rich off a new biotech stock. They don’t tell you about the other 10 that went to zero, of course. “It’s not tough to be a good investor... You put money away, you invest in good companies, and you let it go. You keep building out your portfolio. But, boy, is it hard when the market’s down 1,000 points, and you’re watching your money go down, and the news media is hyping it all up – that’s one of the hardest things.”
SPOTTING THE TRENDS So it’s easy to say investing is simple, just buy great companies ... But how do you know if a company is worthy or not? Matt tells me that is pretty simple, too... Just “use your eyes.” This is similar to legendary fund manager Peter Lynch’s famous advice to invest in what you know. Matt refers to Lynch as “one of the greatest investors ever.” In fact, he gave Lynch’s name when I asked who his investing inspiration was.
“People should literally walk the streets where they live for investing inspiration. Invest in what you’re familiar with. Now, just because you see a lot of people at a store doesn’t necessarily mean it’s a great investment... But it’s a good start.” Matt tells me about a time back in the 2000s when his then-wife was a buyer for Nordstrom clothing, specifically denim. One day, she told him about “these new jeans that had a unique stitched horseshoe design on the back pockets and a $200 to $300 price tag. And the kicker was that they couldn’t keep them in stock because they were so popular.” So Matt started researching the company, True Religion, and liked the fundamentals.
“To be successful in life, you can’t be on the bandwagon... You have to be the wolf, not the sheep.”
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October 2021
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