Welcome to Investor Talk โ 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 โ such as โWhat is your investment strategy?โ, โWhat are your highest conviction stocks?โ, and โWhatโs the biggest investment mistake youโve made?โ
In this edition, we have the pleasure of interviewing:
Name: Aria @QualityInvest5
Age: 19
Residence/Country: Canada
Invests since: November 2021
๐๐ป๐๐ฟ๐ผ๐ฑ๐๐ฐ๐๐ถ๐ผ๐ป
Iโm currently a full-time student and also work at FinChat @finchat_io (the worldโs best stock research platform, which you can try for free). I also have prior experience in sales, which has been instrumental in shaping the person I am today. The lessons learned from rejection and the process of perfecting a "pitch" apply universally throughout life and only improve with time.
I first became interested in investing when a close friend pitched me General Motors $GM as an undervalued Peter Lynch-style investment based on a low P/B valuation. Looking back, itโs hilarious to see how far I've come from that style of investing. Like everyone else, I initially started investing to grow my money.
๐ช๐ต๐ฎ๐ ๐ถ๐ ๐๐ผ๐๐ฟ ๐ถ๐ป๐๐ฒ๐๐๐บ๐ฒ๐ป๐ ๐๐๐ฟ๐ฎ๐๐ฒ๐ด๐?
Today, I'd categorize my approach as a concentrated portfolio of quality + growth. I place significant emphasis on owning high-quality, wide-moat businesses but am willing to sacrifice some quality if it means a notable increase in growth. My recent purchase of Uber $UBER is the perfect example of this strategy.
Uber is a strong-moat business that is difficult to compete withโbut not impossible. A 10/10 moat business would be something like $SPGI S&P Global, where the moat is literally protected by regulations and customer incentives. But at the same time, that business may only grow revenues in the mid- to high-single digits annually. Just off a whim, I'd rank $UBER around an 8/10 in terms of moat strength, but with a 30%+ FCF growth profile, that more than makes up for the slightly weaker moat, in my opinion. Of course not every business fits this mold, but in general those are the two things I put the most emphasis on, a wide moat and ideally a business that grows its earnings/FCF around the 15% mark (or higher) for the foreseeable future!
๐๐ผ๐ ๐บ๐ฎ๐ป๐ ๐๐๐ผ๐ฐ๐ธ๐ ๐ฎ๐ฟ๐ฒ ๐ฐ๐๐ฟ๐ฟ๐ฒ๐ป๐๐น๐ ๐ต๐ฒ๐น๐ฑ ๐ถ๐ป ๐๐ผ๐๐ฟ ๐ฝ๐ผ๐ฟ๐๐ณ๐ผ๐น๐ถ๐ผ?
Currently, I own seven stocks, but my smallest holding, TransMedics $TMDX, hovers around a 1% positionโnegligible in terms of overall performance, as it's more of a small speculative bet.
๐ช๐ต๐ถ๐ฐ๐ต ๐๐ฒ๐ฐ๐๐ผ๐ฟ๐ ๐ฑ๐ผ ๐๐ผ๐ ๐บ๐ฎ๐ถ๐ป๐น๐ ๐ณ๐ผ๐ฐ๐๐ ๐ผ๐ป?
Technically, every holding (except TransMedics) in my portfolio is a tech company. I'm not concerned about sector concentrationโthat's kind of the goal with this investing style. As long as they have different risk factors (which they do), it's not an issue for me.
๐ช๐ต๐ฎ๐ ๐ฎ๐ฟ๐ฒ ๐๐ผ๐๐ฟ ๐ต๐ถ๐ด๐ต๐ฒ๐๐ ๐ฐ๐ผ๐ป๐๐ถ๐ฐ๐๐ถ๐ผ๐ป ๐๐๐ผ๐ฐ๐ธ๐?
$AMZN - Amazon is my highest-conviction bet, purely based on weightingโitโs 30% of my portfolio. AWS alone is a business with potentially decades of runway. Over a very long time horizon, I see nothing that could derail it from achieving above-market returns, making valuation less important the longer you hold.
$ASML - ASML, similar to AWS, has a long runway, and almost nothing can derail it.
$MA - Mastercard has a similar story, but arguably the widest moat of the three.
$UBER - Uber, I actually think will outperform all three of these companies for the more immediate term (the next 3โ5 years).
๐ช๐ต๐ฎ๐ ๐ถ๐ ๐๐ต๐ฒ ๐๐๐ผ๐ฐ๐ธ ๐ถ๐ป ๐๐ผ๐๐ฟ ๐ฝ๐ผ๐ฟ๐๐ณ๐ผ๐น๐ถ๐ผ ๐๐ถ๐๐ต ๐๐ต๐ฒ ๐ต๐ถ๐ด๐ต๐ฒ๐๐ ๐ฟ๐ฒ๐๐๐ฟ๐ป?
Because I've continuously averaged up on my holdings, my total Amazon $AMZN position sits at a 40% gain. But in terms of my most accretive buys, I have shares of Amazon at $106, which translates to a 117% return.
๐ช๐ต๐ฎ๐ ๐ถ๐ ๐๐ต๐ฒ ๐ฏ๐ถ๐ด๐ด๐ฒ๐๐ ๐ถ๐ป๐๐ฒ๐๐๐บ๐ฒ๐ป๐ ๐บ๐ถ๐๐๐ฎ๐ธ๐ฒ ๐๐ผ๐ ๐ต๐ฎ๐๐ฒ ๐บ๐ฎ๐ฑ๐ฒ?
Selling based on short-term concerns, worrying that the price has run up too much, and just trading too frequentlyโthese have all been costly mistakes for me.
I've also made plenty of errors of omission. I knew for a fact that Amazon $AMZN below $130 was a great deal, so why didn't I buy more? The same goes for $GOOGL Google, for Uber at $60 just a month ago, and for companies I didnโt buy at all, like Adyen $ADYEN when it was close to โฌ1000โnow up 85% in a few months. Errors of omission and a lack of patience have been my biggest mistakes
๐ ๐ ๐ณ๐ฎ๐๐ผ๐ฟ๐ถ๐๐ฒ๐
Favorite book: How to Win Friends and Influence People by Dale Carnegie Favorite podcasts: Acquired @AcquiredFM. Ben and David do a phenomenal job over there!
Favorite quote: "Each step illuminates the next." People often get worked up about planning their lives, careers, daily routines, etc. But planning is bullsh*tโexecution is everything, and youโll figure things out as you go, making decisions on the fly with the best available knowledge. Of course, some decisions require more thought, but in general, "Each step illuminates the next." You only start planning for a problem once youโre faced with it.
Favorite FinX account: I have two: - Brad Freeman @StockMarketNe is incredibly rational and does an excellent job with his earnings snapshots. - Dimitry Nakhla @DimitryNakhla someone I've learned a lot from. Always a pleasure to read his work.
๐ช๐ต๐ฒ๐ฟ๐ฒ ๐ฐ๐ฎ๐ป ๐๐ฒ ๐ณ๐ถ๐ป๐ฑ ๐บ๐ผ๐ฟ๐ฒ ๐ถ๐ป๐ณ๐ผ ๐ฎ๐ฏ๐ผ๐๐ ๐๐ผ๐?
I have a YouTube channel under the same name, @QualityInvest5 or Quality Investing with Aria: https://youtube.com/@qualityinvest5 Also, everyone should try out FinChat Pro for FREE (no card required) FinChat. Once you sign up, we automatically apply a two-week free trial to your account.
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.