👨‍🏫 Do This To Be A Better DIY Investor

In our Wealth Building Community, we have a framework for your financial success:

1. Education: Part of learning how to build more wealth starts with knowing who to trust. Our mentors are top experts in their fields (we’re talking a financial planner, hedge fund investor & serial entrepreneur). They’ve built educational courses to guide you on how to truly start building wealth the right way. It’s the financial foundation you’ve been needing.

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What’s on the Menu 🍴

This earnings season has been a banger!

And today we’re diving into some wisdom to help you see the forest through the trees…

Along with a breakdown of why so many crypto projects fail, and what’s happening with more trillion dollar companies.

Let’s get it:

• Apple, Amazon, & Meta Earnings Recap 🍎

• Why Most Crypto Projects Fail 📉

• Do This To Be A Better DIY Investor 👨‍🏫

• Investing Ideas For A World Currently In A Standoff 📺

Today’s newsletter is a 6 minute read.

Apple, Amazon, & Meta Earnings Recap 🍎

It was mostly smiles for investors on Thursday afternoon after three of the trillion dollar tech titans reported Q4 earnings.

Apple, Amazon, and Meta each delivered results that exceeded analysts’ expectations.

Here’s a recap of the earnings reports and stock reactions:

Apple’s results showed the following:

• Revenue growth: +2%

• Operating Income growth: +12%

• Earnings Per Share growth: +16%

AAPL stock had the weakest initial reaction in after hours trading, trading down about 2%.

Perhaps that was because revenue growth remains tepid, though it did improve sequentially from last quarter.

Wearables and China were notable weak segments for Apple, while Services growth continues to shine.

Apple is still buying back stock aggressively with more than $20 Billion worth purchased last quarter. That may be a key reason why the stock still trades at a premium P/E multiple of 28X:

On to Amazon…

Amazon delivered the following results:

• Revenue growth: +14%

• Adjusted Operating Income growth: +134%

• Free Cash Flow growth: +122%

Amazon combined its solid growth in both the retail and AWS divisions with significant cost discipline, leading to a HUGE expansion in bottom line profits and cash flow.

It’s no surprise why the stock gained 9% in after hours trading!

But neither Amazon nor Apple could match the impressive results posted by Meta…

Meta delivered the following Q4 results:

• Revenue growth: +25%

• Adjusted Operating Income growth: +123%

• Earnings Per Share growth: +203%

In addition to posting numbers that beat even the most bullish analyst estimate, Meta also initiated a new quarterly dividend and added $50 Billion to their share buyback authorization.

More than HALF of the world’s population is now a registered user on a META owned app! 🤯

Ad volumes and pricing continue to rise at Meta, leading to strong guidance for next quarter of at 25%+ revenue growth.

Meta also cut its employee headcount by 22% in 2023, which helped it double profit margins as growth resumed. Zuck really delivered on his “year of efficiency” promise!

Meta stock was up 14% to roughly $450 per share in after hours trading on Thursday following the earnings release.

We were buyers of META stock in late 2022 when sentiment and valuation were at extremely pessimistic levels, but the speed & magnitude of recovery have surprised even us!

Megacap tech stocks get a lot of criticism for their heavy weightings in major stock market indices like the S&P 500 and the Nasdaq-100, as well as for their above average valuations.

Yet over the past year most of the “megas” have delivered exceptional growth in top and bottom line numbers that seemingly justify their robust stock performance.

Whether that continues in 2024 is an open question, but right now the future is looking pretty bright for the global tech giants!

Why Most Crypto Projects Fail 📉

Over the past 10 years, nearly 1,600 crypto projects have failed.

Billions have been made from skilled traders…

And billions have been lost by cult-member bag holders.

We see it all the time: People crossing fingers for their chosen tokens to rocket them to the moon.

But let's face it, the crypto universe is more of a shooting star gala than a steady constellation.

They can be great assets to trade short-term, but over time, most of them go to ZERO.

Ever pondered why many of these digital darlings fizzle out into the great void?

Lack of Sustainable Business Model

First off, we've got the biggie: the elusive business model.

Venture capitalists can't help but swoon over the next big "first," showering them with cash. Yet, beyond the glitz, not every brainwave hatches into a golden goose laying sustainable revenue eggs.

Just like in the real world, without a steady income stream, dreams tend to drift into the abyss.

No Real-World Adoption

Then there's the adoption conundrum. If you're building a crypto ark, you'd better make sure you've got a growing crew on board.

But here's the kicker: crypto's not exactly a walk in the park. Between its brain-twisting tech and the fact that not every sector is crying out for a blockchain makeover (AI, we're side-eyeing you), roping in users is no small feat.

Is the blockchain-AI fusion the next revolution, or just a shiny lure for more venture capital?

Boom-and-Bust Market Cycles

It's like Groundhog Day but with a crypto twist, cycling through highs and lows every four years.

Projects time their grand entrances to the bull run beat, jazzing things up with staking and burning moves for that extra sizzle.

But when the profit party hits peak frenzy, the drive to keep the engine running starts to wane.

Projects that hold their capital in their own token can go into a death spiral during bear markets, causing them to go bust before they can produce any real-world impact.

Legal Uncertainty

Crypto's still the new kid on the block, and the regulatory grown-ups can't quite decide how to deal with this unruly adolescent.

Projects might start with hearts in the right place, but securities laws can throw a wrench in the works, leaving grand plans and promises hanging in limbo.

Our Take

Instead of trying to guess which one of the THOUSANDS of crypto projects might survive long-term, we mostly swing trade altcoins with the ultimate goal of accumulating more bitcoin and fiat long-term that we can compound into other investments.

Check out our Wealth Building Community to get our weekly LIVE crypto market update classes!

Do This To Be A Better DIY Investor 👨‍🏫

As a community of do-it-yourself investors, we want to make the best decisions with our portfolio.

The problem is, a lot of people think they’re doing well… but, many are winging it.

Your portfolio is what helps you reach your goals. You have hundreds of thousands (even millions) of dollars on the line over your lifetime by messing it up.

Once you dive into investing, it’s easy to realize how “you don’t know what you don’t know”.

There are endless strategies, styles and assets you can use for building wealth.

Here are some key investing concepts DIY’ers should be mastering for max wealth:

1. Allocation: How much should you own of stocks vs. bonds vs. bitcoin vs. commodities? It’s an important question that can really stunt your wealth if not done well.

   You have to take into account the volatility and expected returns of each asset and align that with your risk tolerance and goals.

   For example, if you’re young and more of a risk taker, if you have too many bonds in a portfolio, you may not grow your wealth as fast as you wish. Commodities can be tricky too! Many people love Gold, but, it’s a slow moving asset and there may be a better one to allocate a higher percentage to.

2. Stock picking: There's no greater surge of confidence than from a beginner stock picker. Many people dive right in and start buying individual stocks with zero knowledge on the skill set of stock picking.

   Hedge fund analysts do endless hours of research before making an investment. So, thinking you can willy nilly pick stocks without the proper education and research is a risky endeavor that's likely to lead you to lost wealth.

   Start with mastering the P/E ratio (price to earnings), cash flow metrics, net debt and revenue growth.

3. Overlapping positions: Many people who invest in index funds (ETFs or Mutual Funds) have to watch out for too much overlap in their funds.

   The point of using funds is diversification. Many fund providers make their fund sound sexy and cool, but, it might just have an allocation that duplicates a fund you already own (typically you want to compare funds against your S&P 500 or Nasdaq index funds for overlap).

4. Tax efficiency: Tax-deferred, tax-advantage, and taxable accounts are often used to create portfolios. They all have different use cases and putting the best asset within the type of account is important.

   For example, you want to put high-return potential assets in Roth (tax-advantaged) accounts if you have the option and using that account makes sense for your tax situation. Why? Growth is tax-free in Roth, so the higher the growth, the more tax free benefit there is.

   Tricks of the tax trade need to be used to maximize your wealth.

These are 4 things you have to master as a DIY investor.

It could make the difference between an easy wealth building journey, and one full of turbulence and disappointment.

If you want to master all of these skills, check out our Wealth Building Community. You get access to premium training courses and classes on stock picking, investment planning, tax planning and more! We help you master being a DIY investor!

Video of the Day: Investing Ideas For A World
Currently In A Standoff 📺

The Fed just left rates unchanged at 5.5%…

The bitcoin halving is less than 90 days away…

The election is coming later this year…

And bulls and bears are in a standoff!

So how can we build wealth in a world that seems gridlocked?

Click here to watch - We Talk Money episode 134

You’ll also learn:

• Why did bitcoin bounce after massive ETF outflows?

• Are China stocks a good value buy right now?

• What will the Fed do with rates this year?

• And much more!

Delicious Bites 😋

• Nearly half of Americans age 18 to 29 are living with their parents

• Tether Reports Record $2.85B Profit as Biggest Stablecoin Nears $100B Market Cap

• 23andMe’s Fall From $6 Billion to Nearly $0

• The office meltdown will result in $1 trillion of losses

Food For Thought 🧠

"The scarcest commodity is integrity."
- Michael Saylor

DISCLAIMER: We are not investment advisors, and this content is for educational purposes only. We don’t offer financial, legal, or tax advice. Nothing we say is a recommendation to buy or sell any assets. Trading and investing are extremely risky, so please be careful and do your own research.