1 00:00:00,080 --> 00:00:01,760 Welcome back, everyone. Thanks for joining. 2 00:00:01,760 --> 00:00:04,560 On today's episode. We have artificial intelligence 3 00:00:04,760 --> 00:00:07,160 that we know is getting better and better every day. 4 00:00:07,400 --> 00:00:09,480 It's being used in more and more applications. 5 00:00:09,480 --> 00:00:14,160 We've seen it advance so much and just like a year or two now, 6 00:00:14,160 --> 00:00:16,720 this raises a question for investors of what can we do with 7 00:00:16,720 --> 00:00:19,000 this technology to better help us invest? 8 00:00:19,360 --> 00:00:21,680 Not only do we want to make great investments in AI 9 00:00:21,680 --> 00:00:24,440 companies, but what if artificial intelligence in and 10 00:00:24,440 --> 00:00:27,320 of itself could help us guide our investments? 11 00:00:27,680 --> 00:00:29,840 That's going to be one of the things we look at today. 12 00:00:29,920 --> 00:00:32,680 I have well over $1,000,000 invested when I combine the 13 00:00:32,680 --> 00:00:35,320 passive income portfolio and the story fund. 14 00:00:35,640 --> 00:00:39,240 Now I invest in companies that I define as super high quality, 15 00:00:39,520 --> 00:00:43,360 dominant companies, ones that are scalable, high margin, fast 16 00:00:43,360 --> 00:00:45,320 growing. These are my favorite type of 17 00:00:45,320 --> 00:00:48,360 companies that I like to buy. But what if we asked AI about my 18 00:00:48,360 --> 00:00:51,880 entire portfolio overall and my investing philosophy? 19 00:00:52,080 --> 00:00:54,080 What would it say about that? Well, that's what we're going to 20 00:00:54,120 --> 00:00:56,720 be looking at today. We have my entire portfolio 21 00:00:56,720 --> 00:01:00,840 combined $1.266 million and we're going to be going through 22 00:01:00,840 --> 00:01:03,960 what AI has to say about it. We also have another example 23 00:01:03,960 --> 00:01:07,960 portfolio here, all in on Tesla. We'll be looking at AI's review 24 00:01:07,960 --> 00:01:11,440 of this approach and all in on Palantir and reviewing the 25 00:01:11,440 --> 00:01:14,320 commentary and analysis that artificial intelligence gives. 26 00:01:14,760 --> 00:01:16,720 Now, of course, we also have some other news to get to. 27 00:01:17,160 --> 00:01:19,400 Trump is back on the tariff train. 28 00:01:19,680 --> 00:01:23,320 He is announcing 25% tariffs on imports from Japan and South 29 00:01:23,320 --> 00:01:25,440 Korea. I have some thoughts on this and 30 00:01:25,440 --> 00:01:27,880 how it will or will not impact the markets. 31 00:01:28,000 --> 00:01:31,040 And of course, we have more news, more drama with Elon Musk. 32 00:01:31,600 --> 00:01:34,560 He is running out of Rd. in China, according to the Wall 33 00:01:34,560 --> 00:01:36,200 Street Journal. That's what they say here. 34 00:01:36,640 --> 00:01:39,800 And on top of that, Elon Musk just recently announced his own 35 00:01:39,800 --> 00:01:41,720 political party, the American Party. 36 00:01:41,760 --> 00:01:44,160 We'll be looking over this news and seeing how it's impacting 37 00:01:44,160 --> 00:01:46,000 different companies like Tesla and Uber. 38 00:01:46,000 --> 00:01:48,480 And then finally, I wanted to throw in a company I have yet to 39 00:01:48,480 --> 00:01:50,440 talk about on this show up until now. 40 00:01:50,440 --> 00:01:53,840 And it's one that I think, in fact, I'll argue in this episode 41 00:01:54,080 --> 00:01:56,640 that it's become more innovative than Apple. 42 00:01:57,080 --> 00:02:00,760 That company is Shark Ninja. Shark Ninja is a fast growing 43 00:02:00,760 --> 00:02:02,560 company that's innovating rapidly. 44 00:02:02,560 --> 00:02:04,400 It's very impressive what they're doing. 45 00:02:04,720 --> 00:02:07,280 And I believe they're beating many top tier tech companies at 46 00:02:07,280 --> 00:02:09,240 their own game. So we'll be looking at this 47 00:02:09,240 --> 00:02:12,320 underdog Shark Ninja and seeing if there's an investing 48 00:02:12,320 --> 00:02:14,520 opportunity here. Now we start things off today by 49 00:02:14,520 --> 00:02:16,600 looking at the theme of artificial intelligence. 50 00:02:17,160 --> 00:02:20,480 We know that as investors, we look at artificial intelligence 51 00:02:20,480 --> 00:02:22,240 through investment opportunities. 52 00:02:22,480 --> 00:02:25,640 What do we want to invest in? Which companies are creating the 53 00:02:25,800 --> 00:02:27,520 AI? Which ones are creating the 54 00:02:27,520 --> 00:02:30,840 hardware to run the AI? Which ones have the network 55 00:02:30,840 --> 00:02:33,200 effects in the user base to implement AI? 56 00:02:33,440 --> 00:02:37,160 Which ones can replace humans with AI enabled robots, so on 57 00:02:37,160 --> 00:02:39,360 and so forth. And that's the major focus most 58 00:02:39,360 --> 00:02:41,840 of the time, which we spend a lot of time on this channel 59 00:02:41,840 --> 00:02:44,280 discussing. Many of the top companies in My 60 00:02:44,280 --> 00:02:47,040 Portfolio are ones that I believe will benefit directly 61 00:02:47,280 --> 00:02:51,400 from AI, like Google or Amazon. But not only is AI providing us 62 00:02:51,400 --> 00:02:53,680 a set of great investment opportunities, different 63 00:02:53,680 --> 00:02:56,960 companies we can buy equity in, but it also may help us directly 64 00:02:56,960 --> 00:03:00,480 manage our portfolio, manage our investing philosophy. 65 00:03:00,800 --> 00:03:04,160 It may help give us ideas and feedback, like a bit of a 66 00:03:04,160 --> 00:03:07,880 financial advisor, an investment broker, someone that you can 67 00:03:07,880 --> 00:03:10,640 call up and get a little bit of help when you're discussing an 68 00:03:10,640 --> 00:03:13,720 investment decision. AI is getting much better at 69 00:03:13,720 --> 00:03:16,760 understanding context and philosophies, different 70 00:03:16,760 --> 00:03:19,800 investing ideas and approaches. I understood this when I was 71 00:03:19,800 --> 00:03:24,280 looking at different LLMS and asking them different investment 72 00:03:24,280 --> 00:03:27,120 questions. I do this regularly and these 73 00:03:27,120 --> 00:03:30,400 AIS are getting much better. For example, the two LLMS I use 74 00:03:30,400 --> 00:03:32,080 the most is Chachi BT and Gemini. 75 00:03:32,080 --> 00:03:35,400 I bounce back between these two regularly testing both of them 76 00:03:35,400 --> 00:03:39,120 out and one of the conversations I just recently had with with 77 00:03:39,120 --> 00:03:42,680 ChatGPT was very impressive of its understanding of my 78 00:03:42,680 --> 00:03:44,800 investment philosophy. Let's go ahead and just take a 79 00:03:44,800 --> 00:03:47,400 look here. The discussion was whether or 80 00:03:47,400 --> 00:03:51,560 not I should sell Costco because it has a 50 PE ratio. 81 00:03:52,040 --> 00:03:55,200 We know that Costco in My Portfolio is a very large 82 00:03:55,200 --> 00:03:57,120 position. We look at it right here, 83 00:03:57,640 --> 00:04:00,760 $85,000 position. So this is a very meaningful 84 00:04:00,760 --> 00:04:03,320 position. It's massively in the green. 85 00:04:03,320 --> 00:04:06,120 The majority of the position is gains because I started buying 86 00:04:06,120 --> 00:04:10,560 the thing back in early 2018. So Costco's up around 3:00 to 87 00:04:10,560 --> 00:04:13,000 4:00 X since when I was buying it to begin with. 88 00:04:13,480 --> 00:04:17,079 So that the kegger of Costco has been incredible, but a lot of 89 00:04:17,079 --> 00:04:21,000 Costco's gains have come from multiple expansion, not just 90 00:04:21,000 --> 00:04:23,080 earnings growth. They have earnings growth, they 91 00:04:23,080 --> 00:04:25,560 have special dividends, and they've had multiple expansion 92 00:04:25,880 --> 00:04:28,880 from the 20s and 30s PE up to A50. 93 00:04:29,400 --> 00:04:34,080 So I asked Chachi PT based on Joseph's strategy, would it be 94 00:04:34,080 --> 00:04:37,920 good to sell Costco stock now that it's trading at A50 PE 95 00:04:37,920 --> 00:04:39,960 ratio? Now here's the answer it gives, 96 00:04:40,360 --> 00:04:42,920 based on Joseph Carlson's investment philosophy, which 97 00:04:42,920 --> 00:04:46,400 prioritizes business quality, predictability, and long term 98 00:04:46,400 --> 00:04:48,960 compounding over short term valuation concerns. 99 00:04:49,360 --> 00:04:53,160 Selling Costco solely because it trades at A50 PE ratio would be 100 00:04:53,160 --> 00:04:58,120 inconsistent with his approach. Here's why Why Joseph would 101 00:04:58,120 --> 00:05:01,080 likely hold Costco despite the 50 PE. 102 00:05:01,560 --> 00:05:04,880 Exceptional business quality. Costco's membership model, scale 103 00:05:04,880 --> 00:05:07,920 advantage, low turnover cost, and defensible Moat aligned 104 00:05:07,920 --> 00:05:10,480 squarely with Joseph's focus on high quality, low drama 105 00:05:10,480 --> 00:05:12,480 businesses. Predictable growth. 106 00:05:12,840 --> 00:05:16,080 It's long history of steady inflation beating growth and 107 00:05:16,080 --> 00:05:19,520 market share expansion in retail market makes it one of the most 108 00:05:19,520 --> 00:05:21,280 predictable compounders in the market. 109 00:05:21,760 --> 00:05:24,120 Valuation discipline and not obsession. 110 00:05:24,480 --> 00:05:27,880 Joseph acknowledges valuation, but he's shown in his own 111 00:05:27,880 --> 00:05:30,960 ownership of names like S&B Global and MasterCard that he's 112 00:05:30,960 --> 00:05:33,640 willing to pay a premium for businesses with enduring 113 00:05:33,640 --> 00:05:36,440 economics and consistent reinvestment opportunity. 114 00:05:36,520 --> 00:05:38,760 Now this sounds pretty accurate so far going on. 115 00:05:38,760 --> 00:05:40,200 It highlights a few caveats here. 116 00:05:40,200 --> 00:05:44,080 Maybe exceptions, it says. That said, when might he trim if 117 00:05:44,080 --> 00:05:46,800 another holding offer superior risk adjusted upside? 118 00:05:47,040 --> 00:05:50,480 For instance, if Costco's Ford returns compressed a low single 119 00:05:50,480 --> 00:05:53,640 digits due to multiple expansion alone, and they're similarly 120 00:05:53,640 --> 00:05:56,040 high quality compounders trading at far more attractive 121 00:05:56,040 --> 00:05:59,280 valuations. Reallocation might make sense if 122 00:05:59,280 --> 00:06:02,120 growth decelerates while valuation stays elevated. 123 00:06:02,600 --> 00:06:05,720 If comp growth starts to materially slow and the PE stays 124 00:06:05,720 --> 00:06:08,920 above 40 to 50, Joseph might reassess whether the business 125 00:06:08,920 --> 00:06:11,400 still meets his hurdle rate for Ford returns. 126 00:06:11,880 --> 00:06:15,920 Bottom line, no, Costco should not be sold just because it 127 00:06:15,920 --> 00:06:19,520 trades at A50 PE unless a clearly superior opportunity 128 00:06:19,520 --> 00:06:21,680 exists. Joseph's philosophy favors 129 00:06:21,680 --> 00:06:24,760 holding elite, predictable businesses for decades, not 130 00:06:24,760 --> 00:06:26,640 trying to time their valuation peaks. 131 00:06:26,680 --> 00:06:28,120 Now. I look at this and I think it 132 00:06:28,120 --> 00:06:31,400 sounds pretty accurate. This is, I believe, an accurate 133 00:06:31,400 --> 00:06:33,680 assessment of my behavior and philosophy. 134 00:06:33,960 --> 00:06:37,560 It doesn't stray too much from my own thoughts, and in a way it 135 00:06:37,560 --> 00:06:40,480 is just my thoughts being relayed back to me. 136 00:06:40,480 --> 00:06:42,640 So naturally I agree. I, in fact, I think this is good 137 00:06:42,640 --> 00:06:44,880 advice. I agree with myself here. 138 00:06:45,400 --> 00:06:49,240 Now, overall, when I look at this, it shows the power of LLMS 139 00:06:49,240 --> 00:06:51,760 to be able to look through a lot of information and give you a 140 00:06:51,760 --> 00:06:56,000 concise, valuable input based on your own investing philosophy or 141 00:06:56,000 --> 00:06:57,320 what you're trying to accomplish. 142 00:06:57,640 --> 00:06:59,200 And I think that can be very helpful. 143 00:06:59,200 --> 00:07:01,640 You may not agree with everything, but the AI at least 144 00:07:01,640 --> 00:07:04,120 gives you some food for thought, some things to think about. 145 00:07:04,600 --> 00:07:07,120 And when you look at this not only just with one company, but 146 00:07:07,120 --> 00:07:10,120 your overall portfolio construction, the entire 147 00:07:10,120 --> 00:07:13,160 composition of it, I think the advice is even more interesting. 148 00:07:13,160 --> 00:07:16,000 When we built this feature in the Qualtrim, I was able to look 149 00:07:16,000 --> 00:07:18,960 at lots of different portfolios and investing philosophies and 150 00:07:18,960 --> 00:07:20,680 see both the qualities and risks of them. 151 00:07:21,120 --> 00:07:23,600 When we look at this month's update, and this is updated as 152 00:07:23,600 --> 00:07:27,080 of this morning, this is how My Portfolio stands as of today. 153 00:07:27,440 --> 00:07:30,920 We can look at the top holdings. We have Netflix right at the top 154 00:07:30,920 --> 00:07:32,560 here. From Netflix we go down the 155 00:07:32,560 --> 00:07:35,640 list. Some of these I've gained 39,043 156 00:07:35,640 --> 00:07:38,400 thousand, 34,000. We can look at the percentages. 157 00:07:38,400 --> 00:07:41,120 Some of these are older holdings or ones that have gained a lot 158 00:07:41,120 --> 00:07:43,560 more than others. The only one that I'm in the red 159 00:07:43,560 --> 00:07:46,520 right now is Salesforce. This is my worst investment as 160 00:07:46,520 --> 00:07:49,960 of right now, but I'm only in the red by around $1600 on this 161 00:07:49,960 --> 00:07:52,440 one, so we haven't had too much of a loss on it. 162 00:07:52,480 --> 00:07:54,920 The companies that I've been buying the most recently include 163 00:07:54,920 --> 00:07:58,200 Equifax, Google, and Amazon. These are three companies that 164 00:07:58,200 --> 00:08:01,200 I'm incredibly bullish on. I think the future is very 165 00:08:01,200 --> 00:08:03,360 bright for him, and I think they're all undervalued. 166 00:08:03,360 --> 00:08:06,000 Now with the overall combined holdings and the weightings 167 00:08:06,000 --> 00:08:09,120 being taken into account, we can see what the AI thinks of my 168 00:08:09,120 --> 00:08:10,560 overall portfolio. Now. 169 00:08:10,560 --> 00:08:13,960 This AI portfolio analysis was updated this morning with all 170 00:08:13,960 --> 00:08:16,680 the latest data. And the way that this works is 171 00:08:16,680 --> 00:08:19,600 we have the quality section here, which builds you up and 172 00:08:19,600 --> 00:08:22,800 makes you feel so good about your portfolio When you run the 173 00:08:22,880 --> 00:08:25,280 AI analysis and you'll get the qualities, you'll be thinking, 174 00:08:25,280 --> 00:08:28,280 wow, I, I have great, I have a great portfolio. 175 00:08:28,280 --> 00:08:30,960 It, it's, there's so much opportunity here. 176 00:08:30,960 --> 00:08:32,720 You know, it gives you all the qualities that highlights all 177 00:08:32,720 --> 00:08:35,039 the strengths. Then you get to the risks. 178 00:08:35,320 --> 00:08:38,080 And this is where it really highlights the stuff that you 179 00:08:38,080 --> 00:08:40,840 might not be as eager to hear about the stuff that's more of a 180 00:08:40,840 --> 00:08:44,039 problem for your portfolio. So that's what it does here. 181 00:08:44,039 --> 00:08:47,360 It, it builds you up at first, then it kind of tears you down 182 00:08:47,560 --> 00:08:49,800 to give you a full, full analysis. 183 00:08:49,800 --> 00:08:52,200 You get both sides of it in the qualities. 184 00:08:52,200 --> 00:08:53,640 And this is a part where it's going to build us up. 185 00:08:53,640 --> 00:08:57,240 It says this portfolio is comprised predominantly of 186 00:08:57,240 --> 00:08:59,720 dominant blue chip companies with entrenched global 187 00:08:59,720 --> 00:09:03,000 franchises, platform advantages, resilient reoccurring revenue 188 00:09:03,000 --> 00:09:05,200 streams. Companies such as S&P Global, 189 00:09:05,200 --> 00:09:09,000 Moody's and Equifax possess wide economic moats derive from data, 190 00:09:09,000 --> 00:09:12,600 regulatory position and essential services offerings 191 00:09:12,600 --> 00:09:15,600 that underpin financial infrastructure globally with 192 00:09:15,600 --> 00:09:17,800 high margins and substantial pricing power. 193 00:09:18,200 --> 00:09:19,720 So we have a lot of good qualities here. 194 00:09:19,720 --> 00:09:23,760 One of them that I do focus on intentionally is resilient 195 00:09:23,760 --> 00:09:26,520 recurring revenue streams. Most of the companies in My 196 00:09:26,520 --> 00:09:29,840 Portfolio are subscription or highly recurring revenue. 197 00:09:30,200 --> 00:09:32,480 They also I believe have substantial pricing power. 198 00:09:32,560 --> 00:09:35,360 Each company has proven that MasterCard, they say. 199 00:09:35,640 --> 00:09:39,800 The AI says exemplifies a business model built on toll 200 00:09:39,800 --> 00:09:42,440 collector economics characterized by asset light 201 00:09:42,720 --> 00:09:45,240 operations and robust transaction based revenues 202 00:09:45,520 --> 00:09:47,400 unconstrained by secular payment growth. 203 00:09:47,480 --> 00:09:50,360 Intuit in Salesforce reinforced the portfolio's technology 204 00:09:50,360 --> 00:09:52,560 exposure with sticky subscription based business 205 00:09:52,560 --> 00:09:55,960 models that serve critical back office enterprise needs and 206 00:09:55,960 --> 00:09:59,560 enjoy high customer retention. Microsoft and Alphabet further 207 00:09:59,560 --> 00:10:02,200 enhanced the portfolio's quality with their dominant software 208 00:10:02,240 --> 00:10:05,240 ecosystems, reoccurring cloud and productivity suites, 209 00:10:05,400 --> 00:10:08,680 revenues and best in class scalability in the respective 210 00:10:08,680 --> 00:10:10,240 segments. It goes on saying that the 211 00:10:10,240 --> 00:10:13,600 consumer resilience and global scalability are reinforced 212 00:10:13,600 --> 00:10:16,520 through Costco's durable business model, which delivers 213 00:10:16,520 --> 00:10:19,200 stable cash flows regardless of macro cycles. 214 00:10:19,520 --> 00:10:23,120 Amazon's omnipresence which most leading logistics and cloud 215 00:10:23,120 --> 00:10:25,920 infrastructure along with formidable first party and 216 00:10:25,920 --> 00:10:30,560 marketplace platform economics and ASMLASML represents a unique 217 00:10:30,560 --> 00:10:33,960 technological gatekeeper in semiconductor manufacturing, 218 00:10:34,280 --> 00:10:37,640 underpinning industry innovation with virtual monopoly status and 219 00:10:37,640 --> 00:10:40,920 EUV lithography systems integral to chip advancement. 220 00:10:41,200 --> 00:10:44,880 Booking holdings in Netflix also sector defining. 221 00:10:44,880 --> 00:10:47,920 They're also sector defining with strong network effects and 222 00:10:47,920 --> 00:10:51,080 operational leverage inherent in their digital platform models. 223 00:10:51,600 --> 00:10:54,840 Collectively, the portfolio's holdings are marked by pricing 224 00:10:54,840 --> 00:10:58,720 power, high free cash flow generation, strong management 225 00:10:58,720 --> 00:11:02,480 teams and significant long term growth runways driven by 226 00:11:02,480 --> 00:11:06,320 entrenched positions in essential, scalable and capital 227 00:11:06,320 --> 00:11:10,800 efficient businesses. So this last sentence here where 228 00:11:10,800 --> 00:11:13,440 it says that these companies have pricing power, high free 229 00:11:13,440 --> 00:11:16,800 cash flow generation, they have strong management teams and 230 00:11:16,800 --> 00:11:19,960 significant long term growth. That's all stuff that I repeat 231 00:11:20,040 --> 00:11:24,320 routinely on this show and the AII believe gets this correctly. 232 00:11:25,000 --> 00:11:29,480 Now this is the qualities of the portfolio, which this portfolio 233 00:11:29,480 --> 00:11:31,880 is at no lack of incredible quality. 234 00:11:32,160 --> 00:11:35,320 It is a very, very high quality portfolio. 235 00:11:35,680 --> 00:11:38,160 So it makes sense that it's giving this glowing review 236 00:11:38,520 --> 00:11:41,160 trying to characterize all the different qualities in just two 237 00:11:41,160 --> 00:11:43,560 paragraphs here. But then we get on to the risks. 238 00:11:43,560 --> 00:11:45,760 And this is something that I like looking at monthly because 239 00:11:45,760 --> 00:11:47,920 it reminds me about the risks of my companies. 240 00:11:48,240 --> 00:11:50,160 I think it's easy when you invest in really high quality 241 00:11:50,160 --> 00:11:53,680 companies to just kind of brush aside or sweep under the rug 242 00:11:53,920 --> 00:11:56,000 some of the risks that you're actually facing. 243 00:11:56,600 --> 00:12:00,040 It says that the portfolio is notably concentrated among large 244 00:12:00,040 --> 00:12:03,480 cap, high multiple growth companies, leaving it exposed to 245 00:12:03,480 --> 00:12:07,320 valuation compression risks, particularly if interest rates 246 00:12:07,320 --> 00:12:10,280 rise or macroeconomic conditions lead to lower risk tolerance 247 00:12:10,280 --> 00:12:13,040 among investors. Technology and digital platform 248 00:12:13,040 --> 00:12:16,200 businesses represent a significant allocation, which, 249 00:12:16,200 --> 00:12:18,440 while resilient in many respects, brings heightened 250 00:12:18,440 --> 00:12:21,960 susceptibility to regulation, emerging competition and rapid 251 00:12:21,960 --> 00:12:24,920 pace of technological changes. Companies like Alphabet, 252 00:12:24,920 --> 00:12:27,920 Microsoft, Amazon and Netflix all face increasing scrutiny 253 00:12:28,160 --> 00:12:30,600 from global regulators concerning data privacy, 254 00:12:30,600 --> 00:12:34,480 antitrust and digital market power, any of which could impact 255 00:12:34,480 --> 00:12:36,320 their long term growth and profitability. 256 00:12:36,680 --> 00:12:40,360 Additionally, the cluster of financial service providers, SME 257 00:12:40,360 --> 00:12:43,560 Global, Moody's and Equifax means that the portfolio could 258 00:12:43,560 --> 00:12:46,560 be vulnerable if there are meaningful shifts in the credit 259 00:12:46,560 --> 00:12:50,320 markets, regulatory frameworks or structural changes that erode 260 00:12:50,320 --> 00:12:53,360 their Moat such as decentralized financial alternatives. 261 00:12:53,760 --> 00:12:57,360 So defy all these companies doing stablecoin and that type 262 00:12:57,360 --> 00:12:59,160 of thing. It's highlighting as a risk 263 00:12:59,160 --> 00:13:02,560 rescue Global Moody's and Equifax, which I do think is is 264 00:13:02,560 --> 00:13:04,880 a notable risk. It also highlighted in this 265 00:13:04,880 --> 00:13:07,760 first paragraph that the very first one, the very first thing 266 00:13:07,760 --> 00:13:10,400 it came up with is that these are high multiple growth 267 00:13:10,400 --> 00:13:13,960 companies leaving them exposed to valuation compression. 268 00:13:14,440 --> 00:13:17,400 And I think right now that is probably the most significant 269 00:13:17,400 --> 00:13:20,920 risk of My Portfolio. Now it highlights a couple other 270 00:13:20,920 --> 00:13:23,600 things here. It says a further risk is the 271 00:13:23,640 --> 00:13:27,240 underwriting of more defensive and non discretionary segments. 272 00:13:27,560 --> 00:13:31,000 Despite Costco's presence, the portfolio has limited exposure 273 00:13:31,000 --> 00:13:34,040 to traditional healthcare, utilities and industrials 274 00:13:34,480 --> 00:13:39,280 outside EFX materials or energy. So I really have no, I have no 275 00:13:39,280 --> 00:13:42,840 investment in healthcare, utilities, industrials, material 276 00:13:42,840 --> 00:13:45,280 or energy. Now it highlights that is a risk 277 00:13:45,280 --> 00:13:47,880 because it it means a portfolio's less diversified, 278 00:13:48,480 --> 00:13:50,840 but I believe this is a risk worth taking. 279 00:13:51,320 --> 00:13:54,760 In my opinion. You can try to diversify into 280 00:13:54,760 --> 00:13:57,600 every sector, but I believe that some sectors are just worse to 281 00:13:57,600 --> 00:14:00,160 be in. I think that overall, even 282 00:14:00,160 --> 00:14:02,600 though these defensive sectors, or at least they're considered 283 00:14:02,600 --> 00:14:06,920 defensive, they're more stable. You have sectors like utilities, 284 00:14:06,920 --> 00:14:10,400 industrials, these Big Blue chip companies that are in the Dow. 285 00:14:10,960 --> 00:14:13,920 They're a lot slower growing. And if you want to outperform 286 00:14:13,920 --> 00:14:16,760 the market, if you really want to have alpha, I think it's very 287 00:14:16,760 --> 00:14:19,960 difficult to do that while investing in all of these slower 288 00:14:19,960 --> 00:14:21,880 growing, more defensive companies. 289 00:14:22,480 --> 00:14:26,400 But it does note that this makes the the portfolio less defensive 290 00:14:26,400 --> 00:14:29,320 in some situations. Now it also says this sector 291 00:14:29,320 --> 00:14:32,400 concentration leaves the portfolio more cyclical than it 292 00:14:32,400 --> 00:14:35,520 may appear, particularly given Booking Holdings, Texas 293 00:14:35,520 --> 00:14:39,160 Roadhouse and Amazon sensitivity to consumer spending trends. 294 00:14:39,520 --> 00:14:42,280 While most holdings demonstrate impressive scalability and 295 00:14:42,280 --> 00:14:45,360 recurring revenues, several require continued innovation and 296 00:14:45,360 --> 00:14:48,440 CapEx intensity to retain their competitive positions, 297 00:14:48,720 --> 00:14:53,240 especially ASML, Amazon and Netflix, raising execution and 298 00:14:53,240 --> 00:14:55,960 investment risk. Finally, relying on a 299 00:14:55,960 --> 00:15:00,200 concentrated handful of global leaders brings idiosyncratic, 300 00:15:00,200 --> 00:15:03,960 headline and operational risk. Idiosyncratic is an investment 301 00:15:03,960 --> 00:15:06,720 term that means that it's very specific. 302 00:15:07,120 --> 00:15:08,920 It's specific to these companies. 303 00:15:09,240 --> 00:15:12,160 When you diversify to an ETF, you don't have those very 304 00:15:12,160 --> 00:15:15,440 specific finite risks that exists with these companies, 305 00:15:15,680 --> 00:15:19,320 with these leaderships. They say where these operational 306 00:15:19,320 --> 00:15:22,880 risks or headline risks, where reputational, legal or 307 00:15:22,880 --> 00:15:26,520 technological missteps could materially impact portfolio 308 00:15:26,520 --> 00:15:28,360 performance. Now, I think overall that's a 309 00:15:28,360 --> 00:15:31,240 good look at My Portfolio. It's a nice reminder of both the 310 00:15:31,240 --> 00:15:34,040 qualities and the weaknesses that I can look at every month 311 00:15:34,040 --> 00:15:36,760 and kind of assess what I'm doing, especially as I'm making 312 00:15:36,760 --> 00:15:39,400 changes to the portfolio and the allocation. 313 00:15:39,880 --> 00:15:42,600 Now let's go ahead and take a look at some other portfolios 314 00:15:42,840 --> 00:15:44,800 with more aggressive investing strategies. 315 00:15:45,280 --> 00:15:47,560 Let's go ahead and just look at an all in Palantir one. 316 00:15:48,040 --> 00:15:51,440 I haven't done this before. I'm not sure what it's going to 317 00:15:51,440 --> 00:15:53,760 do here, but let's run the analysis and see what happens. 318 00:15:53,960 --> 00:15:56,840 I click analyze portfolio. We can wait a few moments here 319 00:15:56,840 --> 00:15:58,920 for it to load in and there we have it. 320 00:15:58,920 --> 00:16:01,040 It's loaded in. We have the new portfolio 321 00:16:01,040 --> 00:16:04,680 analysis and again this is 100% Palantir. 322 00:16:05,040 --> 00:16:07,680 So the only holding this is what the AI has to say. 323 00:16:07,680 --> 00:16:10,640 The portfolio is solely invested in Palantir Technologies, the 324 00:16:10,640 --> 00:16:14,040 company recognized for it's strong foothold in the data 325 00:16:14,040 --> 00:16:16,080 analytics and enterprise software sector. 326 00:16:16,400 --> 00:16:19,320 Palantir Score competency lies in it's highly entrenched data 327 00:16:19,320 --> 00:16:22,480 integration platforms which are tailored for both governments 328 00:16:22,480 --> 00:16:25,680 and commercial clients who rely on secure mission critical 329 00:16:25,680 --> 00:16:28,880 insight generation. The company benefits from deep 330 00:16:28,880 --> 00:16:32,480 relationships with its clients, often with multi year high value 331 00:16:32,480 --> 00:16:35,680 contracts, creating a durable Moat that is hard to replicate, 332 00:16:35,960 --> 00:16:39,320 especially given the sensitive nature and complexity of its 333 00:16:39,320 --> 00:16:41,600 deployments. Its government contracts, in 334 00:16:41,600 --> 00:16:45,440 particular, are associated with long procurement cycles and high 335 00:16:45,440 --> 00:16:47,840 switching costs, further solidifying Palantir's 336 00:16:47,840 --> 00:16:51,600 competitive position and enabling relative predictable 337 00:16:51,600 --> 00:16:54,400 reoccurring revenue. Another strength of Palantir is 338 00:16:54,400 --> 00:16:57,080 to focus on scalability and expansion across various 339 00:16:57,080 --> 00:17:00,960 industries owing to its modular, customizable software platforms. 340 00:17:01,240 --> 00:17:03,560 The company demonstrates A scalable business model with 341 00:17:03,560 --> 00:17:07,240 high gross margins characterized by enterprise software firms. 342 00:17:07,480 --> 00:17:10,560 Its offering is deeply integrated into client workflows 343 00:17:10,839 --> 00:17:13,839 leading to high client retention, strong pricing power 344 00:17:14,079 --> 00:17:17,119 management led by visionary founder continuously seeking to 345 00:17:17,119 --> 00:17:20,160 innovate and expand the platform's capability, extending 346 00:17:20,160 --> 00:17:22,839 its runway for growth both domestically and 347 00:17:22,839 --> 00:17:24,760 internationally. These qualities position 348 00:17:24,760 --> 00:17:27,319 Palantir is a potentially resilient business capable of 349 00:17:27,319 --> 00:17:31,320 thriving through different economic cycles driven by demand 350 00:17:31,320 --> 00:17:34,120 for analytics and data-driven decision making. 351 00:17:35,040 --> 00:17:37,240 That's pretty good. In fact, that's really good. 352 00:17:37,480 --> 00:17:39,040 It's not. It's almost convincing me at 353 00:17:39,040 --> 00:17:40,480 this point to invest in Palantir. 354 00:17:40,880 --> 00:17:43,720 I look at this and it's a bit different than the the 355 00:17:43,720 --> 00:17:46,440 investment analysis you're getting from Dan Ives that 356 00:17:46,440 --> 00:17:48,480 Palantir. You know, if Dan eyes was here 357 00:17:48,480 --> 00:17:52,280 writing these AI write ups, if it was him instead, it would say 358 00:17:52,280 --> 00:17:53,800 it's time to get out the popcorn. 359 00:17:54,240 --> 00:17:57,720 Palantir is the messy of AI, you know, a bit different of 360 00:17:57,720 --> 00:18:00,160 analysis here, but this is really good. 361 00:18:00,160 --> 00:18:03,160 I think it's a thorough look. It shows all the benefits of 362 00:18:03,160 --> 00:18:06,120 Palantir, at least many of them, the strengths of the company, 363 00:18:06,280 --> 00:18:08,760 which I've said for a long time. I think Palantir is a great 364 00:18:08,760 --> 00:18:11,360 company, I really like it. But let's go ahead and take a 365 00:18:11,360 --> 00:18:13,160 look at the risks. What does it have to say here 366 00:18:13,160 --> 00:18:17,760 having 100% of your portfolio in Palantir says? 367 00:18:17,760 --> 00:18:20,520 However, the portfolio single holding concentration in 368 00:18:20,520 --> 00:18:24,360 Palantir exposes it to considerable company specific 369 00:18:24,360 --> 00:18:26,720 risk. Any operational setbacks, 370 00:18:26,800 --> 00:18:29,920 strategic missteps or negative development specific to 371 00:18:29,920 --> 00:18:34,080 Palantir, such as major contract losses, regulatory scrutiny 372 00:18:34,080 --> 00:18:37,520 regarding data security, or failure to sustain innovation 373 00:18:37,520 --> 00:18:41,160 ahead of competitors, could result in significant capital 374 00:18:41,160 --> 00:18:43,720 impairment. With no diversification across 375 00:18:43,720 --> 00:18:46,880 sector or business model, the entire portfolio's performance 376 00:18:46,880 --> 00:18:49,360 is tied intrinsically to Palantir's fortunes. 377 00:18:49,520 --> 00:18:51,920 The government's segments of its business, while a source of 378 00:18:51,920 --> 00:18:54,720 stability, can also be subject to political and budgetary 379 00:18:54,720 --> 00:18:57,440 uncertainties that are outside the company's control. 380 00:18:57,680 --> 00:19:00,640 Market perception of Palantir's controversial dealings and 381 00:19:00,640 --> 00:19:04,280 evolving regulatory landscape involving big data and privacy 382 00:19:04,520 --> 00:19:07,440 could also pose a risk of its valuation of long term business 383 00:19:07,440 --> 00:19:11,160 prospects, it highlights. Again, without any other asset 384 00:19:11,160 --> 00:19:14,120 class, the portfolio lacks a cushion against these 385 00:19:14,120 --> 00:19:16,160 idiosyncratic sector wide shocks. 386 00:19:16,280 --> 00:19:18,880 Investing solely in Palantir seems incredibly risky. 387 00:19:19,160 --> 00:19:21,160 Let's go out and see if it mirrors those same thoughts 388 00:19:21,160 --> 00:19:23,640 about Tesla. My thoughts are it's going to 389 00:19:23,640 --> 00:19:26,080 highlight the very same issue. Just having all of your 390 00:19:26,080 --> 00:19:29,360 portfolio in a single stock is just way too much concentrated 391 00:19:29,360 --> 00:19:30,440 risk. So let's go ahead and take a 392 00:19:30,440 --> 00:19:31,800 look at it here. Now, I'm not going to read the 393 00:19:31,800 --> 00:19:34,640 whole thing, but it goes over a lot of the technology of Tesla. 394 00:19:34,640 --> 00:19:36,920 Some of the things that we've heard before says nonetheless 395 00:19:36,920 --> 00:19:40,040 the portfolio's concentration or concentrated exposure to a 396 00:19:40,040 --> 00:19:42,920 single stock. Tesla represents A substantial 397 00:19:42,920 --> 00:19:46,520 risk as it's performance is closely tied to the fortunes and 398 00:19:46,520 --> 00:19:49,560 volatility of one company. Within the consumer cyclical 399 00:19:49,560 --> 00:19:52,200 sector. Tesla operates in an incredibly 400 00:19:52,200 --> 00:19:55,120 competitive market facing both legacy automotive players, 401 00:19:55,280 --> 00:19:58,400 scaling EVs and new entrants in China and beyond. 402 00:19:58,720 --> 00:20:01,720 Execution risk remains high. Furthermore, Tesla's premium 403 00:20:01,720 --> 00:20:04,760 valuation hinges on the company's ability to deliver 404 00:20:04,760 --> 00:20:07,280 relentless growth and achieve ambitious targets. 405 00:20:07,680 --> 00:20:11,040 Any perceived slowdown or missteps could result in 406 00:20:11,040 --> 00:20:16,400 substantial price corrections. Now I wonder if it's going to I, 407 00:20:16,520 --> 00:20:18,520 I wonder if it's going to mention that Elon Musk getting 408 00:20:18,520 --> 00:20:20,360 involved in politics is a potential risk. 409 00:20:20,600 --> 00:20:22,720 Maybe that's not baked into the models quite yet. 410 00:20:23,120 --> 00:20:25,400 It says. Tesla's business is also exposed 411 00:20:25,400 --> 00:20:28,000 to broader changes in consumer discretionary spending, 412 00:20:28,240 --> 00:20:30,280 especially given its concentration in high ticket 413 00:20:30,280 --> 00:20:32,720 durable goods. Macroeconomic slowdowns. 414 00:20:32,720 --> 00:20:35,600 Rising interest rates can dampen vehicle sales. 415 00:20:35,880 --> 00:20:39,000 The company's aggressive expansion comes with capital 416 00:20:39,000 --> 00:20:42,000 requirements that could pressure margins and lead to dilution if 417 00:20:42,000 --> 00:20:45,480 not carefully managed. Additionally, the highly visible 418 00:20:45,520 --> 00:20:49,080 and unconventional management style primarily driven by Elon 419 00:20:49,080 --> 00:20:53,440 Musk introduces key person risk and the potential for headline 420 00:20:53,440 --> 00:20:56,360 driven volatility. It's exactly what we're seeing 421 00:20:56,360 --> 00:20:58,880 today. The lack of diversification in 422 00:20:58,880 --> 00:21:01,720 this portfolio magnifies the impact of any negative 423 00:21:01,720 --> 00:21:05,360 development specific to Tesla, reducing the resilience of the 424 00:21:05,400 --> 00:21:08,680 overall investment of the sector and company specific shocks. 425 00:21:08,800 --> 00:21:11,280 So there you have it. Investing in any single company, 426 00:21:11,280 --> 00:21:14,080 especially one like Tesla or Palanter, I think you're taking 427 00:21:14,080 --> 00:21:17,720 on significant risk in doing so. And overall, I think the AI is 428 00:21:17,720 --> 00:21:19,680 mostly correct and I think it's good feedback. 429 00:21:20,160 --> 00:21:22,560 Now, when we look at headline risk, there's one piece of news 430 00:21:22,560 --> 00:21:26,160 that happened just today. Trump announced a 25% tariff on 431 00:21:26,160 --> 00:21:29,000 imports from Japan and South Korea starting August 1st. 432 00:21:29,040 --> 00:21:32,280 He gave these letters on Truth Social with this announcement. 433 00:21:32,760 --> 00:21:36,560 And basically the letters say that they're not working with us 434 00:21:36,560 --> 00:21:39,320 fast enough, they're not getting enough done, we're going to 435 00:21:39,320 --> 00:21:41,480 tariff them. And then he says if they 436 00:21:41,480 --> 00:21:45,640 announce reciprocal tariffs, we are going to match and increase 437 00:21:45,640 --> 00:21:48,360 the tariff on them by whatever number they choose. 438 00:21:48,840 --> 00:21:52,880 So if they say they're going to tariff us by 2025%, we'll raise 439 00:21:52,880 --> 00:21:55,760 the tariffs another 25% on them or whatever it may be. 440 00:21:55,840 --> 00:21:57,520 Now we look at how the market's reacting. 441 00:21:57,960 --> 00:22:03,360 Right now, we're down 1.2 percent, 1.4 down a percent or 442 00:22:03,360 --> 00:22:05,520 two after having a great start to the month. 443 00:22:05,840 --> 00:22:07,520 This is big headline news, right? 444 00:22:07,520 --> 00:22:10,760 Tariffs rattle the market, but we're really only down a percent 445 00:22:10,760 --> 00:22:12,920 and a half. And I believe my prediction is, 446 00:22:13,360 --> 00:22:16,960 even if these tariffs get more and more extreme, if Trump re 447 00:22:16,960 --> 00:22:20,440 announces a bunch of them or we get Peter Navarro on TV talking 448 00:22:20,440 --> 00:22:23,400 about the tariffs again, I think we're very unlikely to have the 449 00:22:23,400 --> 00:22:26,920 same type of dip with the same magnitude that we had back in 450 00:22:26,920 --> 00:22:29,680 April. For the simple reason that it's 451 00:22:29,680 --> 00:22:33,320 more scary the first time when you're buying the dip in any 452 00:22:33,320 --> 00:22:36,760 situation, the first time that something happens, it's far more 453 00:22:36,760 --> 00:22:40,040 shocking, far more uncertain, far more scary to the market. 454 00:22:40,600 --> 00:22:43,240 In April 2nd, that's where Trump came out for the first time and 455 00:22:43,240 --> 00:22:46,760 really relayed how extreme these tariffs and reciprocal tariffs 456 00:22:46,760 --> 00:22:48,840 were. They are far above people's 457 00:22:48,840 --> 00:22:51,520 expectations. That shocked the market and 458 00:22:51,520 --> 00:22:54,200 dropped at 10%. That's what I was saying is a 459 00:22:54,200 --> 00:22:57,480 buying opportunity. When investors are unsure, when 460 00:22:57,480 --> 00:23:00,560 they're scared, that's when you buy the second time. 461 00:23:00,560 --> 00:23:04,240 Something happens each time Trump announces tariffs. 462 00:23:04,400 --> 00:23:07,720 For now on, investors will have in the back of their minds that 463 00:23:07,800 --> 00:23:10,640 he can change his mind quickly, that Trump doesn't like having 464 00:23:10,640 --> 00:23:13,240 the market go down, that investors that bought the dip 465 00:23:13,240 --> 00:23:16,400 last time were rewarded. So they're more likely to hold 466 00:23:16,400 --> 00:23:18,040 on to their shares. And in fact, they're more likely 467 00:23:18,040 --> 00:23:20,160 to buy any smaller dip when it happens. 468 00:23:20,200 --> 00:23:22,800 And overall, it's just less scary the second time something 469 00:23:22,800 --> 00:23:25,120 happens. So it's far more unlikely that 470 00:23:25,120 --> 00:23:28,000 the market will drop to the same extent it did the first time. 471 00:23:28,440 --> 00:23:29,880 You can look at any other example. 472 00:23:29,880 --> 00:23:33,200 You can look at COVID that dropped the market 45%. 473 00:23:33,200 --> 00:23:36,280 But if we had another pandemic, if we had another disease, it's 474 00:23:36,280 --> 00:23:39,480 very unlikely in this lifetime that it would drop the market to 475 00:23:39,480 --> 00:23:41,640 the same extent because investors would have a 476 00:23:41,640 --> 00:23:43,880 reasonable expectation of how things would play out. 477 00:23:44,200 --> 00:23:47,360 We'd be able to adapt and know without as much fear. 478 00:23:47,680 --> 00:23:50,680 That's the way the market works. So I believe we're very unlikely 479 00:23:50,680 --> 00:23:53,400 to see the April lows again based on tariffs, even if 480 00:23:53,400 --> 00:23:56,080 President Trump ramps him up again like he did the first 481 00:23:56,080 --> 00:23:57,680 time. Now we also have Elon Musk 482 00:23:57,680 --> 00:24:00,560 making news again. This time, Tesla shares are down 483 00:24:00,560 --> 00:24:04,000 7% because Elon Musk says that he's launching a political 484 00:24:04,000 --> 00:24:06,200 party. Now, he's not just saying that 485 00:24:06,200 --> 00:24:07,840 he has. He's actually launched a new 486 00:24:07,840 --> 00:24:11,760 political party, a new one that he calls the American Party. 487 00:24:12,040 --> 00:24:15,640 The goal of it is to be the centrist party, to try to take 488 00:24:15,640 --> 00:24:19,960 away key votes from swing states so that he can kind of control 489 00:24:19,960 --> 00:24:21,920 which party wins and which one loses. 490 00:24:21,920 --> 00:24:24,440 Now, obviously, this gets deeply into politics, and there's a lot 491 00:24:24,440 --> 00:24:27,240 of opinions on this. Some people say that Elon Musk 492 00:24:27,240 --> 00:24:29,560 should stay out of this, that he shouldn't be involved in 493 00:24:29,560 --> 00:24:31,720 politics. He's not good at it. 494 00:24:31,720 --> 00:24:34,080 It's not what he does. And while you may agree with 495 00:24:34,080 --> 00:24:36,960 those arguments, I'm very reluctant to have the stay in 496 00:24:36,960 --> 00:24:39,560 your lane attitude. I think Elon Musk should be able 497 00:24:39,560 --> 00:24:42,040 to do whatever he wants. He's a a free person. 498 00:24:42,200 --> 00:24:44,960 If Elon Musk wants to share his political views, he's free to do 499 00:24:44,960 --> 00:24:47,280 so. If he is not satisfied with 500 00:24:47,280 --> 00:24:49,640 either political party, he's free to create another one. 501 00:24:50,120 --> 00:24:53,360 But I also believe there's a view from the Tesla investor 502 00:24:53,360 --> 00:24:57,240 perspective that Elon Musk, while he's free to stay out of 503 00:24:57,240 --> 00:25:00,200 his lane and and move to any lane he wants, he's free to get 504 00:25:00,200 --> 00:25:02,400 into politics. He also has a role and a 505 00:25:02,400 --> 00:25:06,320 responsibility. He's still the CEO of Tesla and 506 00:25:06,320 --> 00:25:10,640 he seems to be pursuing politics at the direct expense of Tesla. 507 00:25:11,200 --> 00:25:15,000 Now for the CE OS of companies that I invest in, I've been very 508 00:25:15,000 --> 00:25:18,160 consistent on this. I am OK with them getting 509 00:25:18,160 --> 00:25:21,360 involved in politics if it benefits the shareholder. 510 00:25:21,480 --> 00:25:24,880 If my CEO is going out and becoming political, but it's 511 00:25:24,880 --> 00:25:28,160 benefiting me the shareholder. The politics play well into the 512 00:25:28,160 --> 00:25:31,520 company and the role at the benefit of the company, then I 513 00:25:31,520 --> 00:25:33,880 believe the CEO in that case is doing its job. 514 00:25:34,200 --> 00:25:36,280 It's representing the shareholder base and it's 515 00:25:36,280 --> 00:25:40,240 advocating for its shareholders. But in the case of Tesla, you 516 00:25:40,240 --> 00:25:42,800 can see investors reactions to what he's doing. 517 00:25:42,920 --> 00:25:45,560 Tesla stock is continually getting pummeled by Elon Musk 518 00:25:45,560 --> 00:25:47,640 getting further and further involved in politics. 519 00:25:47,800 --> 00:25:51,800 He seems to have set his Tesla CEO position secondary to his 520 00:25:51,800 --> 00:25:54,480 political ambitions. Seems like it's not even as big 521 00:25:54,480 --> 00:25:56,680 as focus. If you look at what occupies 522 00:25:56,680 --> 00:26:00,560 Elon Musk's mind, it's not Tesla's success, it's politics. 523 00:26:00,680 --> 00:26:03,680 Everyday more frequently he's tweeting about politics, about 524 00:26:03,680 --> 00:26:06,200 political subjects. Most of the time it's not even 525 00:26:06,200 --> 00:26:09,560 related to Tesla at all. It's very difficult to interpret 526 00:26:09,560 --> 00:26:12,800 that this is some long term gambit to make Tesla in a better 527 00:26:12,800 --> 00:26:15,040 situation. If anything, it's actively 528 00:26:15,040 --> 00:26:17,600 damaging the brand and distracting the CEO. 529 00:26:18,040 --> 00:26:20,360 We've seen that Elon Musk has alienated a lot of people on the 530 00:26:20,360 --> 00:26:23,440 left by supporting Donald Trump. Then he's alienated a lot of 531 00:26:23,440 --> 00:26:27,040 people supporting Donald Trump by having a big fallout with 532 00:26:27,040 --> 00:26:28,880 him. And during that time period, he 533 00:26:28,880 --> 00:26:31,520 managed to swing around Europe and alienate a lot of people 534 00:26:31,520 --> 00:26:33,680 there, which were some of his biggest customers. 535 00:26:34,200 --> 00:26:36,800 Elon Musk's involvement in politics has overall been a 536 00:26:36,800 --> 00:26:39,480 complete unmitigated disaster for Tesla. 537 00:26:39,840 --> 00:26:43,720 The company would be better off if he focused on Tesla. 538 00:26:43,720 --> 00:26:46,200 And I believe this puts Tesla investors in a very difficult 539 00:26:46,200 --> 00:26:48,000 situation. They have ACEO, that's a 540 00:26:48,000 --> 00:26:50,920 legendary CEO that has the ability to lead this company in 541 00:26:50,920 --> 00:26:54,360 the right direction, but he's continually focused on other 542 00:26:54,360 --> 00:26:57,120 ambitions, and that is playing into the company. 543 00:26:57,480 --> 00:27:01,080 The big winner of this, of course the entire time is Uber. 544 00:27:01,960 --> 00:27:04,880 Uber investors are very satisfied with what Elon Musk is 545 00:27:04,880 --> 00:27:07,760 doing. Uber investors have ACEO that's 546 00:27:07,760 --> 00:27:10,640 strictly focused on leading the company, integrating it with 547 00:27:10,640 --> 00:27:13,840 EVs, making sure that they become the de facto robotaxi 548 00:27:13,840 --> 00:27:16,080 network. While Tesla stock is down nearly 549 00:27:16,080 --> 00:27:19,320 8%, Uber stock is up nearly 2.2%. 550 00:27:19,600 --> 00:27:22,480 We look at Tesla on the full year basis, we can see that the 551 00:27:22,480 --> 00:27:26,960 stock year to date is down 23%. We look at Uber during the same 552 00:27:26,960 --> 00:27:31,160 time period. Uber is currently now up 52% 553 00:27:31,160 --> 00:27:33,240 year to date. I don't know how long Tesla 554 00:27:33,240 --> 00:27:36,240 investors will continue to tolerate Elon Musk not caring 555 00:27:36,240 --> 00:27:39,160 about the company, focusing on other things and in some ways 556 00:27:39,160 --> 00:27:41,600 directly sabotaging their portfolios and gains. 557 00:27:42,160 --> 00:27:43,560 But I think it's just a matter of time. 558 00:27:43,800 --> 00:27:46,760 We're already seeing discontent with people like Dan Ives, Gene 559 00:27:46,760 --> 00:27:48,880 Munster. We've seen some funds already 560 00:27:48,880 --> 00:27:51,200 pull out money that they are planning on investing in Tesla. 561 00:27:51,200 --> 00:27:53,120 And I think we're going to see more of that fallout in the 562 00:27:53,120 --> 00:27:54,960 future. Now moving on, I'm going to 563 00:27:54,960 --> 00:27:57,880 highlight a stock that I believe is a story of innovation, one 564 00:27:57,880 --> 00:28:00,200 that's becoming more and more dominant every single year. 565 00:28:00,600 --> 00:28:02,240 And that's the type of companies that I like. 566 00:28:02,240 --> 00:28:05,440 Looking at innovation is a part of my investment criteria. 567 00:28:05,920 --> 00:28:09,080 Although it's not necessary for a company to innovate to have 568 00:28:09,080 --> 00:28:11,720 good returns, you can have ones that just kind of do the same 569 00:28:11,720 --> 00:28:14,600 thing over and over again. Companies that do innovate and 570 00:28:14,600 --> 00:28:17,720 invent and create new things typically end up creating a lot 571 00:28:17,720 --> 00:28:19,400 of value for shareholders over time. 572 00:28:19,600 --> 00:28:22,680 These are companies like Amazon or Google creating leading AI 573 00:28:22,680 --> 00:28:25,200 models or always innovating like Amazon. 574 00:28:25,720 --> 00:28:28,640 So when I look at these type of companies, sometimes you get 575 00:28:28,640 --> 00:28:33,160 focused on the bigger, larger market cap companies, the Max 7, 576 00:28:33,200 --> 00:28:36,480 you know, all these wonderful companies at the very top, but 577 00:28:36,480 --> 00:28:39,240 they're not always the most innovative in the market. 578 00:28:39,480 --> 00:28:42,800 You can take for example, Apple. Apple has struggled with 579 00:28:42,800 --> 00:28:45,280 innovation. The updates in the iPhone are 580 00:28:45,280 --> 00:28:48,120 becoming less and less noticeable over time. 581 00:28:48,400 --> 00:28:51,080 The new product launches like the Apple Vision Pro have been 582 00:28:51,080 --> 00:28:53,560 mostly a flop. They haven't gained a large 583 00:28:53,560 --> 00:28:56,520 market share and Apple seems to be stagnating a bit. 584 00:28:57,120 --> 00:28:59,720 While that's happening, there are much smaller companies, in 585 00:28:59,720 --> 00:29:02,400 fact, one that I'll highlight right now that I believe is 586 00:29:02,440 --> 00:29:05,480 incredibly innovative and it's one that you may not suspect. 587 00:29:06,240 --> 00:29:10,440 Shark Ninja, the combination of both Shark company, the one that 588 00:29:10,440 --> 00:29:13,120 makes the the vacuums. You know, they make a lot of 589 00:29:13,120 --> 00:29:14,840 different vacuums as well as different products. 590 00:29:15,600 --> 00:29:19,120 And then Ninja, which makes tons of products from healthcare, 591 00:29:19,120 --> 00:29:23,200 beauty, lots of foodie products, different food gadgets. 592 00:29:23,720 --> 00:29:27,680 This company combined to form what I believe today is one of 593 00:29:27,680 --> 00:29:31,640 the most innovative companies, and I say that not ironically. 594 00:29:31,800 --> 00:29:33,960 It is incredible what this company's actually doing. 595 00:29:34,000 --> 00:29:36,760 This is a video given to investors highlighting what this 596 00:29:36,760 --> 00:29:39,760 company's actually doing and how important they're becoming. 597 00:29:44,480 --> 00:29:47,640 Shark Ninja's a story of innovation and we've been at 598 00:29:47,680 --> 00:29:51,040 this for over 20 years. Our business started with. 599 00:29:51,800 --> 00:29:56,000 So they have, they have these things which are like, it's like 600 00:29:56,000 --> 00:29:58,520 a blender built into a, a bottle. 601 00:29:58,600 --> 00:30:01,720 So you, you blend it and then you just drink it straight from 602 00:30:01,720 --> 00:30:03,200 where you blended it. Like you don't even take the 603 00:30:03,200 --> 00:30:05,040 thing out. So it's, it's just a completely 604 00:30:05,040 --> 00:30:07,360 portable blender. I don't have one of those, but 605 00:30:08,080 --> 00:30:09,720 I, I, I see them, I see them being sold. 606 00:30:09,720 --> 00:30:11,000 They seem to be quite popular this. 607 00:30:11,120 --> 00:30:16,520 Started with cordless sweepers, steam mops, irons and today we 608 00:30:16,520 --> 00:30:19,840 go. The the air fryers, those are 609 00:30:19,840 --> 00:30:22,480 huge. I mean, they're they're probably 610 00:30:22,480 --> 00:30:25,120 one of the most popular cooking items ever made and I think for 611 00:30:25,120 --> 00:30:26,400 good reason. They are incredible. 612 00:30:26,400 --> 00:30:28,200 They do a bit different than a convection oven. 613 00:30:28,400 --> 00:30:30,200 If you haven't tried out an air fryer, I think you're missing 614 00:30:30,200 --> 00:30:33,240 out big time. But Ninja in particular with the 615 00:30:33,240 --> 00:30:35,400 shark Ninja brand has capitalized on this. 616 00:30:35,800 --> 00:30:38,760 Every time I go into Costco, I see a Ninja branded air fryer 617 00:30:38,840 --> 00:30:41,280 every single time. And the only reason that Costco 618 00:30:41,280 --> 00:30:44,560 keeps them on the shelves is because they keep selling They 619 00:30:44,560 --> 00:30:47,040 stop selling. They would no longer they would 620 00:30:47,040 --> 00:30:48,880 no longer be ordering them back at Costco. 621 00:30:48,880 --> 00:30:51,840 Go to. Market under 2 multibillion 622 00:30:51,840 --> 00:30:56,160 dollar brands that we created called Shark, which is a market 623 00:30:56,160 --> 00:31:00,720 leader in cleaning home environment and beauty and our. 624 00:31:01,440 --> 00:31:03,400 Yeah, they also have a lot of beauty items. 625 00:31:03,560 --> 00:31:06,240 They're they're gaining market share in beauty, which is an 626 00:31:06,240 --> 00:31:08,280 area that I would not think Shark would be a part of. 627 00:31:08,720 --> 00:31:12,080 It seems like it would be difficult to go from vacuums to 628 00:31:12,320 --> 00:31:14,320 hair products, but it seems like they're making that leap. 629 00:31:15,000 --> 00:31:18,120 And our Ninja brand, which is a market leader in kitchen 630 00:31:18,120 --> 00:31:21,720 appliances, outdoor cooking appliances, other outdoor 631 00:31:21,720 --> 00:31:24,680 products. The Shark brand is in 14 632 00:31:24,680 --> 00:31:29,000 different categories. The Ninja. 633 00:31:29,000 --> 00:31:31,880 Brand is in 20 different categories. 634 00:31:32,080 --> 00:31:36,280 It's coffee makers, it's knives, it's cookware, it's ovens, 635 00:31:36,480 --> 00:31:41,280 grills, it's outdoor grills, it's air purifiers, it's hair 636 00:31:41,280 --> 00:31:45,840 care, it's vacuum cleaners, corded, cordless and robotic 637 00:31:45,880 --> 00:31:48,760 vacuum cleaners. We have one of these too. 638 00:31:48,760 --> 00:31:51,240 We got, we got the little Shark matrix vacuum. 639 00:31:51,240 --> 00:31:54,440 I don't know where it is one of these things, you know, it just 640 00:31:54,440 --> 00:31:56,200 goes around and vacuums your carpet. 641 00:31:56,200 --> 00:31:58,440 If you have the, if you pick up stuff off the floor, it'll go 642 00:31:58,440 --> 00:32:00,640 through and vacuum it. They work quite well. 643 00:32:01,200 --> 00:32:04,520 Shark has one that they use by the way, they use LIDAR, so that 644 00:32:04,520 --> 00:32:06,360 expensive technology, they use lighter on it. 645 00:32:06,560 --> 00:32:08,280 Many of these use a combination of sensors. 646 00:32:08,280 --> 00:32:10,200 They use LIDAR. Some of them are vision only, 647 00:32:10,200 --> 00:32:13,920 some are Lidar vision. Other ones even have sensors to 648 00:32:13,920 --> 00:32:16,920 identify what type of floor you're on because they'll switch 649 00:32:16,920 --> 00:32:20,640 from a mop to a vacuum. Like, if it knows it's on a 650 00:32:21,080 --> 00:32:23,720 carpet, it'll vacuum. So these are getting quite 651 00:32:23,720 --> 00:32:26,120 advanced. And I believe that this is where 652 00:32:26,120 --> 00:32:30,480 Dyson has missed out. Dyson fell behind in the robot 653 00:32:30,480 --> 00:32:33,160 vacuum game. That's what every millennial in 654 00:32:33,160 --> 00:32:34,000 Gen. Z wants. 655 00:32:34,000 --> 00:32:35,360 They don't want to vacuum their own floors. 656 00:32:35,360 --> 00:32:38,480 They want a robot to do it. And Shark Ninja is on top of 657 00:32:38,480 --> 00:32:40,280 this. Shark has all sorts of ones. 658 00:32:40,280 --> 00:32:43,040 They've really gained market share in this category. 659 00:32:43,320 --> 00:32:46,120 They're on the forefront of all the trends, all of these home 660 00:32:46,120 --> 00:32:49,040 items. And I must ask, just just 661 00:32:49,040 --> 00:32:52,640 pausing here, why doesn't that have an Apple logo on it? 662 00:32:53,440 --> 00:32:58,280 Seriously, why do we not have an advanced integrated Apple robot 663 00:32:58,280 --> 00:33:01,560 vacuum that you can control with your iPhone that's part of the 664 00:33:01,560 --> 00:33:04,880 ecosystem that that's sleek and well designed? 665 00:33:05,240 --> 00:33:07,040 You know, they couldn't figure out the the cars. 666 00:33:07,040 --> 00:33:08,560 Maybe that's just a little too intense. 667 00:33:08,560 --> 00:33:09,960 Maybe there's too much liability. 668 00:33:09,960 --> 00:33:12,920 People get killed in cars. But Apple could have certainly 669 00:33:13,240 --> 00:33:17,600 made a stab at it to do a vacuum if they sold 100 million of 670 00:33:17,600 --> 00:33:19,200 those. How much does that equate to? 671 00:33:19,200 --> 00:33:21,920 These things can sell for four hundred, $500. 672 00:33:21,960 --> 00:33:25,800 And I see it as a massive trend. I really believe five years from 673 00:33:25,800 --> 00:33:28,160 now, nobody's going to be vacuuming their floors. 674 00:33:28,480 --> 00:33:30,680 The sensors are so good. Everyone's going to do it by 675 00:33:30,680 --> 00:33:32,800 vacuum. But Shark came in here. 676 00:33:32,800 --> 00:33:35,560 These other companies came in here and adapted and they 677 00:33:35,560 --> 00:33:38,760 capitalize on this market before the likes of Apple, the ones 678 00:33:38,760 --> 00:33:41,400 that should be doing this. Vacuum cleaners. 679 00:33:42,760 --> 00:33:47,200 We sell our products today in 32 countries, 70 million products a 680 00:33:47,200 --> 00:33:49,040 year. We have hundreds of millions of 681 00:33:49,040 --> 00:33:52,520 consumers around the world. Others can identify problems, 682 00:33:52,520 --> 00:33:55,160 but we can solve the problems that others can't. 683 00:33:55,280 --> 00:33:59,480 Just in the last three years, we've entered into 19 new 684 00:33:59,480 --> 00:34:02,000 categories. There's real innovation. 685 00:34:02,440 --> 00:34:04,560 Before this year, we never made it home. 686 00:34:05,040 --> 00:34:08,159 These things are now they're just everywhere. 687 00:34:08,480 --> 00:34:10,280 The they have two different ones. 688 00:34:10,280 --> 00:34:13,159 They have one where they make you make slushies with them like 689 00:34:13,159 --> 00:34:15,480 this one. Another one you can make ice 690 00:34:15,480 --> 00:34:17,600 cream with it. Those are two more shark 691 00:34:17,600 --> 00:34:20,560 products that they or Ninja products that they invented and 692 00:34:20,560 --> 00:34:22,040 they're getting on the shelves of Costco. 693 00:34:22,040 --> 00:34:23,920 They're getting on the shelves of Walmart. 694 00:34:23,920 --> 00:34:26,360 They're everywhere in people's households now. 695 00:34:26,719 --> 00:34:29,280 And these things are not cheap. They are premium items. 696 00:34:29,840 --> 00:34:33,040 This company is inventing all new categories, creating new 697 00:34:33,040 --> 00:34:35,719 home products all the time, and I'm seeing more and more of this 698 00:34:35,719 --> 00:34:37,719 in my household. I don't have one of these but I 699 00:34:37,719 --> 00:34:40,440 keep seeing more and more of it. We never made in home slushies, 700 00:34:40,760 --> 00:34:47,120 we never made in home espresso, and we're only getting started. 701 00:34:49,040 --> 00:34:51,960 We work for one person, which is the consumer. 702 00:34:52,080 --> 00:34:55,880 There's no shortcut to success. It's earned one product at a 703 00:34:55,880 --> 00:34:58,320 time, 1 five star review at a time. 704 00:34:59,440 --> 00:35:01,640 When I look at this company, I'm impressed by how highly 705 00:35:01,640 --> 00:35:03,840 innovative it is. A lot of this stuff just doesn't 706 00:35:03,840 --> 00:35:06,400 exist and they're coming up with it, making it viable. 707 00:35:06,400 --> 00:35:08,320 Products entering into new categories. 708 00:35:08,680 --> 00:35:11,240 And this is what I expect to see from top tier companies. 709 00:35:11,600 --> 00:35:14,160 When we look at another product here, This is one that my wife 710 00:35:14,160 --> 00:35:16,440 tells me she wants. She wants this thing, and I 711 00:35:16,440 --> 00:35:18,080 didn't even know that this existed. 712 00:35:18,080 --> 00:35:20,360 Now I've seen this type of things at different parks like 713 00:35:20,360 --> 00:35:23,600 Six Flags or sporting events where you have a fan tied to 714 00:35:23,600 --> 00:35:26,960 cold water and it mists you with cold air. 715 00:35:27,360 --> 00:35:29,680 So it really cools you down during the hot summer time. 716 00:35:30,200 --> 00:35:32,200 Now Shark makes this type of product. 717 00:35:32,200 --> 00:35:35,040 They have a fan here you can see it's, it's misting these people 718 00:35:35,280 --> 00:35:37,680 with ice water. You fill up this thing with ice 719 00:35:37,680 --> 00:35:41,240 water, you hook it up and then it, it siphons the ice water up. 720 00:35:41,240 --> 00:35:43,120 It pumps it up and then shoots it through the fan. 721 00:35:43,440 --> 00:35:47,040 So you can have this outdoors. It says it can cool up to 70 722 00:35:47,040 --> 00:35:50,680 feet across and you have yourself like a sports cool Mr. 723 00:35:50,680 --> 00:35:53,520 for outdoor activities and that mist fans a very successful 724 00:35:53,520 --> 00:35:56,200 product. It has 4.5 stars on Amazon and 725 00:35:56,200 --> 00:35:58,360 they sold 10,000 of them in the past month. 726 00:35:58,680 --> 00:36:00,560 That's just on Amazon. Not to mention they're huge 727 00:36:00,560 --> 00:36:03,400 retail outlets. So I'm very impressed by this 728 00:36:03,400 --> 00:36:05,480 company's ability to continually innovate. 729 00:36:05,840 --> 00:36:10,640 Not to mention the past five year performance is 150% and 730 00:36:10,640 --> 00:36:12,880 that's starting at a bad time. If you bought the dip right 731 00:36:12,880 --> 00:36:18,200 after that, it's more like 200 at 300%, but even at 150%, this 732 00:36:18,320 --> 00:36:21,520 beats out Google's performance. Shark Ninja has outperformed 733 00:36:21,520 --> 00:36:24,880 Google over the past five years and it trades at a 24 PE ratio. 734 00:36:24,960 --> 00:36:26,800 Now though I'm very impressed by this company. 735 00:36:26,800 --> 00:36:30,320 What I believe it lacks right now is at least a deep Moat, an 736 00:36:30,320 --> 00:36:32,520 operating system to tie itself together. 737 00:36:32,760 --> 00:36:35,720 I think if they integrate their products more into a smart app, 738 00:36:35,720 --> 00:36:38,360 if they make a more unified, they have some way to tie 739 00:36:38,360 --> 00:36:41,840 consumers to their name brand loyalty, they'll be less reliant 740 00:36:41,840 --> 00:36:44,160 on just purely innovative progress in the future. 741 00:36:44,160 --> 00:36:46,440 But I do believe this is a stock worth of watching, and I believe 742 00:36:46,440 --> 00:36:47,840 many investors could do well in it. 743 00:36:48,000 --> 00:36:50,080 That's for this episode. See you in the next one.