🗣️ Investor Talk #40: Joel Bernard

Founder - GrowthRapidly

Welcome to Investor Talk — where we interview successful investors to uncover their journeys, strategies, and the lessons they've learned. Get inspired by real stories and gain valuable insights to sharpen your own investment approach.

Every interview follows the same set of sharp, insightful questions — such as “What is your investment strategy?”, “What are your highest conviction stocks?”, and “What’s the biggest investment mistake you’ve made?”

In this edition, we have the pleasure of interviewing:

Name: Joel Bernard @growthrapidly
Age: 38
Residence/Country: United States
Invests since: 2011

𝗜𝗻𝘁𝗿𝗼𝗱𝘂𝗰𝘁𝗶𝗼𝗻
I'm a trial attorney with 12 years of experience, and while I hold a bachelor's degree in finance, I've never worked in the financial industry.

My interest in investing began in the summer of 2011, between my first and second year of law school, when I was interning at a federal court in Philadelphia. During that time, some of the law clerks were discussing how it was a great opportunity to buy stocks, given the aftermath of the 2008 recession.

A week later, I bought a few shares of Olin Corporation $OLN, only to sell them two weeks later when the price dropped. After that, I didn't invest much, as I was focused on my legal career, though I did hold some index funds with Vanguard and continued learning about investing. It wasn't until 2022 that I started investing in individual stocks on a more regular basis.

𝗪𝗵𝗮𝘁 𝗶𝘀 𝘆𝗼𝘂𝗿 𝗶𝗻𝘃𝗲𝘀𝘁𝗺𝗲𝗻𝘁 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝘆?
My investing strategy (or philosophy, if you will), for the most part, is to 'buy and hold' for the long term. I look for undervalued stocks, hold it long term and sell it at a profit when it makes sense. However, I will not sell good stocks. Let's take Nubank $NU for example. I began purchasing shares of the company at $3.5 per share, with an average cost of $4.42. I will continue to hold it unless something changes in management or the company's financials. With that said, in some cases, I may reduce or trim my position in a good company and use that cash to buy a more attractive stock. Conversely, I will not sell good stocks just because the share is declining. This has been true for SoFi $SOFI. Lately, SoFi has been doing well, but for a while the stock was flat even after a great quarter.

In terms of the type of stocks, I am mainly interested in growth stocks with potential to double, triple, 5x, 10x or 100x in price. For the time being, I stay away from dividends stocks or value stocks. To me, dividend or value stocks work if I wanted less volatility in my portfolio or if I am working with large sums of money. But because I am working with small sums, it is better that I invest in high growth stocks. The flip side to this, however, is that my portfolio experiences a lot of volatility.

Some of the characteristics I look for before buying a stock is the:
1. The company's management;
2. Companies with some type of "moat";
3. The company's financial position (i.e., market capitalization; balance sheet; income statement; profit margins; etc.);
4. Good Return on Capital (ROC);
5. Growth prospects;
6. Cyclicality, etc.

𝗛𝗼𝘄 𝗺𝗮𝗻𝘆 𝘀𝘁𝗼𝗰𝗸𝘀 𝗮𝗿𝗲 𝗰𝘂𝗿𝗿𝗲𝗻𝘁𝗹𝘆 𝗵𝗲𝗹𝗱 𝗶𝗻 𝘆𝗼𝘂𝗿 𝗽𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼?
Currently, I own 12 stocks. However, I will reduce it to 8-10 stocks shortly. Even at 12 stocks, my portfolio is highly concentrated with only four stocks, accounting for 80% of my portfolio.

𝗪𝗵𝗶𝗰𝗵 𝘀𝗲𝗰𝘁𝗼𝗿𝘀 𝗱𝗼 𝘆𝗼𝘂 𝗺𝗮𝗶𝗻𝗹𝘆 𝗳𝗼𝗰𝘂𝘀 𝗼𝗻?
I am not limited by any sector; frankly, sector allocation has never been my main focus when constructing my portfolio. In fact, I will invest in any sector if I find the stock compelling enough.

Though, I have the greatest exposure in the fintech industry. I currently invest in:
$NU - Nubank
$SOFI - SoFi
$USIO - Usio
$LMND - Lemonade

Overall, my approach is to find stocks that are statistically cheap.

𝗪𝗵𝗮𝘁 𝗮𝗿𝗲 𝘆𝗼𝘂𝗿 𝗵𝗶𝗴𝗵𝗲𝘀𝘁 𝗰𝗼𝗻𝘃𝗶𝗰𝘁𝗶𝗼𝗻 𝘀𝘁𝗼𝗰𝗸𝘀?
$SOFI - SoFi
$NU - Nubank
$HIMS - Hims & Hers

I think those three will continue to compound value over many years.

𝗪𝗵𝗮𝘁 𝗶𝘀 𝘁𝗵𝗲 𝘀𝘁𝗼𝗰𝗸 𝗶𝗻 𝘆𝗼𝘂𝗿 𝗽𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝘄𝗶𝘁𝗵 𝘁𝗵𝗲 𝗵𝗶𝗴𝗵𝗲𝘀𝘁 𝗿𝗲𝘁𝘂𝗿𝗻?
It is Nubank $NU. It is my biggest position, accounting for 45% of my portfolio. I started a position in January of 2023 at $3.50. My average cost is $4.42. To date, I have achieved over 200% return. It was over 250% last year when the stock was trading at $16.

𝗪𝗵𝗮𝘁 𝗶𝘀 𝘁𝗵𝗲 𝗯𝗶𝗴𝗴𝗲𝘀𝘁 𝗶𝗻𝘃𝗲𝘀𝘁𝗺𝗲𝗻𝘁 𝗺𝗶𝘀𝘁𝗮𝗸𝗲 𝘆𝗼𝘂 𝗵𝗮𝘃𝗲 𝗺𝗮𝗱𝗲?
I have made several over the past few years. However, my biggest one has been investing in EV charging stations stocks, such as Chargepoint $CHPT and EVgo $EVGO. They’re just too capital intensive and it is difficult for them to become profitable.

𝗠𝘆 𝗳𝗮𝘃𝗼𝗿𝗶𝘁𝗲𝘀
Favorite book: One Up on Wall Street by Peter Lynch

Favorite podcasts: We Study Billionaires @TIP_Network

Favorite quote: "Complaining is not a strategy. You have to work with the world as you find it, not as you would have it be." - Jeff Bezos @JeffBezos

Favorite FinX account: I follow some great accounts, but I have not picked a favorite yet.

𝗪𝗵𝗲𝗿𝗲 𝗰𝗮𝗻 𝘄𝗲 𝗳𝗶𝗻𝗱 𝗺𝗼𝗿𝗲 𝗶𝗻𝗳𝗼 𝗮𝗯𝗼𝘂𝘁 𝘆𝗼𝘂?
You can follow me on my X page: @growthrapidly where I show my appreciation for great companies!

Disclaimer:
The information and opinions provided in this article are for informational and educational purposes only and should not be considered as investment advice or a recommendation to buy, sell, or hold any financial product, security, or asset. The Future Investors does not provide personalized investment advice and is not a licensed financial advisor. Always do your own research before making any investment decisions and consult with a qualified financial professional before making any investment decisions. Please consult the general disclaimer for more details.