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financial future today. Welcome back to another episode of Sugar Mama's Fireplay. Today, we're tackling a topic that I know so many of you are curious about, shares versus property. For so long, Australians have been told that property is the ultimate investment. You can't go wrong with bricks and watar How many times have I heard that? But is that really the case?
To help us.
Unpack this, I'm thrilled to be joined by Michael McCarthy, a renowned market strategist from Moomoom and Mumu is the innovative online trading platform that is empowering every day investors to take control of their financial future. So in today's episode, we're going to explore why shares might just offer a few advantages over property. Weren't going to be talking about historical returns, lower costs, franking, credits, diversification, liquidity, and so
much more. I might get a little bit passionate about this because I think so many people really do underestimate the value of Australian shares. Now, of course, this isn't saying property is bad, far fromward, but it's about challenging those traditional beliefs and opening your mind to so many other options, but also other options to help you build wealth and understand that property isn't the bill and end all.
And we're going to dive into the mindset of course that holds so many people back from investing in shares and explore how you can actually overcome these barriers to help grow your own wealth in a smart, sustainable way.
So I'm a little bit excited.
Can we jump in right now together, Michael, I like to start the episode. Never have a guest on the show to ask you how you are? And it's not just a service level how are you? It's a genuine how are you going? Right now?
I'm going really well? Thank you can. I'm in a sweet spot. I'm not old enough to be relaxed about things, but young enough still to be able to do all the things that I want to do. So it's a perfect time of life for me.
Oh, I like the sound of your sweet spot. I need to be there more. Well, I don't, I need to be there sooner.
All right, now, I'm really keen to talk about property versus shares, and I have a feeling that we probably share a common belief, but it really irritates me. And I'm tell me, if you have the same problem when people tell you that, you know, property is the only way you can make money, it's there's no risk, you know, this very sort of one dimensional opinion of property. So I'm really keen to give our listeners, most importantly, some facts so that they can sort of set the story straight.
I should say about really Australian shares versus property, because I feel like there's just so much misinformation, there's so much misunderstanding, and it's everyone just looks at it as a tangible asset. So I am very excited about this conversation.
I'm just a little bit excited.
If you can't tell can we obviously before we begin, it's general advice only here. This is, you know, educational purposes only. If you hear something you think, ohy.
Should I be doing that?
Of course, go see a financial planner. But I want to start with the historical returns because I said we're going to focus on facts and figures here, because I really want to arm our listeners with some valuable important information, not just opinions. What are some of the historical returns that you can tell us about shares versus property over the long run.
Well, there's a lot to unpack here, and I love the way you bring the controversy can because this is a controversial question and the reason for that is people have vested interest on both sides of the question. Right. People who sell property want to tell you property is a better investment. People who sell shares want to tell you that shares are a better investment. So to be fair about this, we have to start by comparing like forul life like. So we look at them as investments.
That is, you buy a house, you're not living in it, you're renting it out, and you're getting a return on it. That's an investment style. And comparing that to buying shares and getting dividends on your shares. Now, there are a lot of different studies over the years, so I went for the longest study I could find.
I like that from I'm a long term investor. I think that's more important than these little bite sized pockets of fragments and type of time.
And so this study ran from nineteen twenty six to twenty twenty three, ninety seven years worth of data.
I like the son of this same reliable and it.
Was quoted by somebody I respect, doctor Shane Oliver, very well known in Australia. I loved sharing, and his conclusion over that very long period was that shares are the superior return. Now, the difference wasn't huge. It was eleven
point three percent versus ten point nine percent. Now, that doesn't sound very big, but when you allow for the compounding of interest year on year, that point four percent difference turns out to be a big difference in terms of the money you would have earned if you'd put one thousand dollars into property or one thousand dollars into shares in nineteen twenty six. So that's the best study I could find. I have seen plenty of others in
my searches. One of the more recent ones covered the period nineteen ninety three to twenty nineteen, so it stripped out the GFC effects. Sorry it had the gfcnup, but it stripped out the COVID effects. Anyway, the net result there was eight and a half percent versus seven percent, so a bigger advantage for shares over that period, which surprised me because that's a strong period of property growth.
Wow, And does those figures look at the net returns because obviously it's very expensive to get into the property market, like stamp duty is a bitch, you know, it's a big setback.
It doesn't take into account those transaction costs costs. It's hard to compare light for like you buy property once and you sell it once, whereas with shares, people are regularly turning over their portfolios or trimming them or reshaping them, so the transaction costs aren't taken into account there, but things like tax deductibility are, so we'd have to factor those in. And of course they're very different kinds of investments.
Now, I spoke about the cost of investing in stamp duty, and obviously one of the biggest advantages of shares is the lower ongoing costs compared to property. Can explain why this matters so much for investors.
It's crucial. Containing your costs is one of the aspects of investment that is very often neglected. The reality is, the cheaper your cost, the lower the friction of your transactions, the better off you'll be in the long run because that's money that you otherwise would have invested that you've had to spend on the cost of the transaction. So stamp duty and realistate agents commissions are a very significant
impediment to investment success. It doesn't mean but you can't overcome them, but it's a hurdle that has to be jumped. Whereas when you're talking about shares and it's three dollars a trade, the transaction friction here is very very low, so that gives you a lot more flexibility about how you invest.
I'm just the wear and tear, you know, having to get a you know, an apartment for example, of a fresh coat of paint or the carpets now worn out, and you can't no one's fault. It's just natural wear
and tear like that. They're expensive costs and you know, I will admit I own property and I own shares, and I never get a phone call about having to chip money into my share portfolio ever, if anything that pays me constantly, whereas I'm constantly having to I guess fill the holes on the leaking bucket literally for you know, investment properties. It's just so like just frustrating, you know, and it just it really does impact your cash flow.
Interesting to a friend and she bought an investment property because somebody told her to, and she's like, I just I'm constantly being hit with bills, and then my tenant moves out.
Then I'm stuck for three weeks.
Then I have to pay you know, the the property manager and other you know, couple of weeks rental because they found me a new tenant even though I've just had three weeks without it and I've had to drop the rent. It's it's just the constant dramas and headaches. As I look at that and compare to my comparison to my property and what I've also your personal experience, it's just it's just so much easier and I lighter, more efficient, U super time.
You'll never get a bad tenant in the share port Polio.
That's so true. I love that.
All right. Can we talk about franking credits because you know I am you know, I'm a huge fan of Peter Thornhill. I've had him on the show a couple of times. I know a lot of my listeners also love Peter Thornhill. Franking credits are obviously very unique to the strands share market, particularly with those industrial shares, and you know the fact that they grow on average sort of forty five percent per annum over the long run.
Can you just break down for our listeners, well, why they're so important, how they can really boost your income. That is obviously the dividend income, particularly right now with inflation worries for retirement, it's.
Crucial, and franking credits is one of the key drivers of share ownership. It's one of the reasons so many people, particularly in retirement, own shares. It's that ability not just to get the cash flow that comes with the dividends, but those tax credits can be crucial. And the principle
underlying franking credits is very straightforward. The companies have already paid tax on these profits, and because the tax has been paid, the investor, the shareholder doesn't have to pay tax on the money that's distributed to them as a dividend, and that has the effect of increasing the value by forty two percent. So if you get a ten dollar dividend and it's fully franked and you're paying the top tax rate, that real value is not ten dollars, it's
fourteen dollars twenty. And that big grossing up of franking credits is one of the key reasons so many people value dividends so highly. And one area where the income that comes from shares is clearly superior to the rent that's paid on properties.
Yeah, I think people always need to sit to realize this for themselves, like have those two asset classes and go hang on this one is just it's so much more superior on so many different levels.
Well about it is I think that shares have disadvantages that you can't negatively gear shares. You can. You can borrow to buy shares and negatively gear them if you want. So that tax aspect is the same. Both property and shares are subject to capital gains tax, so in that respect they're the same. But the big difference between shares and property when it comes to tax is those franking credits.
And they're so valuable, particularly you know for self under retirees, you know in pension phase where they don't pay any tax. You know, I've had clients receive like seventy thousand dollars in tax refunds because of purely because of franking credits. Like that is a massive boost to your retirement income and it gives you so much more longevity and sustainability and financial independence. And part of my own financial investment strategy myself is to build up my franking dividends.
Can we talk about the property miss.
And give them a bit of a challenge In Australia there is such a cultural bias towards property and property investment. Why do you think it is that so many people just automatically assume that property is the best, the number one most important asset to build wealth?
Is it because it's a tangible asset?
Is that?
Is it as simple and is it embarrassingly basic as that?
Well? I think there are a lot of threads to that, but that is definitely one of them. People favor we're human beings. People favor things that they can put their hands on, you know, that they can touch and that's a natural human thing. It's completely illogical. It's completely illogical. Right. The house only has value because people believe it has value. That's the same as money, that's the same as shares. They only have value because people believe it. But people
think because they can touch a house, it's different. It's not. But that is a normal human reaction. There are a couple of other reasons why people seem to think that. One of them is the experience. A lot of people's families, their friends have had very good experiences investing in property, and that's a good thing, but they would have been better off in shares, and that's not visible. They see the house, they see how well they've done, They see
them retirement, going on holidays every half year. They see all that, and they think that it's come from property. In so many cases it has, But they don't see the share portfolios that actually underpinned you know, those those fabulous holiday homes that people have on a coach somewhere, or all those things. Because you see the house and because people tell stories. I mean Sydney in particular is a property obsessed city.
I mean, I've got to a dinner party, that's all I can't stand it. I'm boring.
So I think it's that shared success that that has given them the reputation. Nothing wrong with being in property, but if you want the better investment, in my view, you must look at shares Queen.
Move on and talk about liquidity, because this is a big one, you know, with property, and I think a lot of people, particularly.
Young investors, don't realize this.
And I mean it's not and I don't mean that in a meaning or patronizing manner, but you know, with property it's expensive, asterhol You've got strata, you know all the lovely expenses that come with it. And then of course you might get special strata. If you need to come up with some money and you don't have sufficient emergency money, you can get stuck. Because it's not a liquid asset. You can't. So you get a ten thousand dollars special strata leven, you don't have to spare ten
thousand dollars lying around. You can't just sell the front door or sell one bedroom, even though it is probably worth.
More than ten thousand dollars. You can't actually do that. You're stuck.
You Whereas with shares, if you know you had to you could really sell ten thousand dollars with the shares and that money would be in your account in two working days. Yeah, So a lot of people really, I guess, ignore until it's maybe sometimes too late or they caught out in that scenario where they have to suddenly come up with money. Commit to the how the liquidity of shares can actually add even more simplicity and efficiency and flexibility into someone's investment strategy.
Absolutely, and the returns argument and the tax argument, and you know that can all be had, but this is where shares clearly come out on top. That ability to liquidate your portfolio in a single day is very powerful. If things start going wrong, either for you personally or in the market, you can act, and if you act,
you can get results very very quickly. Whereas in a property market slow down, you might be waiting years for a good buyer to come along, and if you have to sell, you might have to sell at a price that is very painful for you. And that lack of liquidity and property is a huge disadvantage. And you touched on another aspect of it. You can slice off a bit of your portfolio. You've got a sudden tax bill
out of nowhere you weren't expecting. You can sell a little bit of your portfolio to cover that cash flow, and then as you recoup the cash over time, you can reinvest it back in the market. So, as you point out, you can't do that with a property. So it's not just the liquidity, it's the ability to reshape your portfolio to suit your life at that given point in time. That really makes shares a much more flexible and powerful investment.
Particularly as well diversification. You know, if you've had one stock in your portfolio to do incredibly well, and you think, okay, I've got a huge exposure to this particular company, all this particular industry. I want to take some money off the table and move on to maybe the next best thing, or you know, just spread my eggs.
You can do that with shares.
With property, you say you bought a property and did very well from it, you've got to sell that whole entire asset, whereas you could with the share portfolio, you could maybe sell half of that holding and then spread it across say five other companies.
You're really stuck.
And then of course you're triggering with property a massive, big hit with the ato assuming you've made a capital growth, you know you've got to pay that to the ATO, so you take a massive step backwards when it comes to releasing that particular asset in comparison to as you said, you can kind of quarantine the losses if it's going down, but you can also help strategically manage your tax by going, okay, well if I sell this asset, I can you know,
offset the tax here. You can be a lot more strategic actually mindfully and proactively plan those transactions with that. You know the fact that shares are so incredibly.
Liquid, Oh absolutely, I mean it comes to things like the capital gains tax discount. For example, being able to sell on day three hundred and sixty six rather the day three hundred and sixty four is crucial. And of course you simply can't time a property sale like that when it sells itselves. You can move it around if you can, but you're committed to it, so it's not just having all your money tied up and then getting slugged when you finally do release the value that you've made.
But there's another aspect to it as well. When we talk about property, is if every property is the same but because every property is unique. So the property market might be going up and you might be sitting in a house.
It's not right, I know, it's sometimes I find it.
So it's little pockets, you know, you know, houses of that particular you know, that particular side of the suburb or that particular area, or even like particular price points. People think that the property market all grows at say seven percent or five percent, whatever the number you want
to use. Actually it doesn't work like that. There are certain markets you know that you know, see five hundred to seven hundred thousand other property market it might be booming, but whereas something over a say two or three million dollars may have softened. Like it, it doesn't all work with this this return that just is unanimously across the
whole property market. There's so many complicated sectors and pockets, and you know, depending on obviously what the market's doing and what the economy is, and what people are looking for and the type of people also in the market that are shopping for like that drives those numbers, and it doesn't. It's not like a sweeping blanket return.
No, exactly. And if you buy a house or an apartment, you're committed to that one house or apartment. It might outperform, it might underperform, but your risk is tied to that one investment. Whereas if you buy a share portfolio, you can diversify across sectors, you can diversify across industries, you can diversify across national borders and across currencies to give you a better risk profile for the returns you're seeking.
You don't have that opportunity in property. You're committed to the one property, and if it doesn't do well, there's not a lot you can do about it. So you could be in that terrible situation where everybody's talking about how the property market's rising and you're quietly sitting there thinking, well, my property is not. That's not the same in shares.
In shares, you can quickly adapt and roll towards those shares that are performing well, and you can get out of the shares that are not performing well, so that you've got much more flexibility and much more power to control your risk when it comes to a share portfolio as opposed to a property.
Look, we're going to talk about diversification because I think it's really important because a lot of people don't really know how to actually diversify your portfolio and why it is so incredibly important. We're just going to take a very quick break to talk about Moomo. Who are today's sponsors.
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its amazing value. So if you are ready to invest and invest in a smart, intelligent way, can I recommend downloading the Mumu app and join a community that supports your financial growth and your financial dreams. Michael, thank you so much for talking to me about this it shares versus property debate.
We just touched on diversification before.
The AD break, and I feel like so many people don't really understand what diversification.
Really is and what it really looks like.
People think, oh, well, I've invested into a listed investment COMMUNITYTF that's diversified. Yes, that technically is. But there's more to be done than just that. You can't just necessarily stop there. Can you explain what diversification is, how it fits in, and how you use, for example, Mumu to help diversify your own investment portfolio.
Diversification is a concept that frankly, most of us are already familiar with. We've all heard the saying, don't put all your eggs in one basket, and that's exactly what diversification is. Not putting all your eggs in one basket. It's spreading your investments across sectors, across industries, across markets,
across different kinds of assets. It's across national borders. International investing in shares is one of the fastest growing areas of our business at the moment, and many investors have a particular focus on the US, but we're also finding good interest in other countries, including lately Hong Kong because of the China exposures. And it's that ability to get
exposures to different nations, to different investment themes. If you wanted tech exposures here in Australia, once you got beyond the top three or four names, you're really struggling for investments. But if you've got access to the US markets or the Hong Kong markets, you can find all the tech exposes you want, so you can get investments that help
spread your risk. The whole point of investing that the main aim is to maximize returns while minimizing risk, and diversification speaks directly to that ability to minimize risk.
So how many different investments would you recommend to help a person build a diversified portfolio? I know, you know, if I look at back in my financial planning days running a practice, you know you'd sort of say thirty stocks across you know, a variety of different industries. What are you seeing now as the trend when it comes to diversification.
Well, look correctly answer to how much should I diversify depends very much on a person's situation. Somebody who's in retirement and is looking to get income and remain pretty capital stable that not to gain or lose too much when the markets move might be very well spread out. They might have more than thirty stocks in their portfolio,
including some higher dividend paying stocks. Whereas somebody who's starting out on their investment career and has plenty of working life to build their wealth and build their portfolio might decide it's a good time to take some more risk, and they've got plenty of time to earn back money if they lose, and they might decide that three or four high growth stocks that are higher risk but potentially
higher reward might be suitable for them. So I'd certainly agree that for most people, twenty to thirty stocks for individual investment, even in a self managed super fund that's under three million dollars, twenty to thirty stocks is often seen as a sweet spot. But if you want more concentrated returns that is higher risk for potentially higher returns, diversify less. If you want to be assured and have
much lower risk, you'd spread beyond thirty stocks. Once again, it comes down to what your investment goals are, where you are in your investment journey, and what it is that allows you to sleep peacefully at night. Get drives the answer to how many stocks should I own?
And doing a risk profile as well.
There's a great way to do it.
Some people say that the share market is very volatile and it's risky. You know, it's akin to gambling. What are your thoughts on this perception and how do you answer that when you come across someone that might say that to you.
People do say that to me Kenna. In fact, I've been involved in a number of late night, robust discussions with fellow traders over all sorts of issues in the market, but the question being, you know, is it gambling? Well? Is the Reserve Bank of Australia gambling when it buys Australian dollars because they're low? Is Warren Buffett gambling when he invests, you know, billions of dollars in coca? If your answer to that is yes, then yes, investing the
stock market is gambling. I come to this with a unique perspective. Can Although I've been in share markets and financial markets for forty years, I actually started my career in numbers on the racetrack. My father was a bookmaker.
Oh wow, in horse resting and missuming.
All of them. Because my father was a mathematician. He wasn't an animal lover. He was a mathematician, and so we worked at all of the tracks. We worked at the gallops as we called them, the trots and the dogs, or the dish liquors as theirs. So risk assessment has been part of my life since the age of fifteen your blood, yes, yes, So I see them all as risk assessment opportunities. Whether it's in a casino or on the board, on the stock exchange, or on the currency markets,
I see them all as risk assessment. People make judgments. They're happy with risk assessment, but they don't like gambling. I'd argue they're exactly the same thing, and that without risk, there's no reward. Yeah, people want to eliminate risk, but they don't understand if you do that. And one of the worst things I see in the investment space on the personal level is people who invest only in cash.
Oh I know, and it destroys them over time because the share market goes up, other markets go up, and cash stays the same. And easily five percent does not save them from the ravages of inflation.
You know what really worries me about that is that people don't realize until it's too late. Yes, and the penny's dropped and you're really stuck and you've lost time and you're not necessarily in position to be able to recover back to what you should be at. And this is why financially see is so important. One of the main drivers of the Sugar Mama platform is just to actually give people the right information that can make great
decisions for the long term. And that's not to say obviously cash is the worst investment ever, It's extremely important appropriate, particularly for emergency money those short term goals. But if you want to build wealth, stop playing in the savings pool and learn how to invest in an intelligent way
for long term wealth. You spoke about obviously risk, I'm interested to know how do you personally use mumou to help mitigate your risk and to also diversify it, Like, what are the key features you use within mumu to build your wealth and stay in that sweet spot that we spoke.
About it at the beginning. Well, so I use a strategy that's very common. So, like a lot of Australians, I have a surf managed super fund and so I manage my own and I use what a lot of Australians use, and that is a core plus satellite approach. In other words, I've got a stable core of investments that I'm in for the long haul. Now. They tend to pay reasonable dividends, not necessarily the highest paying dividends.
There are a number of ETFs involved, and there's some international exposures in that core, and that core doesn't really change much of me. Well. Over the years, I've tried to pick good businesses to invest in and stick with those businesses through the thick and the thin, and then around that core investment portfolio I put satellites. Now, one of the ways I use the the Move platform to help me with the identification of investment opportunities. I go to the low end of the market and I search
the Australian share market by reverse engineering the prices. So I start with the lowest price stocks first of all. And you know, I think it's fair to say there's some dross amongst them. There's some really potentially toxic investments, but there are a few gems and the movie platform helps me find them because it has the financial information that allows me to gauge whether or not I should be investigating further.
So you're like, one man's trash is another man's treasure you're looking for, you know, the diamond in the rough, the one that's been discarded, maybe innocently, is actually an absolute gem.
Yes, or even undiscovered. I'd love undiscovered. My background as a derivatives trader really serves me here because I was trained in a very unconventional style of trading derivatives. And I won't boy you with the details of it, but I used to say that my life is a search for despair and denial because they were the two indicators that often led me to an investment that, for whatever reason, was being shunned that wasn't economic and meant that I
could invest in it. So I use the Movemove platform to find those treasures amongst the trash, as you put it, and the other thing I use it for. And this is definitely not for everybody. I've been trading derivatives since nineteen ninety three. I've studied in this area, this is where my master's degree is. This is not for everybody. But I used the options finder on the Moomoo platform because the opportunity to trade us options is very powerful
for me as an experienced trader. It generates alpha for me, which is what portfolio I managed to say when they get an excess return. So it's an opportunity to make an excess And once again I won't board our listeners with the technical details, but essentially I look to make very small investments that might grow very large, but in most cases will erode to zero.
So this is part of your satellite strategy.
That's right, And so I only commit a very small part of the portfolio to it. I expect to write it off and that it'll be made up for by returns on other investments. And if it comes good as about one in fourteen at the moment, do I get a nice kicker to the returns on my portfolio that year?
Can I see you?
A personal question and obviously feel free to decline this because your IP. But what percentage of your portfolio is core and what percentages satellite?
That's a fair question and I can answer that it varies. It varies depending on where we are in the cycle. So the moment I'm over ninety percent core.
That sounds quite safe.
Yeah, I'm concerned about the short term outlook for the market. So I've really battened down the hatches and most of the rest of it is cash.
To be frank, why did Why are you worried? What are your alarm bells right now?
Sir John Templeton was possibly the first global fund manager in the nineteen sixties, he invested heavily in Japan from the US. He was also a philanthropist and a leading investor in almost every way, and he famously said that bull markets are born in despair. They rise on skepticism, they mature on optimism, and they die on euphoria. And the mood that I'm seeing in the US in particular
at the moment, but in share markets generally is euphoric. Really, Well, look what happened after November five, after the US election. The markets went crazy. They're already at record levels and they've let in some cases twenty or thirty percent above their record highs on the back of the election of the new president and the new Congress.
And so when do you see this potential pullback and buying opportunity? Well, what do you what's that magical moment where you're like, all right, I'm going from ninety ten to like seventy thirty.
Well, here's here's the tough part about it being a qualitative measure like euphoria. It's very hard to time. Yeah, right, And I reminded to time and define well exactly. So the defining I'm okay with. I've been around for four decades now, and so I've sort of seen a lot of market cycles and I'm pretty confident my reading on euphoria. And I do note that Berkshire Hathaway has sold a lot of holdings and accumulated a very large pile of cash. And it reminded me of nineteen eighty seven, now a
bit of history. For the younger listeners, that'd be just about everybody but me in nineteen eighty seven. In March of nineteen eighty seven, the markets had been in a three year bull run and things were looking very very rosy. Everyone was positive. Taxi drivers were asking about what shares they should be buying, and at that time Australia's richest man, mister Kerry Packer, sold out every share he owned in
March of nineteen eighty seven. Now in October of nineteen eighty seven, we had the Black Monday crash and the share market in Australia. And remember it's above the eight thousand mark. The share market at that time was at twenty three hundred and fifty two. That was the high, and it fell to below eight hundred. It was horrific. Now, mister Packard missed out on fifteen percent of the gains between March of eighty seven and October of eighty seven,
the market had gone up another fifteen percent. But when he avoided the sixty five percent plus fall in the market and had cash to buy bargains, he did the deal of a lifetime when he brought back Channel nine from alman Born.
One thing I always think as an investor, I'd never get greedy. I don't want to pick the per top and I don't want to pick the bottom. I'm in it for the long run. It's such a danger in trying to get the absolute like squeeze every single scent out of your portfolio, like you're never going to get it right, or if you do, you're going to get it wrong the next seven times ahead of that, and just don't be greedy, be.
Intelligent, You're so right. Don't pick tops and bottoms. That's the way it's often put. Professional traders say, finess and die. Oh I like it when you try and finess that last little bit and get that last little bit extra the market against you, And yes, you lose a lot of what you would have had.
Yeah, and I know that sounds harsh, but you know, when you're trying to build wealth, you know you want it to obviously pull every single dollar out of your portfolio and be as smart and strategic as possible, but it can come with so much regret and you know things are out of your control to a certain degree. How do you use moomur yourself, like when it comes
to just your building that core portfolio? Like what you know, for a new listener that's not ready to start building a satellite portfolio and use that type of strategy, which is I think a brilliant one. How would they use the Movio app and to build that portfolio like you have the core that.
Is well, the think about it is it very much depends on where a person is in their investment journey. So for me, I start with the macro, I look at the globe, and I look at the big trends of driving markets, and then I work my way down to some themes and then I and often I'll then take part in the community forums on the movie platform. And then once I've sort of got a sense of what the market's thinking, I start thinking about individual stocks and I use the screeners on the Momoo platform to
identify the stocks that I want. Now, the screens are very powerful. They can screen on all sorts of different criteria. Whether you measure companies fundamentally, you want to know things about the cash flow, their profitability, their return on equity. That's one way and our screens will do that. But
you can also put in technical analysis signals. So if you like, for example, head and shoulders formations and think that they tell you something, you can use that as a criteria on a screen and identify charts that have that pattern that you're looking for. So, whatever way you use to choose the stocks, the screeners are very powerful. And one of the things we have noticed on the platform is a huge growth in ETF investment, and it
just makes sense economically. In one transaction, you can get a tailed exposure, whether that's a favored tech stock falling or whether that's to a portfolio of stocks that represents the ASEX two hundred. You can get that in one transaction and hold that and so identifying which ETFs are best for you is a key and once again the screens will help. You can go into the ETF section of the moon Move platform and it'll give you thematics investment,
thematics and if that's if thematic you're looking at. You click on that, it brings up a list of applicable atfs ETF sorry ETFs, and you then click on the ETF. You can drill through to find out more detail about how it performs and you can see chart of it at the same time.
And I love this on app So you can literally do this like sitting on the bus or the train on your way to work, or lying in bed at night, you know, or when you wake up in the morning. It can literally be done in the moment, and you don't need to be sitting there spending hours looking at screens on a desktop, you know, cross referencing, running excels Bridge. Everything's there for.
You absolutely, and in fact, Moumou was the first AI enabled platform. Now that artificial intelligence worry some people, they worry about where it's going. Perhaps one day the machines will take over. I'm here to say no, they will not. AI is just a bunch of algorithms that do jobs that you ask them to do, and so we use AI on the moomou platform to put the relevant information in front of the investor as they're looking for it.
So if you put Meta, for example, the US stock that's so popular, the owner of Facebook and another app apps that are very popular. If you put Meta into our platform, not only will you see it's stock code, but you'll see related information and related tradeable instruments, so that if you just want to invest straight into MATA,
you can go straight into that. But if you wanted to tailor your investment or perhaps look at a portfolio of stocks that are similar to MATA that are wrapped in an ETF, you can find that on the Meumu platform. So we use the AI to put the relevant information in front of you, whether that's a chart for you, whether that's the financial information about the company, or whether that's something else about the company and it's related stocks. That information is brought to the front when you select
a stock. So we'll be using the power of AI to put the most important information in front of investors.
All right, as we wrap up today's episode, for our listeners who really want to get into shares and understand that property isn't for them or it's just something that's
just doesn't float their boat. If they want to start investing in shares but don't necessarily have much money to get started, what are your tips, Like, you know, what would you say to your son or your daughter or you know, my eleven year old son, Like, what would your advice be to them about getting started in shares with a small amount of money.
Well, first of all, you've raised a good point which we haven't touched on yet. You do need a lot of money to get into the property market, but you can get into the share market with as little as five hundred dollars, so you can start at a much earlier point in your investment career, if you want to put it that way. But what I would say is do some paper trading.
Yes, so you can do that through the movie.
Absolutely, it's a very popular module. In fact, we run paper trading competitions regularly in conjunction with our global partner Nasdak, so that you can test your ideas, not just in the market, but against fellow traders and investors, and a lot of people get a real kick out of that.
We just conclude to putition even going, I think at the moment.
Absolutely so we've just completed one and there's another one starting very soon, and we run them regularly because they are a powerful learning experience. You can read all the books you like, or read all the web pages you like, but until you actually start picking stocks and purchasing them and seeing how they go, you haven't really come up with you know, you haven't got to a point where you can say you've got a good formula. So being able to paper trade is ideal because in paper trading,
you're playing with paper money. There's no real money at risk.
It's a dress rehearsal.
There we go the perfect analogy. That's exactly what it is. So you can do all the things that you would do in making an investment. Identify it, execute it, monitor it, see how it goes and nobody ever gets hurt because it's all on paper. Now, that means you don't get the rewards either, So if you're picked well and it goes up, you don't get paid either. But It's a great way to test your ideas before you actually put your money at.
Risk, and then you are ready and prepped for opening night.
I love the analogy.
Well, look, Michael, thank you so much for coming on today's episode. I really appreciate it, and I mean your opinions, your insights, your facts and figures are incredibly important, and particularly right now when so many people feel overwhelmed, you know, with all the different opinions and you know, statements, and you know, I guess seeing the herd mentality as well,
particularly obviously around property. So I think for people hearing today's episode, they'll realize that, okay, property isn't the bill in it all, there is actually something quite possibly far moot more superior, efficient, effective, and just so much easier both financially, mentally and energetically, I will say, and I'm saying that from someone who has, you know, fingers in both pies. So thank you for this, and today again a huge thank you to Mumoo for sponsoring this episode
of Sugar Mama's Fireplay. As I have said, if you are looking for a smarter, easier way to invest, Moomu has you covered and they have low fees incredibly intruitive tools, many of different ones as well which I've used personally, and of course expert driven insights. So even if you're just a tiny bit interested, join the Mumu community today. Just simply download the app and start your journey towards
financial freedom with Mumu. I promise you. Investing has never been simpler and more inspiring.
Thank you everyone for listening.
To today's episode. This is Sugar Mamma's fireplay. I will see you next Monday, and of course please take a moment to leave a rating and review and let us know what you would like to hear more of. I am here to help you, I'm here to guide you. I'm here to motivate you. This is Sugar Mama's fireplay Chow for now.