The Canadian Investor - Instagram vs. Tiktok and Commodities vs. Inflation

Episode Date: August 1, 2022

In this release of the Canadian Investor Podcast, we discuss the following topics: Instagram making a shift to become more like rival Tiktok How oil has performed in periods of high inflation and interest rate hikes Why patience is a powerful tool for investors Stocks on our watchlist, presented by EQ Bank Tickers of stock discussed: FNV.TO, EQIX Check out our portfolio by going to Jointci.com Our Website Canadian Investor Podcast Twitter: @cdn_investing Simon’s twitter: @Fiat_Iceberg Braden’s twitter: @BradoCapital Want to learn more about Real Estate Investing? Check out the Canadian Real Estate Investor Podcast! Apple Podcast - The Canadian Real Estate Investor  Spotify - The Canadian Real Estate Investor  Sign up to Stratosphere for free 🚀 our platform for self-directed stock investing research. Register for EQ Bank, the seamless digital banking experience with better rates and no nonsense.See omnystudio.com/listener for privacy information.

Welcome back into the show. This is the Canadian Investor Podcast, made possible by our friends and show sponsor, EQ Bank, which helps Canadians make bank with high interest and no fees on everyday banking. We also love their savings and investment products like GICs, which offer some of the best rates on the market. I personally, and I know Simone as well, is using the GICs, which offer some of the best rates on the market. I personally, and I know Simone as well, is using the GICs on a regular basis to set money aside for personal income taxes in April of every year. Their GICs are perfect because the interest rate is guaranteed, and I know I won't be able to touch that money until I need it for tax time. Whether you're looking to set some money aside for a rainy day or a big purchase is

coming through the pipeline or simply want to lower the risk of your overall investment portfolio, EQ Bank's GICs are a great option. The best thing about EQ Bank is that it is so easy to use. You can open an account and buy a GIC online in minutes. Take advantage of some of the best rates on the market today at eqbank.ca forward slash GIC. Again, eqbank.ca forward slash GIC. This is the Canadian Investor, where you take control of your own portfolio and gain the confidence you need to succeed in the markets. Hosted by Brayden Dennis and Simon Bélanger. The Canadian Investor Podcast. Today is July 27th, 2022. My name is Brayden Dennis. As always, joined by Simon Bélanger. Simon, that fancy new intro, the people are loving it. You love it. I love it. It's good stuff. We haven't even really addressed it and here it is. It should be a good one today. We're talking

about how Instagram just wants to be TikTok. You're going to talk about historical performance of oil and commodities during high inflation periods. And then I'm going to talk about something called no called strikes in investing, which I think is an awesome little segment. And then we're going to round it out with stocks on our watch list to date presented by our friends at EQ Bank, which is always a fun segment. I enjoy it thoroughly. So we should keep doing that one forever. Simon, how are you doing today? I like your topics here today. It should be a good one. Yeah, yeah, I'm excited. I've been meaning to do

this for a while. I just look at the historical returns, like how it performs, you know, what's pretty current when you think about inflation, rising interest rates, if we can learn anything about the past will be interesting. It was fun to do that research. And I think it's going to be a fun episode overall, just preparing before I'm going to play softball tonight. Oh yeah. Do you have any dingers, any home runs on the season yet? Yeah, I have a couple. You have a couple? Oh. Yeah. Yeah. Is it lob ball? Like you have to hit the plate? A slow pitch. Yeah, slow pitch. So you have three pitches, your own team pitches to you. Three pitches if you don't hit you're out oh your own team pitches okay yeah exactly and it's co-head so three girls are required on each team and then it's two guys one girl two guys one girl hitting so it's still a

getting a hold of a softball is so good like it's as good as hitting a perfect drive in the middle of the center of fairway like oh baby yeah i know and we have a pretty good team there's you know the guy that i feel like everyone knows where he has like amazing genes like a guy who would play any sport like seriously and would excel we have a guy like that on our team where it's like oh just like oh my god athletic specimen yeah it's like i could train eat perfectly and i would never come close. Does he just go up and hit it out of the park every single time? Oh, pretty much. Yeah. Oh, yeah. So I feel like everyone knows something. Some people are just so good at everything. All right. Let's start with my bold prediction. I have a bold prediction that I've been thinking

about. I've been communicating it verbally to some friends and bouncing this idea off it, talking to my girlfriend about it. And there's been some major changes in Meta's asset Instagram, which everyone is very familiar with. They have changed how the app works. And basically the synopsis is that it's more like TikTok. It's more video. It's like full screen and people hate it. Now, the biggest difference, Simone, is that when I go on the app, it is no longer about me and my friends as it once was. It's no longer about the people that I'm following. It is about what the algorithm wants to feed me to hopefully inject this crack of social media into my veins and keep me engaged. But people are like, hey, dude, we already have TikTok for that. Why is Instagram like this? Now, obviously, Meta, being a public company, looks at this and goes,

we want to drive revenue growth, drive ARPU, which is average revenue per user. And the CEO of Instagram yesterday made a video talking about how, yeah, there's been a lot of complaints about it. And in a very diplomatic way, Simon, he goes, yeah, but the world is changing and so are we. And this content's more engaging. So tough luck. And here's where my bold prediction is. do you have any more comments on that before like how i don't know if you've got whisper of this i know you're not an instagrammer but before i get into my bold prediction have you seen uh discussions around this yeah i've heard about it i think the kardashians commented on it too if i remember oh yeah yeah i would be the last person to find out

if the kardashians comment yeah i know i think i saw that somewhere where they were like not happy about some of the changes and i use instagram there's like a big petition and stuff oh it could be yeah i used instagram in the past but just don't go on it all that often and it was tied to my facebook account and i had the two-factor authenticator i changed my phone doesn It doesn't work. I tried to reset it and then I was like, oh, screw this. I don't even really use it anymore. So I use my wife's account. Well, she will let me use her account for Facebook, for Facebook marketplace when we want to sell stuff. That's it. Yeah, that's my workaround. So I'm done with Facebook.

You're no longer generating revenue for Meta. Okay, so here's my workaround so i'm done with facebook you're no longer generating revenue for meta okay so here's my bold prediction i predict that there is right now a social app brewing that is going to make a major splash in pop culture and and become quite an important business, which is a social app that is all about your tribe. Because when you log into these social platforms anymore, whether it's TikTok and Instagram, it's no longer about your tribe. And people desperately seek social communication on these platforms with their own tribe, whether it's your friend's vacation, pictures and videos of your close friend's dinner party, organizing events with your friends, you know, like these kinds of bridging between real life and your online presence, because that has evaporated with the current applications.

And if I was to start, if like I was going to try to make this business, I'd probably call it tribe or something. I don't know. I just keep throwing that word around, maybe tribe, something along those lines. But people are craving these online connection with people they actually know because it has disappeared. This is my prediction into what happens that there's this very important social app that we need to be paying attention to because it's going to come up. I'm so confident in this, Simon, that this is going to happen. Timestamp, July 27th, 2022. Now there is an app called Be Real. This app basically is like, it's all about you and your friends. And it tells you like a notification. It's like Simone. Okay. It's two o'clock today.

You have to take a picture of what you're doing right now. And it takes a picture of the front of your front camera. So like a selfie and what you're doing a picture forward. So it uses both cameras and it's just lets people in your tribe know what you're doing. It's called be real. I've seen it climb the ranks on app stores. I've seen the little kitties at my cottage, all the, you know, Snapchat and TikToker kitties using be real. So I'm always paying attention, man. I'm always like, So I'm always paying attention, man. I'm always like, what are these gen alphas doing? Because it's going to matter.

There's important businesses being created about this. But look out for this. This is my bold prediction. There is an important social media app that needs to be created or already is created and is on the come up about connecting you and your tribe because Instagram has completely divested in that business model. They are going full algorithmic, tick-tocking videos, engagement, maximize ARPU, make this stuff crack because that's what makes money. And there's going to be an opportunity there. This is what I think. Yeah. I mean, you could be right. And I think

they're just using the same playbook that they did with copying snapchat right because the stories came from snap from snap yep yeah exactly so i think they're just using the same playbook but i'm gonna go and say it may not work this time because i think tiktok is way bigger than snapchat was ever in terms of popularity so i think, if they want that experience, like you said, they're going to go on TikTok. I'm not sure if, I think they may actually be alienating some of their users by trying to push that too hard because they'll look for something that will replace the experience that was Instagram or they'll go straight to TikTok

where there's probably, I don't know how many users there are in TikTok compared to Instagram, but I assume that there's sufficient users for people to switch over there. As do-it-yourself investors, we want to keep our fees low. That's why Simone and I have been using Questrade as our online broker for so many years now. Questrade is Canada's number one rated online broker by MoneySense, and with them, you can buy all North American ETFs, not just a few select ones, all commission-free, so that you can choose the ETFs that you want. And they charge no annual RRSP or TFSA account fees. They have an award-winning customer service team with real people that are ready to help if you have questions along the way.

As a customer myself, I've been impressed with Questrade's customer service. Whenever I call or email, every support rep is very knowledgeable and they get exactly what I need done quickly. Switch for free today and keep more of your money. Visit questrade.com for details. That is questrade.com. Here on the show, we talk about companies with strong two-sided networks make for the best products. I'm going to spend this coming February and March in an Airbnb in South Florida for a combination of work and vacation and realized, hey, my place could be a great Airbnb while I'm away. Since it's just going to be sitting empty, it could make some extra income. income. But there are still so many people who don't even think about hosting on Airbnb or think it's a lot of work to get started. But now it is easier than ever with Airbnb's new co-host network. You can hire a local quality co-host to take care of your home and guests. It's a win-win since you make some extra money hosting on Airbnb, but can still focus on enjoying your time away. Find a co-host

at airbnb.ca forward slash host. That is airbnb.ca forward slash host. All right, let's move on. You're going to talk about performance of, is this about oil? Mostly oil. Yeah. Cause I was thinking of doing it about multiple commodities but then i i figured you know we probably go on for like three hours this episode if i did it for more than once and commodities are a snooze fest anyways but oil these days people love this stuff yeah it's always people talking about it you know and we have a lot of listeners out west whether it's saskatchewan alber, Manitoba, I think of Saskatchewan, Alberta, probably the two primary provinces when it comes to oil in Canada. I know there's some offshore. Especially Alberta. Yeah, Alberta and definitely some offshore as well in the east. But

it's important for the Canadian economy. So I figured we could look back a little bit what happened during high inflation period and rising interest rates. So I mean, the reason why I wanted to do this is we constantly hear, we've talked about it before, commodities do well during high inflationary periods. I wanted to see how well they actually perform. So I'll be focusing here on oil. Like I said, if not, it would be too long. So let's start by looking at the price of oil and how it fared during the 1970s and 1980s, those two were definitely the highest periods of inflation where there's some good data. There were, I think the late 1940s, I think also had some high inflation, but it's a bit

harder to get data from that time. So the numbers I'll be talking about are mostly not inflation adjusted. I will reference some inflation adjusted numbers, but I will mention them when I do. The first thing here is oil didn't start rapidly increase until the oil embargo that began in October of 1973 ended in March of 1974. During that time span, the price of oil went from around $3 to actually over $10. So tripled, actually more than tripled during a short time span. Oil continued to increase, although at a much slower pace for much of the last part of the 1970s. However, in the late 1970s, and we're starting to see, well, you'll start seeing a

pattern here. In early 1980s, there were some notable geopolitical events that made oil increase to around $15 per barrel from around $15 a barrel to $40 a barrel. First, there was the Iranian Revolution in 1979. Is that WTI, by the way? No, that's not the WTI. I think it's the other one. I'm trying to remember. But anyways, I should have put that in my notes. It's okayti i think it's the other one i'm trying to remember but anyways i should have put that in my notes anyway it's okay yeah it's all good i'm just curious because

i'm trying to like compare to you know how that's trended over time here while you're speaking yeah and so there was the iranian revolution in 1979 and there was the iranian iraq war that started in 1980. To answer your question, I'm pretty sure it's brand crude that I use the data. And oil prices started going down from that point onto the sharp drop that we saw in the low teens in 1985, 1986. So that's most likely because of a period of slow economic growth during that time. most likely because of a period of slow economic growth during that time. Now, it's really interesting because inflation in the US really picked up between 1973 and 1982. So we constantly hear about, you know, highest inflation and like 40 years or whatever the timeframe is. And these are really the periods where inflation was really, really high. So during that period of time,

it was never below 5.74% on a yearly basis and went as high as 13.55%. I'm using the US metrics here because it was the economic power at the time, and it's still one of the most dominant forces in the world today. But looking at inflation adjusted data the price of oil actually outperformed inflation during that period of time so that's really interesting because i think it brings some validity that you know the price of oil can or well at least oil in this situation can actually outperform inflation and although the us Fed did raise rates in the 1970s, it really went on inflation control from 1979 to 1987. Those are also known as the Paul Volcker years, with the rates being routinely in the double digits during that time period. And I think at times hitting as high as

20%. I don't have all the rates here, but I'm just going on memory. Anything you want to add here before I continue? No, I'm getting a history lesson. This is dumb. And one thing before I continue is we're seeing actually geopolitical events have a lot of impact on oil. And I think that's something we can actually compare to today, right? With what we're seeing happening in Russia, Ukraine,

you know, oil being not as accessible for certain parts of the world from Russia. They're obviously selling it to other countries. And we're also seeing the biggest impact, right? Yeah, definitely. Europe's seeing the biggest impact. But the world price, obviously, the price of oil is going up around the world. Obviously, it's gone down a little bit recently, but it's still at pretty high levels. And, you know, we're also seeing some more tensions between the West and Saudi Arabia, although I think the U.S. is on damage control when it comes to the relationship

with them. But just to say geopolitical events tend to have a pretty big impact here, at least looking on a historical basis. So looking at oil price alone you can make a case that based on the 1970s 1980s it could perform well in the current environment but i think we have to keep in mind again how much the geopolitics events affected the price now if we look at how exxon because exxon was actually not Exxon Mobil at the time, and Chevron performed between. I took a slightly bigger period here, 1973 and 1985, compared to the S&P 500. I wish I could have compared with a Canadian company, but I couldn't find any data of any publicly listed company that was pre-1990. And that's not overly surprising because oil sands,

which is, you know, the primary source of oil in Canada, didn't really become prevalent until later. I think it was really the ancestor of Suncor. I don't have the exact name, but before they changed their name, I think they started in the late 1960s. If you look it up, you'll probably be able to find it. I think it was like Oil Sand Company or something like that. I'm finding it right now.

This is something that I'm not familiar. I'm going to find it right now and let you know. Okay, so I chose the time period just because that's when inflation... Sun Company of Canada, a subsidiary of Sun Oil. Yeah, something like that. It was a weird name. They changed it to Sun Quarry. Formed Sun Quarry by merging its Canadian refining and retail interests.

Great Canadian oil sands, a majority owned subsidiary. Oh, yeah. Plan to develop the Athabasca oil sands in 67. Yeah. So it's like a rich history here. Yeah. And that was definitely the earliest times we didn't really see oil sands becoming more prevalent until the price of oil was making

it more profitable to do so because it's very extensive. So I chose the time period of 73 to 1985 to get back to that because that's when inflation was at its highest. And also when we saw interest rates go up the fastest to control inflation a lot of parallels right now clearly interest rates are ways away from being what they were at the time it's not even close but we are seeing rapid increases now during that time period exxon had returns of about 150 percent the snp 500 77 percent%, and Chevron minus 50%. So I'm not sure if there was something, I tried to search if there was any like potential issues going on with Chevron just because there was such a big discrepancy between that and Exxon. But I wanted to show both not to say,

just to show that, okay, one did outperform, one did not outperform. But because inflation was so high during that time, the S&P 500 actually underperformed inflation. So if you just held the S&P 500, you would not have kept up with inflation, which is not true when we look at longer periods of time. But this specific and obviously arbitrary, completely, you know, all transparency, it's very arbitrary that I chose that period. Hand selected. Yeah, exactly. So, you know, don't, you know, add us saying like, oh, see, we told you, you know, the S&P 500 is not good. It's definitely an arbitrary period. And clearly during that time. Dude, you told me I should be investing long term, man. What is this? Yeah.

And I couldn't find the Exxon inflation adjusted data, but it probably slightly overperform versus inflation just based on the returns. I don't know if oil alone is a good indicator of all commodities, but the main takeaway for me here is having done this research is like I mentioned, geopolitics can have a big impact on the price of oil. I would assume it's pretty similar for all commodities because we're seeing that right now. Anything that was massively exported by Ukraine or Russia prior to the war has gone significantly up in price. So I think it's a reasonable assumption to make because there's a huge difference between Exxon and Chevron in the returns. How a company is run probably has a big impact on returns, even if it's a company that's highly affected by the price of a certain commodity like oil here.

Oil did outperform inflation during the last high inflation period. But again, you can make a case that right now we are not necessarily as dependent on oil that we were at the time. I think, you know, we'll see because there's a lot of byproducts of oils that are way more prevalent that were back then. So I think that's something that you can give and take. We don't know how high and how long inflation will last right now. So that's the biggest wild card, right? That's the problem with inflation. That's the problem with macro. You don't know how high inflation will be. You also don't know to what extent central

banks will raise rates to fight inflation. Right now, they're saying that, you know, that's their priority. And a year ago, they were saying that inflation, if there would be some, would be transitory. And I think Bank of Canada Canada governor whether it's a year ago or two years ago I know Dan retweeted that I think he said you know a tweet from the Bank of Canada governor saying that these low rates would last for an extremely long time so businesses had nothing to worry about and Dan as he can be sarcastic sometimes said oh that really aged like milk over time yeah so I think these are just kind of factory to consider, but it's interesting to see how oil performed quite well during that time.

Again, historical performance, even if circumstances have some similarities, doesn't mean that it's going to perform the same, but it's interesting to see what happened in the 70s and 80s there. So the main takeaway for me looking at this is even when you had a period where everything's on your side for a certain company and you saw Exxon double the returns of the index, of the index, you had Chevron be an absolute dog, right? And it goes to show that the micro level, like studying the actual business, the management team, the fundamentals of the business is the only thing that's really in your control and reliably predictable if your investment analysis is correct. It's like when last week when everyone's like, let's sell Google shares because Snapchat can't figure out how to make money, right? It's such a goofy premise, but this is how the market acts. When clearly the companies have entirely different unit economics and entirely different business models. One created $22 billion in profit from their Google search business, and one can't figure

out how to make a dollar. They're both advertising companies, digital advertising businesses, both dealing with probably a slowdown in spend from these companies on marketing dollars in an economic slowdown with completely different these companies on marketing dollars in an economic slowdown with completely different results and completely different profitability. And so just a roundabout way in the way I'm thinking about this is, yes, these macro things matter clearly in everything you've pointed out here, but it also matters which horse you're picking here because Chevron was an absolute dog during this period so that's quite interesting to see that you know all of the everything was right for them you know

like i don't know how so what was the i tried to find what like if there was any scandals or anything like that i couldn't find anything specifically for chevron but i i love that how it highlights like something must have been going. Oil went from 15 to 40 and the share price of the oil co went down 50%. Yeah. That's impressive, dude. That's impressive. That's impressive. But it shows, you know, whatever industry you're looking at, I mean, there's a reason.

I think that's a good segue for your next segment here. But, you know, Buffett does invest in oil, in oil companies. He's never been shy about it he's done it in the past but he also is very selective obviously has a value investing mindset that's a big part of his investing but he also values management a whole lot and you can take again a Buffett example where he likes to invest in banks he He also, you know, he's also human like all of us. I mean, the infamous investment that he did in Wells Fargo, right? Every year he would get asked about Wells Fargo and everything that the dysfunction that was going on and he was still

sticking by them at some point. I think he offloaded most of it at this point, but it just goes to show that Wealth Fargo couldn't find a way of not shooting itself in the foot, whereas other banks were performing, other similar banks were performing in an exceptional manner. So really, like you said, you can have different businesses in the same sector that do almost the same thing, but have vastly different results because of how it's run. Totally. I mean, no one's immune from the odd mistakes. The difference is if you're willing to try to do the right thing consistently for, in Buffett, the Oracle of Omaha's case, we're talking about many, many decades of consistency right yeah no of course he's not

immune to the odd blunder kraft heinz was a fail he lost like 50 of his investment in like a month after he bought it too like it was like that was not a good i mean but again as long as your good bets outweigh those mistakes right and. And he's sizing these things correctly. So as long as Apple keeps... And when I say that, I just mean, I hope Apple keeps ripping for him. Oh, so far so good. We'll see.

I don't know when they release, but I feel like it'll be soon. So... Yep. It's become such a gigantic part of that business is Apple stock has become such a gigantic piece of Berkshire Hathaway. It's kind of mind-blowing. As do-it-yourself investors, we want to keep our fees low. That's why Simone and I have been using

Questrade as our online broker for so many years now. Questrade is Canada's number one rated online broker by MoneySense. And with them, you can buy all North American ETFs, not just a few select ones, all commission-free, so that you can choose the ETFs that you want. And they charge no annual RRSP or TFSA account fees. They have an award-winning customer service team with real people that are ready to help if you have questions along the way. As a customer myself, I've been impressed with Questrade's customer service. Whenever I call or email, every support rep is very knowledgeable and they get exactly what I need done quickly. Switch for free today and keep more of your money. Visit Questrade.com for details. That is Questrade.com. Here on the show, we talk about companies with strong two-sided networks make for the best products. I'm going to spend this coming February and March in an Airbnb in South Florida for a combination of work and vacation and realized, hey, my place could be a great Airbnb while I'm away. Since it's just going to be

sitting empty, it could make some extra income. But there are still so many people who don't even think about hosting on Airbnb or think it's a lot of work to get started. But now it is easier than ever with Airbnb's new co-host network. You can hire a local quality co-host to take care of your home and guests. It's a win-win since you make some extra money hosting on Airbnb, but can still focus on enjoying your time away. Find a co-host at airbnb.ca forward slash host. All right, segue to Mr. Buffett. I'm talking about something called no called strikes. No called strikes is a analogy Buffett has used many times comparing investing and baseball.

I'm going to read a quote here from an exchange on an interview he did. And here is the first piece of the quote here. In the securities business, which translation for newer investors who are not in the managing money professionally business, is just means in the investing individual equities business, securities business. In the securities business, every day you have thousands of major American corporations offered to you at a price that changes daily, and you don't have to make any decisions. Nothing is forced upon you. There are no called strikes in this business. The pitcher just stands there and throws the ball at you. And if you're playing real baseball and it's between the knees and your shoulders, you either swing or you get a strike called on you. If you

get too many called on you, you're out. In the securities business, aka the investing business, you sit there and you throw US Steel at 25 and they throw General motors at 16. You don't have to swing at any of them. There may be wonderful pitches to swing at, but if you don't know enough, you don't have to swing. And you can sit there and watch thousands of pitches and finally get one right there where you wanted something that you understand. And then you swing. The interviewer says, so you might not swing for six monthser says, so you might not swing for six months. Buffett says, might not swing for two years. And he goes, isn't that boring? And he goes, it will bore most people. And certainly boredom is a problem with most professional money managers.

If they sit out an inning or two, not only do they get somewhat antsy, but their clients start yelling, swing you bum, from the stands. And that's very tough for people to do. Okay, so let's break this down into a few pieces here. So he's saying there's no called strikes in the baseball analogy, meaning it doesn't matter if you don't swing at the pitch. Because in baseball, if you throw one in the strike zone and the batter doesn't swing, it's a strike. In the in baseball, if you throw one in the strike zone and the batter doesn't swing, it's a strike. In the investing business, if they throw one right down the plate and everyone's telling you that's a good pitch to swing at, but it's not where you hit the ball. It's not where you hit the ball best. Maybe you hit the ball best in the top right of the zone.

Maybe that's your sweet spot. Maybe the analytics say that actually the bottom left corner of the strike zone, you shouldn't swing. And so you have to know yourself, right? Because if you don't know the business and it's not the right pitch for you, you don't have to swing. This is the idea of no called strikes. Okay. Number two takeaway here is that he says he might not swing for many years. He's willing to do nothing. He's willing to sit on his hands for multiple years while most professional money managers, their clients, the industry, as everyone is saying, swing you bum. IBM comes across their plate. You can't lose money in IBM, right? It's very tough for people not to swing on those

pitches when everyone's telling them that they should. And a lot of times that leads to more decision-making. And so I really like this idea of no-called strikes because it is so important in your investing philosophy. Because everyone and their friend will tell you, you need to own this stock probably at the precisely wrong time when it's overvalued, overhyped. And the inverse when it's an unloved business. It is the contrarian mindset that Buffett is getting to here. And you don't have to swing at every freaking pitch. Buffett's saying here you can have thousands of businesses you look at in a year and not swing at any of them. That's the beauty of it. No one's telling you what you have

to do. You just have to swing at the ones you think you have a real edge at and you have very high conviction that you're going to be right. And you got to know the business from a reasonable level. You have to give yourself at least like an, be honest, eight plus to really own the security. You can't own businesses in your portfolio that you don't understand. It's a terrible idea. It's going to go down and you're going to be like, what the hell is going on? Right? And so, I don't know, man, I love this way he puts it and I love no called strikes. It's, it's one of the best parts of being an investor. Yeah, yeah, definitely.

I think it's really good. And obviously, when you're trying to find good companies, you really want I mean, that's what we believe. You really want to be picking good quality companies and buying them at a reasonable price. I'm not saying, you know, going value hunting, dumpster diving in terms of price. You definitely want it more as a reasonable price. I'm not saying, you know, going value hunting, dumpster diving in terms of price. You definitely want it more as a reasonable price and you have to take your time.

There is no rush. There's no gun to your head. You don't need to invest in the stock market just because your friends are investing right now or because Brayden and I are putting some money. Like, just take your time, right? There's no rush. The markets are going to be open

the next day and if it's not the next day it's going to be the next Monday if it's the weekend so you'll have time and for the most part I'm a firm believer that in the long run taking a bit more time whether it's an extra couple weeks an extra month two, an extra quarter to see how a business that you're interested in is doing, an extra year if you need to. Taking that extra time more often than enough will prove a good thing instead of rushing in and trying to not miss out on a company or trying to buy the dip because you think it's happening right now. Yeah, exactly. Because it's more important that you limit mistakes versus making sure you correctly timed the stock. Losing money, it hurts way more mathematically. It's the old, you lose 10%, you have to make 11% to actually break even. And the math just really swings. You lose 50%, now you have to

make 100% to get back, right? It's just basic math. If I have $100 and I lose 50% on some stupid investment that I got some whisper stock, my buddy told me to go buy some crappy junior mining stock. Bro, Braden, they're going to hit gold, man. They're literally just waiting for this permit. How often do you hear this? They're just waiting for this permit to dig this uranium, and it's going to go to the moon after that. Two months later, the stock's down 50% in this hypothetical situation, and now you have $50. You had 100, now you have 50. Your investment went down 50%. To regain to your $100, you have to double your money, which is 100% return. That math is not good for you. Losing 50 and gaining 100 are the same

mathematically. And so that math fights against you. Take the extra time to avoid mistakes versus trying to get right because there's no called strikes. So if you're late, it's okay. Wait for the right pitch. All right, Simone, let's move on to stocks on our radar presented by our wonderful friends at EQ Bank. I love this segment. I have so, oh God, dude, I have way too many things on my list for my watch list because I'm seeing lots of opportunity, man. And let's get you go first here. I limited myself just to one name here. I was very disciplined. Yeah. Okay. Sounds good. I have a few as well, but one that's been on my radar for a while is

Franco Nevada, ticker FNV.TO. It's also listed in the US, FNV. You're all commodities today, buddy. Yeah. Just sticking to the theme here of commodities. It's definitely my favorite type of mining commodity play, but this one's not quite a miner. So it's a streamer. Essentially what they do is they'll provide oftentimes royalty when these mining companies start extracting, whether it's various commodity could be gold, silver, oil, iron ore, and even more. So it gives you some exposure to a variety of commodities that I do like. And it also is a lot less capital extensive and a lot less risky than these traditional mining companies. Because what

they'll do is they'll take a bunch of various bets, and then some of them will work out, some of them won't. But I think it's a lot better than putting all your eggs in one mining company. It's down 25% from its highs, yields 1%, so it does pay a small dividend awesome balance sheet with no debt and almost no liabilities share count does increase a bit year over year but it's really reasonable we're talking here like one to two percent per year at most so considering they have zero debt i think that's a really good thing here and it's one that i've been thinking about for a while. The reason why I'm really interested and I will probably start a position soon is because I'd like to have some exposure to commodities in my portfolio. I still believe in you know great businesses that are not

dependent on commodities and cyclicalities but you, you know, having something about 5% of my portfolio, I don't think it's outrageous or anything like that. And does provide a bit of a hedge in terms of the other types of companies that I currently own. So to me, it's really, honestly, it's like a perfect place to get exposure to a basket of commodities. It's one that I will never understand no matter how many times you talk about it. And that's okay. That's all right. It seems interesting. My main question to you, explain like I'm five. How is it better than buying? What makes streamers so much better? Or why do you like them? Like from like, explain like I'm five. I know you just went into that, but like, if you were to explain to someone

in three seconds who has a peanut brain like me, why streamers? Yeah. Well, the basic case is pretty simple. In my opinion is just think about a traditional miners, right? Think about what's involved in that. The operation, it's extremely capital extensive and you have cause that can vary greatly. So you don't have cost certainty, whereas the streamer will provide financing and then they leave it in the hands of the miners to actually do the production. And then they get a cut in return, whereas the miner, you know, certain costs and we're seeing right now with inflation right certain costs will start going up they may enter a certain section of a mine that it's even more expensive to start extracting labor costs may be going up there could also be for a lot of minor there's also you know they'll be present in several different countries so there's also some regulatory obstacles that they'll have to deal with certain political

issues too in some countries where you have governments in place not saying that franco nevada or streamers are not immune to that but it's definitely a lesser risk and because they have exposure to so many different projects without themselves doing the extraction. It really allows them to, in my opinion, be a much more profitable company than you see a traditional miner. They also tend to trade at much higher multiples than traditional miners, I think, for that reason. Right. And for that reason, they probably should. Okay. Thank you for that. I'm going to go with Equinix, a name you own, a name I've talked about extensively here on this podcast, and more importantly, a name that I should own. It's very high on my watch list. They just reported breaking news. They just reported their Q2, just like right now. So I can speak to it here on the fly. This is a REIT. It's a

real estate investment trust. It's down more than 20% this year, as many names are, as many technology companies are, because they are the largest data center business in the world by quite a large margin. They benefit from increased interconnectivity of our world, the need for faster internet speeds, reduced latency, the need for business interconnection, co-location, and a huge driving force underpinning all of this is the growth of cloud computing, hybrid, and public clouds. Equinix maintains a 15% growth rate for sales year over year, and it adjusted funds from operation as well on that same clip. On a historical basis, I don't see that slowing down. Now, they're reporting Q2 right now. I have found it weird that over the past day, you've had pretty good results. Microsoft Azure

maintaining above 40% growth year over year on revenues in the cloud. These should be good signals for the data center providers when the hyperscalers are maintaining those growth rates in what I'll call air quotes, like tougher economic conditions. So here we are, C-BAR, and you're getting the real authentic. I'm opening the press release right now. This just came hot off the press. Revenues are up 10% and they just wrapped up the company's 78th consecutive quarter of revenue growth. The longest streak of any S&P 500 company. Record bookings, raising the dividend, over 435,000 interconnections. Dude, this is the easiest long in the world at this point. I don't know why I don't own shares. This is a good time for me to speak to it now. Hopefully I don't have to have

this segment on my watch list anymore and I can speak to it as a shareholder because it's just, this business is incredible. You could still have it on your watch list once you're a shareholder. Yeah, well, you know what I i mean you know what i try to reserve this segment for a company actually that's not even true last time i think i did google yeah i think you did so you know that's all right that's not even true actually it can it can come around on this segment i try to do ones i don't own but then again i've definitely done something that i do own when i want to buy more of them so that's's it, man. It's a pretty, pretty easy long. I mean, one of the easiest thesis I can come up with. Yeah. And pays a nice little growing dividend.

So I think, I mean, you're preaching to the choir, so I don't think there's much more I need to say. You're not going to be like, dude, I don't like it. Oh wait, it's a huge part of my portfolio. Yeah. I think that's probably a wrap for today. Do you have anything else or? No, let's wrap it up here. Thanks for listening so much, guys. This podcast comes out Mondays and Thursdays. If you have not left us a review, go ahead and do that. If you've been listening to this podcast, say you've been hypothetically. I know I'm speaking directly to some people.

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terminal for free. Just go to stratosphere.io, hammer that, go check it out. Dude, we're coming out with lots of new stuff every single day. It is the only thing I think about. It's kind of insane. I don't constantly think about topics and stuff. Oh, man. Like, start your own business, they said. It'll be fun, they said.

It'll consume every waking second of your life, they said. But no, I love it. So go check that out at stratosphere.io. Thanks so much for listening. We'll see you in a few days. Enjoy earnings season. We'll be here every Thursday. We have an earnings roundup.

So you got to be here every week. Cheers. Bye-bye. The Canadian Investor Podcast should not be taken as investment or financial advice. Brayden and Simone may own securities or assets mentioned on this podcast. Always make sure to do your own research and due diligence before making investment or financial decisions.