply, you've invested at a
(23:05):
substantial discount and you've built up a substantial reserve for
when the markets come roaring back, and they
will.
Suze (23:12):
Because remember everybody, these markets aren't going to tank overnight
50 or 100%, and if you keep being diligent, you're investing,
you're investing, and you're investing, and now you're out of
your $12,000 it's all spent, but you haven't lost the money,
it's invested in a stock that you wanted to buy.
(23:34):
That was a good quality stock, and the reason that
it went down isn't cause the stock itself was bad.
It's that all the boats were sinking cause the water
went down when it turns around and a great example
of this was 2009.
You know, when the Standard and Poor's 500 index, I think,
was at 600, and all these stocks were at nothing.
(23:57):
They had all gone down incredibly and if you just
kept them and now you have a whole lot of
shares because they got so cheap as you were buying them,
oh my God, you made a fortune over the next years,
so you're not out of money.
You've invested all the money that you designated towards that stock,
and once that amount of money is designated, you bought
(24:20):
all the shares you can with it.
Keith (24:23):
Good.
Suze (24:23):
Now you just told
them.
Keith (24:25):
And, and the really cool thing about that, right, and again,
you know, learning this as a professional trader is a
professional investor.
That's a great problem to have because of the dramatically
increased profit potential when the markets come roaring back. So it's,
it's maybe you think, oh this is, this is a
bad amount of cash. I can't buy more. That's the
real problem is you can't buy more, but you've already
(24:45):
locked in your future returns. So I mean how cool
a trade-off is that? And, and you know again it's,
it's counterintuitive.
It doesn't make a lot of sense at first, but
when you really think about buying at a discount and
you think about buying these great companies, I mean this
is like buying Apple at $10 a year or being
able to buy Palantir at 6 when it dropped. I
mean think about that, right? I did. Exactly, me too.
(25:08):
I mean, I bought more, you know, I mean people,
people are like, oh my God, but it could go down. Yes,
it could, but when it comes roaring back, imagine how
much bigger your profit potential has become.
That's how a winner thinks. So we get rid of
that fear. I mean, that's normal, that's, you know, you're
not abnormal if you're feeling that, but do make an
(25:28):
effort to take those emotions out of the equation because
you are listening to Suze, you are playing to win.
Suze (25:35):
And they're also, if they're smart, they're listening to you.
Keith (25:39):
You're
Suze (25:40):
very
Keith (25:40):
kind.
Suze (25:41):
So one last about this, then we'll quickly go to
Palantir and other things, but
all these people did this Monte Carlos. They, I mean,
some of these people went to the 10th degree to
figure out what's better, dollar cost averaging or value cost averaging,
and they want to know as if it makes really
(26:03):
a tremendous difference. So just briefly, can you answer that
for these
people?
Keith (26:09):
Absolutely. So I was king of the nerd herd growing up.
I had my propeller beanie and everything.
And you know my background is in nonlinear data science,
so this is a question that we have spent tens
of thousands of hours of computing time on. Uh, yes,
we've run those same Monte Carlo simulations we have run
all of the randommizers you can think we've done walk
forward testing we've run back testing we've done testing on
(26:32):
the testing.
And what we have learned is that there is absolutely
no question that value cost average is the best way
to go. Where it breaks down is when people start
trying to second guess it. Oh, I've got to do
it on this date. I've got to do it on
this time. I've got to, I'm gonna be out of cash.
Oh my gosh, it's falling too long. Those are questions
(26:52):
that are put on by human limitations, not quantitative limitations
as part of the modeling.
And so we've run it with small data sets, we've
run it with millions and billions of data points in
in the sets in every single time under a wide
range of conditions, both hypothetical and real.
VCA wins.
Suze (27:10):
Yeah, so for those of you who wrote into me,
and I appreciate it, and you present like I ran
this Monte Carlo, which is, it's uh it's a program
that I don't know. I've yet to really think that
it comes out with the best answers for all of you,
but that's besides the point.
Keith (27:28):
Well, let me, let me, let me, let me spoke about
that there is, there's an interesting thing, right? So the
Monte Carlo simulation is a quantitative exercise that supposedly introduces randomizing,
you know, variables to the test set and
there's a huge proposition in the market that Burton Michael
wrote this thing, a random walk down Wall Street and
the markets are random, nobody can predict it. Well, I believe,
you know, people who are a lot smarter than I am,
(27:50):
believe that's not true.
The markets are not random. There are very predictable elements
to them, and that is exactly why VCA works in
today's markets is because what we're doing is we're not
working on the random price nature of the markets. We're
not working on the random stocks. We're very deliberate about
which stocks are we picking, how are we using it,
what are the tactics we're picking.
(28:11):
So we're automatically stacking the odds in our favor to
nth degree. I mean, now, obviously, you know, the world
could be a very quiet place for a few 1000
years if things get out of control geopolitically, but the
markets are not going to be our worry if that happens, right?
So take that out. It's more important to reinvest as
if the sun's coming up tomorrow. And what we know
from the Monte Carlo simulations and all the other simulations
we do is if VCA wins.
Suze (28:34):
But you know it's so funny.
These people right and they're so proud at the research
and the things that they've done. I just want to
say something to all of you. I'm thrilled that you're
doing that.
And you come up with your own conclusion based on
maybe one study or whatever. I'm asking you all now
(28:54):
to listen to Keith. For 40 years he has been
doing this. When he says he's a propeller head and
a nerd. Oh, he is. Half the time he's talking
about things and I'm like, What the hell did you
just say? But you can run your own if you want.
Or you could take 40 years of experience and millions
(29:18):
of dollars of research.
Computerization that none of you have the ability to do
truthfully and listen to what he just said. He has
nothing to gain other than to help you help yourself.
We're switching now. We'll run this podcast a little bit
longer than normal because we have the master here and
(29:40):
I just want to answer the main things you want
to know, which is ready for this drum roll.
Keith (29:48):
(Keith makes a drum roll sound)
Suze (29:48):
There we go. Is it too late to buy Palantir?
Keith (29:54):
No
way.
Suze (29:57):
I thought you were gonna say no way, but anyway,
if he were just talking to me alone, everybody, he
would have used the word. But since we're on a podcast,
he's trying to show you he's a dignified man, which
he is. You're very good. Anyway, go on, go on.
Keith (30:14):
So, so here's, here's how you break it down, right? And, and,
and again, there are a couple different elements that intersect here,
which is why people are asking this question, right?
Number one, oh my God, is it too late? Well,
think about that. If it's a great party and you
know it's gonna go on for a long time, are
you too late to get there at 8 o'clock as
opposed to 7 o'clock? No way. You're gonna walk through
the door and have a great time, right? Now you're
(30:36):
gonna have to look a little harder because maybe the
room's gonna be a little crowded before you get to
the bar, the cocktail tray or the hors d'oeuvres, whatever.
Same situation here Palantir is still a phenomenal stock. It
is still.
Early days we are still ahead of one of the
greatest single trends in recorded human history and that's how
we use AI and big data. There is nobody else
(30:58):
who does what they do. The numbers are all going
in the right direction. The CEO is unapologetically in support
of his shareholders. He could give a, you know what
about Wall Street, which is really attractive from an investing standpoint,
but then at the bottom line.
The way you control this is to use a tactic
(31:19):
like VCA because behind the scenes professional traders have, believe
it or not, they have largely missed the boat. They
couldn't check their boxes they couldn't see Palantir in their spreadsheets.
I can't tell you how many thousands of traders, professionals
I've heard from, seen, watched, who missed this boat. So
now they know they've missed it.
(31:41):
So their goal is going to be to introduce volatility,
scare you out of your shares at a lower price
so they can buy it and use VCA or some
variant of it that we've been talking about so that
they can get their hands on the run higher. I
think we're looking at $200 a share. I was a
lone wolf in the woods when I said that initially.
I mean, we took out every price target 50, 70, 80, 100.
(32:05):
I think we're $200 within 36 months, probably quite a
bit sooner than that.
Suze (32:10):
So another question is how do I know if I'm
investing too much in Palantir? I don't know. I think
you can't invest enough in it, but that's just my opinion.
Go on.
Keith (32:21):
Well, that is a very simple answer too, believe it
or not, again, it has nothing to do with numbers.
Are you sleeping at night? I mean, are you worried
about it because if you're asking that question, my answer
would be, and having worked with thousands of investors around
the world for decades, is if you're asking that question
or you're losing sleep at night, you've got too much
risk on the table. So dial it back.
Suze (32:41):
The next one is that if Palantir has doubled on you,
and the truth is many of these people bought it
at 20.
Keith (32:49):
How cool is
that?
Suze (32:50):
Right? And now here we are almost 100 points higher,
and now they're afraid.
So should they be selling? Should they, they're just freaks.
Should they do free trades? Any advice to them?
Keith (33:06):
Well, I just wrote about this the other day to
our clients, uh, you know, professional and otherwise, and said, OK,
there's something you want a professional has a big gain
on the table like that, uh, there's something called selling
into strength.
And you want to sell because you have the opportunity
and you can, not because you must. And the reason
most investors feel the fear that that people are voicing
(33:27):
is because they're holding on too tight.
They can't let the stock fly like they want it
to because they're worried about it, they're scared about it.
They're they've let their emotions cloud their judgment.
So here's my answer, and it's twofold. Um, number one,
if you want to take a little bit of money
off the table and get to the point where you're
sleeping at night and you're not worried about it, I
(33:47):
would submit that's probably a pretty smart thing to do.
On the other hand, if you don't need your money
for 5 or 10 years and you can stomach the
volatility and you make peace with the headlines, and you
understand what I'm telling you about Wall Street wanting to
take your money.
Then you know what? You just hold your nose, let
it ride, put a big smile on your face, Cheshire
grin like I have, and you let it run because
(34:10):
stocks like this are gonna run again. I've, I've done
this a long time. I've learned every lesson I talk
about the hard way, right? And, and if you hold
on too tight, guess what? Sooner or later you're gonna
fall off the rope. If you hold on too loose,
maybe you can't grab the rope. So, so it's not
a competition, it's what's right for you out there, everybody listening.
Get comfortable with it. Get mentally comfortable with it. If
(34:30):
you're not, then sell a little bit. Get to the
point where you are and use tactics like DCA and
VCA to start re accumulating positions because that's how you
control risk and maximize profit potential.
Suze (34:42):
However, one of your OBAers, One Bar Ahead, which is
a service that Keith has, that all of you are
more than welcome if you want serious education, everything to join. However,
wrote me and said, Suze, since he's going to be on.
He wrote and said, if you have it, you might
want to sell 25% and actually maybe even do a
(35:07):
strategy in case it goes down. Is he expecting it
to go down?
Keith (35:12):
No, that's not quite a correct assessment. It was 10%
of the value, uh, but then on top of that, no,
I'm not expecting it to go down at all. That
had nothing to do with expecting it to go down
that had everything to do with reducing risk, which is
inherent in the DCA tactic, you know, it's like going
to Vegas gambling theory and investing theory is very similar
in this regard. The longer you leave your money on
(35:32):
the table or in a stock you own, the higher
the risk there is.
So what you wanna do is again, uh this is
a professional grade tactic as you start to accumulate position,
everybody's going yeehaw wha you know they're going off to
the rodeo.
But they also forget they could get bucked off. And
so what you want to do is you want to
just like step back for a little bit, take a
(35:53):
little money off the table, harness it, you know, I
mean that's we sell 10%, knock it back down a
little bit quantitatively and continue to accumulate the shares because
you never look a gift horse in the mouth. When
a stock really runs really quickly, this casino doesn't owe
you a 7% more than Palantir does.
Suze (36:10):
One
more question before we go on to
the program or whatever it is that we're going to
create here for everybody, which is I'm waiting for you
to talk about topics relating to the risk of our
bank accounts, savings, and assets. How do we protect them now?
(36:30):
Everybody is scared to death.
With everything that's going on that they don't understand, they're
all afraid that their money's going to become worthless. Banks
are going to close. FDIC isn't going to be able
to pay for anything. The treasuries are going. I have
people writing me and said I cashed out of all
my treasuries because the treasury, so everybody is scared to death.
(36:55):
What would you tell them? OK,
Keith (36:57):
number one.
You gotta take a deep breath. I mean you just
owe it to yourself to take a deep breath and
this is something we talk about all the time with
our clients around the world there is stuff you can
control and there is stuff you can't control. You can't
control what's gonna happen with the Treasury Department any more
than you can control the price of a green door
(37:18):
in mainland China. You just can't, but what you can
control is buying great companies, investing in amazing technology, stuff
that is going to build your future.
So, you know, again, to my comment earlier, you can
invest as if the sun's gonna come up tomorrow, which
is statistically the more viable thing to do and history
proves it beyond any shadow of a doubt, or you
(37:40):
can cower in fear.
And if you cower in fear, you have got to
come to terms with that you're gonna get left behind.
That's just as simple as that. And again, it doesn't
feel good, it's scary, it's uncertain, but here's the other
thing about that, right? I mean, I run into this
a lot, a matter of fact, I'm speaking in Vegas
next week. I know this question is going to come up,
but what about the Treasury? But what about the Fed? Well,
(38:02):
the numbers show that those things don't matter on anything
other than a short term basis. So again,
take a deep breath. Trust the numbers, look at your history.
The most dangerous words in the English language are, yeah,
but it'll be different this time. Odds are it will not.
(38:23):
In fact, odds are we're gonna find a way through this.
It may not be perfect, it may be kick the can,
but that's all the domain of clickbait artists, late night
email scammers, and foo-os, all of whom want to sell
you something or want your attention for whatever reason.
If you stay focused on the great companies, on the
great CEOs, on the big broad sweeping themes that are
(38:45):
improving humanity, improving our financial situation, and you're thinking like
a winner, suddenly you can invest in optimism, and that's
a whole different picture. You can look forward to the
sun coming up every single morning instead of worrying about
what happens when it sets.
Suze (39:03):
That's my man. Now, the biggest question of all.
Keith (39:08):
I didn't do it.
Suze (39:09):
No, but I kind of did. Uh oh, right, and
it's this. When is the program coming out which does
this thing, and I've told everybody they had to be
patient number one because this was a project.
(39:29):
That was actually turned out to be far more complicated
than ever before because it wasn't just about Keith everybody
being able to do value cost averaging and everything on
a set number of stocks that he has followed without
having to determine money.
(39:50):
Into the equation it was just buy this, buy, sell that,
whatever it may be. This is where, and I told
you a little bit about how we wanted the program
to work. You would decide the amount of money you
want to invest and every month you would get an
email saying buy this many shares and it would all
be personalized for you.
(40:11):
That turned out to be a whole lot more difficult
because of the number of people that most likely will
sign up for this, which could be 100 or 200,000
people because of both of our audiences. So therefore I
then said, wait, wait, maybe we don't do that.
(40:34):
Maybe we create an exchange traded fund or really it's Keith.
You create an exchange traded fund. People just buy shares
in it and you get to do anything you want
with the stock within there. So I kind of screwed
it up as well and then Keith started to go, oh,
maybe we should go down that road. Maybe we should
(40:56):
call it this. I mean the two of us can
drive each other crazy.
But the two of us love each other so much,
but that's what happens when you put together two brainiacs
that really care about their customer. They care about every
single one of you and so what's the best way
(41:18):
combining both of our cares for you.
And doing it for sophisticated investors as well as investors
that ask some of the questions that you're asking me,
which are like, oh, you're just starting out, you're afraid
you're a woman who just lost her spouse and you're
70 years of age, and you want to just do it.
(41:41):
So tell him what you're thinking now, Keith.
Keith (41:47):
Absolutely. So yeah, I mean, Suze's absolutely right. When we
started this project, the, the markets were in sort of
one state of mind, and we started looking at the
complexities involved, you know, all of a sudden it went
from a few million calculations a day to literally billions
of calculations a day. The permutations involved with hundreds of
thousands of people tracking, you know, 30-40 stocks or whatever
(42:08):
it is, you know, the number was gonna be and
then doing all the math in VCA necessary to do
that was was one problem.
The other problem was that the markets themselves changed and
you know, even within the last two years, you know,
you've seen stocks like Nvidia and Tesla and Costco, Walmart
and some of the names you hear me talk about
on television a lot, these stocks have gone absolutely bananas.
And so that made, you know, the nature of picking
(42:30):
stocks very, very complicated because we, you know, we don't
just throw darts on the wall and say, hey, I
think you should buy this. I mean there's a lot
of quantitative stuff that goes on under the hood before
you hear me talk about a stock, whether it's, you know,
here on television or in one bar ahead. I have
to know with absolute certainty that I've got the confidence
in that stock to recommend it because I buy those
stocks too. I mean, I, you know, if I'm talking
(42:50):
about it, I like to eat my own cooking. A
lot of people don't, but I do, and you see
those disclosures.
Every single time I'm on television, I own it. My
family owns it. My company recommends it. no investment banking,
you know, I am very transparent about this. So...
Suze (43:03):
And therefore Suze owns them too.
Keith (43:05):
Exactly. Well, this is the thing. I mean this is
why we're pals, right? But the thing about that, right, is,
is now you have when we started you had maybe 30-40%
of the market that was computerized, but the rise of
passive investing, the blend of options, Wall Street's go fast crowd,
now you have 80% to 85% of the market on
any given day,
that is moving by computer with no humans involved, no
(43:28):
regard for the fundamentals, no regard for the selection process.
So it makes that problem a little complicated. And then
that third thing, that little, you know, that little thing
called the cloud, uh, you know, people have heard of that,
but the architecture of the cloud keeps changing. So every
time we'd engineer something, you'd get right up to the
starting line, you know, Amazon, which we intend to use,
would change the way the cloud works and so we
had to reprogram everything. So, so long story short.
(43:49):
We're very close. We're rejiggering, but it's gonna be ready
when it's ready. We are also pursuing an ETF because
that's something that any investor can use. It can be point,
click buy. You don't have to worry about a dang
thing except maybe VCAing into the ETF itself, so it
becomes dramatically simplified. We take care of all that other
stuff behind the scenes and you don't have to lift
(44:10):
the figure.
Suze (44:11):
And personally, that's my vote.
Keith (44:13):
Well,
me too,
Suze (44:15):
but here's what's interesting and tell them the truth. Over
a year ago, yeah, maybe a year and a half ago,
I said, can't we just do an ETF?
Keith (44:25):
Oh, you did. Yes, you did, and I got Suze schooled
on that. Yes, I did.
Suze (44:30):
And no, it's like, no, if we do an ETF,
they're gonna, everybody's gonna find out about the secret sauce
and I don't want everybody to know what we're doing
because all because what happens with Keith's work a lot,
everybody is everybody rips it off because they know that
it's so good all these years of his experience and
the money he's invested in the computer systems, all of
(44:53):
a sudden you see it somewhere and they're taking credit
for it.
And then all of a sudden it makes it that
it's not, it's just not good. With an ETF it
was possible that they could go in and re-engineer what
Keith had done and bring it out in another ETF
and that's why Keith
(45:15):
didn't want to do it. Now he thinks that he
can protect it. Is that correct?
Keith (45:20):
That
is absolutely correct. And not only that, but the, the
group that we're working with has just within the last
week signed all the documents promising to protect it. So
it's a very different playing field now.
Suze (45:32):
So if it's true, everybody, and he can do that,
trust me, you are far better off rather than getting
an email every month, you figuring out what you should
do and you doing it every month, even though that's
how you would learn about investing. It would be far
better off for you in the long run.
(45:52):
To simply be able to VCA into the ETF and
there you go on with your life. So I hope
you understand that we haven't meant to, you know, go, no,
don't invest. That's why I did a podcast quite a
few months ago saying don't wait, you are to continue
to invest right now, continue to do these things we've
(46:15):
talked about, but that's the direction.
That Keith is going and I always wanted him to
go because I know from the bottom of my heart
it will be the easiest and most profitable thing for
you to do because you don't have to worry about it.
You're on vacation. You don't get the email. You don't
do it. And given the emails that I've gotten about
(46:39):
value cost averaging and how do you do it if
you have a whole lot of stocks and I only
want 4% of my port, no.
Just, you can do what you want with your stocks,
but there should be a sum of your money that
could be under the ETF doing it for you. What
do you think, Keith?
Keith (46:57):
Well, yes, and there's one other big benefit to that too, Suze, and, and,
and it's this, is if you have an ETF suddenly
your financial professionals, if you have one or your planners
that you work with can work on integrating it into
your financial plan.
So, so it, it adds to the flexibility in terms
of how you can use it and it also makes
(47:19):
it suitable for somebody who's just starting out and has
just a little bit of money to invest, but it
also opens it up to very, very sophisticated, very, very
large investors again, all at the touch of a button, so.
As frustrated as I am personally about uh the complexity
of where we started and where we are now, I
think that this is gonna be a very viable, very
(47:39):
good solution, and we're hoping to get it across the
finish line very, very quickly.
Suze (47:43):
So I hope all of you enjoyed this podcast with
the maestro. Before we go, anything else you wanna say?
Keith (47:53):
Just thank you to everybody thank you to you, Suze,
for having me on. What an honor. I mean, just, I,
as I say, I've been looking forward to this all
week and it has met and exceeded every single one
of my expectations. What a privilege to be on with
you today and to have everybody out there putting your
faith and your trust in what I have to say.
Thank you for your time.
Suze (48:10):
Thank you, Keith. I love you so much. I can't
even stand it. I hope you had a good Valentine's
Day too.
Keith (48:17):
We did and right back at you. Love you, Suze.
Suze (48:20):
All right, everybody, so there's only one thing that we both
want you to remember when it comes to your money,
and it's people first, then money, then things. I hope
you enjoy today. I hope you all stay safe and
know that together we will rise. We are strong.
February 16, 2025. Welcome everybody to the Women and Money podcast,
as well as everybody smart enough to listen. I hope
you had a good Valentine's Day. Did you?
I did, but we'll have to wait until Thursday when Ms.
Travis can tell you all about it. But for now,
(00:51):
I think you all should get out your little Suze notebooks,
and today's Suze School is going to be very, very different.
Because today Suze School, we're gonna have a guest. It's
not gonna be just me. I'm gonna pretend like I'm
KT and I'm going to be asking the true expert
(01:11):
when it comes to certain things about value cost averaging
dollar cost averaging, and oh, all kinds of other things
that you wrote in and asked about before I introduce
the most extraordinary and amazing.
You have to wait till I say his name, but anyway,
(01:32):
last Sunday I did an episode on value cost averaging.
On the Women and Money Community app, I put up
an example of how it works. Boom, there goes my
email and I'm in the Women and Money community app,
and you had question after question and I'll be honest
(01:53):
with you,
I'm not good enough at that because it isn't my concept. Remember,
I was taught it by somebody, our guest, and I decided,
you know what, all of you always deserve the best.
You deserve the most knowledgeable in certain areas, in fact,
(02:15):
in all areas and in this particular area that we're
about to talk about today, which isn't just about value
cost averaging, but it's about the markets overall, it's about
individual stocks. It's how to make your money, make more
money when it comes to investing.
(02:35):
There's, in my opinion, the one and only Keith Fitz-Gerald,
and he is with us right now. Good morning, boyfriend.
Keith (02:47):
Well, hello there. Thank you so much for having me.
I've been looking forward to this all week and thanks
to everybody listening for spending a few minutes of your
time with us today. This could be great.
Suze (02:56):
This is great and you know so many people, Keith
wrote in and they said, we wish this could be
on video. We want to see both
of you and then they would write in and they said,
Why don't the two of you always do a podcast together?
Oh my goodness. All right, so maybe we'll have to
do that.
Keith (03:15):
Let's think about it. That would be so much fun,
wouldn't it? All right.
Suze (03:18):
So everybody, if you don't know about value cost averaging,
then you need to go back to last Sunday's podcast
and listen to it. You just do. But so many
of you have already listened to that podcast.
Therefore, I'm gonna ask you, Keith, some of the questions
(03:38):
that were on the wall and people wrote in. They
want to know about it, but then we're gonna switch
because people are also writing in and going, Keith, I
bought Palantir at 20. Should I buy it more now?
I mean, we have questions all over, but then I
also want to give you a little time
(03:59):
for you to tell everybody what you want to tell them,
they're also asking about is a program going to come out?
Is it not gonna come out? So let's answer all
their questions today. Outstanding. And let's hopefully make them happy.
Now I'm going to start off easy here for you. OK.
(04:19):
All right. The first question, which I find fascinating is
kind of generic.
Doesn't everything depend on the day that you invest your
money and where the stock is on that particular day?
Keith (04:34):
That is a very interesting question with a very simple answer,
and it's no. And here's why the actual day you
buy or the time of day you buy or the
method by which you buy doesn't matter. The key with
something like value cost averaging or even dollar cost averaging
is to do it consistently. So if you look at
(04:56):
the data, and this is what we do for a living,
and we look at all this data, if you look
at all the data for hundreds of years.
If you're consistent, you are getting around market timing risk.
You are harnessing volatility that others fear, so it doesn't
matter whether you pick your birthday, whether you do it
on Christmas, whether you pick another holiday, whether you do
it even every Monday morning as long as you do
(05:18):
it
consistently.
Suze (05:19):
Great, there's one next.
Looking forward to hearing from both of you together. Yeah, baby,
here we are together. I know. Is there a more
and you kind of just answered this, but I'm gonna
keep drilling this in because I'm telling you people blew
their minds with the details and really the minutia and
(05:42):
it's really a little bit ridiculous. I have to tell you.
Because they think you have to stick to a certain formula.
You can't, it's like they've put themselves into this little
box that they're afraid to come out of now. So ready,
looking forward to hearing from both of you together. I
don't blame you. Is there a more ideal time of
day to invest the market open?
(06:06):
The close and for VCA does it matter what time
of month? Also, what about dividing funds for weekly or
biweekly or stick to monthly? See how what they've done here?
Oh sure, sure. So it's like they're thinking that.
Everything has to be a certain way. Like when I
gave the example last Sunday of $12,000 and $1000 a month,
(06:30):
they literally took it that they needed $12,000 and they
had to put in $1000 a month. So first of all, everybody,
that was just an example last week.
It's just an example. So you could do it with
any amount, but that's the question. What's your answer?
Keith (06:48):
Well, there's two elements at work here, right? And they're
both counterintuitive, and, and there's also some fun to this
because like anything in the stock market, there's there's always
rhyme or reason or some history. So when I started
my career 45 years ago, I mean, I've been doing
this for a long, long time.
There used to be very definitely a time of day
where you could swoop in and and have an advantage.
(07:09):
And funny enough, that was roughly 10:35 in the morning
and roughly 2:38 in the afternoon. And the reason why
had nothing to do with the stock exchange.
In the morning, the donut truck would show up and
everybody run off the floor to go get donuts. In
the afternoon, the hot dog truck would show up and
everybody run off the floor to get hot dogs. So
if you were trading or you're looking for just a
little bit of an edge, you knew that there was
(07:30):
going to be a lull in activity and frequently you
could get a better price either buying or selling. So,
you know, that used to be true, but now what's
happened is we have this tremendous shift to computerization.
And so most if you go to the New York
Stock Exchange today, it's a very quiet place and people
are walking around with iPads and there's very little open
pit trading left in Chicago anymore. In fact, you go
(07:52):
to the Hong Kong Exchange, which is one of the
busiest in the world, and it's dead silent. So this
idea that is there a better time to buy or
a worse time to buy really is moot now because
the computers have eliminated all of that. But if you
really want to try.
What we're seeing lately is that the first 30 minutes
and the last 30 minutes are interesting because there's additional
(08:14):
volatility and interesting can be good or bad. It just
depends on how you approach it. So, so I would
get that out of your head. The big key is
consistency number one. The other thing is you're falling if
you're thinking that way, there's nothing wrong with that. That's natural, right?
A lot of people do that, but you're falling right
into Wall Street's trap, OK? Wall Street wants you
(08:37):
to think in smaller and smaller and smaller and smaller
details because that's how you're easier to separate from your money.
If you're constantly off balance, if you're focused on the minutiae,
you're gonna get squeezed every time. The counterintuitive thing to
do is to take a deep breath, take a step
back and understand that investing as much as they want
(08:59):
you to think it's a game of precision.
Is a game of being close enough. You find great stocks,
you invest in them consistently, you hold for as long
as you can, you leave your money alone for as
long as you can. That really is the key in
today's markets. It's counterintuitive, so it's, I would encourage everybody listening. A,
that's normal what you're feeling, but B, take a deep breath,
(09:22):
step back, that's the real key to success.
Suze (09:25):
And the thing is, is that, does it matter if
it's weekly, biweekly, or should they stick to monthly?
Keith (09:32):
OK, that's another wrinkle. Now that's really my encouragement is
once a month is probably just fine for most investors.
And and the reason is that if you start going
down into weekly or biweekly, suddenly you're getting into market timing,
you're getting into, you know, the world of very sophisticated
traders who are out to separate you from your money
(09:54):
and you don't want to play that game. The way
to beat Wall Street is not to engage in fights
you can't win and not to pick battles that they
have an interest in fighting.
And so again, counterintuitively, if you're investing consistently and you're
doing it once a month, you are far more likely
to make money over time than you are to lose it.
You are also far more likely to harness the volatility
(10:16):
they want you to fear.
And finally, you are far more likely to sleep better
at night, and I like that
part.
Suze (10:24):
Yeah, but you see what I mean, how they're like
getting into the how often whatever this next one is
kind of about the what ifs. Do you have to
then assign how much money you're allocating to each share
in your portfolio at the beginning of the year?
So people are confused about, well, I gave an example.
(10:46):
You have $12,000 to invest, and again they freaked out.
So the question is, here we are, maybe it's March,
maybe it's April. How do you start doing this and
how do you know how much to allocate to do
this with?
Keith (11:03):
Well, again, this is like cooking a great recipe, right?
You wanna know what ingredients you need before you get
started because the last thing you want to do is
if you're making great cookies, find out you're short of
flour or maybe you're missing the chocolate chips you were
counting on or something like that, right? My suggestion again is,
is you want to think in as long a time
frame as possible, 12 months a year, most of us
(11:23):
can handle. Most of us can say, oh, you know, where,
where am I gonna be 12 months from now? We
actually call this the painted picture.
And what we do is we test it out at
the beginning of the year and we paint a picture.
Where do I want to be in the year? What
does my cash flow look like? What, what reasonably am
I gonna have to invest? And that depends on your job,
that depends on your family support. Do you have an
emergency fund built up, all the things you constantly encourage
your listeners to listen to and focus on and do.
(11:46):
And once you got those decisions out of the way,
it's simply, OK, how much can I realistically invest per month?
What do I want my account to grow?
And all you gotta be is close enough. You don't
have to be to the penny and, and if your
circumstances change during the year, then guess what? You can
change your thinking too. The math still works. So you know, I,
I liken this to holding my thumb up and looking
(12:08):
at the horizon and if I can see the horizon
around my thumb.
That's about right.
Suze (12:12):
So it's not like you have to have a specific
amount of money like $12,000 that you divide by 12,
so you have to invest $1000 a month, whether it's
dollar cost averaging or value cost averaging.
You can change as time goes on, correct?
Keith (12:32):
Absolutely, and that's a vitally important concept to think about and,
you know, I, I, I talk like you to tens
of thousands of investors a year around the world, and
one of the mistakes that everybody makes is they box
themselves in.
And in today's world, you can't do that. Today's world
is constantly fluid, it's very dynamic. We live at one
of the most exciting times in human history, which means
that being flexible is exactly what you want to do
(12:57):
because if you're being rigid and uncertain.
And if you're being living in fear as opposed to
investing in optimism, you've already doomed yourself to to bad performance.
What you want is to build your wealth and your
confidence and your knowledge as the markets do that.
Suze (13:12):
Where everybody seems to be confused because of the example
that I gave.
Keith (13:19):
Welcome
to my world,
Suze (13:20):
right? Which
is with value cost averaging you look at the value
that you intended to have as you know, every single
month and you invest according to that depending on the
stock price. Again, for those of you who don't know
what I'm talking about, listen to last Sunday's podcast or
look at the example on the Women and Money community app.
(13:43):
So this now.
Is using that example of $1000 a month, $12,000 at
the end of the year for your target value. Here
is the question.
I'm getting a little confused around month 6 because everybody
obviously in month 6, your target value at $1000 a
(14:05):
month would be $6000 for that month. All right.
I thought the target portfolio amount for month 6 would
be $6000 which I think is the actual portfolio value.
If the stock is at $120 a share, which we
said it had gone back up to.
Then that means that it's already at $6000 and we
(14:30):
don't need to add any more money for that month.
So what do we do?
Keith (14:37):
OK, so let's take the the model and the example
out of the equation for it. Let's imagine we're going
to the grocery store, and let's imagine we've got lately
$100 for eggs, but I mean, you know, let's let's
just imagine we've got $20 and we want to buy
some eggs, right?
If we see the price of eggs go on sale
and we know we're gonna need them, it's very likely
(14:58):
you're gonna buy something that's on sale, right? You're gonna
take that extra amount of money and you're gonna buy
a few extra eggs because odds are good that the
price of those eggs is gonna go higher next week.
That is value cost averaging in a nutshell. If you
have a sale in front of you, you spend a
little bit extra money to buy whatever stock it is
you want to get your hands on. If the price
of eggs goes higher and you've already got your eggs
(15:18):
on the shelf, guess what? You don't need to buy them.
The value of your eggs is already there. You've got
them on your shelf, they're already in your pantry. Value
cost averaging with stocks is the same way. If you
have a sale, if the markets come down on you,
if the price of that stock drops.
What you want to do is think about your target
in terms of, OK, my portfolio is worth $100 next
(15:40):
month I want it worth $110 so I'm gonna add
a little extra money to bring the value of my
portfolio to 110 regardless of what the stock has done.
So you buy a few extra shares and the advantage
to doing that, Suze, is that you buy low, you
sell high over time.
That dramatically accelerates your profit potential, particularly if you're working
(16:01):
with dividend stocks and you're leaving your money alone for
a long time. You will come roaring out of the
basement and turn around 4 or 5 years from now
and go, wow, I had no idea because suddenly you've
bought lower and sold higher.
Suze (16:16):
The main difference that I think I have right, you'll
have to tell me, but that most people aren't quite
grasping is that dollar cost averaging was very simple for them.
They picked a specific amount of money and they pushed
automatic and every month that amount of money was taken
(16:36):
out of their money market accounts to buy stock. What
they're missing, however, is with value cost averaging, even though
in both cases as the stock goes down you're buying more.
And obviously as the stock goes up, you're buying less,
(16:56):
but with value cost averaging, you're getting a little bit more.
Than with dollar cost averaging because you're not sticking to
the same dollar amount every month.
Keith (17:08):
Bingo.
Suze (17:09):
Say that again.
Keith (17:10):
Bingo.
Suze (17:11):
Say it again...
Keith (17:12):
Bingo bingo bingo bingo bingo bingo bingo bingo bingo.
Suze (17:15):
And that's what they're missing. You want to get more
value for your money, everybody. You don't want to go
on automatic and just oh,
I'm going to invest $1000 a month or $100 a month.
When if you just invested $120 a month, you would
be getting a few more, even if it's a half
(17:38):
a fraction of a share more, that half a fraction
of a share more will make you a whole lot
more money in the long run, and that is what
they are missing.
Right, so again, just to repeat like another question, maybe
I missed something. What if month 4, the value is
at $4000 and you don't buy any more shares. So
(18:01):
in fact you might not actually invest the whole $12,000
in one year because the account value has increased. They forget,
well, you tell them what they forget, what they could
do with that money.
Keith (18:14):
Well, you forget two things, right, because if you've got
a stockpile of cash and it's sitting on your pantry
shelf and the eggs go on sale, number one, you've
got the flexibility to go ahead and buy them if
you want, but number two, if you're used to dollar
cost averaging and you're disciplined and you already got that
under control, here's where this gets really cool and really interesting.
(18:37):
Because if you're used to putting in $500 a month
and you're already mentally disciplined, you're paying yourself, you're doing
all the things Suze encourages you to do constantly, then
go ahead and do it anyway. But put it in
a short term Treasury fund. Now all of a sudden
you're earning 4%, 3%, 5%. Your cash is stockpiled. It's
not sitting there. You're not tempted to spend it because
you've already paid yourself, you've already invested.
(18:58):
And then when you get the chance and the market
will inevitably hand you several chances during the year to
do
this.
Suze (19:06):
Or you could take that extra money that you're not
investing in stock A and possibly start to do the
same thing with stock B or another ETF. So there's
you don't have to just stick with one stock and
just go, oh, now what do I do? Do you?
Are you starting to get this, everybody?
(19:28):
You've put yourself into a box, and the last thing
both Keith and I want you to do when it
comes to investing is limit yourself. Investing is about expansion.
The investing is about understanding your own emotions and really
keeping them at bay and thinking, oh, I've done something wrong,
(19:49):
I da da da, no.
Just keep listening and you'll get it. Last one on this,
which is maybe I'm not completely understanding it, but it
seems that in this example.
Why did I give this example anyway of having $12,000
to invest that if the stock price is decreasing for
(20:13):
several months or there is a steep drop, would you
deplete your $12,000 before month 12?
Keith (20:24):
OK, that is A, a very smart question, B, a
very logical question, and C, I love it because it
means you're thinking ahead. You're really beginning to understand how
this works. The markets go through protracted downturns.
But here's the thing, and this is where you've got
to really again I've been doing this a long time.
(20:44):
One of the hardest lessons for me to learn as
I came up through the ranks is you've got to
learn to trust the numbers. You've got to learn to
trust human psychology and let me give you a data
point that will really drive this home is the markets
since 1871 have a very defined upward bias. If you
look at other markets for even far more ancient periods
(21:05):
in history, they all have an upside bias.
But our stock markets today since 1871, have spent 83%
to 85% of the time at or within 10% of
new all-time highs.
Meaning that there are a lot more bulls than bears
over time and if you buy the right companies, if
you're DCA or VCA into the right companies, you are
(21:27):
automatically putting the odds in your favor. That's roughly if
we look at it again since 1871, there's 1300 new highs.
That's roughly one new all-time high a month for a
long period of time, so...
The idea that you're playing not to lose is where
everybody's mindset is.
(21:48):
But where your mindset should be is playing to win.
And and that's a very different mental calculus. And again,
if you're thinking I'm playing not to lose, there's nothing
wrong with that, that worked for a long time, diversification
worked for a long time, but you're falling into Wall
Street's trap.
What you want to think about is flipping that around,
playing to win, playing to get those great companies, playing
(22:12):
to build your wealth. This is not a competition, it's
about what you want to achieve with your life and
your world and your money.
Because if you work hard for your money, there's gonna
come a day where your money works hard for you
and that's what VCA is all about. It's, it's like taking,
you know, buying holds good DCA is better, but VCA
really now you're cooking with some hot sauce. It gives
(22:32):
you the opportunity for bigger returns, less risk, and discipline.
Suze (22:37):
So to answer his question though, the chances of him
being told
Keith (22:42):
I forgot about that part.
I got so excited. I forgot about that part. I mean,
I love what I do. Yes, to answer your question,
that is absolutely possible in a protracted downturn. However, we've
done a lot of research in this area.
That's not a bad thing either, because what it means
is you have now invested deeply, you've invested at a
(23:05):
substantial discount and you've built up a substantial reserve for
when the markets come roaring back, and they
will.
Suze (23:12):
Because remember everybody, these markets aren't going to tank overnight
50 or 100%, and if you keep being diligent, you're investing,
you're investing, and you're investing, and now you're out of
your $12,000 it's all spent, but you haven't lost the money,
it's invested in a stock that you wanted to buy.
(23:34):
That was a good quality stock, and the reason that
it went down isn't cause the stock itself was bad.
It's that all the boats were sinking cause the water
went down when it turns around and a great example
of this was 2009.
You know, when the Standard and Poor's 500 index, I think,
was at 600, and all these stocks were at nothing.
(23:57):
They had all gone down incredibly and if you just
kept them and now you have a whole lot of
shares because they got so cheap as you were buying them,
oh my God, you made a fortune over the next years,
so you're not out of money.
You've invested all the money that you designated towards that stock,
and once that amount of money is designated, you bought
(24:20):
all the shares you can with it.
Keith (24:23):
Good.
Suze (24:23):
Now you just told
them.
Keith (24:25):
And, and the really cool thing about that, right, and again,
you know, learning this as a professional trader is a
professional investor.
That's a great problem to have because of the dramatically
increased profit potential when the markets come roaring back. So it's,
it's maybe you think, oh this is, this is a
bad amount of cash. I can't buy more. That's the
real problem is you can't buy more, but you've already
(24:45):
locked in your future returns. So I mean how cool
a trade-off is that? And, and you know again it's,
it's counterintuitive.
It doesn't make a lot of sense at first, but
when you really think about buying at a discount and
you think about buying these great companies, I mean this
is like buying Apple at $10 a year or being
able to buy Palantir at 6 when it dropped. I
mean think about that, right? I did. Exactly, me too.
(25:08):
I mean, I bought more, you know, I mean people,
people are like, oh my God, but it could go down. Yes,
it could, but when it comes roaring back, imagine how
much bigger your profit potential has become.
That's how a winner thinks. So we get rid of
that fear. I mean, that's normal, that's, you know, you're
not abnormal if you're feeling that, but do make an
(25:28):
effort to take those emotions out of the equation because
you are listening to Suze, you are playing to win.
Suze (25:35):
And they're also, if they're smart, they're listening to you.
Keith (25:39):
You're
Suze (25:40):
very
Keith (25:40):
kind.
Suze (25:41):
So one last about this, then we'll quickly go to
Palantir and other things, but
all these people did this Monte Carlos. They, I mean,
some of these people went to the 10th degree to
figure out what's better, dollar cost averaging or value cost averaging,
and they want to know as if it makes really
(26:03):
a tremendous difference. So just briefly, can you answer that
for these
people?
Keith (26:09):
Absolutely. So I was king of the nerd herd growing up.
I had my propeller beanie and everything.
And you know my background is in nonlinear data science,
so this is a question that we have spent tens
of thousands of hours of computing time on. Uh, yes,
we've run those same Monte Carlo simulations we have run
all of the randommizers you can think we've done walk
forward testing we've run back testing we've done testing on
(26:32):
the testing.
And what we have learned is that there is absolutely
no question that value cost average is the best way
to go. Where it breaks down is when people start
trying to second guess it. Oh, I've got to do
it on this date. I've got to do it on
this time. I've got to, I'm gonna be out of cash.
Oh my gosh, it's falling too long. Those are questions
(26:52):
that are put on by human limitations, not quantitative limitations
as part of the modeling.
And so we've run it with small data sets, we've
run it with millions and billions of data points in
in the sets in every single time under a wide
range of conditions, both hypothetical and real.
VCA wins.
Suze (27:10):
Yeah, so for those of you who wrote into me,
and I appreciate it, and you present like I ran
this Monte Carlo, which is, it's uh it's a program
that I don't know. I've yet to really think that
it comes out with the best answers for all of you,
but that's besides the point.
Keith (27:28):
Well, let me, let me, let me, let me spoke about
that there is, there's an interesting thing, right? So the
Monte Carlo simulation is a quantitative exercise that supposedly introduces randomizing,
you know, variables to the test set and
there's a huge proposition in the market that Burton Michael
wrote this thing, a random walk down Wall Street and
the markets are random, nobody can predict it. Well, I believe,
you know, people who are a lot smarter than I am,
(27:50):
believe that's not true.
The markets are not random. There are very predictable elements
to them, and that is exactly why VCA works in
today's markets is because what we're doing is we're not
working on the random price nature of the markets. We're
not working on the random stocks. We're very deliberate about
which stocks are we picking, how are we using it,
what are the tactics we're picking.
(28:11):
So we're automatically stacking the odds in our favor to
nth degree. I mean, now, obviously, you know, the world
could be a very quiet place for a few 1000
years if things get out of control geopolitically, but the
markets are not going to be our worry if that happens, right?
So take that out. It's more important to reinvest as
if the sun's coming up tomorrow. And what we know
from the Monte Carlo simulations and all the other simulations
we do is if VCA wins.
Suze (28:34):
But you know it's so funny.
These people right and they're so proud at the research
and the things that they've done. I just want to
say something to all of you. I'm thrilled that you're
doing that.
And you come up with your own conclusion based on
maybe one study or whatever. I'm asking you all now
(28:54):
to listen to Keith. For 40 years he has been
doing this. When he says he's a propeller head and
a nerd. Oh, he is. Half the time he's talking
about things and I'm like, What the hell did you
just say? But you can run your own if you want.
Or you could take 40 years of experience and millions
(29:18):
of dollars of research.
Computerization that none of you have the ability to do
truthfully and listen to what he just said. He has
nothing to gain other than to help you help yourself.
We're switching now. We'll run this podcast a little bit
longer than normal because we have the master here and
(29:40):
I just want to answer the main things you want
to know, which is ready for this drum roll.
Keith (29:48):
(Keith makes a drum roll sound)
Suze (29:48):
There we go. Is it too late to buy Palantir?
Keith (29:54):
No
way.
Suze (29:57):
I thought you were gonna say no way, but anyway,
if he were just talking to me alone, everybody, he
would have used the word. But since we're on a podcast,
he's trying to show you he's a dignified man, which
he is. You're very good. Anyway, go on, go on.
Keith (30:14):
So, so here's, here's how you break it down, right? And, and,
and again, there are a couple different elements that intersect here,
which is why people are asking this question, right?
Number one, oh my God, is it too late? Well,
think about that. If it's a great party and you
know it's gonna go on for a long time, are
you too late to get there at 8 o'clock as
opposed to 7 o'clock? No way. You're gonna walk through
the door and have a great time, right? Now you're
(30:36):
gonna have to look a little harder because maybe the
room's gonna be a little crowded before you get to
the bar, the cocktail tray or the hors d'oeuvres, whatever.
Same situation here Palantir is still a phenomenal stock. It
is still.
Early days we are still ahead of one of the
greatest single trends in recorded human history and that's how
we use AI and big data. There is nobody else
(30:58):
who does what they do. The numbers are all going
in the right direction. The CEO is unapologetically in support
of his shareholders. He could give a, you know what
about Wall Street, which is really attractive from an investing standpoint,
but then at the bottom line.
The way you control this is to use a tactic
(31:19):
like VCA because behind the scenes professional traders have, believe
it or not, they have largely missed the boat. They
couldn't check their boxes they couldn't see Palantir in their spreadsheets.
I can't tell you how many thousands of traders, professionals
I've heard from, seen, watched, who missed this boat. So
now they know they've missed it.
(31:41):
So their goal is going to be to introduce volatility,
scare you out of your shares at a lower price
so they can buy it and use VCA or some
variant of it that we've been talking about so that
they can get their hands on the run higher. I
think we're looking at $200 a share. I was a
lone wolf in the woods when I said that initially.
I mean, we took out every price target 50, 70, 80, 100.
(32:05):
I think we're $200 within 36 months, probably quite a
bit sooner than that.
Suze (32:10):
So another question is how do I know if I'm
investing too much in Palantir? I don't know. I think
you can't invest enough in it, but that's just my opinion.
Go on.
Keith (32:21):
Well, that is a very simple answer too, believe it
or not, again, it has nothing to do with numbers.
Are you sleeping at night? I mean, are you worried
about it because if you're asking that question, my answer
would be, and having worked with thousands of investors around
the world for decades, is if you're asking that question
or you're losing sleep at night, you've got too much
risk on the table. So dial it back.
Suze (32:41):
The next one is that if Palantir has doubled on you,
and the truth is many of these people bought it
at 20.
Keith (32:49):
How cool is
that?
Suze (32:50):
Right? And now here we are almost 100 points higher,
and now they're afraid.
So should they be selling? Should they, they're just freaks.
Should they do free trades? Any advice to them?
Keith (33:06):
Well, I just wrote about this the other day to
our clients, uh, you know, professional and otherwise, and said, OK,
there's something you want a professional has a big gain
on the table like that, uh, there's something called selling
into strength.
And you want to sell because you have the opportunity
and you can, not because you must. And the reason
most investors feel the fear that that people are voicing
(33:27):
is because they're holding on too tight.
They can't let the stock fly like they want it
to because they're worried about it, they're scared about it.
They're they've let their emotions cloud their judgment.
So here's my answer, and it's twofold. Um, number one,
if you want to take a little bit of money
off the table and get to the point where you're
sleeping at night and you're not worried about it, I
(33:47):
would submit that's probably a pretty smart thing to do.
On the other hand, if you don't need your money
for 5 or 10 years and you can stomach the
volatility and you make peace with the headlines, and you
understand what I'm telling you about Wall Street wanting to
take your money.
Then you know what? You just hold your nose, let
it ride, put a big smile on your face, Cheshire
grin like I have, and you let it run because
(34:10):
stocks like this are gonna run again. I've, I've done
this a long time. I've learned every lesson I talk
about the hard way, right? And, and if you hold
on too tight, guess what? Sooner or later you're gonna
fall off the rope. If you hold on too loose,
maybe you can't grab the rope. So, so it's not
a competition, it's what's right for you out there, everybody listening.
Get comfortable with it. Get mentally comfortable with it. If
(34:30):
you're not, then sell a little bit. Get to the
point where you are and use tactics like DCA and
VCA to start re accumulating positions because that's how you
control risk and maximize profit potential.
Suze (34:42):
However, one of your OBAers, One Bar Ahead, which is
a service that Keith has, that all of you are
more than welcome if you want serious education, everything to join. However,
wrote me and said, Suze, since he's going to be on.
He wrote and said, if you have it, you might
want to sell 25% and actually maybe even do a
(35:07):
strategy in case it goes down. Is he expecting it
to go down?
Keith (35:12):
No, that's not quite a correct assessment. It was 10%
of the value, uh, but then on top of that, no,
I'm not expecting it to go down at all. That
had nothing to do with expecting it to go down
that had everything to do with reducing risk, which is
inherent in the DCA tactic, you know, it's like going
to Vegas gambling theory and investing theory is very similar
in this regard. The longer you leave your money on
(35:32):
the table or in a stock you own, the higher
the risk there is.
So what you wanna do is again, uh this is
a professional grade tactic as you start to accumulate position,
everybody's going yeehaw wha you know they're going off to
the rodeo.
But they also forget they could get bucked off. And
so what you want to do is you want to
just like step back for a little bit, take a
(35:53):
little money off the table, harness it, you know, I
mean that's we sell 10%, knock it back down a
little bit quantitatively and continue to accumulate the shares because
you never look a gift horse in the mouth. When
a stock really runs really quickly, this casino doesn't owe
you a 7% more than Palantir does.
Suze (36:10):
One
more question before we go on to
the program or whatever it is that we're going to
create here for everybody, which is I'm waiting for you
to talk about topics relating to the risk of our
bank accounts, savings, and assets. How do we protect them now?
(36:30):
Everybody is scared to death.
With everything that's going on that they don't understand, they're
all afraid that their money's going to become worthless. Banks
are going to close. FDIC isn't going to be able
to pay for anything. The treasuries are going. I have
people writing me and said I cashed out of all
my treasuries because the treasury, so everybody is scared to death.
(36:55):
What would you tell them? OK,
Keith (36:57):
number one.
You gotta take a deep breath. I mean you just
owe it to yourself to take a deep breath and
this is something we talk about all the time with
our clients around the world there is stuff you can
control and there is stuff you can't control. You can't
control what's gonna happen with the Treasury Department any more
than you can control the price of a green door
(37:18):
in mainland China. You just can't, but what you can
control is buying great companies, investing in amazing technology, stuff
that is going to build your future.
So, you know, again, to my comment earlier, you can
invest as if the sun's gonna come up tomorrow, which
is statistically the more viable thing to do and history
proves it beyond any shadow of a doubt, or you
(37:40):
can cower in fear.
And if you cower in fear, you have got to
come to terms with that you're gonna get left behind.
That's just as simple as that. And again, it doesn't
feel good, it's scary, it's uncertain, but here's the other
thing about that, right? I mean, I run into this
a lot, a matter of fact, I'm speaking in Vegas
next week. I know this question is going to come up,
but what about the Treasury? But what about the Fed? Well,
(38:02):
the numbers show that those things don't matter on anything
other than a short term basis. So again,
take a deep breath. Trust the numbers, look at your history.
The most dangerous words in the English language are, yeah,
but it'll be different this time. Odds are it will not.
(38:23):
In fact, odds are we're gonna find a way through this.
It may not be perfect, it may be kick the can,
but that's all the domain of clickbait artists, late night
email scammers, and foo-os, all of whom want to sell
you something or want your attention for whatever reason.
If you stay focused on the great companies, on the
great CEOs, on the big broad sweeping themes that are
(38:45):
improving humanity, improving our financial situation, and you're thinking like
a winner, suddenly you can invest in optimism, and that's
a whole different picture. You can look forward to the
sun coming up every single morning instead of worrying about
what happens when it sets.
Suze (39:03):
That's my man. Now, the biggest question of all.
Keith (39:08):
I didn't do it.
Suze (39:09):
No, but I kind of did. Uh oh, right, and
it's this. When is the program coming out which does
this thing, and I've told everybody they had to be
patient number one because this was a project.
(39:29):
That was actually turned out to be far more complicated
than ever before because it wasn't just about Keith everybody
being able to do value cost averaging and everything on
a set number of stocks that he has followed without
having to determine money.
(39:50):
Into the equation it was just buy this, buy, sell that,
whatever it may be. This is where, and I told
you a little bit about how we wanted the program
to work. You would decide the amount of money you
want to invest and every month you would get an
email saying buy this many shares and it would all
be personalized for you.
(40:11):
That turned out to be a whole lot more difficult
because of the number of people that most likely will
sign up for this, which could be 100 or 200,000
people because of both of our audiences. So therefore I
then said, wait, wait, maybe we don't do that.
(40:34):
Maybe we create an exchange traded fund or really it's Keith.
You create an exchange traded fund. People just buy shares
in it and you get to do anything you want
with the stock within there. So I kind of screwed
it up as well and then Keith started to go, oh,
maybe we should go down that road. Maybe we should
(40:56):
call it this. I mean the two of us can
drive each other crazy.
But the two of us love each other so much,
but that's what happens when you put together two brainiacs
that really care about their customer. They care about every
single one of you and so what's the best way
(41:18):
combining both of our cares for you.
And doing it for sophisticated investors as well as investors
that ask some of the questions that you're asking me,
which are like, oh, you're just starting out, you're afraid
you're a woman who just lost her spouse and you're
70 years of age, and you want to just do it.
(41:41):
So tell him what you're thinking now, Keith.
Keith (41:47):
Absolutely. So yeah, I mean, Suze's absolutely right. When we
started this project, the, the markets were in sort of
one state of mind, and we started looking at the
complexities involved, you know, all of a sudden it went
from a few million calculations a day to literally billions
of calculations a day. The permutations involved with hundreds of
thousands of people tracking, you know, 30-40 stocks or whatever
(42:08):
it is, you know, the number was gonna be and
then doing all the math in VCA necessary to do
that was was one problem.
The other problem was that the markets themselves changed and
you know, even within the last two years, you know,
you've seen stocks like Nvidia and Tesla and Costco, Walmart
and some of the names you hear me talk about
on television a lot, these stocks have gone absolutely bananas.
And so that made, you know, the nature of picking
(42:30):
stocks very, very complicated because we, you know, we don't
just throw darts on the wall and say, hey, I
think you should buy this. I mean there's a lot
of quantitative stuff that goes on under the hood before
you hear me talk about a stock, whether it's, you know,
here on television or in one bar ahead. I have
to know with absolute certainty that I've got the confidence
in that stock to recommend it because I buy those
stocks too. I mean, I, you know, if I'm talking
(42:50):
about it, I like to eat my own cooking. A
lot of people don't, but I do, and you see
those disclosures.
Every single time I'm on television, I own it. My
family owns it. My company recommends it. no investment banking,
you know, I am very transparent about this. So...
Suze (43:03):
And therefore Suze owns them too.
Keith (43:05):
Exactly. Well, this is the thing. I mean this is
why we're pals, right? But the thing about that, right, is,
is now you have when we started you had maybe 30-40%
of the market that was computerized, but the rise of
passive investing, the blend of options, Wall Street's go fast crowd,
now you have 80% to 85% of the market on
any given day,
that is moving by computer with no humans involved, no
(43:28):
regard for the fundamentals, no regard for the selection process.
So it makes that problem a little complicated. And then
that third thing, that little, you know, that little thing
called the cloud, uh, you know, people have heard of that,
but the architecture of the cloud keeps changing. So every
time we'd engineer something, you'd get right up to the
starting line, you know, Amazon, which we intend to use,
would change the way the cloud works and so we
had to reprogram everything. So, so long story short.
(43:49):
We're very close. We're rejiggering, but it's gonna be ready
when it's ready. We are also pursuing an ETF because
that's something that any investor can use. It can be point,
click buy. You don't have to worry about a dang
thing except maybe VCAing into the ETF itself, so it
becomes dramatically simplified. We take care of all that other
stuff behind the scenes and you don't have to lift
(44:10):
the figure.
Suze (44:11):
And personally, that's my vote.
Keith (44:13):
Well,
me too,
Suze (44:15):
but here's what's interesting and tell them the truth. Over
a year ago, yeah, maybe a year and a half ago,
I said, can't we just do an ETF?
Keith (44:25):
Oh, you did. Yes, you did, and I got Suze schooled
on that. Yes, I did.
Suze (44:30):
And no, it's like, no, if we do an ETF,
they're gonna, everybody's gonna find out about the secret sauce
and I don't want everybody to know what we're doing
because all because what happens with Keith's work a lot,
everybody is everybody rips it off because they know that
it's so good all these years of his experience and
the money he's invested in the computer systems, all of
(44:53):
a sudden you see it somewhere and they're taking credit
for it.
And then all of a sudden it makes it that
it's not, it's just not good. With an ETF it
was possible that they could go in and re-engineer what
Keith had done and bring it out in another ETF
and that's why Keith
(45:15):
didn't want to do it. Now he thinks that he
can protect it. Is that correct?
Keith (45:20):
That
is absolutely correct. And not only that, but the, the
group that we're working with has just within the last
week signed all the documents promising to protect it. So
it's a very different playing field now.
Suze (45:32):
So if it's true, everybody, and he can do that,
trust me, you are far better off rather than getting
an email every month, you figuring out what you should
do and you doing it every month, even though that's
how you would learn about investing. It would be far
better off for you in the long run.
(45:52):
To simply be able to VCA into the ETF and
there you go on with your life. So I hope
you understand that we haven't meant to, you know, go, no,
don't invest. That's why I did a podcast quite a
few months ago saying don't wait, you are to continue
to invest right now, continue to do these things we've
(46:15):
talked about, but that's the direction.
That Keith is going and I always wanted him to
go because I know from the bottom of my heart
it will be the easiest and most profitable thing for
you to do because you don't have to worry about it.
You're on vacation. You don't get the email. You don't
do it. And given the emails that I've gotten about
(46:39):
value cost averaging and how do you do it if
you have a whole lot of stocks and I only
want 4% of my port, no.
Just, you can do what you want with your stocks,
but there should be a sum of your money that
could be under the ETF doing it for you. What
do you think, Keith?
Keith (46:57):
Well, yes, and there's one other big benefit to that too, Suze, and, and,
and it's this, is if you have an ETF suddenly
your financial professionals, if you have one or your planners
that you work with can work on integrating it into
your financial plan.
So, so it, it adds to the flexibility in terms
of how you can use it and it also makes
(47:19):
it suitable for somebody who's just starting out and has
just a little bit of money to invest, but it
also opens it up to very, very sophisticated, very, very
large investors again, all at the touch of a button, so.
As frustrated as I am personally about uh the complexity
of where we started and where we are now, I
think that this is gonna be a very viable, very
(47:39):
good solution, and we're hoping to get it across the
finish line very, very quickly.
Suze (47:43):
So I hope all of you enjoyed this podcast with
the maestro. Before we go, anything else you wanna say?
Keith (47:53):
Just thank you to everybody thank you to you, Suze,
for having me on. What an honor. I mean, just, I,
as I say, I've been looking forward to this all
week and it has met and exceeded every single one
of my expectations. What a privilege to be on with
you today and to have everybody out there putting your
faith and your trust in what I have to say.
Thank you for your time.
Suze (48:10):
Thank you, Keith. I love you so much. I can't
even stand it. I hope you had a good Valentine's
Day too.
Keith (48:17):
We did and right back at you. Love you, Suze.
Suze (48:20):
All right, everybody, so there's only one thing that we both
want you to remember when it comes to your money,
and it's people first, then money, then things. I hope
you enjoy today. I hope you all stay safe and
know that together we will rise. We are strong.
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