Phil Town. He’s a two-time New York Times’ best-selling author, hedge fund manager, and founder of Rule One Investing. He’s teaching individuals how to take control of their financial futures so they don’t have to find a fund manager or financial advisors.

Famous Five:

• Favorite Book? – Intelligent Investor
• What CEO do you follow? –  Warren Buffett
• Favorite online tool? — Evernote
• Do you get 8 hours of sleep?— Yes
• If you could let your 20-year old self, know one thing, what would it be? – That USA will put us in a war and it will suck

 

Time Stamped Show Notes:

• 01:30 – Nathan introduces Phil  to the show
• 02:00 – What makes you qualified to talk about this?
• • 02:08 – “By New York Wall Street standards,  I’m completely unqualified”
• 02:23 – Most people invest using the concept of modern portfolio theory
• 02:50 – There are people who Phil follows for 30 years now
• • 02:58 – Ben Graham developed the ideas and values of investing in the 30s and 40s
  • 03:12 – Warren Buffett and Charlie Munger
• 03:41 – Phil has a principle of picking good companies while they’re on sale
• 03:55 – Phil learned to use other people’s money to build up their funds
• 04:22 – How much outside capital have you raised in your hedge fund to date?
• • 04:32 – Under a hundred million
  • 04:40 – Phil started to manage money through separate, managed accounts
  • 04:58 – Phil can manage other people’s money that don’t have the investing capital for hedge fund
• 05:53 – The people who needed their accounts to be managed the most are getting the least attention
• 06:10 – How do you beat a company like Wealth Front
• • 06:24 – Wealth Front is run by modern portfolio theory math
  • • 06:58 – “It’s such nonsense and yet, it’s the only math there is”
  • 06:57 – A robo-advisor pretends that they can use volatility as a reference point for risk
  • 08:10 – People need to know how to invest on  their own
• 08:23 – Phil mentions the three things that he believes someone should do if they don’t want to be an active investor
• • 09:19 – Find a financial advisor who knows what they’re doing
• 09:30 – The gap Phil wants to fill
• 09:56 – “An active fund cannot be the index”
• 11:05 – If you’re not going to learn how to invest, you’ll have fewer choices
• 11:43 – It is simple to invest correctly
• 12:00 – It’s not true that there are losers and winners in investing
• 12:46 – “Investing is simply buying something that you understand for less than its worth”
• 13:20 – Phil started with real estate
• 14:02 – Warren Buffet is one of the best real estate investors
• 15:02 – Phil shares the essence of a good investment
• 16:05 – The essence of speculation or trading
• 16:40 – Nathan asks Phil for his opinion regarding Bill Ackman’s Chipotle Mexican Grill
• • 17:21 – Chipotle Mexican Grill has no leverage
• 18:40 – The one rule Phil applies to all different investment strategies is don’t lose money
• • 18:55 – Rule 2 is to remember rule 1
• 19:15 – Phil’s 4-rule process
• • 19:18 – First, am I capable of understanding this business?
  • 19:22 – Second, does this business have protective characteristics that keeps competition a leg?
  • 19:33 – Third, is this owned by people with integrity?
  • 19:36 – Fourth, am I buying this at a big discount to its value?
• 20:35 – How do you handle imperfect planning?
• • 21:13 – You have to have a big discount on the value that you’re purchasing
• 22:48 – Phil’s first book came out in 2005, second in 2010, and another one in 2018
• 24:55 – The Famous Five

 

3 Key Points:

• People need to know how to invest on their own—if you’re not going to learn how to invest, you’ll have fewer choices.
• There is a difference between a good investment and speculation.
• Investing is simply buying something that you understand for less than its worth.

 

Resources Mentioned:

• Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments
• Drip – Nathan uses Drip’s email automation platform and visual campaign builder to build his sales funnel
• Toptal – Nathan found his development team using Toptal for his new business Send Later. He was able to keep 100% equity and didn’t have to hire a co-founder due to the quality of Toptal
• Host Gator – The site Nathan uses to buy his domain names and hosting for the cheapest price possible.
• Audible – Nathan uses Audible when he’s driving from Austin to San Antonio (1.5-hour drive) to listen to audio books.
• The Top Inbox  – The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences
• Jamf – Jamf helped Nathan keep his Macbook Air 11” secure even when he left it in the airplane’s back seat pocket
• Freshbooks – Nathan doesn’t waste time so he uses Freshbooks to send out invoices and collect his money. Get your free month NOW
• Show Notes provided by Mallard Creatives