0:00 getting started in their career maybe you know they've got that first job out of college so perhaps for the first time in their life they've got a little bit of extra money what would you recommend for someone in in that situation in terms of how they approach uh you know investing their money and and presumably looking toward the future who are you are you going [Music] what do you want together we'll find the
0:36 ideal path on the way to wow show with your host Kevin bemle if you're going to invest it's best to have a philosophy rather than just buying or selling on hunches willy-nilly when you have a plan you can invest according to that plan Dimitri farberov is going to talk to us about how to develop that investment philosophy
1:11 but first we're going to talk to Diane Quinones and she's going to make a cocktail for us and I'm thinking it's going to be Mezcal Moscow all right how are you doing good um how did you know uh yes the whole the whole production is the Mezcal leaving company uh yes we covered Mescal we talk about tequila and uh Mezcal as Agave Spirits so today I'm making a cocktail that I'm very excited to show you guys it's the espresso Martini so this is very very popular it's having a Resurgence
1:48 um typically done with vodka base but we're gonna do a Mezcal Base today just to kind of play around with it and um just show some nuance and this is going to we're gonna make two of these right uh yes well you know and then you'll have to make someone aside the team to keep them happy I'll be at cocktail partying all so we're gonna do an ounce and a half of the Mezcal okay we will add a half an ounce of of the coffee liqueur here this is
2:24 really beautiful Caribbean coffee liqueur so and that's for each cocktail for each cocktail correct so half an ounce of a coffee liqueur it could be anything so if you have a Starbucks one you can use that or Mr black or any of the newer ones you'll see and then we're going to use one ounce of fresh pressed espresso so this is very important you could use coffee it's it's a trick to do something different but you want to use espresso because it's going to have that punch and that power so you want one ounce of espresso for each drink
2:59 the caffeine will get you going yes exactly and then we're just going to add a little bit of simple syrup the coffee liqueur already is a little bit sweet right so you're just going to add just a hair of simple syrup about a quarter ounce for each one okay so we'll put two in there and then that's it and then the secret to this is the shaking because the sugar and the coffee liqueur are gonna mix together and they're gonna become frothy and it's gonna whip almost whip together oh okay yeah so you'll see the texture is very important here so this is this is a little bit like an ice
3:34 Blended mocha without the blender exactly so yes it's gonna be like a frappuccino so you'll definitely have to really shake it hot you want the frothiness to come into the Shaker you want to see this part to hold because it's so cold oh all right this is this is like you know you can have the margarita Blended or you can have it what straight up and this is all the ice is doing the blending here for you so that's going to create the texture like I said before and the other important thing is that that fresh espresso is going to create that texture
4:09 okay so you'll see oh yeah wow there's no cream or anything but just that shaking with the sugar and the fresh espresso we'll give you that beautiful frothiness oh it's actually there's a head on it oh yeah yeah wow voila espresso Martini yeah and if you notice it should almost Cascade like that yes it is almost like again it goes from Yeah Yeah from very light to go light to dark and then it'll change as you drink it so there you are Cheers Cheers [Music]
4:48 so Deanne mixed this up I think you will like this all right you smell the coffee in it perfect ah wow nice way fantastic yeah great coffee flavor just what the doctor ordered yeah so you know there was a time when you came home from work and that well you probably weren't greeted with something quite this fancy but at least a martini yeah so I'm gonna read a little uh biography of you here Dimitri Farber off is a uh decided underachiever
5:27 great he graduated [ __ ] laude from UCLA and earned both the charter financial analyst and the chartered financial planner designations I I should say my mother is has a um uh uh certified certified financial planner designation it was a load of work and I understand the chartered designations are even more work than that so wow at Miracle Mile investors which is a registered investment advisor with over two billion dollars under management Dimitri personally manages about 80 million dollars for individuals and
6:04 institutions including a mixed martial arts champion the producers of the most popular show on Netflix and entrepreneurs and founders of some of the most successful businesses in Los Angeles over the decades I've met I don't know how many stock Brokers financial advisors wealth managers what sets you apart from the thousands and thousands of these guys is that you have a philosophy that undergirds your practice and that's that's really where I'd like to start is is talking about
6:40 this investing philosophy because I think that's where a lot of people go wrong so so talk to us about that a few ways yeah I would say investing is very hard and people think that investing is easy depending on when they come into the cycle of the general markets uh they they think they can just ride a wave and and make a lot of money but countless mistakes over 20 plus years in my life has taught me that philosophy is critical to having long-term success in the markets right Warren Buffett has a philosophy which means he doesn't Flinch
7:16 when markets turn against him because he knows that his philosophy is what's going to be it's going to be standing after all the volatility is done most people don't have a philosophy they defer to others to help them determine what that philosophy is they they focus on the next hot stock or the next hot sector but when volatility comes into play and when blood is on the streets and when they they turn on the TV or read the newspaper and it says sell because X is going to happen in the world and and and you see your portfolio down 10 20 30 and that could be countless hundreds of thousands if not
7:52 millions of dollars in my world that changes people people don't know how they're going to react under those circumstances and so that's where for me in my personal investing has I've learned to to really understand what my core philosophy is right it's only when times are really hard that we understand kind of what makes us tick and I I've learned that through through all the volatility in the markets over the last two decades whether the great financial crisis or the corona crisis or any any periods of volatility in between clients that don't have a philosophy
8:27 will fail nine times out of ten and that's where that's where having an advisor is so valuable who does have a philosophy but it's important to find that advisor who helps educate you about what your philosophy ought to be helps understands what your psychology is that will really determine how you react to in times of stress so every philosophy every individual is different they're going to be folks that have a philosophy of momentum they're they're going to be folks that have a value philosophy they want to they want to be the contrary and they want to do what what folks are not
9:03 doing they want to invest away from the herd some have to be a part of the herd and so that's where it's critical I think that's what differentiates the quality advisor and the successful investor from that individual who's going to make the mistake that's going to make the difference in in long-term returns over time so let's take someone who's let's say is is just getting started in their career um maybe you know they've got that first job out of college so perhaps for the first time in their life they've got a little bit of extra money
9:39 they can you know go on a big vacation they can you know spend it on this or they could you know start in investing some money so um what would you recommend for someone in in that situation in terms of how they approach uh you know invest in their money and and presumably looking toward the future maybe they're not married yet but you know hope to get married and and have a family all that kind of right well first and foremost that individual their number one investment is is in herself or himself I think that's that's the key that's
10:14 that's going to be the biggest return of on on principle or on invested Capital will be the investment that they make in themselves their education and so on but assuming they have a career and they have they have ample income and to to pay for the day-to-day and they have savings at that point the value is not in the underlying investment itself but it's in the process with which someone approaches in investing for the long run which is save save as much as you possibly can and and and when you have money to save do consistently and then at that point the question is what
10:50 savings what investment is going to get you the best return on on on your principal over time and that and that it's a question of diversification uh that's where philosophy is also important because diversification is not going to bring uh riches overnight diversification is going to bring riches over 30 plus years but if your philosophy is one that's not going to be satisfied with slow slow returns and and and wealth that's going to be accumulated over a very long period of time then you
11:26 have to know that in advance and then and then find the strategy that makes sense for you so that might be investing in Angel Investing as just as an example it's more aggressive but that's going to have a different return characteristic than a diversified stock and bond portfolio so that's where philosophy is a critical element of things but in general I think to get started you have to just understand how to react to volatility which is inevitable in any part of our lives so that's where I tell anybody get started in the market diversify portfolio to to
12:01 one individual might be boring but to someone who's never experienced any volatility seeing a five ten percent decline in any amount of capital is significant and will cause you to lose sleep so get used to that and then over time you can diverse diversify into other Investments that have a different risk profile so how does one determine whether his his philosophy is is valid or he's made a mistake and actually does need to you know
12:39 readjust his portfolio or or you know change his Outlook how how do how does one determine that right well that that depends on a number of factors the first is are they doing it on their own are they investing with alongside somebody else an advisor and and I think that that's a critical element if if you if you own a bad individual investment and the market turns away against you you should be able to cut your losses and and leave but you need to know what
13:15 makes a bad investment what makes a good investment and and most people don't even ask us questions like when are you willing to exit your investment if you have a long-term Horizon and you've got to diversify portfolio like in in your ins in your case you know that any volatility will be short-lived it might be a couple months days or years potentially but it'll in the grand scheme of things will be short-lived but if you have a one one stock that you own I know folks that have millions of dollars in Tesla right how do you know if Tesla's a quality investment it's a great car right it's a great product a
13:51 great CEO but it it's it's an investment that can drop and has dropped 40 percent and and potentially if we look back three years ago was on the verge of bankruptcy if starts in the line in in the right way now Elon looks like a genius and the company is great but several years ago that wasn't the case so I I think it's it's about knowing what your why you're investing how long you're investing and what the eventual outcome that you want to get accomplished if again if you're if you're investing in a single company versus a collection of companies based
14:27 on global macro Trends in in general economy and we know that you look back over the last hundred thousands of years human progress is forward and therefore the companies that participate in the human progress if you're Diversified in all of them across different asset classes different geographic regions you'll be fine but that's that's a philosophy right that's I'm investing in the long-term growth of society I want to participate in that as opposed to a speculation on one stock or one one sector that you
15:03 believe will do well robotics is an example well what if Trends move away from that direction how do you know you have to answer those questions before you come into that investment and if you don't if you don't have those answers then you're speculating and you will make mistakes without a doubt so I mean it's interesting of all things you brought up robotics I I would think that today um it's virtually a given that something like robotics is going to grow and and become ever more a part of not just American business or worldwide business
15:39 but even here in the home you have you know robotic vacuum cleaners and you've got I don't know you've got Alexa and all these things where you know I guess there's not one where you can say mix me or Martini Alexa you know but maybe maybe there will be soon so what determines or what kind of um information guidelines should we be looking for as we you know size up those you know because even within a macro strategy we still have to make
16:15 individual investment decisions right I still have to decide whether I'm going to buy you know uh Procter and Gamble or whether I'm gonna buy you know Apple so where do I what what kind of guidelines should I be looking for there well I I think I think there a big factor is how are you investing if you're buying individual companies what how are you approaching understanding their their balance sheet are you are you buying their balance
16:50 sheet for future growth are you buying it for Value relative to more expensive competitors uh and and so so there most people don't invest based on balance sheet analysis like years ago like Warren Buffett does or has done most people invest in Trends and and so that's that's critical for example my clients they won't know that I mean everyone knows Apple but they won't know the difference between teledoc and I don't know Siemens right um but yet they participate in that growth other individuals they gravitate
17:27 toward individual stocks that they want to own and and those individuals need to be able to identify markers for Success so if you're buying based on future cash flow if you're analyzing current cash flow and you're discounting it based on certain interest rates then you have to understand what factors might change that might change the investment thesis if it's interest rates so for example the NASDAQ and we're going to get just a little bit wonky here but but the NASDAQ is is largely not large but a big majority of the name names right now are
18:02 growth names they're not necessarily creating cash flow and and revenue to the to the investor their focus is on growth and reinvesting their earnings over time so therefore their future earnings are dependent upon interest rates so as interest rates go up the Rel the value of Google for example is is lower if interest rates go higher because they're not paying cash flow to the investor whereas the so that so there's a shift currently for example going from certain growth names with the expected rise in interest rates to to
18:38 more income names and and and so knowing why you invested in Google uh is is critical or in your case Procter and Gamble it's critical to know are you investing because there are a lot of factors that play into a return profile the reality is these days most of the return profile is tied to the sector not to the underlying company so Procter and Gamble will do more or less as well as Johnson and Johnson or whatever companies are in this are in the space but if there's an underlying reason why you like Procter and Gamble over over the competition you want to make sure
19:13 that those factors continue staying in place and perhaps improving are they starting to do you have a better CEO do you have is a marketer that you're buying for and therefore you're looking for market share but other than that if you're not looking for so if are you doing bottom-up analysis are you doing economic top-down analysis and so there's so many different factors but the key is know why you got into the investment in the first place and so my clients they could care less about the individual names because they're buying the overall Trends there are other investors on Robinhood right so a lot of the younger
19:49 audience that you have might not be they're not analyzing the company's cash flow but they like they for some reason the that audience has gravitated towards Robinhood they've gravitated towards crypto and in Tesla and those names these are these are momentum investors that's their personality for whatever reason they're attracted to it and others will say I can't stand crypto I don't understand it I don't want to have anything to do with it these are the individuals most likely that are more value oriented individuals contrarian and knowing what your gut tells you at these levels is is very often an indicator where you're going to
20:24 naturally gravitate to and then how you invest but the key is you got to study you have to I mean it's a process people think investing is so easy and it's it's probably the hardest thing one can do over time because human psychology is barely nearly impossible to to really it's it's a life it's a life's journey right to really understand that psychology oh so um I've got about 10 questions when I ask you but I have time for only one more quick question for someone who wants to get started on their investing Journey
20:59 what's what what would you recommend as being the first thing they should do I would say pick up a book on psychology I though the com the one that comes to mind is is Daniel kahneman's Thinking Fast and Slow uh it's it's just really understanding your perception of the world and and and that that's critical of course it's it's important to have an understanding of of money just the very basics of money and uh there are a lot of great books about the basics of money
21:35 but knowing the basics of money is not enough you have to know what pitfalls you're going to face and that the only way to do that is really understanding your own elements of fear and greed and and how you're going to react under those circumstances same remember the book again so thinking fast and slow by Danny Kahneman okay is is probably my favorite book in because it's so applicable to uh any any facet
22:10 of life excellent Dimitri thank you so much for coming and talking with us it's such a pleasure thank you for the opportunity so that's our show for this week folks interview I told Dimitri he's just the kind of person I think is ideal for managing Investments unflappable I've known him for quite a while and I try to even throw a curveball at him just took it right in stride so I think we can literally take Dimitri's advice to the bank especially his his tip on how to get
22:45 started the book by Daniel Kahneman a Nobel Prize winner thinking fast and slow I I honestly haven't read it I'm gonna pick up a copy because I'm always interested in in resources that can help me better understand how we as human beings think and act send us a a message at our website the way to wow show.com tell us what you think about our guests what you're getting out of it what you'd like to see we're always interested to hear your input courage at all times my friends
23:22 Marie you're still my bell darling [Music] thank you [Music]