7investing CEO Simon Erickson breaks down the bull and bear cases for a pair of disruptive companies who each have a clear path to disrupting their respective marketplaces: MercadoLibre for e-commerce in South America, and SoFi for digital lending and banking. Which company will have better returns for shareholders over the next 5 years? That’s the question we’ll be answering through the polls in the Summer Stock Challenge.

Listen to the breakdowns, and then head to our Twitter page @7investing to cast your vote!

Transcript:

JT: Hello everyone, and welcome back to the Seven Investing Podcast. I’m your host today, JT Street, and I am joined by seven investing CEO Simon Erickson, for yet another of our breakdowns into our summer stock challenge. Simon, how are [00:01:00] you today, sir?

Simon: Good, jt. Highly caffeinated. As always. We got another good matchup.

Simon: Let’s get right to the punchline.

JT: All right, so today’s matchup we have in this corner, Mercado Libre, a digital payments and. Marketplace, south American Titan, and in the other corner we have SoFi Technologies. I was gonna say that they’re an upstart banking system, but that might be a little bit confusing with, another e-commerce platform or a e-banking platform.

JT: But, SoFi Technologies. They just got their banking charter. They started out in student loan payments and they are moving into the digital banking space. So,I am going to let Simon go through each one of these companies and talk about them much more eloquently than I can. And then we’re gonna decide which one of those is going to have the higher returns for investors over the next five years.

JT: So let’s start with MercadoLibre. As I mentioned something, you know the word Amazon gets thrown out a lot when discussing [00:02:00] MercadoLibre. They are. Doing, in South America, what Amazon or they’re trying to do in South America, what Amazon did, in North America and around the globe, creating a digital online marketplace.

JT: Simon, tell us a little bit about MercadoLibre. For those who don’t know that ticker,

Simon: Yeah, absolutely. like you said, kind of a lot of comparisons to, to eBay or to Amazon, but it is Latin, America’s largest e-commerce provider, a digital marketplace, if you will. It’s the middleman that connects the buyers with the sellers of whatever they wanna sell.

Simon: And there’s 81 million people that are buying things in Latin America, in the 18 countries and where it operates. And there’s 1 million sellers that are selling things on the Mercado Libre platform. And it might sound simple, right? You just have to have a website, right? And just connect people to, to buy and sell things.

Simon: But it’s actually a lot, a lot, a lot more complex than that. And the thing that’s so appealing about Mercado Libre is, is, is [00:03:00] exactly what we’ve seen on other continents as well. Why is Amazon, Amazon and no one else has really challenged their lead in e-commerce? Why is Alibaba such a regional leader, you know, over in China and see limited in Southeast Asia?

Simon: I mean, you kind of see these regional monopolies building up in e-commerce, and that is because there’s just one platform that tends to put all of their money. Into providing the best payments. Online shopping and in logistics option for, for both the buyers and the sellers, and then there’s no reason to go anywhere else.

Simon: You know, I, I have not moved from Amazon because I love the two day free shipping. I love that, you know, I can trust all the vendors that have been vetted there, and then it’s really, really easy to just one click payments. And when we compare Mercado Libre to Amazon, it’s because they’ve done a lot of that similar playbook.

Simon: They’ve got Mercado, Pago, jt, you and I both book Spanish. You know, they’re kind of the PayPal equivalent of making it super easy to just [00:04:00] pay for things in a region where online payments is, is still kind of new to most of Latin America, right? It is the trust factor that they’ve introduced into the entire continent of South America, and several of the countries are right outside of it too.

Simon: And then the logistics too, right? If you’re shipping things in Brazil, if you’re, if you’re a business that wants to ship something and you use the postal service, we’ve gotten used to, in the US it take, you know, a couple of days, probably up to a week or so, in Brazil, it’s 40 days or more. It’s a month and a half to get anything shipped.

Simon: But if you’re using a Mercado, envi Os, they’re shipping solution for Mercado Libre. Since they’ve got their own trucks, they’ve got their own planes, they’ve got their own infrastructure, it’s a day and a half. The majority of their shipments are getting there. They’re within two days as opposed to 40 days.

Simon: And so you kind of see, you know, why is Mercado Libre so amazing? Why do they have all those buyers? Why are they doing 10 billion in gross merchandise volume? That’s US dollars equivalent, per quarter. It’s because. There’s this regional [00:05:00] monopoly winner take most dynamic in e-commerce Mercado Libre wearing the crown as the king of e-commerce in Latin America.

Simon: A

JT: And you were talking about just the. The sheer amount of disruption going from sending your package and having it get, I don’t know, lost in the wilderness for 40 days, before arriving to its destination, rather than a day and a half. I, I imagine that’s probably one of the reasons why their revenue, was up 58% to 3 billion in their payment volumes increased.

JT: 96% to 37 billion. That’s in one quarter. Am I reading that right? Is that, is that. Is that accurate?

Simon: For the most recent quarter? That’s right. And that’s year over year. And not, not quarter over quarter, but it is over the last year, which is amazing. You know, when you think about it, jt um, you know, eBay kind of, and PayPal were kind of meant to be on platform, right?

Simon: You use PayPal for purchases on eBay and now people use PayPal for everything, right? You [00:06:00] can subscribe to seven investing, with pay, pay with it, with PayPal. Now it’s the same thing with Mercado. Pago down there. You can use it on platform. But it’s also just kind of this entire payments ecosystem that’s been used for everybody down in South America.

JT: And if you want to do that, that’s seven investing.com/subscribe. Yeah, I, I couldn’t resist. I couldn’t resist. Perfect. So let’s transition a little bit. We’ve got kind of a feel for Mercada Libre. It’s doing really disruptive things down south. let’s pivot over to SoFi Technologies, which also, began its history as a bit of a disruptor.

JT: In the student loan space. Let’s go through a little bit about SoFi. For people who don’t know its history,

Simon: Yeah, and this is, this is digital banking, right? We, we knew that there was gonna be disruption in digital banking, right? It was all these legacy banks had all these bricks and mortar locations and the staff and, you know, the electric bills and everything.

Simon: And, just, there’s not a whole lot of need for that unless you really like [00:07:00] going in person to the bank. A lot of people don’t now. And so there was kind of the opportunity to just, what if, what if you just built an app? And, um, got rid of all those costs and just made it as attractive as you could for the rates.

Simon: Right. And so what SoFi did was exactly that. they put all of their, their profits into building the, the best mobile app products so they could offer, like you mentioned, jt, that kind of started with tech Savvy 20 somethings who had student loan debt, right? They wanted to refinance student loans, get better interest rates on those.

Simon: Um, If you can save a couple hundred bucks a month by doing that, it’s, it’s kind of a, a really big win. And SoFi said, you know, Hey, now that we are right in your pocket, I guess figuratively because they are a bank, but they’re also right in the pocket with your cell phone. They said, you know, why don’t you come back to us again and we’ll give you another loan when you wanna take out or borrow some money for, for a home loan, for a mortgage or a car note or, or a personal loan.

Simon: You know, we want to be there for you in every phase of your life. And SoFi [00:08:00] is really dead set on becoming. That lending provider of choice, again and again and again, because most people, you know, at least traditionally, have used several banks for different things, right? You had a different bank that was servicing your mortgage, who might be a different bank that was servicing your car loan, who is different than their bank that you did for your, your regular banking, you know, or your.

Simon: A deposit base sits and SoFi said, what if we collapsed all of those into a simple to use app that’s got a whole bunch of different products, and that’s exactly what they’re intending to do going forward.

JT: We were talking before we hit record on this about SoFi, and you seem to think that SoFi right now has a lot of built up, pent up momentum.

JT: From the pandemic and from the student loan pause and from it getting its banking charter, I, I believe, 2022 or 2021, somewhere in there, very, very recently. And all of that is you think leading towards some sort of, in inflection point [00:09:00] for SoFi in the very near future.

Simon: I really do. You know, this is something that we’ve recommended many times at seven investing.

Simon: It’s, we’ve actually put re recommendation after re recommendation our scorecard. I might have slipped up a little bit and revealed a little bit of company ip, giving the recommendations away. But go check that out, like you said.

JT: Um, well, and, and, and to, to just. Put a note on that before we continue. Right now, you can go to seven investing.com and if you type in your email address and are right there at the, the top of the homepage, you’ll actually get our most recent recommendation on SoFi.

JT: So, you know, it’s, it’s kind of our, our favorite. Our worst kept secret right now is you can read seven investing’s recommendation on SoFi right now for free just by going to our website and typing in your email address. So, um, throwing that out there too if, I mean, there’s a lot to like about this company and, and you guys clearly do as advisors.

Simon: The cat is outta the bag, or at least it’s beginning to, you know, there was the overhang of the student loan [00:10:00] moratorium where it was just gonna be mass forgiveness of student loans. People wouldn’t need to refinance. That’s mostly behind SoFi now. And I think that was the clarity that the market needed, for this company.

Simon: And now it’s kind of willing to put the. Appropriate investment into it that, that we’ve been waiting for. Um, the company is growing incredibly quickly, jt the reason I say inflection point is you see the deposit base and the assets that they’re consolidating, just growing so, so quickly. Right now, we’ve got Anthony Nodo at the helm.

Simon: He’s c e o. He was the chief operating officer of Twitter in Twitter’s heyday, and now he’s coming back and he’s saying, you know, we want SoFi to be a top 10 US financial institution. And like you just said, it was only 20, 21, 2 years ago that they even got their bank. I’m sorry that they even hit the public markets.

Simon: It was a spac i p o back then. They then got their banking charter, shortly after, within a year and kind of in early 2022, you know, the Federal Reserve comes out and they say, okay, [00:11:00] there’s, there’s around 2000 chartered banks in the United States right now. Um, a year ago, you know, early 2022, SoFi was number.

Simon: Let’s see if I have this written down. 449 on the list In terms of the assets that they controlled, right, it was already kind of respectable on this list. Most chartered banks are rather small and regional, but then just within one year it had jumped up to number one 14. It had jumped 300 spots because it had amassed more than $13 billion in consolidated assets, and even just one quarter later here, Nodo had just pointed out in their financial results and their quarterly update that they’re now at 22 billion in assets.

Simon: If you go out there, you offer really, really attractive rates when people are looking for short term investments, right? Um, they wanna put deposits in the bank cuz you can still get four or 5% on your cash and they make it easy, super easy within the app to do it. And, um, suddenly when you, when you see that seemingly ambitious goal of being a top 10 bank, if you continue to [00:12:00] collect 10 billion or more in assets per quarter from the right marketing, you know, low cost acquisition strategy, don’t have the le the legacy bricks and mortar.

Simon: number 10 is TD Bank, jt, who’s got 400 billion in assets. That’s still a far away from 20 billion, but. You look at the momentum, um, that SoFi’s got you look at how they’re consolidating assets, people are moving assets from other accounts into these guys. Um, it might not be as audacious and ambitious as it sounded at the time that Nodo made that claim a couple of years ago.

Simon: Yeah.

JT: When you think about it, yeah. If we take the 13 billion. in total assets that they had, of course, even at 22 billion, I believe they even have to 20 x, their managed assets just to get to top 10 status. So, you know, if you’re, if you’re looking at a company from an investor’s perspective and say, okay, well here’s a company where their stated goal is to 20 x their managed assets.

JT: So you would think [00:13:00] proportionally that would be 20 Xing their revenue too. Um, although maybe not. Yeah, that’s, I’m not sure that that’s accurate because you would hope that, right. but the idea of a company saying, Hey, we’re gonna grow by 20 x in the very near future is, is pretty exciting. And, and, and you mentioned one of the ways that they’re doing that is having, checking with really, really attractive rates.

JT: You know, we’re, we’re investors we’re always looking for, um, Free money, I guess, for, for lack of a better word. And you can go and get a SoFi account. I think I saw their last checking, their savings account was like 5.2%, which is now above the rate of inflation. So, yeah, you know, you and I are the same age.

JT: We’ve never had a savings account be worth anything. From traditional banks, like most savings accounts, you’re getting like 0.2%. You’re like, oh, great, I got three pennies. Yay, saving, right? [00:14:00] Having an actual investment vehicle in your savings account where the risk is nil and you’re getting a 5% guaranteed return on your investment, that’s really attractive for a lot of people.

JT: So it’s not surprising to me to see them. Picking up steam here. So, so that’s the, that’s the plus for SoFi and Mercado Libre. That’s the landscape for, for each of them. Let’s go take the flip side of the coin. You know, we’re looking at these stocks long term. Which one is going to be the better return for investors over the next five years?

JT: And that means also looking at what are some of the headwinds that might prevent them from being. The best stock for investors in the next five years. You, you wanna have a clear picture of, of the good and the bad. So while we’re on SoFi, let’s, let’s stay here. What do you see as, I mean, you don’t, you can’t know the unknown unknowns, but what are the known unknowns, the, the hurdles that are in SoFi’s path over the next five [00:15:00] years in your mind?

Simon: And, and it’s gonna be very similar for both of these, JT because we are in financial services now, right? And the financial services risk is financial risk, right? The, these companies have to be making good loans that don’t blow up, right? Remember the two big to fail, you know, banks making bad, you mortgage loans and you know, student loan or whatever it was.

Simon: Loans. You’ve gotta make sure that you’ve got credit worthiness with your borrowers. Um, Now the risk is we might be having a, a kind of challenging macro out there right now, right? Interest rates did go up, which is great if you’re getting 5% on cash that you’re parking in the bank. It’s not as great if you have an adjustable rate loan or a mortgage that’s getting more expensive for you every month.

Simon: And so the, the risk for, um, for SoFi, yes, it’s amazing to see, so many assets consolidating with them. Not only getting new customers. Right outta the gate that are ready to start the journey. But consolidating assets from other loans too that are, that are [00:16:00] moving to the platform. But we’ve gotta watch the credit risk.

Simon: We’ve gotta watch the financial risk of, of bringing all of that onto the balance sheet. Make sure that non-performing loans are, are kept in check. Um, it seems like that’s not a concern yet, but it’s something that SoFi is very aware of. We wanna make sure that they’re not just. Bringing a ton of money in and then it all blows up and then they, they don’t get those paid back over time.

Simon: Um, it’s, I, I say it’s, it’s similar because it’s a similar risk for Mercado Libre, who has begun extending credit terms, to both its vendors and its, its buyers on the platform. MercadoLibre is a way to kind of juice the top line juice. the, the, gross merchandise volumes that it has is saying, Hey, if, if you need money to stock up on inventory, if you’re selling things, you’re one of those million small businesses, you know, we can, we can extend you a loan to do that.

Simon: Or if you’re one of our preferred buyers who’s been on the platform, you buy a lot of things. You know, we can give you either more favorable terms or a consumer loan for things like that. And interest rates are a lot higher in Latin America than they are in the us. You know, you might think something like that might be a [00:17:00] eight, 10% kind interest rate.

Simon: You gotta pay back. it’s typically 2020 5% down in Latin America. And, and that’s simply, a function of the economy. But a lot of businesses aren’t gonna be, or, or consumers aren’t gonna be able to pay their back. And so for, for both companies, you know, financial risk for financial services, it’s something we’ve gotta kind of keep an eye on as we’re investors, especially as long-term investors like we want to be.

JT: Could there be an additional risk for Mercado Libre, built into that macro where, you know, we talk a lot about. Recession risk, right? In our financial discussions here in this country. And, and that’s certainly something that’s global right now, everyone’s kind of looking over their shoulders saying, are we going to get an inflation related recession?

JT: is that an additional risk from MercadoLibre being that they are in the, the sales space too? So, so they have it from both ends, right? They have the supply side and the demand side. risk there if, if there is a recession and people, you know, [00:18:00] Tighten up, the, the purse strings and, and stop buying online as much.

JT: Could, could that be something that negatively impacts them disproportionately, moving forward?

Simon: Absolutely a hundred percent. You know, if people are spending an average of a thousand dollars a month on discretionary purchases and then all of a sudden, you know, you gotta pull back on their purse strings a little bit and you’re spending a hundred dollars, that def, that directly impacts, gross merchandise volumes for an e-commerce provider.

Simon: All those are great. Jt, and maybe even one more from MercadoLibre is there’s competition that’s coming in down there, right? It’s not a surprise that Brazil is a huge market and there’s gonna be a lot of opportunity, and we’ve seen, um, international companies C Limited has got shoppy that they, that they want to encourage people to use down there.

Simon: And they’ve been very aggressive in, offering promotional discounts, you know, and offering pro, you know, really attractive terms, payment terms, things like this to try to get people to use their app instead of using MercadoLibre. Now they haven’t invested in the [00:19:00] infrastructure, which is why I still like Mercado Libre.

Simon: it’s not easy to spend billions of dollars to buy your own airplanes and your your own payments platforms and things like that, but it is worth watching that, Brazil from a regulatory perspective. Is lowering the bar for entry for international players. International vendors now don’t have to pay the same import duties that they used to have to, so there could be some additional risks of competition rising in, Mercado, Libre’s most important market of Brazil.

JT: So, Best stock to own for investors over the next five years. We’ve got SoFi. We’ve got Mercado Libre. we posted our poll just a few minutes ago and we’ve already got quite a few responses to it. This will obviously change by the time people listen to this, but Right. This is, this might be our closest one.

JT: Yet with, with nearly a hundred votes in looks like Mercado Libre just edging out so far. But that, that had flipped from when I had [00:20:00] looked at it before we started this podcast, 20 minutes ago. So it really is neck and neck. I, I think there’s a lot of split here. Both of these are, you know, if we’re gonna horse race for a minute, for a Fin twit horse race for a minute, I, both of these are, are kind of darlings in the growth stock community.

JT: So I’ll be real interested to see. Where people land on this, because like you said, SoFi is nearing an inflection point. Mercado Libre has that lovely, monopoly. It’s, it’s fending off challengers. It’s got the logistics. Where do you stand on this, Simon? What’s, what’s your pick?

Simon: These, well, the, the, the secret is actually, I’ll let everyone in on a secret of how we’re, we’re doing this summer stock picking challenge.

Simon: And, and that is that all of these are actually really good companies. You know, we purposely picked good growth style companies like we’re talking about this week, and really good dividend payers that we’ll talk about next week. So it’s almost like a personal preference. You can’t go wrong with [00:21:00] any of these, but we do make it fun and frame it as a vote because.

Simon: If you’re really forced to choose, right? You can’t just go out and buy everything. You have to be like, all right, it’s either Mercado Libre, or SoFi. And we’re also framing it over a five year period. That’s a long time to invest for most people. You know, the turnover of most funds is, is multiple stocks every single year, and we’re framing it completely differently, saying five years out.

Simon: So you’ve got plenty of time to execute on what you’re wanting to do. Um, MercadoLibre today is a 56 billion market cap, and SoFi is about an eight and half billion dollar market cap. And MercadoLibre has been a fantastic performer for five years, up 259%. Um, SoFi came high outta the gate and it’s, and it’s spac i p o back in, in June of 2021 and has down 17% since then.

Simon: But again, I think we’re really starting to see the momentum building for them. they put the time into product development. Like we said, they, they plowed all of their money into the banking [00:22:00] charter and going out and, um, low acquisition costs to get new people on the, on, on board. And then also kind of the, the app that they built up.

Simon: And then they’ve got a whole business to business component too, we didn’t even talk about here today. But Galileo on kind of the way they’re approaching businesses is very different than consumers. Um, Forced to choose though, jt just one of these companies for five years. I, I would probably vote for SoFi in this matchup just because you, you’ve gotta really appreciate not only the ambition, but the execution and just how large that market is and how ripe it is for banking disruption.

Simon: It kind of checks a lot of the important boxes for me. It’s one I’m very comfortable holding for the next five years. I, I

JT: came into this ready to be convinced that MercadoLibre was the one to go with, right? I, I, I had. I had my inklings that SoFi was where I was gonna lean. And I, I came into this with no expectation, ready to be convinced.

JT: And I, I don’t think I have been, there’s a lot of risk. I, [00:23:00] I know a little bit about e-commerce. I, one of the stocks I, I like is doing something very similar, is Jua, which is doing something very similar to what Rico Libre is doing, but in Africa. And I’ve seen the kind of, Challenges, logistical marketing, so many challenges to try and build up that kind of presence there.

JT: And, and tho those are, you know, different companies doing things different ways. But I, I know the challenge. And so with so many risks, especially in the macro environment for Mercado Libre over the next five years, I, I think I like SoFi better too. Especially because that 17% down, since it’s spac is a little bit misleading.

JT: The company has gone what? It’s, it’s, it’s over a hundred percent since year to date, right? I, I, I think it was down in the fours and it’s over in the eights, you know, as we, as we have this conversation. So it’s been running already. It’s got a good head of steam and, and with the future that they are, [00:24:00] Advertising.

JT: If they get anywhere close to that, it’s gonna be really, really nice to be a SoFi investor. So I’m gonna agree with you, Simon. I think SoFi is, is the winner. we’ll see if Fin Twit agrees with us in the next 22 hours or so. If you would like to join us on this adventure, ill say, oh, go ahead Simon.

Simon: Jt, can I get one more thing too?

Simon: It’s interesting, we, we’ve had, we’ve had three votes now, right? We had, um, the first one was a trade desk versus rocket, right? Right. And then we did, Nvidia versus Snowflake. And, and you know, now we’ve got, um, you know, the one that we just discussed, SoFi versus Meli and all three, I, I voted in the minority.

Simon: I have voted for the losing company in the poll, which is interesting. So maybe I’m the contra indicator. I don’t know. It’s, it’s interesting that I voted on the wrong side of the coin for the vote each, each matchup. Yeah. I know that

JT: the trade desk had a big pop yesterday after we talked about it on Monday.

JT: So you’re welcome. Trade desk holders, for the, for the seven investing [00:25:00] bump. So if you wanna follow along with this, we are just scratching the surface. We’ve done the majority of our growth stocks. Tomorrow we’re gonna do things a little bit differently. We’re not gonna do ahead to head. What we’re gonna do is we’re gonna take the three winners.

JT: So whoever wins this matchup is going to join, the trade desk is going to join Snowflake, and they are all going to be put in a. Heads up four on one-on-one on one-on-one, right? Battle royale, where all of our winners are in a four person poll. And the fourth one is our round one buy on the growth stock side, which is Tesla.

JT: The, the 800 pound gorilla of the growth stock world, right? It’s, it should be a really interesting matchup. We’ve, I don’t think we’ve ever done this before, but it’s always been head-to-head one-on-one, so I’m really intrigued to see if you, if you put four companies in there, split the vote four different ways, [00:26:00] who’s gonna rise to the top and, and can anyone dethrone Tesla?

JT: On Elon’s platform of choice. That’s always interesting to see. We have had Tesla lose Paul’s before, so it’s not just. fan boys coming and voting. So it should be real interesting to see what happens when we put four stocks in a room together and see who comes out. Victorious. Do you have any predictions of, of what you Well, we, it’s hard to make a prediction cuz we don’t know who’s gonna win this one.

JT: Mercado Libre versus SoFi. So let’s put a pin in that. I’ll ask your prediction on that when we talk about these tomorrow, but that should be really fascinating. And then, Next week we’re gonna do what we did this week, but with income stocks. And that’s gonna be really neat too, because a lot of the focus for seven investing has been growth stocks over the past few years, but there’s a little bit of intrigue around income, the past year or so.

JT: As, as things have gotten a bit tumultuous in the growth, landscape, which might be my understatement of the [00:27:00] podcast. It’s gonna be really neat to see as we go through this process with our income stocks. How that works out too, cuz there’s a lot of real intriguing ones in that too. Like you said, we’re, we’re not picking bad companies here.

JT: All of these are really, really, fascinating potential plays. So if you’re looking to follow along with us, you can do that by going to seven investing.com/growth vs income. That has our full list of the matchups. You can see what we’re going to be talking about on what day, so you can follow along. And then Simon, I got, I gotta give you credit.

JT: You have put in a mountain of work on these companies doing our individual breakdown pages. We’ve got a landing page. There it is. There’s the coffee plug. For those of you listening on the podcast,

Simon: I for those kids, that’s my caffeine plug. That’s my

JT: coffee, right? That’s, that’s right. I’ve got mine. I’m not gonna show it cuz it’s a disgusting energy drink and I’m a horrible person.

JT: But the. The, the amount of work that you’ve put into these breakdowns is really [00:28:00] nice, and I can tell you that it’s effective because it’s what I read before we do these podcasts, that gives me some, semblance of, of sounding like I know what I’m talking about. So if you want to learn more about these companies, we post each of these along with the polls each day, just go down into the comments.

JT: You can find those breakdowns. They’re really, really valuable. So thank you for doing that too.

Simon: Yeah, it’s really a, it’s kind of fun, jt you know, we, we do this in kind of a public facing, you know, poll matchup. It, it’s a fun summer stock picking challenge, you know, public facing. But the context behind it is, is very deep.

Simon: It’s years of investing research. Um, Not, not just what I can pull together, you know, in, in, you know, four or five hours in a day to collapse everything into a report like this. But it’s, it’s just kind of, you know, you find the opportunities as investments over time. You see these companies getting stronger, then you think long term, you think five years rather than five months, and that’s how you can compound your returns.

Simon: And so I think one of my favorite parts of this, and, and by the way, [00:29:00] in addition to what you mentioned on the homepage, seven investing.com/email is where you can get into our email list and we’re gonna send, um, First of all, a, a consolidation of all of the, the articles together so you can go back and reference ’em later.

Simon: But also a full report on the winner too. because again, we picked good companies. We’re gonna track all of these. We partner with wide charts to track the returns of these companies. And we’re gonna say, you know, over five years, this is how it’s gonna do. This is how we think it’s gonna do, we’re gonna check in on them, but we’re also gonna provide for anybody who gets into the email list, um, a, a, a full report on the winner.

Simon: And I think that’s what investing is all about. It’s just, just, you know, you can compound knowledge over time, every day, every week, every month, every year, and then every decade. And before you know it, you’re, you’re making your own financial decisions. You’re not relying on anyone else to do it for you.

Simon: You can take charge of your, your 401k or your, your ira or your know, your trading portfolio, whatever it might be, and feel confident in doing that. And it doesn’t happen overnight. You can’t flip a switch and just all of a sudden become an expert investor. But [00:30:00] we’re trying to make it fun. We’re trying to share a lot of these insights.

Simon: that has certainly done pretty well for us and in the stocks that we’ve picked over the past decade or so. And it’s kind of the, the very core of what we’re trying to accomplish with seven investing of empowering other investors. So I enjoy this. I really like these, these tournament, matchups. It’s a lot of fun doing the research and finding the right companies for

JT: long-term investors.

JT: Yeah. And you said it, one of the things that I hear a lot when I tell people what we do is, oh, you can’t, the, the game is rigged, right? You can’t make money picking individual stocks. There’s so much against you algorithmic trading and, and dark pools and, you know, all these things that are, that are set out to, separate individual investors from their money.

JT: And the strategy that you guys promote, and that seems to be very effective is the way to protect yourself from all that is time, right? We, we can’t get in first. [00:31:00] We can’t beat the, the machines, right? We can’t get out first. So how do you, how do you play that? Well, you don’t play their game. You play the, you play a different game that erodes those advantages and that’s buy hold.

JT: So if you find a great company, you buy and hold it over time, you’re gonna have great returns. Despite the way the market is stacked against the individual investor, and when you look at our portfolios, if you go to our portfolios page on seven investing.com, you’ll see that there’s a lot of green there.

JT: You know, we, we weathered in our main portfolio, we’ve weathered the, the big drop of 2022, and you can see that through dollar cost averaging, buying and holding as you go through the low end of that and start to see us coming through in 2023. We’re green on every one of our Best Buy portfolios that go back to, I believe, October of 2022 or, or even actually the summer of [00:32:00] 2022.

JT: So it, you really do see that proving out over time that, you know, even though the wave of the market goes up and down, if you just keep on every month finding good companies, Investing what money you have into that, and then dollar cost averaging over time. That is how you make the most of these kinds of recommendations.

JT: So it’s been really fascinating for someone who had very little investing knowledge before we started this thing together, to, to go through the seven investing university experience. it’s been a lot of fun. And I’m happy to see where things go moving forward. So to follow along, again, seven investing.com/growth versus value.

JT: If you want to see all of our recommendations over the entire history of seven investing, you can subscribe to our premium service right now for just $1. And you can do that by going to seven investing.com. Slash subscribe. All of those links are available on our Twitter feed on social media. You [00:33:00] can find that at seven investing For Simon Erickson, I’m JT Street, and we will see you tomorrow for our next matchup in the Summer Stock Challenge.

JT: Have a great day, everyone.