August 9, 2018

Bestseller author Thomas Meyer on stock investing [uncut]

I met Swiss author Thomas Meyer for an interview in Zurich. Even though he (like many people) was initially quite skeptical about stocks, he quickly changed his mind when I explained how it actually works. First of all, stock trading is not difficult, and secondly, it is not immoral - at least not more immoral than any other activity that people use to make money. What finally convinced Thomas was when I showed him how he could use good investing to generate up to 50 percent more capital for his retirement. Because Thomas likes to take matters into his own hands – and because this approach will enable him to save a lot of money for external administration fees – he wants to invest by himself, and thus he uses the information from our newsletter to buy his first stocks.

In regard to choosing stocks, Thomas has doubts whether it can be profitable to invest in ecologically-responsible companies. Investing in any other company is out of the question for him. I am able to put him at ease – stocks of "green" companies don’t have any disadvantages. On the contrary: If the concerns regarding climate change prove true, these companies might have a very promising future.

In our third interview, Thomas asks me where he can find ideas for new stocks. I ask him where he finds the ideas for his books. "In life", he answers. I tell him that I think it’s the same thing with stocks. You won’t find the good ideas in investment magazines, because everyone else can read them too – and that usually means that it’s already too late to buy the stock. Thomas likes this answer and decides to invest in cannabis stocks because he sees a lot of potential in the health sector.

In episode four, we are talking about put options. That’s because Thomas thinks long-term investing is a bit boring and he would like to have more action. However, I discourage him from ever investing in options, because they are basically pure gambling. For instance, the stock of VW only briefly fell after the emission scandal and has since been rising continuously – even though the company’s image is still damaged. Thomas is convinced and won’t start investing inputs.

In our last interview, Thomas asks me about the fluctuations of the market. Just like anyone else, he’s afraid of losses. Unfortunately, I have to tell him that fluctuations are just a part of investing in stocks. And because people these days can trade stocks much faster than a few years ago, these course fluctuations are actually much bigger than they used to be. However, despite the bad news, I can put Thomas at ease: When following a long-term investment strategy, these short-term losses are completely irrelevant. All that matters is the portfolio development in the long run.

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