Investing for Doctors: Masterclass

Look, we all know weekends are pretty.

Important for doctors on healthcare professionals, they are precious.

So why would 253 doctors sign up.

For a Financial Wellness Weekend event that was only for 50 slots in the first place? Well, let's find out. Welcome to my wife Dr. I'm Dr. Andrew X. Salaried Energy. I'm founder of Moneywise Dr. A platform that helps doctors and healthcare professionals make smarter financial decisions and avoid costly mistakes. Today we're delving into another segment of our recent Ask Me Anything session where we received an overwhelming response from 253 participants. For just the available 50 slots was quite a turnout. Now, for doctors and healthcare professionals looking to secure their financial future, understanding smart investing while minimizing risk and taxes is quite vital, it's crucial. In this session we have some intriguing questions which are prompted by the participants Questions as the person stands we have some really intriguing discussions to an open floor.

We covered a wide array of topics.

Including investing strategies for beginners, individual stocks versus index funds, smart tax options for doctors with limited companies, asset protection and ensuring financial security for your loved ones True things on insurance and trusts Exploring side hustles for medical professionals, there was much, much more. It was a full two hour event and it's loaded.

Let's dive in. Thank you for the wonderful job you're doing. I already know that this event will be packed with opportunities to learn new money skills. Always humble. I want to have more insight into these questions. For landlords who are planning to relocate out of the United Kingdom, is it better to own the house in person, in personal name or through a limited company? I think I've already answered this question. Just in case anyone missed it. We said that limited company gives you more opportunities to manage a property. One thing that if you're going to buy properties, you can use what we call an spv. An SPV is called a special purpose vehicle. A special purpose vehicle is basically a limited company and that can help you buy property and manage property. There are special purpose vehicles for different things, but don't get confused, don't get worried. It's not offshore anything. It's just a special purpose vehicle and it's focusing on property. So yes, Dr. Is a. I think a limited company might give you more flexibility. Not for your personal house. Unfortunately for your personal house you have to buy it in your name. But if I didn't buy to let you're buying stuff for serviced accommodation or you're buying commercial property or you're doing shoppers and uppers, whatever real estate investment you're doing even some people sell like parking lots. Buy and sell parking lots or rent stamps. Limited company will give you more flexibility. Is also more tax efficient. I think part of why it's more tax efficient is because it allows you, the government allows you to deduct your expenses as a business, whereas if you're a private landlord, the rules have changed over the last few years. You couldn't do those deductions anymore. Can just deduct some of your expenses, but you can't really deduct the cost of financing. All right, so I'll jump into the next question. The next question is, which is also from Dr. What are some tricks to know the company that will do well when buying stocks?

I just want to take a minute to thank you for what you've done. Yes. You watching this channel now? Let me tell you what it is. So this channel has grown at amazing rate. It has grown at an amazing rate from 0 to over 1400 subscribers just within 4 months of launching it. Now, this is beyond my wildest imagination. And when we launched a few months ago, I thought it might take us a couple of years, maybe three years to even cross the 1000 mark. So thank you. However, something really fascinating has come to.

My notice and I thought I should.

Share it with you. I've come to see from our YouTube analytics, from our numbers from the back end, that 70% of you who watch this channel regularly and listen to the Money Wife Doctor podcast are yet to hit that subscribe button, that precious subscribe button on our YouTube channel.

You see, when I first made this.

Call a few weeks ago, it was about 75%. So thanks to you, the number has dropped from 75 to 70 just about the past few weeks. And I'm grateful. Well, our target is to get to 50%.

If you can get 50% of the.

Regular watchers subscribe, that would be fantastic. And I want to speak to the other 70%. While I thank the 30% who have already subscribed to the other 70%. My question is, why haven't you subscribed? Tell me in the comments. And if you like what you're watching right now, please can you hit the subscribe button? Go ahead, smash the subscribe button.

Subscribe.

So thank you for watching. And now let's jump back to this episode.

I think I already did a video on this. I'll send the link. Right. So when it comes to investing, I think a lot of people think about investing in different ways. My experience of investing has been almost 20 years now. So I started investing as a 19 year old and 19 years later, so I'm sure many of you now can calculate my age. But I started investing just early medical school times and all that, just before medical school actually. And part of what I learned having been through 2008 crash, 2010 flash crash and you know, Covid crash. A lot of times people think that investing is just sort of like buying chips or just putting money in different things. But to address Dr. A's question, he obviously understands investing. His question is, how do you know which companies to select, which companies to invest in? I don't know. Are there any other persons here who have similar questions around investing, especially stock market investing? If you just say hi or hello, that would be enough. Yes, I do. All right, excellent. Thank you. Right, so we'll address it at the same time. Oh, thank you. Now we'll address it all at the same time. When it comes to investing, there are many investments. I know there's property. I'm not a property investment guru or anything. In fact, I'm not any type of guru. But I have more experience in the stock market because I've been there over the years. I think I have a couple of friends here as well who joined this. Ask me as you ask me anything, because that's what they do. Even people who already have knowledge in an area, they still want to learn more. But I have a couple of friends here who have also been investing in the stock market. I've known each other since university days. Some of them started with bonds, then they started buying stocks. Now how do you know which stock to invest in? This is not a one hour question, not a one day question, but I'm going to summarize it for you in a nutshell. One, when you want to approach investing, you need to have an investment philosophy, a way to approach your investing, a strategy, how you approach investing. And I'll tell you what I do myself. I think I have a copy of my book here, the Intelligent Investor, which is the first book I read as a teenager on investing. It's a bit complex, but that affected my investment philosophy. This is the way I approach investing. You want to buy things before they become overpriced. You want to invest in companies before they become popular. Why? Imagine that. Let me give for example, imagine you've got like, you've got like a car you want to sell. There's only one of those car left and there's like a thousand people wanting to buy the car. What will happen to the price of the car up or down, what will happen? Go up. Up. Thank you. Right, so if you're investing and you're going to beat up what everyone is buying, like when I published some of my investment record and my investment return from one of my accounts recently, people are like, you didn't make 100%, you didn't make 75%. I said, people are now like thinking, oh, should I buy the same stocks? I'm like, no, you're not going to make money buying it when it's gone up. So my investment philosophy is that I want to buy undervalued stocks. I want to buy stuff before people know about it. I want to buy it when people think, oh, things are not going all right here. I want to buy things when it seems like, oh, it's not popular. And whenever it's popular, what happens in the stock market is that when a lot of people are buying a particular stock, the price keeps going up. And the higher you have to pay for something, the less likely you're going to make any returns from it. The higher you have to pay for something, the less easy it is to be profitable or even to make good returns on it. This is a simple way that I approach the stock market. We are going to interpret it in numbers at some point during this event. Now, on the flip side, the way to look at it is that when everybody is greedy, that's the time to be fearful. I think Warren Buffett make this quote when everybody's saying, oh, the stock market is booming. Oh, this is an amazing time. I want to buy this, I want to buy that. That's the time to be very careful. That's the time to be slow in making investment. But I'll give you an example. Covid 20. Is it Covid 2020 or whatever? Covid 2019. COVID 19. It looks like so much in the past during the COVID crash, at that point, a lot of people were not investing. A lot of people were selling their stocks. Businesses were shut down. That is when I went crazy. That is when I was buying. I bought a large ranch of different stocks. I was investing not just in the UK and us I think I also invested in Nigeria. I'm originally Nigerian and I started my stock market investing from Nigeria. I think I bought a large tranche of uba then when I say large, I mean large relatively. To me, it's not like I bought about a million units. I'm going to say about a million units of UBA then, and then added another 500 units of UBA then that's UBA, the bank in Nigeria. And then there were some other companies, Dangote Cement, some companies that were really doing very well. But you saw that during the crash, people just reacted normal human way. They didn't realize that these companies are going to still be existing. They didn't look at the numbers or the profits the companies was doing. They didn't look at what we call EPS earning per share. They didn't look at PE ratio price to any ratio. They didn't care about anything. They didn't want to do any analysis basis. They just reacted in a normal human way. Now if you are emotional like that, I will give you a way to invest in the stock market that will reduce your risk. This is not where I started and that's not how I made my money in the stock market. But to reduce your risk and you can still make money on the long term. I'll talk about that in a minute. But the way I approach stock investing is that I want to invest in what people are not buying. For instance, when I bought a company called copat, it's not popular, nobody knows about it. Obviously I have to do a bit of research, do a bit of digging, do analysis, do what we call DCM discounted cash flow analysis. These things are not difficult. If you're a doctor, you know, doctors are smart, you can learn these things. Obviously you spend six years in medical school, so don't expect to spend six minutes and learn how to do these things. They are very learnable. But by the time I was investing in a company like Meta, because when I shared recently, I think we got 102% returns on our investment with Meta. Meta is Facebook. Why that happened was not because we bought it when Meta was popular. No, I've been following Meta for many years. I've not been able to buy until there was bad news. When there was bad news, they said, oh, they started dropping because they invested over 10 billion in metaverse. A lot of analysts started writing articles. A lot of people are selling their shares. And when we dug into the numbers, we saw that Meta was a very solid company. They have WhatsApp, they've not monetized, they have Instagram, they're barely monetized. They've got Facebook, which they can still squeeze money from. They have very solid cash reserves. They have, they have very low debt. So if you look at their depth to asset ratio, so I'm giving you some of the numbers I would look at. They have low debt to asset ratio and you see they're being run by a very fierce, competitive CEO who is still very young. Mark Zuckerberg, I think is barely 40. And you're thinking Meta. No, I'm going to take my chances on Meta and I'm going to invest in Meta. And again, why? I say you need to have a strategy, you need to have a philosophy. I don't mean that you need to take all your money because one of my friends was speaking to me two, two days ago, I said, oh, that time invested in Meta and I joined you. Obviously I told him, if you invest in what I'm investing in, you're taking, you're taking a risk because you don't know what I'm selling, you don't know how much allocation I'm doing. But he said, oh, that time invested in Meta and I joined you now he doubled his money. But he's thinking, I wish I put hundred thousand pounds is a gp. He said, I wish I put hundred thousand pounds. I said to him, hang on, hang on, hang on. If you put a hundred thousand pounds, anything can also go wrong. You can also lose the money. Except that hundred thousand pounds money you can afford to lose. So having a strategy, think about it. When I'm, when I'm taking a position in any particular company, I take a position that if that company goes to zero, I'm not going to become homeless, I'm not going to lose my son's inheritance. So allocation is important. So I tend to do 10 to 15% maximum in any singular stock if I have very, very high conviction like Meta. And I thought, oh, this stock is really, really doing good, the market is missing it. I'm going to go ahead and put maybe the 15% or might even get to 20%. Of course this can also go wrong. I've had companies like Alibaba, which I invested in Baba, when everyone thought Alibaba was going to go down, they had problems with the Chinese government. And till now I don't think I've recovered my full investment in Alibaba. But overall picture, if you think about my Meta investment, my Google investment pitch return 33%. If you look at Alibaba, look at other investment overall, that's what generated. I didn't share my 2021 returns. That was about 76% because of COVID So what I suggest is that if you are going to think about investing in common stocks need to settle down and start learning fundamental analysis. The first book I'll suggest is the Intelligent Investor. Or go and watch the video I already did on my YouTube channel, the Intelligent Investor by Benjamin Graham is a very good book. It's not very easy to understand. Now there are other really, really good books. There is a book by a gentleman called Mohnish Pabrai. It's called Dandu Investor. I don't know if I pronounced it well. Dandu is an Indian name. Mohnish is an original. Mohnish is originally Indian. So Dando Investor is also a book that could help you. But I also published a list of other investment books I think is a good idea if you want to start thinking about becoming an investor. You want to learn how to read companies 10k. So 10k is like companies reports and all that. Now if you're not ready. I read Intelligence Investor so I didn't understand it. Right. Thank you Bassy for being so honest. Intelligence Investor was written many years ago. It's not an easy book to understand. There are some videos that explained it. But you can also read other simple books. There are other simple books like I think Peter Lynch. Peter lynch wrote another one. He said how to become a stock market guru. Whatever. I, I'll publish a list that I can use. But now, now let me talk to people who don't want to do all of that. I have an average doctor, I've met a lot of doctors who say no, no, no, I don't want to spend many days or nights analyzing the stuff. And that's fine if you are, if you're a doctor, you want to just get the average market returns. You want to invest without having to do all the work. I have a suggestion for you. You can buy a broad based index fund. I did an article on our website titled I don't know if I can find it now how you can beat 99% of, let's say invest. I can beat 99% of professional fund managers. I will get down out for you. Okay, I'll send the link in the comments and you can save it and have a read later comment box. Okay, now let me address for those of you who are not as crazy as I am and you don't believe because I think it's a sort of, I don't know if it's mental problem. It's not mental problem. But after looking at all the numbers and you still think that you can beat the market, you can do better than the market, then you must be ready to do the work. I've been fortunate. I think I've been fortunate. And I, I said after I got married I, I explained to my wife my investment theory and how I work I said to her, every year I wonder if it's the year I'm eventually going to lose money. So I've gone almost 20 years. I've never had a losing year. I've had years that weren't as good. There were years that maybe you made like 76%, 85%. There are years I made just like 10, 15%. But I've never had a losing year. And every year I think, who knows? Will this be the losing year? And that makes me to remain humble. I don't gamble, I don't take. I have my emergency fund separate. I have fund for, you know, sort of like for my son's inheritance. I have fun for other issues. I have a will. You know, if you have all those things set up, then you invest only with money you're ready to lose. Now if you're like an average person, you want to have time to play with your kids, go do stuff, obviously have a bit of fun. You don't want to go into all those investment analysis, rather than trying to buy single stocks, buy the whole basket. I explain it to you. If you're trying to buy an investment, if you're trying to buy a winning investment, it's trying to find a needle in a haystack. They're trying to find because a lot of companies look like they are going to do well, but they don't eventually do. A lot of companies look like they're not going to do well, but they turn out to do very well. There are also companies that you think they're going to do well. Then you find out that they are cheating or they were, they were doing a wrong account. And if you people remember all the scandals of the early 2000s, Anderson, ATO Anderson and all that accounting fraud that happened or think about companies like was the one that happened recently. There's this big crypto company, was it ftx, that they found out that they were, they were fraudulent. Imagine that you are an investor in those companies. So if you're an investor, you're trying to find a winning stock, you're trying to find a needle in a haystack. It requires a lot of work and sometimes you may not turn out being able to do that. So what you could decide to do will be to buy the whole haystack. And that's index fund investing. Now when you are buying index fund, you're saying, rather than buy one stock, I'm going to buy the whole market. And there are many ways to do this. A lot of people go for market weighted index it's not as complex as it sounds. Market weighted index is basically you want to buy the biggest companies in the market. An example is S&P 500. S&P 500 is in the US. The top 500 companies in the US market, you have all the Google, Tesla, Apple, you say Facebook, last Meta, you're going to buy a share in all of them, you're just going to buy a percentage of that. So you're saying I'm not going to try to figure out which company is going to do well because the company that did well 50, 60 years ago, they are no longer doing well. Some companies that did well 30 years ago, they are no longer doing well. So what I'm going to do is that I'm just going to buy the top companies. Just buy the top companies, all of them. Now what that does is that it reduces your risk because if one company is no longer doing well, they will remove it from the index. So buying an index fund means that you're reducing your risk. You're not calculating which stock market in PE ratio or eps and you're not doing all those analysis, you're just buying basically what the market is. Now the big thing about this, sorry, the big thing about buying an index is that it reduces your cost as well because you're not buying and selling in the market, you're not paying any stock brokers and at the same time also you're reducing the chances that you're going to make a psychological mistake. Now I'm going to tell you one big thing. It's like an investment secret. There are a lot of money managers and I interact with some of them. Some of them are experts. They've been doing this for years. Some of them studied maths, statistics, physics, quantum, whatever, and they are applying it to the market. They're using computers and everything. 99% of professional money managers, 99% of professional money managers are not able to do better than the index funds. 99% of the professional money managers, they are not able to beat the market. They are not even able to get above the average market returns consistently. So that means that if you, as an average person decides to buy an index fund, you already have the charts over the last, I'll say 20 years and the records are there. I've done an article on this on my website. 99% of them are not able to beat the index fund. And while they are very good, they are experts. A lot of them are not able to beat the index fund because when you invest money with them you are going to pay a fee. They pay taxes because of the number of times they trade. Remember that that fee you are paying and those taxes you're paying, they are also part of your return and those ones are actually going to reduce your returns. So while I didn't start out with index fund, I'm thinking that, okay, if I'm setting aside money for my little one, I'm most likely going to put in my index fund because I'm not sure if he has the ability to manage it yet. And also, if you're a doctor, healthcare professional, don't get discouraged if you hear us talking about fundamental analysis. Obviously there are other people who do things like technical analysis. They use computers, they try to use graphs, they try to time the market. That's very different. I don't do any of that. So if a doctor, healthcare professional, are you feeling, oh, I don't think I can invest because I don't know what to do. You can set up an account. I tend to prefer an ISA account. If you're in the uk, you can use a stock and shares ISA because anything you invest inside that account is tax protected, up to £20,000, you can set up an ISA account, you can set up a monthly investment, sit down, decide what you can invest on monthly basis. And I've helped quite a few doctors set these things up. You set it up, you investing into the index fund, you're not making any decision about what to buy. You set it up automatically and it's going directly, you're buying it passively. When the market goes down, it goes down. When the market goes up, it goes up. When the market is just plates. But guess what? Over 20 years, over 15 to 20 years, over 30 years, you find out that you end up doing far much better than most active investors who are oftentimes don't know what they're doing. And even when they are experts, experts still make psychological mistakes. Right? That was a very long answer, but I hope that answered the question that you asked Dr. Eze. I'm going to hand over to the moderator now and we'll carry on taking more questions. Any questions are coming. Well, what do you think of it?

If you found this useful, let me know in the comments and we'll release more content like this from the event.

Well, if you don't really find it.

Useful, that's fine, we'll just carry on what we already do. But I'd like to hear from you in the comments either way. If you like the full video link, go to the comments go to the comment section or check the description and you'll get the link to subscribe to the newsletter to get the full 2 hour video when it's released. Thank you for watching and thank you for subscribing to money wise Dr. Alright then, till next time.

Bye bye.