The Canadian Investor - The risks of leverage and free cash flow with Andrew Sather

Episode Date: April 5, 2021

We’re back this week with some recent stock market news followed by an interview with Andrew Sather form the Investing for Beginners Podcast. Tickers of stocks discuss: AC.TO, CSU.TO, SPG, TOI.V, TSLA, GME, GS, HD Want to send us a question? Check out our Anchor.fm link in the description below and leave us a voice message! https://einvestingforbeginners.com/ Getstockmarket.com Candian Investor Pod Twitter: @cdn_investing Simon’s twitter: @Fiat_Iceberg Braden’s twitter: @BradoCapital --- Send in a voice message: https://anchor.fm/the-canadian-investor/messageSee 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. Live from the great white north, 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 Belanger. The Canadian Investor Pod. It is Saturday, April 3rd.

And it's a good day, Simon, because the golf courses are open today. And you bet I'm playing 18 holes today. What going on today for you man i'm going i'm doing well i'm gonna go for a nice 20 minute walk outside so that's the longest i've gone with after my knee injury so building that back up but i think i'll be good to go for some biking in the next three four weeks so pretty excited but golf in ottawa is probably a no-go for another couple of weeks you you got a couple more weeks yeah yeah all right let's uh let's discuss some news other than uh Ontario's back in lockdown I don't know about the rest of the provinces but Ontario's back in lockdown which is uh never mind uh let's move on to business news I don't want to dwell on it

uh what do you got for us yeah so there's uh we'll do quite a bit of news uh on uh at the beginning of this episode so the first one was uh some recent dollarama news so they came out with their most recent fiscal year results and as part of that they mentioned that they'll open more than 600 new stores across Canada by 2031. That will bring its total store count to 2,000 stores. So that is a lot of stores for Dollarama across Canada, but their CEO seems to be adamant that there is enough demand for that. So we'll see how it works out. But for the past year, they seem to have done a pretty good job considering the pandemic with them being i think an essential business if i remember correctly it was to be

expected that it would be a good year but just a quick quick overview they had a six percent increase in sales which is very good considering the situation. They also had an increase in free cash flow year over year. I don't have the exact percentage because I just had a quick glance at it, but it seems like they're doing very well in terms of pandemic and their business going forward. 600 stores, that's a lot. And is it just Canada? Yeah, it's just Canada.

I don't think they have a presence internationally or in the States. There's a lot of competition south of the border in dollar stores. So I can see why they just want to pretty much have the monopoly up here. Yeah, and it sounds like they do. I mean, at least in Ottawa, they're kind of everywhere already. And I don't see much competition aside from the independent one here and there and I think I've seen a few dollar trees but that's about it yeah and this business we've talked about it before on this podcast it's one that kind of

defied the street narrative that had no pricing power because they can actually take up like it's like 50 cent increments on their products right they can take them up and they've had pretty much no pushback on you know some of these items being five bucks or more now um especially because they're still cheap for what you're getting and uh they can take up like 50 cents on some of these products and margins go bananas so um it's actually a good business man yeah yeah no it sounds like it i mean something to look into if you like uh the kind of steady grower um i don't think it's going anywhere anytime soon what do you got next for us so the next piece of news is one that just came out yesterday. So the Air Canada deal with Air Transat ended up falling through. The reasons cited by the companies were the European regulatory approval, which was

denied even though Air Canada tried to put some contingencies to satisfy regulators over there. I'm not exactly sure to which extent why they needed European regulators. I would assume it's because they're using their airports. They must also have a pretty decent European traveling base. So I would assume that's the reason behind it. But it was obviously required for the merger to go through. And after it was announced, the Canadian Transport Minister, Omar Al-Ghabra, and I am probably butchering his name right there, he tweeted that the federal government is looking at financial support options for Canadian airlines, including Air Transat.

So I guess there's to be continued when it comes to that. So I wouldn't be surprised if we see an announcement regarding some financial support from the feds in the next weeks or months coming ahead. This is not, of all the big blockbuster deals these days, this is not one I had pegged to not go through, if I'm being dead honest. And I'm no expert in the airline industry, but this is not one I had pegged as probably won't go through. And I don't think the street did either because it traded pretty much at the proposed price for a long time anyway.

So there wasn't much arbitrage on the price there. So I guess myself and the market would be surprised to see this result. And yeah, that's I guess that's too bad, huh? Yeah, yeah, it sounded like that's something that should really would have benefited Air Transat because of the whole pandemic. I think they're of all airlines, they're really struggling because they tended to have flights to vacation destination. And obviously that's been hammered by the pandemic. So we'll see their CEO sounded fairly optimistic that things would be okay for them. But yeah, the federal government did say

that they want to protect jobs. So yeah, I have a feeling we'll see something coming up, an announcement from them in the near future. 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. Moving on, before Brookfield had a proposal to take out and buy out 100 of the bpy publicly listed units that's their real estate investment trust business uh they've reached an agreement so they're acquiring it at 18 17 per bpy unit which represented a 26 premium um when the deal was first announced uh you know this is brookfield doing brookfield doing things that are contrary to what is you know appreciated

in the market and uh real estate office and uh retail particular, what's in their portfolio, has been beaten up a lot for these public listings on the real estate investment trust side. But if you're Brookfield, they don't own the crappy subpar real estate. crappy subpar real estate. They own the best real estate in the world with big central city anchor, important buildings on the office side and the premium mall properties across the world. So they own quality properties and Brookfield believes that they're going to be valuable in the future, and they see good value in taking those units off and adding it to the Brookfield asset management business. So as a BAM shareholder, this is what you sign up for, right?

Is you sign up for Bruce Flatt doing things that the market doesn't like. And that's why the stock has done so well over his tenure, his very long tenure now. And he's not afraid to go against the grain and do deals like this. And that's what you sign up for. And that's why he has my capital. And I'm going to continue to own Brookfield and be very happy about it. Yeah, it's definitely Brookfield doing Brookfield things. And so they're being contrarians when it comes to that.

But they sound like they see a lot of value in BPOI. So that's why they're going ahead with this. And they've had some interesting deals in the past year. One of them is they, I believe they got approval to purchase JCPenney assets along with Simon Property Group. With Simon, yeah. Exactly. So I think that Simon Property Group is also an interesting one if anyone's interested in that space. So they own high-quality malls,

and they seem to have a similar kind of operating apparatus as BNY does. Obviously, BNY also has some office space and some apartment buildings, but it's something to keep definitely interesting. It's more of a contrarian play right now with everything going on but i know they're also both of them whether it's bpy but also simon property group as you can see they can be really creative with their financial resources and i think they're yeah it's i think the future will probably look uh look pretty bright for them when things do return to normal i think the biggest wild card is when exactly that will happen yeah especially for you know back to an

office setting but obviously they're keen and i tend to agree with them that eventually the office space is has proven to be very valuable over time. Okay, let's transition. I'm going to discuss Topicus.com. Topicus.com listed very recently on the TSX Venture. And why they listed on the Venture, I'm not actually sure. It's also like a very Constellation move, just like Mark Leonard refusesard refuses to list constellation software on other uh exchanges other than the tsx because he wants the price to say it's to stay low essentially so topic is

listed on the tsx venture now if you were a constellation shareholder this is a spin-off and you were actually given a few shares depending on you know how many shares of constellation you have but there's a couple key points and there's a great report done by this anonymous guy who has a blog called the 10th man and he writes writes a lot about constellation software. And he did a big, deep dive into topic is on March 3. So if you Google the 10th man topic is or the 10th man constellation, you'll find some of his lengthy, lengthy reports. And he's this guy, I swear, he knows the business better than anyone I know. So good job to him. But there's some key takeaways to Topicus because if you have these shares in your brokerage, since you own Constellation Software, you might be wondering, what is this business?

So Topicus, you know, in the grand scheme of things, it's a very small constellation, but like European version. That's like the no jargon version of what it actually is. So it is like a 2010 vintage constellation. The 10th man says they've reset the clock on M&A and it should be much easier for Topicus to scale acquisitions than CSU today. Now there's a couple other things. Constellation has changed their direction to larger acquisitions with lower hurdle rates and cutting the special dividends saying no more special dividend we can achieve much better returns for shareholders by investing it in acquisitions and so topicus is going to bypass that learning lesson and not be doing any special distributions

via a dividend um and the other thing is topicus.com which is a dutch business uh the ceo of topicus.com will now be the CEO of Topicus, the listing here that has Topicus.com, the business, and then now this acquisition wing. They've achieved organic growth year over year of over 10%. And when you think of organic growth at Constellation, it's like less than 2%. The whole business is driven by acquisitions.

So this is interesting, right? Because it's a 2010 vintage in size, and there's a lot more organic growth. And they've kind of learned some things, and the same guys that run Constellation are the same guys running Topicus, Mark Leonard at the helm. And this is, you know, can ease your mind if this position

sitting at your in your brokerage account right now, is that this is basically Constellation mini European size, but there's a lot of upside to it with a lot of organic growth and some learnings along the way from the guys who run Constellation. So that is Topkis.com. It's been a hell of an IPO already. I think it IPO-ed at $65, and it's over $80 today. So, I mean, lots to like here. Honestly, lots to like here. More for me to dig in.

I haven't added to it yet, but I'm really thinking about it these days. Any comments there, Simon? No, I'll defer to you when it comes to Constellation and Topicus. It looks interesting. I mean, it also goes to show that there's a wide variety of listing on the TSX Venture. And I did get a few tweets about it, like someone thinking about investing in a TSX Venture company and kind of putting the brakes after they heard one of our recent episodes. I would say whatever the company is, especially on TSX Venture,

you'll want to do some extra due diligence on it because typically the regulatory filings are not as stringent as the TSX. So I'm not saying don't invest in the TSX Venture. Just make sure you turn all the rocks that need to be turned before you start putting some money in there. That's a good point. The TSX venture, unfortunately, is a field of landmines. Honestly, there's no other way to put it.

There's so many pump and dumps and crap companies and super speculative junior mining exploration businesses on there um but topicus is not anything like that so you can sleep just fine at night knowing that that tsx venture sits in your portfolio um simon what's going on with uh okay goes this is this nuts man yeah that is uh is some pretty big news. And I'm not exactly sure if we're pronouncing it correctly. Archegos, Archegos, Archegos. Regardless, I'm sure you've heard the news of the family office that worked like a hedge fund that incurred some heavy losses. The numbers I've seen is anywhere between $20 and $30 billion in losses. To just

give you an idea of what happens. So a family office typically has less requirements than normal hedge funds. They're supposed to be managing capital for either single families or multiple families and are typically for very high network individuals. So fortunately, Brayden and I cannot use those kind of services. Speak for yourself, buddy. Yeah, it depends what the threshold of super high network individual is. So what happened, what triggered all of this is there was a margin call, which means that the hedge fund got wiped out. What's really kind of interesting what happened here is the fund's CEO, Bill Huang, is someone who's had a kind of shady past and some pretty hefty fines with some insider trading and other things. So there was already some

question marks around him. And what is believed to have caused the whole sell-off was ViacomCBS, which Arkegos had significant exposure through leverage or derivatives. So they actually were heavily levered for their position. I'm not sure exactly to what ratio, but it was, I believe, higher than 10 to 1. I've heard even to the extent of 20 to 1, but there's still a lot of details coming out. So I'm sure we'll know more in the next months or year as this SEC actually announced that they are launching an investigation into this. So because it was a family office, Bill Hwang avoided a lot of disclosure with the SEC

since the shares being held were actually held through the derivatives. So they weren't necessarily being shown as the direct owners of the shares, even though he held the higher than 5% stake which would normally cause disclosure for these type of funds another thing that I've seen is apparently he used the same type of collateral for the for the leverage for several banks so that's why there's banks that actually did not see any losses and some that were severely hit by this. So some Goldman Sachs and Durcha Bank were able to avoid material

losses because they got ahead of it and sold their exposure to that pretty early on. But then Crédit Suisse and a few other banks actually did not. So they had some significant losses. Crédit Suisse, I think it's anywhere between $3 and $5 billion, depending on some of what I've seen. But again, we'll probably know a bit more in the upcoming months and years. Like I mentioned, the SEC has announced an investigation. So I think we're just seeing the tip of the iceberg of what really happened.

But what is really making the markets nervous about all of this is, according to a piece in The Economist in 2018, back then there was $4 trillion managed by these family offices. So I can probably assume that it's closer to five or even higher right now with the growth we've seen in the past three years. But if that kind of behavior is actually happening like pretty widespread in these family offices, it could cause some serious problem and serious ripple effects in the financial markets. But it also shows that these so-called professional investors, these professional banks, are making essentially the same kind of mistakes that they made back in the financial crisis. And they're using way too much leverage. In some cases,

they probably don't even know from what I've seen what they're really getting into. Because if Bill Wang was using the collateral with several different banks, the same collateral for his assets, it kind of makes you wonder if the banks are actually doing their due diligence. So even small investors like us, I think it's a good reminder of the dangers of using leverage and how quickly things can go sideways. It can go really well, but if you get a pullback and then you get a margin call, depending on how much you're levered, you can essentially be wiped out.

So Bill Wang went to, let's just take the 20 billion figure on the low end to being completely wiped out in a matter of a day, essentially. So that's pretty much the low down on that. 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. I'm going to quote the boys, Warren Buffett and Charlie Munger. There's three ways to go broke. Liquor, ladies, and leverage. And that third piece, leverage, is almost every disaster begins with leverage.

And this brings us to, you know, a good talking point is, you know, there's very famous investors basically saying you don't really need to run leverage in your investment portfolio for the regular average self-directed investor. I mean, if you are doing it with lots of margin of safety and you have, you can cover margin calls and stuff like that, then sure, whatever, you may want to take on more risk and do whatever you want to do. But Warren Buffett has exclusively answered this question many times on CNBC because he always asks, should the regular investor use leverage? And he always says the same thing, that the regular investor has enough time horizon and will accrue enough money with a good savings rate that you don't need to use leverage to

increase your position size and your portfolio in your portfolio in general. So do you ever use margin or leverage ever in equity positions? Have you? No, I've never used it. I mean, I may, may at some point if I want to try shorting or options or things like that, but I'd be very conservative on that approach. But so far, I've kind of stayed away from that, and it's worked well for me. I guess the only leverage I've kind of used is for a mortgage, right? Yeah, yeah, real estate. Exactly, which is pretty common, but I've always been a big believer

in putting that 20% down because it gives you that buffer. And it actually reminds me of a recent discussion that the former CEO of the CHMC mentioned and he sees the biggest risk in the housing market in Canada as being people putting only five percent down and that combined with people being overextended could be a recipe for disaster and what he's really referring to is people are being over levered. So that's really the big thing. And he was saying that in his mind, they should put that down payment at 10%. But it's another example of what potentially over leverage can do,

because that was one of the things that happened during the housing bubble in the US. And the crash is that people were being over leveraged, having several properties with little to no down payment. Yeah, it's the source of pretty much all financial ruin is leverage, like honestly, in every single situation. So I've never used leverage to go long position. I've never used leverage and other financial instruments like some of these complex things like derivatives. And you really just don't need to. That's just my opinion. You really just do not need to use leverage on a stock portfolio that you're managing, like whatsoever. If you need more money to invest, you got to look at your savings rate. And in the generation phase,

like in the accumulation phase of generating wealth, your savings rate is going to matter more than your investment decisions, I think. Maybe later when your portfolio has been compounding for 20 years, those decisions will will have mattered more than your savings rate in 20 years. But right now, or in the accumulation phase, your savings rate is pretty much everything, you have more money to invest. And then you just won't need leverage. Because like you said, with your mortgage, you're not getting margin called, there's no 50% drawdowns on your house. Well, not that you would see in a few trading days anyways. So yeah, it's something to bring up is liquor ladies and leverage. It's the only way to go broke.

Yeah. Who knows about the other two for a bit long, but we know that the last one definitely was the deciding factor there. But yeah, something to keep in mind. I know the allure of quick gains is very enticing, but just remind yourself that it can go both ways. And if it goes the other way, it won't be pretty. Yes, sir.

Okay, we're going to transition. We had an awesome conversation with Andrew Sather at eInvesting for Beginners. Semyon and I had a chance to sit down with him last week and just pick his brain on some things he's been thinking about. So I'm happy to bring you that conversation, and here it is. We have a special guest on for this segment of the show today, Andrew Sather from eInvesting for Beginners

and the Investing for Beginners podcast. He is a great all-around guy, very smart guy. Andrew, welcome to the show. It's always good to have you on. Yeah, thanks for having me on again. So we were talking a little bit before recording, and we're going to get to some nerdy accounting jargon later. going to get to uh some nerdy accounting jargon later but can we please dunk on the arc invest analyst coming out with this insane price target with the insurance business for tesla um what was your reaction to this and if you read the report i mean any cfa would just was just like how is this a real thing

you know i i know i didn't read the report so this is coming off second hand basically my source on this is a instagram meme i saw which that's legit though everyone knows that's where everyone should get their facts from. It was a pretty meme. And it wasn't like trying to poke fun and I'm not trying to say anybody's doing things wrong. We all have our different opinions of how things should be valued. But it showed how much in revenues and how much in gross profit. And so I think Tesla as a whole was supposed to have more revenues than Walmart has now, but then also have like 40% gross profit, which sounds like a tech

company. It doesn't sound like a car company to me. Yeah. I mean, let's not forget this is a car company, and the ARK price target is $3,000 per share in 2025. The problem with incentives and analysts coming out with these reports and firms like ARK that are getting so many flows into their ETFs, their flows are incredible. And don't get me wrong, Cathie Wood, very smart. What she believes in and standing by it, I really back that. But the reason they got a name for themselves and the reason their fund did so well was that pre-split $2,000 price target for ARK, which everyone made fun of. Sorry, from ARK for Tesla. And everyone made fun of it.

And so maybe the incentives could be not correctly aligned when these price targets are hit and then you know they look great but i mean no one would even know about arc if they didn't make this call so you gotta wonder that not only that it's their biggest holding so it's obviously in their interest to pump up the stock as much as they can be as optimistic as they can i mean it like the gamestop guy he he went on and he testified and he said i like the stock right um i i almost would prefer to see that rather than to see numbers which just look really unrealistic totally uh yeah that guy's awesome by the way that guy is awesome okay i'm not a cat okay um yeah you bring up a good point

honestly it looks like it's an absolute liquidity crisis with you know all these flows going into these highly illiquid names, very small caps. So anyways, we'll see how it all pans out. They've been right on a lot of stuff so far, so who am I to really say? Andrew, go ahead. It's not even the – not to be the dead horse. It's not just the projections about the auto business. I know there's projections about the auto business. I know there's projections about the insurance business too. But if you start to dig into how finance companies grow, particularly like banks

or insurance companies, as the law is now, you have to put a certain amount of capital into reserves in order to grow your revenue base. And so a lot of these projections don't seem to have that into account. And it's just very, very rosy. It's hard to see how you can build an insurance company from scratch without having to use a lot of capital, which will stifle growth from other segments. Yeah, Andrew, I had a question for you.

So what do you think for the future of tesla just out of curiosity like with more um car manufacturers getting into the business of electric vehicles i'm of the opinion that you know it may they may have more competition than they think in the years to come and the business may not go as well as you know a lot of people think so what are your thoughts on that? So I have some boots on the ground research. Being somebody who grew up in California, I go back and visit every once in a while.

And I'll tell you, in California, Tesla is just out of control. It's everywhere you look and turn, up and down the 505 freeway. It's truly incredible. And just in a few short years, how it's gone from like, oh, hey, there's a Tesla to like, oh my God, there's like three Teslas next to me, you know. But, you know, having flown from there and where I live now on the East Coast in Raleigh, North Carolina, it hasn't quite hit that saturation point yet. And if you look at some of the reports coming out of Europe, they're actually... So in China, they had some early momentum and it kind of faded off. In Europe, Volkswagen's actually done really, really well.

And a lot of the other German manufacturers are really stepping up their game. And so we might see some, although it's caught on a lot in like the Silicon Valley, California kind of area, they're having troubles in Europe. And we don't know how that's going to play out, but it doesn't seem like they're going to be able to have that kind of California takeover. but it doesn't seem like they're going to be able to have that kind of California takeover. It's not necessarily going to duplicate in other countries or even other continents. And so that's something to kind of temper expectations on, whether that's margins or straight-up revenue growth. I love the boots-on-the-ground research.

I personally, I was an engineer working in the automotive sector for a while i was working at magna international uh many canadians know the name i know it's a lot yeah it's a large are you familiar with uh gentex competitors that's another manufacturer they're they do they do like uh components into cars also and i know magna is like okay i guess magna must be the big fish in gentex is like they're our big brother kind of deal gotcha yeah they're a they're a big player now and the thing about auto manufacturing is margins are god awful so i mean the car business is you know not the super high margin software businesses that you see these crazy price of sales multiples strapped to.

But I don't want to take this whole segment for Tesla because let's get into two things that you've been digging into on the accounting side. Return on invested capital and free cash flow, I think of as maybe the most important metrics to track in stock investing. There's lots to look at, but those two are guaranteed checkboxes for my research. You were mentioning some nuances with these two metrics, and I'm happy to have you discuss those and we can chat. Yeah, let's talk about free cash flow. And I think this is pertinent because it's very obvious as these 10K and the annual reports come out for the fiscal year 2020,

you saw huge disparities and some industries had crazy demand where they can't keep up with supply and supply is constrained. Other industries are struggling because demand just dropped off a cliff. And so a huge component of free cash flow is working capital. And so just to kind of break that down and make it simple, working capital is I got to get some inventory. That's the simplest way I like to think about it. I got to spend some cash to build some inventory. So if I'm a retailer, if I have a holiday season coming up, I might get rid of a bunch of my cash so I can fill my shelves and my warehouse. That way, when we get all this demand, we can sell through. And so as you have those changes in the working capital, they influence your free cash flow.

Before we wrap things up, I wanted to take a moment and thank Andrew for coming on the podcast and having that great discussion with us. Unfortunately, we're missing a few minutes of the discussion that we had with Andrew because of technical difficulties. So you did not catch the end of that discussion. However, I still think there was some really good information in the discussion that we were able to capture in the podcast today. If you'd like to learn more about Andrew, you can go to his website, einvestingforbeginners.com. his website, einvestingforbeginners.com. Andrew is also the co-host of the Investing for Beginners podcast along with Dave Ahern, which you can listen to on a weekly basis. That wraps it up for the Canadian Investor Podcast today. We hope that you enjoyed the episode and we'll be back

with a new episode next Monday. The Canadian investor is not to be taken as investment advice. my day. The Canadian investor is not to be taken as investment advice. Braden or Simone may own securities mentioned on this podcast. Always make sure to do your own research and due diligence before making investment decisions.