Latest / Black Box Theory Podcast / Stop Chasing Stocks. ETFs Are the Discipline.
Transcript
- Thomas: Chasing stocks, man. Chasing stocks need to go to bed. obviously not eight literally, right? still invest in stocks, but I think a lot of people you might have heard about these things called ETFs. We've talked about them for a while. ETFs stand for what what are they called? Malcolm: Saying straight a fonts. Thomas: Exchange trade. Okay, yeah, I I should have known that off the top of my head. But you know, there's there's an ETF boom going on. So you might have heard it from other other creators. there's I forgot the number, but there's like a thousand ETFs that are going to be created in 2026 alone or 3,000. There's a lot of them. and essentially what that is, is a managed fund that invests in stocks for you. So let's say if you have an ETF that holds Google, Microsoft, Amazon, Meta, whatever, like it tracks those and plays a part in it. But what I want to talk about specifically is a company called Roundhill ETFs. Malcolm: Mm-hmm. Thomas: A lot of people might have heard of them. with a memory etf called dram that's dra i will say it's a little bit expensive they specs ratio about s 0.65% when you buy it but yeah essentially they they hold different different things and and if you go to roundhill's website they have a bunch of theme etfs but for dram like or dram their holdings and they get you exposure to things like samung micron skynix seagate sand disk western digital And you can chase Malcolm: Mm-hmm. Thomas: different areas. I know Malcolm, I know y you probably have have a good amount to share about this. Or like Brown Hill, the German. Malcolm: Yeah, yeah, no, yeah, for sure. So like yeah, no, yeah. So so yeah, Round Hill's definitely like I think taking taking the and and to your point, you also did make a good point earlier. Like I don't think people realize like ETS like like Thomas said are exchange traded funds. and these are just essentially just baskets of stocks that are all just rolled up into one ticker so that you don't have to worry about finding, you know, the right company, the right like it's just it's a lot easier for especially for not even just for beginner investors, but for people who don't want to like constantly have to check check and actively manage and and essentially be a hedge fund manager for the own portfolio. Me personally, I used to like to do that when I was like 18, 19, bro, because I just wanted to be like the I wanted to be the next, you know, like find the next company, get these two thousand percent returns that you see from all these, you know, crazy creators. But it's like, you realize, bro, like the the key to like wealth building, right? It's not, it's it's not the you're it's not going to be the there are some people that do make it like that, but that's a very small percentage of act people. A lot of people fail trying to make these bets and do these options calls on like these companies and And you a lot of us only see the very extreme. But for most people, the average person, and even not even just the average person, you ask Warren Buffett about his strategy. Just get you an ETF, get you get you something that you know that you're gonna get your a guarantee annual return on and leave it alone. Don't touch it. That that has been the the big the biggest change I've made in my investing strategy. and that's just been like that comes with a lot of discipline because a lot of people aren't able to like resist that urge. To constantly like check their portfolio and to constantly like make an adjustment to their portfolio and what they're invested in. But unfortunately, like it's not unfortunate, but it's just like something I just have it's a it's a tough lesson to accept, like especially for someone who like wants to actively manage everything. All the wealth comes from just leaving stuff alone, bro. It's from getting into these ETFs, these big baskets, the VOOs of the world, the QQQMs of the world, the SCHD, the SCHGs, the the VXIs, right?