PRASHANT MOHAN | From Sharesight

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Trying to teach an 11 year old about corporate actions - Prashant Mohan at Sharesight

We started with the best of intentions to talk about corporate actions but took a couple of turns along the way. Prashant Mohan is the Chief Marketing Officer at portfolio tracker Sharesight. We talked about his investing history, what he's learnt working at a Fintech Startup, why he started investing with an LIC rather than an ETF, and finally getting around to corporate actions - what they are and how they have to be accounted for.

This conversation came about because of this blog post.

“You know, if you think of your own life as where you invest your time, you don't want to be hyper-focused on just one thing. You do want to have a varied sets of interests, and that's how you become an interesting person. So it's exactly the same concept when it comes to investing as well, that you have a bunch of investments that give you that diversity of return and income should one of them fail.”

Prashant is currently the CMO at Sharesight where he leads a team of talented marketers who are all investment geeks. He joined Sharesight in 2018. Before joining Sharesight, he was responsible for driving customer acquisitions and growth at leading fintech, Prospa. He has held various roles across finance and technology companies including running strategy and sales operations for Google in AUNZ and also at Westpac bank. He holds an MBA from INSEAD business school in France and Singapore and is also a graduate from BITS, Pilani.

“I liked that idea that you refer to the full company name and not with a ticker code, because when you're using ticker code, you're probably displaying more of a trader behaviour. It's just, you know, looking at some of those candlestick charts, there's nothing wrong with that that's needed very much needed, but also that it's not just a arbitrage opportunity to make more money. It's also when it comes to long-term investing, you're actually bought into the story. But in the process also you make money.”


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Prashant (3s):
I've been trying to teach my 11 year old son about investing. Now. He, his attention span for the amazingly interesting stuff that I have to say about corporate actions is pretty limited, but when it comes to talking about the companies that he uses, for example, I created a portfolio saying hey you use an iPad. You use Minecraft, which is actually owned by Microsoft. So let's create a portfolio of all these companies. You can do that for yourself. As an investor, look around you, look at all the products and subscriptions that you have. Just create a dummy portfolio and see how that portfolio performs over time.

Phil (43s):
G'day and welcome back to Shares for Beginners. I'm Phil Muscatello. How do you track your portfolio? Do you use Excel, Google sheets or accounting software? Or do you hand over a shoe box full of ASX trade notes to the accountant? Joining me today is Prashant Mohan chief marketing officer of Sharesight. G'day Prashant. Thanks for coming here. And we've just been enjoying our flat whites as well. Our oat flat whites,

Prashant (1m 9s):
Phil makes the best oat flat fights in the city.

Phil (1m 12s):
Oh, fantastic. Thank you very much for that. So let's just start out. You work at Sharesight. Okay. Which as many people will know as a portfolio tracking tool, but you don't come from a finance background. You're a marketing person, you know. So how long have you been at Sharesight and what did you start to learn about investing by coming to Sharesight?

Prashant (1m 35s):
I've been at Sharesight since May, 2018. So just over four years now and coming to Sharesight, the amount of learning that I had to do for investing has been a tremendous learning journey. I've learned a lot of good things in a sense, I'd say the first biggest learning that I learned at Sharesight or kind of relearn that Sharesight that every investor should know about is just the power of compounding. I think at its basic sense, that's the fundamental truth, which is, you know, attributed to Albert Einstein, calling it the eighth wonder of the world.

Prashant (2m 15s):
And why I say that is just how a tool such as Sharesight is able to present your actual total annualized return. And what that means is if you did earn similar returns year after year, it's very difficult to visualize compounding. And when you do that and when the effects of compounding come into play, then it becomes a big sum. And that's the first, most important lesson out of Sharesight. The second thing is the importance of tracking dividends and income in general.

Prashant (2m 57s):
In every portfolio has two components to it, or actually a few different components. So the fundamental unit is capital growth. That's what everybody thinks that in investing for. So you put in a certain amount of money and that asset then grows over time and becomes much bigger than what you initially invested for, but in doing so, it also starts giving you some income at regular intervals and in share market terms those are dividends. If you're a property investor, that's three, a rental income, for example. And the importance of dividend tracking is very high, just because particularly in the Australian stock markets, we have the tradition of paying dividends.

Prashant (3m 45s):

Phil (3m 46s):
Yeah. We love, we love dividends here in Australia, more than other countries. Yeah.

Prashant (3m 50s):
Yeah. And, and that's fantastic because you are then taking the returns that a company's giving to shareholders and actually monetizing it at regular intervals of time. Now, when you fast forward to your retirement age, that becomes extremely important because it generates that income stream that you rely on. But even at a much younger age, even for beginner investors, it's really important because you learn that you generate a passive stream of income. And that is a tremendous thing to happen to any youngster that there's this asset that you've invested in and it's generating income.

Prashant (4m 32s):
It's not proportional to the effort you put in for a tent. And the third component is really around currency fluctuations. And this is particularly true when it comes to overseas investments,

Phil (4m 44s):
Which are so much easier to access these days.

Prashant (4m 46s):
Exactly. You know, there are so many brokerages that provide you access to overseas investing as well as so many ETF providers that have made that have made it so easy to access these markets. So even though you are technically investing in these ETFs in Australian dollars, the internal mechanics of how that ETF works has all of these concepts built into them. Yeah.

Phil (5m 11s):
The moving parts that we'll adjust for, this is one of the factors, isn't it? Yeah,

Prashant (5m 15s):
Exactly. So I think these, I would say are the three sides of the return side of information. There's another really interesting concept when it comes to investing that every beginner investor and everyone should know is the risk side of investing. Now, when I say risk, it's not about fear. When I say risk is something that you can mitigate. And there are things that you can look at in, in your portfolio. So for example, a measure of risk is diversification to take the, the layman's term of don't put all your eggs in one basket.

Prashant (5m 59s):
When you diversify the idea that if something goes down, something else is going to pick up and vice versa. When the cycles. change is a really important concept. You know, if you think of your own life as a, an where you invest your time, you don't want to be doing hyper-focused on just one thing. You do want to have a varied sets of interests, and that's how you become an interesting person. So it's exactly the same concept when it comes to investing as well, that you have a bunch of investments that give you that diversity of return and income should one of them fail.

Prashant (6m 43s):
And that's an, that's a really important concept that I've learned. Again,

Phil (6m 46s):
I just wanted to take a break here just to mention I was at the pub last night with some mates and this friend of mine, and he was talking about his retiring now in his mid to late fifties. And that's basically because he's had this concentrate, quite a concentrated portfolio of shares. And for years he's just been reinvesting the dividends. He hasn't been taking anything out of it. And it has been a bit painful at times because he's had to pay the tax on this, but preserving the re-investment as well. And he's at a stage now where, like I said, late fifties and I commend younger listeners to take this in mind that it comes around really quickly and that this compounding is so important, isn't it?

Prashant (7m 29s):
Absolutely. And, and you, you raise a really important point with regards to concentration and, you know, when you make these decisions, investing positions, it seems like things are always on the up, or it's a no brainer investment, but you know, we've been through a few economic cycles when these things made complete sense at a given point in time, I guess, like, even as recently as last year, if you spoke to any of the crypto investors, you would think that that's the way, you know,

Phil (8m 3s):
Digital diamond, hands, diamond, hands

Prashant (8m 6s):
I'll just go buy a digital JPEG. And that's going to generate some enormous amounts of money through NFTs and things like that. And of course, media plays a huge role in this. You can get caught up in all the dramas of the day, but like you said, it's really important to zoom out and look at history, look at how things have been going on. Like something that seems absolutely obvious. And, you know, there are cycles of bubbles and bursts and hopefully you never get caught in one of these cycles of bust, but that's the whole point of, you know, being prepared

Phil (8m 45s):
And thinking for the long-term

Prashant (8m 46s):
And thinking for the long-term. Yeah.

Phil (8m 47s):
Yeah. I blame the traditional finance industry as well to a certain extent because they've made it so complex and so complicated that suddenly when an easy solution presents itself, that's been hyped up in social media and the traditional major as well. It seems like, you know, we can get one up on wall street, so to speak.

Prashant (9m 6s):
Absolutely. And, and I think like a traditional finance is, you know, where the investment has always been sold. You know, traditionally financial investments have always been sold as a middle person. That's, you know, has some set of incentives to make the sale to you. And the story, they come up to, the people who are less informed, they've been able to get away, but you know, selling really dirty investments. But now that that cycle has changed, you know, for now people are buying into things, buying not only into financial instruments, but also into the stories of the founders stories of the companies.

Prashant (9m 50s):
And, you know, with, you know, even more recently with ESG coming, becoming more and more mainstream, people want to know where their money is going and what kind of things are, are we actually funding actually on that, on that front, I, again, take a little bit of a detour, go for

Phil (10m 9s):
It, go down another rabbit hole.

Prashant (10m 12s):
I love going into rabbit holes. You know, I've been thinking about this a lot. Like, you know, one of the questions that's been tarted around is who can make a bigger difference to the environment. Is it users or consumers or investors, and again, taking a lesson from history, if you look at the world, yes, sure. There were always markets to be conquered so that you could sell your products into those markets, but,

Phil (10m 41s):
And, and exploit those and

Prashant (10m 43s):
Exploit them

Phil (10m 44s):
As sources of new goods or either ways of producing them.

Prashant (10m 48s):
I'm using them. But a bigger story that's not very well recognized is actually the power of investors. And I know being a history buff, I just went through this recent book called The Anarchy by a guy called William Dalrymple and got to do a lot

Phil (11m 7s):
With the famous history,

Prashant (11m 8s):
Historical, very famous history writer. And this story was about the British east India company at the root of it. Colonialism was investments looking for returns. And, you know, there was a ship that needed investing. That ship was, you know, they, they got together a bunch of capital holders and those capital holders needed at a time. And that's the incentive at which everything started. So if you know, that's a negative example of what happened with capital and investing, the same thing can be used for positive change. So I think, yeah, these, these stories are enormously powerful.

Prashant (11m 52s):
And with empowerment of everyday investors, it's becoming so much more easier to tell these stories. And that's where I applaud you for making this podcast now empowering investors

Phil (12m 9s):
For being such an early supporter of the podcast as well from very, the very early days.

Prashant (12m 13s):
Yeah, no, I think it's a really important role in society that you play,

Phil (12m 21s):
You were kind of referring to the businesses and that the implication was that the businesses are actual businesses that you are investing in. And one of my guests was saying that he doesn't refer to companies by their ticker code. He refers to them by their full name, so that you do keep it in your mind that you're talking about an actual living, breathing business that you've invested in. You're a part owner in, and all of the staff and management are working on your behalf.

Prashant (12m 50s):
Yeah. That's a, that's a brilliant way to look at it actually, because that's actually what you are. And this comes from the philosophies of Warren Buffett and Charlie Munger, you know, they've always said maintain that you are part owners of business, and that's the only way you can get a long-term view on what is it that your money is doing not only for yourself, but also for the rest of the world when it comes to this whole idea of stakeholder capitalism. Yes. Money is important. But if I were to make money using a tobacco investment, as the primary are guns yeah, sure. Guns do sell, you know, they, it's, it's a crazy weird world, but do I want to be supporting that with my money?

Prashant (13m 37s):
So that's the important question that you can always ask. And that's why

Phil (13m 41s):
That's part of having your own investing style as well. And realizing that you do want to, you know, you can invest in so many sectors, so many areas that you can make it nuanced in terms of what your own belief systems are.

Prashant (13m 54s):
Absolutely. Yeah. And, and that's the, I liked that idea that you refer to it as a bit, the full company name and not with a ticker code, because when you're using ticker code, you're probably displaying more of a trader behavior. It's just, you know, looking at some of those candlestick charts that, that are, they're not nothing wrong with that that's needed very much needed, but also that it's not just a arbitrage opportunity to make more money, but it's also when it comes to longterm investing, you're actually bought into the story. But in the process also you make money.

Phil (14m 33s):
He referred previously in the introduction to annualized return and that's really important, isn't it? It's a really important feature of Sharesight to understand how you can benchmark your own returns against say the ASX 200 or whatever you're benchmarking against. I just wanted to explore that in terms of, I mean, if you look funds and ETFs, they're showing you one year return six month return, 10 year return. How does that interact with an annualized return as shown by Sharesight?

Prashant (15m 2s):
So there's two ways in which you can, you can look at return. So one is called time-weighted and the other is money weighted. What we show in Sharesight is actually money-weighted. What you see typically in a online broker portfolio is, is time-weighted. So for example, you bought something for a hundred bucks, five years ago, and today that's 150 bucks. While you look at the little green symbol next to it and say, okay, that's gone up. Tomorrow your brother-in-law in the BBQ is going to say, oh, he made like 2000% return on some crypto that no one's ever heard of.

Prashant (15m 42s):
And that is how investing stories and traders stories get talked about. The same way in which media talks about headlines as well so that's just a headline number. Yep. It means nothing to you personally, because the concept of time or the dimension of time is completely missing from it. And this is where the annualized return concept comes in really handy. There's another rule called the rule of 72, which in compound interest terms, again, for some reasons that's also attributed to Albert Einstein, maybe he did, maybe he did not, but the idea is whatever is your annualized return, take that in the denominator and 72 divided by that number.

Prashant (16m 28s):
So for example, if your annualized return is 10%, approximately 72 divided by 10, which is 7.2 years, is how much that investment will take to double in value.

Phil (16m 40s):
Okay. Yep. So can you give us a real world example, just give us some numbers, put that in context of numbers.

Prashant (16m 47s):
Yeah. So, so, so say for example, a more common example is somebody buys an investment property and an investment property was worth 500 K and in seven years time, that's become a million bucks and we're talking pure capital growth here. Yep. Now the return from a PR annualized is roughly about 7%. Yep. So if in 10 years it's doubled, that's a 7% annualized return. Now what's missing is the fact that you've also put in a lot of cost into this. And so all of those costs eat into your return. And so the actual number is a bit lower than that.

Prashant (17m 30s):
So coming back to your question on what's the importance of that annualized return, it's not only important to look backwards, but also to look forward and see if I continue on the same trajectory, I'm going to achieve certain goals and certain milestones with regards to my own portfolio. And that's where it becomes a really useful tool. And then we can further break down the annualized return into components like capital growth and dividend growth and currency fluctuations and so on.

Phil (18m 3s):
Yep. And because I'm the cost basis, just going into the complications of it, if you're doing a dividend reinvestment plan, for example, your cost basis is going to be affected by every one of those dividends. Isn't it?

Prashant (18m 16s):
Absolutely. And this is another area where Sharesight does an amazing job of keeping track of your cost basis. So what happens is every time a dividend is declared, so say every six months you have the option of either taking the cash out or reinvesting that dividend in the form of dividend reinvestment plans in both cases, irrespective of what your decision is, you've got to pay taxes. So let's park that for a second. But coming back to the dividend reinvestment plan at each six months cycle, you've got a certain cost basis on which that particular stock has been bought. So literally what, what you're doing is you're buying the stock at, at, at a new price for that dividend value.

Prashant (19m 3s):
And over time you have whole parcels of shares that all have different cost bases.

Phil (19m 9s):
They've all been bought at different times and some are higher. Some are lower. Yeah,

Prashant (19m 12s):
Yeah, exactly. Now I actually have a dividend reinvestment, but one of my first investments, which is a very famous Australian listed investment company called AFI or AFIC, I've opted in for dividend reinvestment. Originally I bought 300 shares in our 300 units of this listed investment company. And over time, you know, I've been accumulating small little, you know, four shares, five shares every six months. And that total's now come to about 380 I think. My broker actually shows that I have 380 shares, but attributes the cost at, which I bought the original 300 shares.

Phil (19m 59s):
That's right. They don't adjust for that at all. There's no way of any brokerage ever shows that do they?

Prashant (20m 4s):
No, they don't. And they don't, they actually don't know it. That's the biggest,

Phil (20m 9s):
It's five past the brokerage. Exactly. Broker. There's nothing. That's nothing to do with a broker.

Prashant (20m 13s):
That's nothing to do with the broker. Yeah. But because it's registered with your HIN number, it still shows up in your brokerage and then it adjusts the green or the red value against which you are evaluated in that case is just today's price that price when you bought it and times the number of shares you hold. And so that's like really basic information or even potentially incorrect information because it's not the complete picture. So the way we like to call it within our Sharesight, parlance is kind of a GPS with one half of the picture missing, or even like your side view and rave your mirrors one half missing completely.

Prashant (20m 57s):
And that's where all of the dividend reinvestment plans get tracked to a pretty high degree of accuracy from a cost basis. And you talk to an accountant when you do your taxes, that's literally music to the areas because just being able to track this is enormous number of hours of work, which you have solved for yourself. You're going to pay less accounting bill and the accountant is doing more value added stuff for you

Phil (21m 27s):
And LIC in this day of ETFs. Why did you go down the LIC route? But I mean, what was it about that that attracted to you? And I just wanted to preface this by saying that next year, I think is the hundredth anniversary of LIC in this country.

Prashant (21m 43s):
Wow. I did not, I did not know that. LIC and particularly AFIC. So that's a bit of a rabbit hole on how I got into investing in the first place. I would actually break down my investing journey, to use a test cricket parlance, two innings. My first innings was in India and back in like late nineties, early two thousands

Phil (22m 9s):
On the nifty 50

Prashant (22m 10s):
On, in, on tech stocks. And this is what we did. Like I worked for a tech company and my tunnel vision said that is all that existed in the world. I work for one, everything is really awesome. And so that's the world of investing. So I bought into a number of tech stocks, which, you know, only a couple of years later went to complete bust. And so when investing kind of reduced in importance for me, and it sort of like stayed in more of a background thing. And then when I moved to Australia and, you know, got through the whole motions of settling down and things like that.

Prashant (22m 50s):
And when I was ready to invest, one of the first investing related blogs that I came across was that of the barefoot investor and the barefoot investor always used to recommend AFI our AFIC as a really important means of generating income for the long-term.

Phil (23m 10s):
And, and that, that that's the days before ETFs as well. So that's why they were

Prashant (23m 15s):

Phil (23m 17s):
Taking the role of an ETF ETF kind of structured

Prashant (23m 21s):
Exactly. They were doing the role of an ETF. Now again, to zoom out and look at LIC is it's also the fact that they're more actively managed. And I think one of the best known LICs globally is Berkshire Hathaway. It's not called that in the US but yeah,

Phil (23m 42s):
It's a particularly Australian sort of English, I think, name as well. Isn't

Prashant (23m 46s):
It? I think so. I might even just be Australian. Yeah. So this particular LIC, which is AFI or AFIC came with glowing tributes and reviews from the barefoot investor. And when I looked at their annual reports and the companies that we're investing in, it gave me a high degree of exposure to pretty solid blue chip companies within the ASX mainly, and also had a little bit of diversification. So if you see the overlap between an LIC like a AFIC and ETFs, there's a high degree of overlap. The only advantage I might say, an an C might have is when it comes to more downturns, they are probably more active in managing that portfolio and drive towards safety.

Prashant (24m 39s):
Whereas an ETF realized pretty much passively for the index index to reflecting the index, to work itself out.

Phil (24m 47s):
And I believe they keep cash reserves as well to keep on paying dividends for considerable periods of time through market downturns.

Prashant (24m 55s):
Absolutely. So they, there that's the other part because they're more actively managed. They have the luxury of doing that. The other component, particularly for people closer to retirement is the amount of franked dividends that LIC is pay.

Phil (25m 13s):
Yeah. Because they can pass on the Franking, although ETFs can do that as well. Can't they

Prashant (25m 17s):
ETFs can do that, but they potentially generate products that have a higher degree of franking credits. Yep. That's right. And you know who doesn't like some good income that's coming at a, at a nice little discount.

Phil (25m 30s):
And of course the other thing with LIC is as opposed to an ETF and a essay and ASX 200 ETF is going to have the 200 top stocks in the ASX, but why do you need to own all four banks, five banks, if you include Macquarie or, you know, there's going to be still a couple of dogs in there as well that are not worth owning and an actively managed LIC will hopefully take out all of the dross.

Prashant (25m 54s):
Yeah, absolutely. And I think that is the advantage of that. And I think it does have a higher concentration of say the ASX 20 and potentially a few other really good performance from within the ASX 200 as well.

Phil (26m 10s):
And how about now, how's your investing? I mean, without giving way too much details and personal information, but what's your investing style looking like now?

Prashant (26m 18s):
Yeah, I would say very much on the value investing side. I'm a little

Phil (26m 23s):
Individual shares and stocks,

Prashant (26m 25s):
If you, I do have a few individual stocks again on the back of some research. And also I have caught on a couple of trends as well. I wouldn't say I'm completely immune to it, but I would say in terms of my core and satellite, a majority of the core would be ETFs and supplemented by a satellite, a few individual stocks.

Phil (26m 51s):
Okay. We've gone down a couple of rabbit holes Prashant, but the, the original reason we were going to call about this is because of a blog post that I saw you write about corporate actions and of course Sharesight tracking corporate actions. So what are corporate actions and why do they need to be tracked? And can they be troublesome in tracking?

Prashant (27m 10s):
Great question, Phil and yes, I love corporate actions. Absolutely. So corporate action is any event that's initiated by a publicly listed company that brings an actual change to equity or debt and in the case of other instruments debt, but in the case of stocks, it's, it's primarily equities and basically examples of corporate action. So the way a corporate action works is the board of directors of a company approve a certain action to be taken and therefore results in something significant with regards to share holding of the company, examples of corporate actions.

Prashant (27m 58s):
The most simple one that happens very regularly are dividends. Dividends are paid out quarterly or half yearly. Other examples which happen less frequently are things like stock splits. Other things like demergers or spin-offs M&A is another really important one. Mergers and acquisitions companies might decide to amalgamate due to whatever reason

Phil (28m 26s):
The buybacks buybacks

Prashant (28m 27s):
Buybacks is another

Phil (28m 29s):
Really buybacks

Prashant (28m 30s):
Share buy backs at another set of corporate actions.

Phil (28m 33s):
So overall, this is basically a change in the number of shares on issue is that they basically all boil down to that at some, in some fashion,

Prashant (28m 43s):
You could say that, and each of them have their own little nuance, so we could go through each of them and why it's important for individual shareholders to actually track them. And in terms of like your other question on why is it difficult and what are the implications of not being able to track these corporate actions? I'd like to give an example from the financial advice world where I think last year Westpac was in trouble, because a lot of people using one of the wrap platforms were not informed or like the financial advisors could not inform their actual clients of corporate actions.

Prashant (29m 28s):
Now, when you are able to inform your clients or customers about certain corporate actions, they can then make informed decisions about investing in that particular stock. So for example, if you have a stock split as an example, the company stock has split that does not change the overall equity of the company at all the, or the market cap. It's just that suddenly now the stocks have been made more affordable or at the time.

Phil (30m 1s):
So the face value of each of each share is say, halved in value.

Prashant (30m 6s):
If it's

Phil (30m 7s):
An apple, Apple's a great example of this. They've just been doing slot stock split after stock split for years, haven't they, whereas Berkshire Hathaway haven't done it. So that's why their stocks are worth. I don't know how many hundreds of thousands of dollars.

Prashant (30m 19s):
Exactly. And I think like just last week or the week before last Google split a shares, a one to 10, mm. The stocks were going at about 1500 to 2000 range, and now they've dropped down to the 150 mark, like at the moment. So why would a company do this? So nothing's changed. So for example, as an individual investor, if I had one chair of Google, I now own 10 shares

Phil (30m 50s):
With 10th of the value,

Prashant (30m 51s):
But worth 10 10th of a value. Yeah. And the reason a company would do this is just to signal to the market that there's a lot more growth. There's potentially a certain mental barriers involved in this. It's, it's much more of a human psychology thing where they don't want a stock worth more than a thousand bucks or 2000 bucks. And then it becomes really hard and therefore to make it more affordable, to more investors, the stock value drops and that you're compensated with that many more number of shares in the company so that you can kind of pick that dip down and then start over again and let the runway carry the flight that way.

Prashant (31m 34s):
In a reason why a stock split is really important to track as an individual investor, again comes back to adjusting the cost basis. So if I bought shares in a certain company, so like say a Google, as an example, let's assume that I was lucky enough to get them at a really cheap rate back in the day when it was just a hundred bucks. And then that ran up to 1500 bucks or our time it went up into the two thousands. But then now it's kind of pulled back in the whole tech, pull back as a whole, and it's the cost basis that needs to be tracked very accurately.

Prashant (32m 14s):
Should you actually decide to sell at a later date? And this is the reason why a portfolio tracker like Sharesight will help you track that cost basis. And we automate all of this completely and you'll, you'll be able to see the cost basis and therefore get the true return of that information. Another corporate action that happens every now and then is a bonus share. Sometimes the company is really happy with their performance and they want to reward investors with, with an additional share.

Phil (32m 51s):
And I can't think of any better way to spend the money to make more money.

Prashant (32m 54s):
Exactly. So that's another example. Shareholders are given a bonus share. Again, it's really important to adjust the cost basis. It's not that you got that for free, that like they said, there's nothing called free lunch. It's, it's again, an example of where that share acquires are inherits half the cost. If it's a one Institute bonus when it comes to accounting purposes and capital gains purposes. So again, in your true return information, that plays an important role.

Phil (33m 27s):
Okay. So if listeners want to find out more about Sharesight, they've talked about some of the benefits here as well. And we will mention my promo code or my affiliate marketing link, which I just want to in full disclosure, you will, you'll get four months free by using my affiliate link and I will get paid a commission, but that's just one of the ways I run the podcast, but I'm only talking about products that I believe in like Sharesight. So tell us a bit more.

Prashant (33m 52s):
Yeah, absolutely. So the easiest way is we are completely online. So share is our website. Like you say, if you go to, Phil's a specific URL, which I'm sure he'll link in the show notes,

Phil (34m 6s):
And I'll tell you, now it forward slash shares for beginners,

Prashant (34m 10s):
And you'll get that additional four months free on Phil's link. And the way it works is we are a freemium product. So up to 10 shares is completely free up to 10 holdings. So it can be shares, ETFs, anything you want,

Phil (34m 26s):
You can just try it out and see if it works for you. Yeah,

Prashant (34m 28s):
Exactly. And you know, for beginner investors and for anyone getting yourself familiar with investing in a risk free manner, you know, you can even use Sharesight as an educational tool and put in some investments portfolio, dummy portfolio. So for example, I've been trying to pitch my 11 year old son about investing. Now. He, his attention span for the amazingly interesting stuff that I have to say about corporate actions is pretty limited, but when it comes to talking about the companies that he uses, for example, you know, so for example, I created a portfolio saying, Hey, you use an apple iPad.

Prashant (35m 11s):
You use Minecraft, which is actually owned by Microsoft. So let's create a portfolio of all these companies that isn't it,

Phil (35m 18s):
You got Disney.

Prashant (35m 19s):
If you've got Disney, we've got a Nintendo. The only one that's not listed from among his favorite companies is Lego. That's still a private company, but pretty much all other products that he uses when it comes to education. You know, he uses Mathletics, which is owned by three PL. So it's just a whole portfolio of things. So you can do that for yourself. As an investor, look around you, look at all the products and subscriptions that you have just create a dummy portfolio and see how that portfolio performs over time. You know, you can, you can put in a dummy portfolio that began say two years ago, or five years ago, whatever, have you, and, and see how you can get yourself to understand the mechanics of the stock market and particularly off your own portfolio investing and the decisions that you, that you make.

Prashant (36m 17s):
And that's a really good way to learn about the share markets in general, just

Phil (36m 23s):
Watching it, just watching what's happening. Yep.

Prashant (36m 25s):
Yeah, exactly. So it's, it's like, it's like the game before, you know, the, the, the real thing

Phil (36m 32s):
Prashant Mohan. Thank you very much for joining me today.

Prashant (36m 35s):
Thank you so much, Phil. I've had an absolute blast talking to you at this time.

Phil (36m 39s):
If you found this podcast helpful, please tell a friend, especially if it's someone who needs to start thinking about investing for their future, you'll be helping them and helping me to keep this show on the road.

Chloe (36m 49s):
Shares for beginners is for information and educational purposes, only it isn't financial advice and you shouldn't buy or sell any investments based on what you've heard here. Any opinion or commentary is the view of the speaker only not shares for beginners. This podcast doesn't replace professional advice regarding your personal financial needs circumstances or current situation.

4 (37m 9s):
And thank you for listening to my podcast.

Shares for Beginners is for information and educational purposes only. It isn’t financial advice, and you shouldn’t buy or sell any investments based on what you’ve heard here. Any opinion or commentary is the view of the speaker only not Shares for Beginners. This podcast doesn’t replace professional advice regarding your personal financial needs, circumstances or current situation