TRAPPER LIve 9/24/20

ETF which one has had a return in the last 10 years?

I'm back. I needed to get some things together. Trapping Thursday will be back in effect.

Reup on Youtube channel. course 40% off.DM new millionaire to buy course. To get into group, DM Trapper Anonymous. 

Amazon wrote deal with Tesla. They are coming out with a video game program inside computer, its like cable but for video games. 

Write the list of attribute. Check this off for any business you are invested in.

simple business you understand that has a moat. a great advantage. 

We like boring businesses. that are simple, huge moats. because give us the competitive advantage over other investors. How is that possible?

Have they transitioned over time. the world, the economy evolves every one to two years. lets think about McDonalds, they didn't sell off assets. They continuously evolved. they have done some things i do not like. with some black franchisees. 1. it was a burger place, known for burgers and fries. they added drive through. They added a dollar menu. then they created a kiosk, you order there and pick up your food.  are the businesses you are evolving?

When stocks fall, is it sale, discount or is it just cheap?

it is a sale, now we find buying prices. if its cheap, we gotta ask ourselves how cheap. we buy stocks at discount prices we now give ourselves leverage. to exit the stock if we make a mistake.  

When at discount we must exercise patience. it takes patience. Why? fear kicks in and people sell. its innate nature for you to sell. if they start shooting, let me run too! this is where homework and fundamentals kick in and you gotta stay strong.

Why do stock prices actually fall? why we have actually leverage and we don't understand the leverage that we have. Institutions make 85 percent of the market.  banks, and hedge funds. 

They call us retail or individual investors. They are graded by their peers and their returns per year. This is how they keep their job. the people get the job next, out of MBA schools. they look for hidden gems all of that. qualitative analysis.

If you see Billions (show? movie?) computer do everything. they cant say sit here as things fall. they have to get out and go somewhere else that is wining because they have to say, my return is this. 

When they come out of a stock, that stock is going to come down. depends on how much they take out, is going to make the stock fall down. 100 million out of a stock, then more institutions come out of it, it makes the stock go down. 

now as individual investors, we have to say I am not an institutional investor. I do the fundamental analysis .I purchase this stock because I saw earnings growing in the last 5 years. this business has great management. I saw revenue going over the last5 years. Free cash flow is growing. Debt was consistently decreasing. That's my reason. 

We know that everyday is not a sale. Everyday is not a discount. We understood this.  I bought more here. This is why we understand value and fundamentals. Now we know what is moving the market. we have built the fortitude to stay in the stock. 

We gamble, looking at what say. listen to what fundamentals are saying. Fundamentals tells us the story. this is advantage we have over institutional investors, the have to beat the market or be fired. We don't have to do that.

A stock having a story. What is the story? What is the idea and the concept of the business? What is the meaning behind this company? What made you buy this stock? what was the reason, what was the narrative behind this purchase? It can't be because Trapper said get it. It gotta be because you understood the simplicity of the business. You understood how that business made money. That's the story. What product or service does this business bring to the marketplace?

Did the story of the business change? If it did, you have proper cause to exit. The story tells us the key. We can exit, it's okay. It's not the reason I invested. It's no longer the reason why I am here. Do we understand the vision of management?

We can't look 'this stock is going up'. but is there a vision? Is management keeping their word with the vision, if not we are going to exit stage left. Is this business complicated? 

Everything I bring to the group is a simple stock. It has to be simple. I don't want to complicate it. I need it simple. If I can read mission statement, if I can understand mission statement, I'm gonna put it in the do not understand pile. 

Why you like chipotle? They sell burritos. sells fresh vegetables. everyday. revenue, sales kept growing. I like simple. I don't have a hedge fund. I don't need complicated.

When Warren Buffet made a mistake, took a 50 million loss. It's okay, I'll make it up. I was wrong, I am gone. Everyone will make mistakes. The greatest investor of all time, has made mistakes. He said I made a mistake when I didn't sell coca cola in 2007. He made a mistake, and get got out of the stock.

You don't have to prove anything to anybody. It's cool, keep going. It's okay. I promise that it's okay to make a mistake in this game. I did the same thing with Zoom. I bought it, got a great price, shot up, I rode it then they got hacked and they had an issue. I felt like google amazon they had other systems in place. I profited 6k I exited the stock. I still won, going on to the next. It's okay. 

My goal is to help us become great fundamental investor. Not great traders. That is not my thing. I do option trading, of course I did. I as making money on options. I'm getting off the game plan. It was my fault. Everybody wasn't ready for that. I'm not gonna bring that to the people like that. People learn more when they learn to invest long term investing. Then you can get into options, day trading, etc.

You cant go from addition to calculus. Set yourself up for failure. All I'm gonna do is help people thrive.  Build the culture one share at a time.