October 7, 2025 • 27 mins
We unpack how busy professionals can build income with options without day trading by using realistic goals, quality stock selection, and a simple, repeatable process that protects capital. Fadi shares his GROWTH framework, why margin kills portfolios, and how real estate and options complement each other.
• Why the market looks like a casino without rules
• Setting realistic ROI targets and sleep‑well risk limits
• Long‑term vs swing vs day trading and time cost
• How to research quality stocks and value them
• Simple options approaches for income and entries
• Paper trading, feedback loops, and skills matrices
• Trader vs investor psychology and decision rules
• When options complement real estate and liquidity
• Why to avoid margin and keep position sizes small
• Three beginner steps to start responsibly this week
Connect with Fadi:
LinkedIn: https://www.linkedin.com/in/fadihabib/
Facebook: https://www.facebook.com/fadihabib111
Website: www.Legacywealthbuilderacademy.com
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_00 (00:00):
I figured out that a nine to five will not get me
(00:04):
where I want.
SPEAKER_01 (00:07):
Welcome to the Five Questions Podcast, where we
unlock real estate and businessinsights one question at a time.
Welcome to the Five QuestionsPodcast.
I am your host, Mario Lamar.
(00:28):
Our guest on today's show is anengineered, turned educator
helping business busyprofessionals build income with
options, the responsible way.
Founder and CEO of Legacy WealthBuilder Academy and creator of
the growth system.
(00:49):
Please welcome Fadi Habib.
Faddy, um, welcome to the FiveQuestions Podcast today.
SPEAKER_00 (00:55):
Hi, Mario.
Very happy to be here.
SPEAKER_01 (00:57):
The concept of the podcast, Faddy, is very simple.
I asked you five questions,either about business or real
estate, in this case, probablymore about business in your
case, and we get straight to thepoint.
You ready?
Ready.
Okay.
First question I have for you.
You spent uh 30 plus yearsleading in uh engineering,
(01:18):
operations, supply chain beforemoving into coaching and
investing.
What moment convince you that uhmaybe the stock market could be
learned by any busyprofessionals?
SPEAKER_00 (01:33):
Okay, so a couple of things.
I started investing from day onebecause I figured out that a
nine to five will not get mewhere I want.
So a very good book to for thelisteners to listeners to read
is The Cash Flow Quadrant.
I read it when I was 20 and Ifigured out that though I have a
really high-paying job, all ofmy life I had high-paying jobs.
(01:53):
I will never be wealthy with uhwith the nine to five.
So I started with real estateand uh I did very well.
Did some mistakes in thebeginning, like everybody.
Uh but uh I like 15 years ago or12 years ago, I was totally
convinced that any investor whoinvests in the stock market is
(02:14):
an irresponsible investor.
Because I everybody was losingmoney around me.
So I thought it's a casino, andit is actually, if you're not if
you're speculating, if you'regoing to gamble, it is a casino.
So um the moment I got thatactually there is a system, it
doesn't have like the fact thateverybody's using a knife in a
wrong way doesn't mean that theknife is bad.
(02:37):
So the stock market is not acasino, though a lot of people
are using it as a casino.
There's actually a method,there's a way, uh, there are
rules that you can apply to notspeculate.
The fact your attitude, ifyou're going to the stock market
as a speculator, all what you'regonna get is a lot of risk.
But if you go as an investor, uhso it's it's it's in the
(02:57):
mindset.
So the moment I realized when Iwent to this course to basically
prove that the guy doesn't knowwhat he's doing, and I was
totally convinced uh after thecourse that actually, you know
what, there is a way.
I was open enough to open mymind that there is a way.
I took a lot of courses, and umI did very well that the people
in these courses told me to comeand coach, and this is how it
(03:19):
started basically.
SPEAKER_01 (03:21):
It's nice to know that you touch different
investment types, and so youknow what you're talking about.
Uh, you didn't just do realestate and you tried stock
markets, and now you can say forsure, with a proper system, it's
possible for any busyprofessionals.
You were busy, you had busy uhjobs before, and you did it.
(03:44):
So you can now share yourexperience.
Experience, yeah.
SPEAKER_00 (03:48):
And there are investors who do it, like Warren
Buffett.
He all what he got is 20% peryear, but but he had a system.
So there's a way, there's a way.
And my way of doing it is Idon't want to look at charts all
day.
I I'm not a day trader.
I actually believe that daytrading is a very good way to
lose your money very quickly.
So it's not day trading, it'sbased on the principles of Peter
(04:10):
Lynch and Warren Buffett, butalso we're doing swing trading.
So there is a way to uh dostrike this balance between RY
as well as what I'm giving intothis uh business, the
investment, which is basicallytime and risk, right?
I want I don't want to spend alot of time and I want very
limited risk.
And you have this balancebetween RY and risk.
SPEAKER_01 (04:31):
Well, this brings uh us to our second question for
you.
Uh and you argue that uh themarket isn't a casino when you
approach it responsibly, and weyou just touched on this a
little bit.
What does responsible optioninvesting look like day to day?
Uh, risk limits, position,sizing, you know, all those
(04:52):
things, and time commitment forsomeone that has a full-time
job.
SPEAKER_00 (04:57):
Correct.
So uh there are different typesof investing.
There's long-term investing,like Warren Buffett, buys
something and waits for 30years.
You don't have 30 years to wait.
So that's one way.
Long-term investing.
The second is swing trading.
You go in and out in a week or amonth, third is day trading,
fourth is the extreme uh case ofscalping.
You go in and out in seconds.
Okay.
(05:18):
So for me, uh, day trading andscalping is uh pure speculation.
It's really very risky.
For me, it's not really thatresponsible.
I want something that isrepeatable.
Plus the fact that if you go tothe scalping and day trading,
you need a tremendous amount oftime and tremendous amount of
skill.
So by focusing more on the leftpart of this quadrant, which is
(05:41):
long-term investing and swingtrading, you limit the amount of
time that you need to do.
So I was able to do it with 10minutes a day.
That's it, doesn't need any moreonce you figure out the system.
Number two, you don't want to bea gambler.
Responsible means um you can'thave this attitude of going
buying a lottery ticket and youbelieve that you're an investor.
You're not an investor.
(06:01):
A real estate investor has to dosome research about the stuff
that they're being like youknow, you as a real estate
investor.
If you you can't just buy aproperty because one of your
friends told you it's going up,or one of your friends told me
you go buy there, you're gonnaask questions like what is the
rent?
Is it cash flowing?
What is the cap rate?
Is the location okay?
You you figure out whether it isworthy of your investing or not,
(06:23):
and you're very um uh uh youselect, you're very
discriminatory in terms of wheredo you put your money and so
responsible means you understandwhat you're going into, the fact
that you're not speculating, thefact that you understand risk.
A lot of people think that youcan get ROI without risk,
there's no such thing.
So if you go about like if yourun after get rich quick scheme
(06:48):
type things, if you get rich, ifyou run after really, really
high ROI, you will end up buyinglottery tickets.
But if you're oblivious aboutthe risks, so actually, in some
of the things I do, I don't haveum uh I don't have uh stop
losses because the type ofthings that we do doesn't have
that much risk.
Um the idea is to go into aposition whereby if the market
(07:10):
goes up, down, or or or down umsideways or down, you're okay
with all the outcomes.
Okay, but this doesn't happenexcept when you have a little
bit of uh like education aboutwhat is a good stock, what is a
cheap stock, or what is anexpensive stock.
So meta at 500 is a cheap stockcompared to Blackberry at$3,
right?
It has nothing to do with price.
(07:31):
So um idea of responsible meansyou're not gambling, idea of uh
responsible means that you cansleep well at night, you're not
putting your money at risk.
Everything, of course, there isrisk, but but but you're not
putting you're not limited risk,extra risk just to get the high
ROI.
Responsible means that at anypoint of time you know that
(07:52):
keeping your money and uhpreserving your capital is much
more important than the ROI thatyou're making.
Yeah, if you just chase ROI,it's just a matter of time where
you're gonna lose your capital.
And we don't do that.
SPEAKER_01 (08:04):
And at the beginning, uh, when I did your
introduction, we talked aboutthe growth system.
Uh you developed that.
So uh how about we break thatfor our listeners?
Uh, first of all, what do youwhat is the growth system?
What does the letters represent?
Um, and you know, how does theframework take a listener that
will learn today from today'sepisode from goal setting to
(08:28):
trade selection, entries, exits,uh, you know, all the review
stuff?
SPEAKER_00 (08:33):
Okay, cool.
So, what I did because I took alot of courses, uh, when I
decided that I'm gonna ventureon this and start teaching
people, I said, what is it thatI need that if I went back being
a beginner, what is it that Ineed?
Okay, what is the right frame ofmind?
Because a lot of people in thisspace um go after the get rich
(08:56):
quick scheme.
And there's a lot of ads outthere, especially on Facebook,
that tells you you're gonnadouble your money in uh in two
weeks or a month or six months.
This is just all gambling typestuff.
So none of that.
It's not a get rich quick.
So the first thing is goalsetting.
Goal setting means if I'm inToronto and I'm driving to um
Florida and it takes 24 hours todrive there.
(09:18):
If my goal is to reach there inthree hours, this means I have a
wrong goal because my goal willdictate that I have to drive at
900 kilometers per hour.
Yeah, it's just a matter of timewhere I will I will be in an
accident, right?
So this is what I meant by aright goal.
The right goal is to setyourself that 24% ROI per year
is very good.
The market, which is the spy,gives you about 11%, 10, 11.
(09:41):
So 24 is double that.
So if you can have 24 double themarket with limited risk, and
you can double your money everythree years, that's more than
enough.
That's really good.
So that's goal setting is tochange your mind because a lot
of people come to me saying 24is very low.
Okay, fine.
Then then you go.
It just you have no idea howmuch risk you're taking by
(10:03):
adopting that.
So that's goal setting.
Number two is research stocks.
You really need to know how toevaluate the investment that
you're buying.
You're not buying lotterytickets, you're buying
investments.
For me, only one to five percentof the stock market, stocks on
the stock market is is a goodstocks or investable stocks.
Blackberry, for example, is notan investable stocks because it
(10:25):
loses money.
So there's some criteria wherewhereby you can evaluate whether
this is a good stock or not.
And we use some screeners sothat we don't have, like, you
know, we're not gonna read thebalance sheet of 6,000 uh uh
companies.
So we can figure out a list,shortlist, a list of 20, 30
stocks that are good.
Uh, part of that as well isfiguring out or understanding
(10:48):
how to evaluate whether thestock is cheap or expensive.
That's important.
Third is O, which is optionsmastery.
Options is like Chinese, it's avery new concept for a lot of
people, a lot of mechanics.
So you need to dwell in it andimmerse yourself in it to
understand a little bit.
There's like 50 different waysof doing options.
I focus on just two very simpleways.
(11:09):
Understand it.
And my method is instead ofteaching people, I went to
courses like this.
You teach 50 different methodsand they talk five minutes about
each one, you go out of thecourse, not able to implement
anything, right?
Because just the breadth.
So I focus on just two, but wewe we do like ninja like ninja
type training.
(11:31):
W is about uh went throughpractice.
If you have all the knowledge,but you're not practicing, like
you can't really do this by justwatching YouTube channels
because YouTube will give youthe knowledge, but will not give
you training.
You need the feedback.
So uh part of the 12-weekmentorship program that I have
is that you have to open a papertrading account.
Paper trading means everythingis the same, it's simulated
(11:54):
trading.
The just the money, they giveyou a million dollars, monopoly
money.
So everything is the same, theprices are the same, everything
is the same, it's just not yourmoney.
So you're not you can't makemoney, but you can't lose money.
So it's zero, like one zero riskinvolved in the training.
And that's the responsible wayof doing it because you will
make mistakes.
And before you put your moneyinto anything, you need to try
(12:16):
it.
You need to prove to yourselfthat you can make money with
paper trading before you go andput money.
Because if you don't make moneywith paper trading, meaning I
might have been teaching you uhsomething that is uh fictitious
or wrong, maybe you're makingmistakes, maybe you didn't
understand.
So you gotta prove to yourselfthat you can make money um with
the training.
And with the training, you get alot of feedback, and that's very
(12:38):
important.
The feedback and the structure,the fact that we meet every week
in a small setting, um, is veryimportant because it counter
like it pushes the learning andthe the progress very quickly.
Because without feedback, you'rein a loop that you're blind.
Um T is psychology, veryimportant.
(12:58):
Train your psychology.
If you don't have a grip betweenthe fear and greed, if you're
too fearful, you will do youwill do nothing.
And same as in real estate.
If you're too greedy, you willbe in a position whereby you
will take something that is veryrisky.
And H is habitual learning.
So that's the system.
This is all the elements that Ido believe will get somebody
from absolutely no experience instocks and options to somebody
(13:21):
in three months whereby they'rereally confident uh about what
they're doing.
SPEAKER_01 (13:25):
And with that growth system, you said it's a 12-week
program.
SPEAKER_00 (13:29):
Correct, it's a 12-week mentorship program.
SPEAKER_01 (13:31):
12-week mentorship program, and you you you're
there showing up with the group,you have discussions, and it's a
really uh hand-holing system.
SPEAKER_00 (13:41):
Yeah, it's very hands-on.
You can't hide.
It's not it's not that I'm gonnagive you videos to watch.
It's it's uh I have a skillsmatrix.
Again, I'm uh 30 years inoperation, so I have a skills
matrix, and I'm also aprofessor, so nobody can hide.
So you have to show me thatthere's some certain skills,
like there's something like 20skills that you need to show
before you can prove to yourselfthat you can go to live trading.
(14:04):
And I will show you the skillsmatrix.
Uh, I will mark if you hit anymilestone, and I will tell you,
you know what, I want to seemore of that.
Uh and we meet uh one to threehours every week, and part of it
is theory, but the fun part iseverybody showing their cell
phone, showing their trades.
(14:24):
And again, there's nothingconfidential about it because
it's old paper trading.
Yeah, and I interview them, Iask them questions, and uh you
learn from your mistakes as wellas seeing the mistakes.
So they go through the programdoing about 300, 400 trades,
they've seen it all basically byafter three four months.
SPEAKER_01 (14:41):
So that brings uh me to our fourth question, and I
have a question for you.
Uh uh something I want to talkabout.
You said we talked aboutgamblers versus investors.
Now let's talk about tradersversus investors.
Uh, how do you draw the line?
Um, maybe you can walk usthrough a recent simple option
(15:04):
uh income example that shows youthe process, uh, the entry
criteria, risk management, and apost-trade review, and how a
trader versus an investor wouldsee it.
SPEAKER_00 (15:18):
Okay, so very quickly, uh there's a
fundamental difference in traderand investor.
Investor will one of the mainworries of an investor is is
this a good stock or not?
The investor doesn't want to buybad products, investor wants to
invest, okay?
Trader does not care if this isa good product or not.
(15:38):
Trader, all what they're lookingat is the volatility of the
stock going up and down.
They don't care if this isreally bad stock because they
are not really investing, theyare speculator.
Okay, so on a scale of investorversus trader, if you go a
little bit push the trader more,you'll find a gambler.
Okay.
So uh uh so so uh that's onething.
(16:00):
Trader is uh looks at very shortterm investor more of a long
term.
Uh uh investor wants to likeinvestor, kind of uh wants to
marry the girl, trader wants aone night, one time, one one
night stack, kind of, right?
He he doesn't have doesn't wantany relationship with the stock.
Yeah, they just want in a veryshort term, wants to move.
(16:22):
Um, the investor uh sticks withum uh a stock even if the price
went down because they theybelieve in the stock.
Trader don't.
The trader goes out, have stoploss, they don't care, right?
So very different uh way.
So um uh an investor in my worldwill not do options except uh
(16:44):
except on a good stock.
Because worst case scenario, ifthey if they have to buy the
stock, uh they are they cansleep well at night.
They know that, for example,Meta, Meta will um Meta at some
point was uh$400 in the sameyear went to$80.
Um if you're an investor and youknow that this is a good stock,
(17:07):
um good stock because Meta ispumping a lot of cash, a lot of
profit, revenue is good.
You will keep the profit, you'renot gonna sell it.
You will go and try to get moremoney to buy it.
If you know that$80 is a verycheap price, it's really a
bargain, yeah, right?
You will go and try to buy moreif you know what you're doing.
A trader will not do that.
(17:28):
A trader will will sell a normalperson in the stock market that
they they don't have anyeducation, usually their
psychology will push them to buyat the top, wait till it goes
down, and sell at the bottom.
That's the normal, that's thenormal person.
That's why everybody's losingmoney because they have no
concept of what it is thatthey're trying to do.
SPEAKER_01 (17:48):
They get scared.
SPEAKER_00 (17:50):
Yeah, investor is very different.
Investor looks at good stocks,they know that good stocks will
on the long term.
Peter Lynch told us there's 100%correlation between the value of
the stock and the price of thestock on the long term.
So if the company is makingmoney with some criteria that I
discussed in the course, it willgo up in the long term.
So even it went down, that's nota reason to sell, that's a
(18:11):
reason to buy more.
That's a little bit of a flavorof a difference between trader
and investor.
SPEAKER_01 (18:15):
And and you talked about uh meta uh as an as an
example.
SPEAKER_00 (18:20):
Do you have another example that you you maybe did
uh recently uh that shows you soall one of the myths about the
stock market is that uh uh somepeople expect the stock market
to go up all the time.
It breathes, it goes.
So all the like it doesn't likethere's no exception to this,
Mario.
All the stocks, even if they'rea good stock like Apple, Amazon,
(18:41):
they go up and down.
That's normal.
There is nothing normal aboutexhaling.
Like if you think that exhale,like if I look at my kid and it
like and he inhales and thenexhales, and if I think that
exhaling is bad, I will have togo and get a doctor because
there's something there isnothing wrong about the company
going up and down.
In the short term, the stockmarket is a bunch of drunk fools
(19:03):
running around.
There's at it's running onsentiment, it has nothing to do,
completely disassociated withthe value of the company, right?
That's why you see bad companiesgoing up or good companies going
down.
In the short term, there'sabsolutely no logic.
It's it's just uh sentiment andhormones going up and down.
In the long term, though,there's 100% correlation for
(19:25):
good companies to go up becauseat the end of the day, we're
buying stocks for companies, andcompanies are businesses, and
businesses are evaluated at theend of the day on how much
profit they make.
That's a business, right?
So if a company is making moneyon the long term, it's gonna uh
go up.
Don't expect anything from it inthe short term.
That's why traders, like youknow, I I don't like playing the
(19:48):
trading game, the trader daytrading.
SPEAKER_01 (19:52):
Freddy, uh, we're already at our fifth and final
question for today.
Uh, you know, a lot of ouraudience are real estate
investors.
Uh, maybe for the audience,where do options fit alongside
properties or real estate in abalance plan?
Maybe you can give us the prosand cons, the liquidity, uh, the
(20:15):
liquidity portion, because realestate takes a long time.
Uh, is it the same thing withyour uh what you're doing, the
time involvement?
Uh, and then we'll finish offwith maybe give us uh, if you
can, two, three steps forbeginners to take this week that
they can start doing thisresponsibly.
SPEAKER_00 (20:36):
Okay.
So uh for me, I do believe thatif you are serious about being
wealthy, at some point of timein your career, you have to be
involved in these three things.
There's three different ways,other than the night to five
stocks, real estate, and openinga business.
You can't do the three at thesame time, right?
You can't just open the three atthe same time too much.
So focus on one, get it correct,and then go to the other.
(20:58):
So for me, options or stocks andreal estate are extremely
complementary because they aredifferent animals.
Uh, stocks and options are veryliquid.
Real estate is not.
If I have a house or stuff, if Iwant to sell it, it will stay a
little bit on the market, right?
Uh options are very easy.
I can get money out and in very,very quickly.
(21:18):
Um, and the good thing about itis that sometimes the the like
the stock market is up and thereal estate is down, and vice
versa.
So all good sophisticatedinvestors I have, they have
both, and they can move moneyfrom one thing to the other.
For example, right now inCanada, there's a lot of the
real estate is a little bit likeagain.
(21:40):
I know there are opportunitieseverywhere, but overall, in in
Toronto, for example, it's veryhigh.
Some people like sold at thepeak and put some money into the
stocks, and they have that.
Um, the good thing about aswell, the stocks and options is
that it has this potential forincome generation.
And a lot of times, especiallywith high interest rates, the
real estate does not have what Ihad before as positive cash
(22:04):
flow, is not positive cashflowing anymore because of the
interest rate.
So options is a very, very goodway to to uh to create this.
So um um also one thing I willnever buy any real estate
without taking a mortgage.
So we use leverage in um in inin real estate.
I will never use margin orleverage in stocks because it
(22:26):
was just the diff, it's adifferent animal.
There's a lot of volatility andit's a recipe for disaster to
not use margin.
Actually, when you open abrokerage account, they give you
about three dollars or two tofour dollars for every dollar
you give.
But I caution people, I makesure that my my students never
use margin because there's a lotof market meltdowns.
(22:47):
And again, if the philosophy isto preserve your capital, much
more important than makingmoney, then we don't use margin
because again, I'm not gonna gothrough the mechanics of it, but
it's very risky to use margin.
It will amplify your profitsvery quickly, but you're gonna
make a lot of money in the firstsix months, and then seven
months when the market goesdown, you're gonna give all the
profit back plus the capital.
So whatever use margin so thatwe're in the safe space.
(23:09):
Three steps for uh people isnumber one, open a paper trading
uh brokerage account.
It's free, you don't have tofund it.
Uh, but whatever strategy youlearn, start with paper trading.
The brokerage that I use, again,they don't pay me any money to
say that, but it's called IBKR.
You can open it for free and youcan train in a paper trading
(23:30):
account.
They give you a million dollarsmonopoly money.
Uh that's one thing.
Number two, go to YouTube andlearn uh as much as you can
because uh information is acommodity right now, it's
everywhere.
However, I do not believe thatanybody should like you can play
with paper money, but you needum the way I say it is that
(23:52):
because my father wasn't abillionaire or a millionaire, I
have to learn myself.
Yeah, so to jumpstart youreducation and to make sure that
you don't make mistakes, becauseyou need to find a good um
mentorship program.
Don't just buy courses, right?
Because courses you need thefeedback, you need somebody like
I do believe that you cannotlearn how to ride horses by
(24:16):
watching YouTube channels.
You need somebody with you inthe stable, you can't learn how
to swim by watching YouTubechannels.
You need somebody with you inthe pool.
So find a mentorship programthat is good.
Interview a lot of people, go uhand look and find somebody who
can caterpillar your success ina way that is safe.
That's very important.
Safe.
Don't don't risk your money.
SPEAKER_01 (24:37):
Yeah, I I couldn't agree more with you, uh, Fadi.
Um I I did it with with realestate.
Uh I tried some programs thatdid not have mentorship built
in.
It was videos, and you know, youlearn on your own.
I it costed me thousands andthousands of dollars of mistakes
(24:58):
I did.
Um other program, I had a mentorthat could overlook, you know,
the things that I was doing.
Hey, uh Mario, make sure you'renot doing this.
Oh, you forgot about this.
Did you think about that?
These are the types of uhmentorship programs that are
people need, absolutely need,and don't see it as a cost, see
(25:21):
it as an investment in yourselfto protect you from having costs
that are much more than usuallythe program itself.
SPEAKER_00 (25:30):
If the objective is to do this and you're serious
about it, it's a cost, yes, butit's an investment too.
Because if you're serious aboutit, why pay for a course with no
feedback?
Guess what?
I want to tell you this stat.
You know how many percent ofpeople, when they buy a video
course, they finish it to theend?
Only three percent.
Yeah.
Three percent.
(25:50):
So what are what are the chancesthat these three percent of
people will implement?
It's almost zero.
It's almost zero.
So get to a mentorship programbecause you will not be able to
escape.
And the fact that there isstructure into this, like when
you have when you know thatyou're gonna meet with your
mentor once every week or onceevery month, you you gotta wake
up and do what you need to dobecause you don't want you don't
(26:12):
want to be embarrassed in frontof the the accountability part,
the structure is very important,the structure.
So I cannot agree more.
SPEAKER_01 (26:20):
Yeah, Fadi, thank you so much for spending the
time to answer some questionstoday.
Your uh your knowledge, uh,valuable, very valuable.
Uh, I hope our listeners willtake a piece of your knowledge
and advice and take them, takeit, take it on their journey uh
to become wealthy andsuccessful.
Thank you again, and uh we'lltalk soon.
(26:42):
Thank you very much, Mario.
Thank you.
Thanks for tuning in to the FiveQuestions podcast.
If you enjoyed today's episode,don't forget to subscribe, like,
and hit the notification bell onour YouTube channel so you never
miss an episode.
Stay tuned for more insights andtips to transform your real
estate and business games.
See you next time.
I figured out that a nine to five will not get me
(00:04):
where I want.
SPEAKER_01 (00:07):
Welcome to the Five Questions Podcast, where we
unlock real estate and businessinsights one question at a time.
Welcome to the Five QuestionsPodcast.
I am your host, Mario Lamar.
(00:28):
Our guest on today's show is anengineered, turned educator
helping business busyprofessionals build income with
options, the responsible way.
Founder and CEO of Legacy WealthBuilder Academy and creator of
the growth system.
(00:49):
Please welcome Fadi Habib.
Faddy, um, welcome to the FiveQuestions Podcast today.
SPEAKER_00 (00:55):
Hi, Mario.
Very happy to be here.
SPEAKER_01 (00:57):
The concept of the podcast, Faddy, is very simple.
I asked you five questions,either about business or real
estate, in this case, probablymore about business in your
case, and we get straight to thepoint.
You ready?
Ready.
Okay.
First question I have for you.
You spent uh 30 plus yearsleading in uh engineering,
(01:18):
operations, supply chain beforemoving into coaching and
investing.
What moment convince you that uhmaybe the stock market could be
learned by any busyprofessionals?
SPEAKER_00 (01:33):
Okay, so a couple of things.
I started investing from day onebecause I figured out that a
nine to five will not get mewhere I want.
So a very good book to for thelisteners to listeners to read
is The Cash Flow Quadrant.
I read it when I was 20 and Ifigured out that though I have a
really high-paying job, all ofmy life I had high-paying jobs.
(01:53):
I will never be wealthy with uhwith the nine to five.
So I started with real estateand uh I did very well.
Did some mistakes in thebeginning, like everybody.
Uh but uh I like 15 years ago or12 years ago, I was totally
convinced that any investor whoinvests in the stock market is
(02:14):
an irresponsible investor.
Because I everybody was losingmoney around me.
So I thought it's a casino, andit is actually, if you're not if
you're speculating, if you'regoing to gamble, it is a casino.
So um the moment I got thatactually there is a system, it
doesn't have like the fact thateverybody's using a knife in a
wrong way doesn't mean that theknife is bad.
(02:37):
So the stock market is not acasino, though a lot of people
are using it as a casino.
There's actually a method,there's a way, uh, there are
rules that you can apply to notspeculate.
The fact your attitude, ifyou're going to the stock market
as a speculator, all what you'regonna get is a lot of risk.
But if you go as an investor, uhso it's it's it's in the
(02:57):
mindset.
So the moment I realized when Iwent to this course to basically
prove that the guy doesn't knowwhat he's doing, and I was
totally convinced uh after thecourse that actually, you know
what, there is a way.
I was open enough to open mymind that there is a way.
I took a lot of courses, and umI did very well that the people
in these courses told me to comeand coach, and this is how it
(03:19):
started basically.
SPEAKER_01 (03:21):
It's nice to know that you touch different
investment types, and so youknow what you're talking about.
Uh, you didn't just do realestate and you tried stock
markets, and now you can say forsure, with a proper system, it's
possible for any busyprofessionals.
You were busy, you had busy uhjobs before, and you did it.
(03:44):
So you can now share yourexperience.
Experience, yeah.
SPEAKER_00 (03:48):
And there are investors who do it, like Warren
Buffett.
He all what he got is 20% peryear, but but he had a system.
So there's a way, there's a way.
And my way of doing it is Idon't want to look at charts all
day.
I I'm not a day trader.
I actually believe that daytrading is a very good way to
lose your money very quickly.
So it's not day trading, it'sbased on the principles of Peter
(04:10):
Lynch and Warren Buffett, butalso we're doing swing trading.
So there is a way to uh dostrike this balance between RY
as well as what I'm giving intothis uh business, the
investment, which is basicallytime and risk, right?
I want I don't want to spend alot of time and I want very
limited risk.
And you have this balancebetween RY and risk.
SPEAKER_01 (04:31):
Well, this brings uh us to our second question for
you.
Uh and you argue that uh themarket isn't a casino when you
approach it responsibly, and weyou just touched on this a
little bit.
What does responsible optioninvesting look like day to day?
Uh, risk limits, position,sizing, you know, all those
(04:52):
things, and time commitment forsomeone that has a full-time
job.
SPEAKER_00 (04:57):
Correct.
So uh there are different typesof investing.
There's long-term investing,like Warren Buffett, buys
something and waits for 30years.
You don't have 30 years to wait.
So that's one way.
Long-term investing.
The second is swing trading.
You go in and out in a week or amonth, third is day trading,
fourth is the extreme uh case ofscalping.
You go in and out in seconds.
Okay.
(05:18):
So for me, uh, day trading andscalping is uh pure speculation.
It's really very risky.
For me, it's not really thatresponsible.
I want something that isrepeatable.
Plus the fact that if you go tothe scalping and day trading,
you need a tremendous amount oftime and tremendous amount of
skill.
So by focusing more on the leftpart of this quadrant, which is
(05:41):
long-term investing and swingtrading, you limit the amount of
time that you need to do.
So I was able to do it with 10minutes a day.
That's it, doesn't need any moreonce you figure out the system.
Number two, you don't want to bea gambler.
Responsible means um you can'thave this attitude of going
buying a lottery ticket and youbelieve that you're an investor.
You're not an investor.
(06:01):
A real estate investor has to dosome research about the stuff
that they're being like youknow, you as a real estate
investor.
If you you can't just buy aproperty because one of your
friends told you it's going up,or one of your friends told me
you go buy there, you're gonnaask questions like what is the
rent?
Is it cash flowing?
What is the cap rate?
Is the location okay?
You you figure out whether it isworthy of your investing or not,
(06:23):
and you're very um uh uh youselect, you're very
discriminatory in terms of wheredo you put your money and so
responsible means you understandwhat you're going into, the fact
that you're not speculating, thefact that you understand risk.
A lot of people think that youcan get ROI without risk,
there's no such thing.
So if you go about like if yourun after get rich quick scheme
(06:48):
type things, if you get rich, ifyou run after really, really
high ROI, you will end up buyinglottery tickets.
But if you're oblivious aboutthe risks, so actually, in some
of the things I do, I don't haveum uh I don't have uh stop
losses because the type ofthings that we do doesn't have
that much risk.
Um the idea is to go into aposition whereby if the market
(07:10):
goes up, down, or or or down umsideways or down, you're okay
with all the outcomes.
Okay, but this doesn't happenexcept when you have a little
bit of uh like education aboutwhat is a good stock, what is a
cheap stock, or what is anexpensive stock.
So meta at 500 is a cheap stockcompared to Blackberry at$3,
right?
It has nothing to do with price.
(07:31):
So um idea of responsible meansyou're not gambling, idea of uh
responsible means that you cansleep well at night, you're not
putting your money at risk.
Everything, of course, there isrisk, but but but you're not
putting you're not limited risk,extra risk just to get the high
ROI.
Responsible means that at anypoint of time you know that
(07:52):
keeping your money and uhpreserving your capital is much
more important than the ROI thatyou're making.
Yeah, if you just chase ROI,it's just a matter of time where
you're gonna lose your capital.
And we don't do that.
SPEAKER_01 (08:04):
And at the beginning, uh, when I did your
introduction, we talked aboutthe growth system.
Uh you developed that.
So uh how about we break thatfor our listeners?
Uh, first of all, what do youwhat is the growth system?
What does the letters represent?
Um, and you know, how does theframework take a listener that
will learn today from today'sepisode from goal setting to
(08:28):
trade selection, entries, exits,uh, you know, all the review
stuff?
SPEAKER_00 (08:33):
Okay, cool.
So, what I did because I took alot of courses, uh, when I
decided that I'm gonna ventureon this and start teaching
people, I said, what is it thatI need that if I went back being
a beginner, what is it that Ineed?
Okay, what is the right frame ofmind?
Because a lot of people in thisspace um go after the get rich
(08:56):
quick scheme.
And there's a lot of ads outthere, especially on Facebook,
that tells you you're gonnadouble your money in uh in two
weeks or a month or six months.
This is just all gambling typestuff.
So none of that.
It's not a get rich quick.
So the first thing is goalsetting.
Goal setting means if I'm inToronto and I'm driving to um
Florida and it takes 24 hours todrive there.
(09:18):
If my goal is to reach there inthree hours, this means I have a
wrong goal because my goal willdictate that I have to drive at
900 kilometers per hour.
Yeah, it's just a matter of timewhere I will I will be in an
accident, right?
So this is what I meant by aright goal.
The right goal is to setyourself that 24% ROI per year
is very good.
The market, which is the spy,gives you about 11%, 10, 11.
(09:41):
So 24 is double that.
So if you can have 24 double themarket with limited risk, and
you can double your money everythree years, that's more than
enough.
That's really good.
So that's goal setting is tochange your mind because a lot
of people come to me saying 24is very low.
Okay, fine.
Then then you go.
It just you have no idea howmuch risk you're taking by
(10:03):
adopting that.
So that's goal setting.
Number two is research stocks.
You really need to know how toevaluate the investment that
you're buying.
You're not buying lotterytickets, you're buying
investments.
For me, only one to five percentof the stock market, stocks on
the stock market is is a goodstocks or investable stocks.
Blackberry, for example, is notan investable stocks because it
(10:25):
loses money.
So there's some criteria wherewhereby you can evaluate whether
this is a good stock or not.
And we use some screeners sothat we don't have, like, you
know, we're not gonna read thebalance sheet of 6,000 uh uh
companies.
So we can figure out a list,shortlist, a list of 20, 30
stocks that are good.
Uh, part of that as well isfiguring out or understanding
(10:48):
how to evaluate whether thestock is cheap or expensive.
That's important.
Third is O, which is optionsmastery.
Options is like Chinese, it's avery new concept for a lot of
people, a lot of mechanics.
So you need to dwell in it andimmerse yourself in it to
understand a little bit.
There's like 50 different waysof doing options.
I focus on just two very simpleways.
(11:09):
Understand it.
And my method is instead ofteaching people, I went to
courses like this.
You teach 50 different methodsand they talk five minutes about
each one, you go out of thecourse, not able to implement
anything, right?
Because just the breadth.
So I focus on just two, but wewe we do like ninja like ninja
type training.
(11:31):
W is about uh went throughpractice.
If you have all the knowledge,but you're not practicing, like
you can't really do this by justwatching YouTube channels
because YouTube will give youthe knowledge, but will not give
you training.
You need the feedback.
So uh part of the 12-weekmentorship program that I have
is that you have to open a papertrading account.
Paper trading means everythingis the same, it's simulated
(11:54):
trading.
The just the money, they giveyou a million dollars, monopoly
money.
So everything is the same, theprices are the same, everything
is the same, it's just not yourmoney.
So you're not you can't makemoney, but you can't lose money.
So it's zero, like one zero riskinvolved in the training.
And that's the responsible wayof doing it because you will
make mistakes.
And before you put your moneyinto anything, you need to try
(12:16):
it.
You need to prove to yourselfthat you can make money with
paper trading before you go andput money.
Because if you don't make moneywith paper trading, meaning I
might have been teaching you uhsomething that is uh fictitious
or wrong, maybe you're makingmistakes, maybe you didn't
understand.
So you gotta prove to yourselfthat you can make money um with
the training.
And with the training, you get alot of feedback, and that's very
(12:38):
important.
The feedback and the structure,the fact that we meet every week
in a small setting, um, is veryimportant because it counter
like it pushes the learning andthe the progress very quickly.
Because without feedback, you'rein a loop that you're blind.
Um T is psychology, veryimportant.
(12:58):
Train your psychology.
If you don't have a grip betweenthe fear and greed, if you're
too fearful, you will do youwill do nothing.
And same as in real estate.
If you're too greedy, you willbe in a position whereby you
will take something that is veryrisky.
And H is habitual learning.
So that's the system.
This is all the elements that Ido believe will get somebody
from absolutely no experience instocks and options to somebody
(13:21):
in three months whereby they'rereally confident uh about what
they're doing.
SPEAKER_01 (13:25):
And with that growth system, you said it's a 12-week
program.
SPEAKER_00 (13:29):
Correct, it's a 12-week mentorship program.
SPEAKER_01 (13:31):
12-week mentorship program, and you you you're
there showing up with the group,you have discussions, and it's a
really uh hand-holing system.
SPEAKER_00 (13:41):
Yeah, it's very hands-on.
You can't hide.
It's not it's not that I'm gonnagive you videos to watch.
It's it's uh I have a skillsmatrix.
Again, I'm uh 30 years inoperation, so I have a skills
matrix, and I'm also aprofessor, so nobody can hide.
So you have to show me thatthere's some certain skills,
like there's something like 20skills that you need to show
before you can prove to yourselfthat you can go to live trading.
(14:04):
And I will show you the skillsmatrix.
Uh, I will mark if you hit anymilestone, and I will tell you,
you know what, I want to seemore of that.
Uh and we meet uh one to threehours every week, and part of it
is theory, but the fun part iseverybody showing their cell
phone, showing their trades.
(14:24):
And again, there's nothingconfidential about it because
it's old paper trading.
Yeah, and I interview them, Iask them questions, and uh you
learn from your mistakes as wellas seeing the mistakes.
So they go through the programdoing about 300, 400 trades,
they've seen it all basically byafter three four months.
SPEAKER_01 (14:41):
So that brings uh me to our fourth question, and I
have a question for you.
Uh uh something I want to talkabout.
You said we talked aboutgamblers versus investors.
Now let's talk about tradersversus investors.
Uh, how do you draw the line?
Um, maybe you can walk usthrough a recent simple option
(15:04):
uh income example that shows youthe process, uh, the entry
criteria, risk management, and apost-trade review, and how a
trader versus an investor wouldsee it.
SPEAKER_00 (15:18):
Okay, so very quickly, uh there's a
fundamental difference in traderand investor.
Investor will one of the mainworries of an investor is is
this a good stock or not?
The investor doesn't want to buybad products, investor wants to
invest, okay?
Trader does not care if this isa good product or not.
(15:38):
Trader, all what they're lookingat is the volatility of the
stock going up and down.
They don't care if this isreally bad stock because they
are not really investing, theyare speculator.
Okay, so on a scale of investorversus trader, if you go a
little bit push the trader more,you'll find a gambler.
Okay.
So uh uh so so uh that's onething.
(16:00):
Trader is uh looks at very shortterm investor more of a long
term.
Uh uh investor wants to likeinvestor, kind of uh wants to
marry the girl, trader wants aone night, one time, one one
night stack, kind of, right?
He he doesn't have doesn't wantany relationship with the stock.
Yeah, they just want in a veryshort term, wants to move.
(16:22):
Um, the investor uh sticks withum uh a stock even if the price
went down because they theybelieve in the stock.
Trader don't.
The trader goes out, have stoploss, they don't care, right?
So very different uh way.
So um uh an investor in my worldwill not do options except uh
(16:44):
except on a good stock.
Because worst case scenario, ifthey if they have to buy the
stock, uh they are they cansleep well at night.
They know that, for example,Meta, Meta will um Meta at some
point was uh$400 in the sameyear went to$80.
Um if you're an investor and youknow that this is a good stock,
(17:07):
um good stock because Meta ispumping a lot of cash, a lot of
profit, revenue is good.
You will keep the profit, you'renot gonna sell it.
You will go and try to get moremoney to buy it.
If you know that$80 is a verycheap price, it's really a
bargain, yeah, right?
You will go and try to buy moreif you know what you're doing.
A trader will not do that.
(17:28):
A trader will will sell a normalperson in the stock market that
they they don't have anyeducation, usually their
psychology will push them to buyat the top, wait till it goes
down, and sell at the bottom.
That's the normal, that's thenormal person.
That's why everybody's losingmoney because they have no
concept of what it is thatthey're trying to do.
SPEAKER_01 (17:48):
They get scared.
SPEAKER_00 (17:50):
Yeah, investor is very different.
Investor looks at good stocks,they know that good stocks will
on the long term.
Peter Lynch told us there's 100%correlation between the value of
the stock and the price of thestock on the long term.
So if the company is makingmoney with some criteria that I
discussed in the course, it willgo up in the long term.
So even it went down, that's nota reason to sell, that's a
(18:11):
reason to buy more.
That's a little bit of a flavorof a difference between trader
and investor.
SPEAKER_01 (18:15):
And and you talked about uh meta uh as an as an
example.
SPEAKER_00 (18:20):
Do you have another example that you you maybe did
uh recently uh that shows you soall one of the myths about the
stock market is that uh uh somepeople expect the stock market
to go up all the time.
It breathes, it goes.
So all the like it doesn't likethere's no exception to this,
Mario.
All the stocks, even if they'rea good stock like Apple, Amazon,
(18:41):
they go up and down.
That's normal.
There is nothing normal aboutexhaling.
Like if you think that exhale,like if I look at my kid and it
like and he inhales and thenexhales, and if I think that
exhaling is bad, I will have togo and get a doctor because
there's something there isnothing wrong about the company
going up and down.
In the short term, the stockmarket is a bunch of drunk fools
(19:03):
running around.
There's at it's running onsentiment, it has nothing to do,
completely disassociated withthe value of the company, right?
That's why you see bad companiesgoing up or good companies going
down.
In the short term, there'sabsolutely no logic.
It's it's just uh sentiment andhormones going up and down.
In the long term, though,there's 100% correlation for
(19:25):
good companies to go up becauseat the end of the day, we're
buying stocks for companies, andcompanies are businesses, and
businesses are evaluated at theend of the day on how much
profit they make.
That's a business, right?
So if a company is making moneyon the long term, it's gonna uh
go up.
Don't expect anything from it inthe short term.
That's why traders, like youknow, I I don't like playing the
(19:48):
trading game, the trader daytrading.
SPEAKER_01 (19:52):
Freddy, uh, we're already at our fifth and final
question for today.
Uh, you know, a lot of ouraudience are real estate
investors.
Uh, maybe for the audience,where do options fit alongside
properties or real estate in abalance plan?
Maybe you can give us the prosand cons, the liquidity, uh, the
(20:15):
liquidity portion, because realestate takes a long time.
Uh, is it the same thing withyour uh what you're doing, the
time involvement?
Uh, and then we'll finish offwith maybe give us uh, if you
can, two, three steps forbeginners to take this week that
they can start doing thisresponsibly.
SPEAKER_00 (20:36):
Okay.
So uh for me, I do believe thatif you are serious about being
wealthy, at some point of timein your career, you have to be
involved in these three things.
There's three different ways,other than the night to five
stocks, real estate, and openinga business.
You can't do the three at thesame time, right?
You can't just open the three atthe same time too much.
So focus on one, get it correct,and then go to the other.
(20:58):
So for me, options or stocks andreal estate are extremely
complementary because they aredifferent animals.
Uh, stocks and options are veryliquid.
Real estate is not.
If I have a house or stuff, if Iwant to sell it, it will stay a
little bit on the market, right?
Uh options are very easy.
I can get money out and in very,very quickly.
(21:18):
Um, and the good thing about itis that sometimes the the like
the stock market is up and thereal estate is down, and vice
versa.
So all good sophisticatedinvestors I have, they have
both, and they can move moneyfrom one thing to the other.
For example, right now inCanada, there's a lot of the
real estate is a little bit likeagain.
(21:40):
I know there are opportunitieseverywhere, but overall, in in
Toronto, for example, it's veryhigh.
Some people like sold at thepeak and put some money into the
stocks, and they have that.
Um, the good thing about aswell, the stocks and options is
that it has this potential forincome generation.
And a lot of times, especiallywith high interest rates, the
real estate does not have what Ihad before as positive cash
(22:04):
flow, is not positive cashflowing anymore because of the
interest rate.
So options is a very, very goodway to to uh to create this.
So um um also one thing I willnever buy any real estate
without taking a mortgage.
So we use leverage in um in inin real estate.
I will never use margin orleverage in stocks because it
(22:26):
was just the diff, it's adifferent animal.
There's a lot of volatility andit's a recipe for disaster to
not use margin.
Actually, when you open abrokerage account, they give you
about three dollars or two tofour dollars for every dollar
you give.
But I caution people, I makesure that my my students never
use margin because there's a lotof market meltdowns.
(22:47):
And again, if the philosophy isto preserve your capital, much
more important than makingmoney, then we don't use margin
because again, I'm not gonna gothrough the mechanics of it, but
it's very risky to use margin.
It will amplify your profitsvery quickly, but you're gonna
make a lot of money in the firstsix months, and then seven
months when the market goesdown, you're gonna give all the
profit back plus the capital.
So whatever use margin so thatwe're in the safe space.
(23:09):
Three steps for uh people isnumber one, open a paper trading
uh brokerage account.
It's free, you don't have tofund it.
Uh, but whatever strategy youlearn, start with paper trading.
The brokerage that I use, again,they don't pay me any money to
say that, but it's called IBKR.
You can open it for free and youcan train in a paper trading
(23:30):
account.
They give you a million dollarsmonopoly money.
Uh that's one thing.
Number two, go to YouTube andlearn uh as much as you can
because uh information is acommodity right now, it's
everywhere.
However, I do not believe thatanybody should like you can play
with paper money, but you needum the way I say it is that
(23:52):
because my father wasn't abillionaire or a millionaire, I
have to learn myself.
Yeah, so to jumpstart youreducation and to make sure that
you don't make mistakes, becauseyou need to find a good um
mentorship program.
Don't just buy courses, right?
Because courses you need thefeedback, you need somebody like
I do believe that you cannotlearn how to ride horses by
(24:16):
watching YouTube channels.
You need somebody with you inthe stable, you can't learn how
to swim by watching YouTubechannels.
You need somebody with you inthe pool.
So find a mentorship programthat is good.
Interview a lot of people, go uhand look and find somebody who
can caterpillar your success ina way that is safe.
That's very important.
Safe.
Don't don't risk your money.
SPEAKER_01 (24:37):
Yeah, I I couldn't agree more with you, uh, Fadi.
Um I I did it with with realestate.
Uh I tried some programs thatdid not have mentorship built
in.
It was videos, and you know, youlearn on your own.
I it costed me thousands andthousands of dollars of mistakes
(24:58):
I did.
Um other program, I had a mentorthat could overlook, you know,
the things that I was doing.
Hey, uh Mario, make sure you'renot doing this.
Oh, you forgot about this.
Did you think about that?
These are the types of uhmentorship programs that are
people need, absolutely need,and don't see it as a cost, see
(25:21):
it as an investment in yourselfto protect you from having costs
that are much more than usuallythe program itself.
SPEAKER_00 (25:30):
If the objective is to do this and you're serious
about it, it's a cost, yes, butit's an investment too.
Because if you're serious aboutit, why pay for a course with no
feedback?
Guess what?
I want to tell you this stat.
You know how many percent ofpeople, when they buy a video
course, they finish it to theend?
Only three percent.
Yeah.
Three percent.
(25:50):
So what are what are the chancesthat these three percent of
people will implement?
It's almost zero.
It's almost zero.
So get to a mentorship programbecause you will not be able to
escape.
And the fact that there isstructure into this, like when
you have when you know thatyou're gonna meet with your
mentor once every week or onceevery month, you you gotta wake
up and do what you need to dobecause you don't want you don't
(26:12):
want to be embarrassed in frontof the the accountability part,
the structure is very important,the structure.
So I cannot agree more.
SPEAKER_01 (26:20):
Yeah, Fadi, thank you so much for spending the
time to answer some questionstoday.
Your uh your knowledge, uh,valuable, very valuable.
Uh, I hope our listeners willtake a piece of your knowledge
and advice and take them, takeit, take it on their journey uh
to become wealthy andsuccessful.
Thank you again, and uh we'lltalk soon.
(26:42):
Thank you very much, Mario.
Thank you.
Thanks for tuning in to the FiveQuestions podcast.
If you enjoyed today's episode,don't forget to subscribe, like,
and hit the notification bell onour YouTube channel so you never
miss an episode.
Stay tuned for more insights andtips to transform your real
estate and business games.
See you next time.
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