# I just found out what type of investor I am... (just sharing a story)



## MrMike (Sep 30, 2020)

I had $5K to invest and my plan was to put it all into Netflix. They're at $511/share and I truly believe that price will go up, way up; I believe they will be worth a lot more in the future. So that was my plan come Monday morning.

On Saturday I asked my 8 year old his opinion, should I invest in Netflix or Disney. He said Disney which I expected. I asked "Why? You love watching Netflix.". He replied "Yes but Netflix streams video and that's it. Disney has Disney +, makes movies, has theme parks and sells toys." I thought to myself.... holy [email protected], this kid is right (technically speaking Netflix does make original movies and shows and I'm sure they do have Stranger Things T-shirts, but I get what he's saying).

I do think Netflix will be huge but realistically, its possible for to have less market share in the future. So if I bought their stock, I could only make money with capital gains. I would be "checking in" more often to check the price.

Where as companies like Enbridge, Bell or any of the banks, I've always said who cares about the price because as long as they're paying dividends, it's worth it. But with Netflix, you don't get dividends, you don't have that advantage. I get Disney doesn't pay a dividend right now because they froze it a while back but they're more like to start paying again than Netflix is to start paying. Also, because Disney has multiple income streams, I feel like they are the "safer" bet when compared against each other.

So what type of investor am I? I'm not the type to invest in Netflix, Tesla, companies that are growing and not paying a dividend. I understand you can make a lot of money by investing in companies like these but that's why I'll never become rich in the stock market. I'm more a "slow, steady, collect dividends, see smaller capital appreciation" type guy.

PS - I suppose I could invest in Netflix but it would have to be with money I'm OK losing if that happened. Like if I collected $3K in dividends/month, I wouldn't mind throwing some in Telsa, etc... just to see what happens. But when I'm working for the money, I don't want to risk it.


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## Money172375 (Jun 29, 2018)

Don’t get too hung up on “top line” revenue or all the cool stuff a company produces. GM sold the most cars and the largest variety of cars for decades, and look what happened to them. There‘s a lot more to a company than what the average person “sees”. 

if it’s just play (gambling) money, then have it.


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## bgc_fan (Apr 5, 2009)

MrMike said:


> On Saturday I asked my 8 year old his opinion, should I invest in Netflix or Disney. He said Disney which I expected. I asked "Why? You love watching Netflix.". He replied "Yes but Netflix streams video and that's it. Disney has Disney +, makes movies, has theme parks and sells toys." I thought to myself.... holy [email protected], this kid is right (technically speaking Netflix does make original movies and shows and I'm sure they do have Stranger Things T-shirts, but I get what he's saying).


You're underselling Disney. Think about every franchise that they have: Marvel, Star Wars, and Fox properties. Which is all aside from their Disney holdings, and Hulu+.


https://storage.googleapis.com/titlemax-media/1c8ace8f-every-company-disney-owns-13_pageversion-lg.jpg



When you talk about moats and entries to barrier, Disney has a pretty large one.

That aside, back to your original point about Enbridge, Bell and banks. They are pretty established and aren't going away any time soon, having the same moats and financial security. Bank and telecom competition is pretty non-existent in Canada, unless there is some really disruptive technology, but even then they would adapt.


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## MrMatt (Dec 21, 2011)

bgc_fan said:


> When you talk about moats and entries to barrier, Disney has a pretty large one.


Netflix has the broadest and most comprehensive dataset on viewer behaviour.
They've also shown they can effectively target those audience with content specifically for them.

I expect Netflix and Youtube will be fighting to own targetted microaudiences.
Disney is in a different space, they have the mass market.
Everyone at least knows about marvel or star wars, even if they don't watch all the content.

I'm long Google & Disney, I simply haven't had the funds to buy Netflix.


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## bgc_fan (Apr 5, 2009)

MrMatt said:


> Netflix has the broadest and most comprehensive dataset on viewer behaviour.
> They've also shown they can effectively target those audience with content specifically for them.


Here's a question, do you subscribe to Netflix? I only play with it when vacationing and the rental has Netflix available. People will rave about the amount of content, but personally, it's like subscribing to 100+ TV channels, there's a lot of content, but nothing to see. You can argue that I'm not targeted because I don't have a profile, which is true, but there's nothing really that attracts me.



MrMatt said:


> I expect Netflix and Youtube will be fighting to own targetted microaudiences.
> Disney is in a different space, they have the mass market.


You're kind of contradicting yourself here. Netflix is not targetting a microaudience, they'll going for mass market, otherwise they aren't going to go too far. Netflix is producing its own content to attract more subscribers, which is having mixed success.


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## Eder (Feb 16, 2011)

Most of the pandemic stocks are presently getting repriced to more realist values...as are the stocks that fell out of favour due to the pandemic. 

Netflix might be a lot higher in the future but maybe not. They are a pretty concentrated one trick pony bet on streaming average content....no moat at all.


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## MrMike (Sep 30, 2020)

bgc_fan said:


> People will rave about the amount of content, but personally, it's like subscribing to 100+ TV channels, there's a lot of content, but nothing to see.


I've been a sub for more than 10 years. Part was because I have kids and their content on demand is awesome. Personally, my go to is Brooklynn 99 and Superstore. I can watch those over and over and over again. So awesome!!!



Eder said:


> Netflix might be a lot higher in the future but maybe not. They are a pretty concentrated one trick pony bet on streaming average content....no moat at all.


My wife pointed out that they do make original movies and some have even won Oscars (I don't keep up with awards). So they're not really a one trick pony, they do create content - I really enjoyed The Witcher, and to a lesser extent Stranger Things.


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## cainvest (May 1, 2013)

MrMike said:


> My wife pointed out that they do make original movies and some have even won Oscars (I don't keep up with awards). So they're not really a one trick pony, they do create content - I really enjoyed The Witcher, and to a lesser extent Stranger Things.


I normally don't watch netflix but Queen's Gambit was a very good mini-series done by them.


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## bgc_fan (Apr 5, 2009)

MrMike said:


> I've been a sub for more than 10 years. Part was because I have kids and their content on demand is awesome. Personally, my go to is Brooklynn 99 and Superstore. I can watch those over and over and over again. So awesome!!!
> 
> 
> 
> My wife pointed out that they do make original movies and some have even won Oscars (I don't keep up with awards). So they're not really a one trick pony, they do create content - I really enjoyed The Witcher, and to a lesser extent Stranger Things.


I mean, it works for you, not for me. Keep in the mind that the content they do create is why they have a high burn rate and will affect their bottom line. For every Queen's Gambit, there's a Marco Polo.

Edit: I'll just add that there are a lot of free options: CBC, CTV Throwback, Tubi.TV where I find that there is enough content to keep me occupied.


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## P_I (Dec 2, 2011)

This is starting to sound a bit like the philosophy that guided Peter Lynch and was published in his book _One Up on Wall Street_ (1989). It is a good read.


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## MrMatt (Dec 21, 2011)

bgc_fan said:


> Here's a question, do you subscribe to Netflix? I only play with it when vacationing and the rental has Netflix available. People will rave about the amount of content, but personally, it's like subscribing to 100+ TV channels, there's a lot of content, but nothing to see. You can argue that I'm not targeted because I don't have a profile, which is true, but there's nothing really that attracts me.
> 
> 
> 
> You're kind of contradicting yourself here. Netflix is not targetting a microaudience, they'll going for mass market, otherwise they aren't going to go too far. Netflix is producing its own content to attract more subscribers, which is having mixed success.


I subscribe to Netflix, it has enough good enough content to satisy my <1hr a day of TV.
yes it is like subscribing to 100 channels, for $12/month.


As far as Netflix targetting a microaudience, I think that's the future. Maybe microaudience was the wrong term, I'm thinking niches that don't have widespread appeal, and honestly I'm posting/writing to think it through myself.

They do have the big mass market attempts. But they are also trying to target specific niches. 
I think they will continue this trend and use their data to target those audience more strategically.

If an audience is worth $2M to them, then they'll know to spend up to $2M to get content for that audience. I don't think anyone else will be able to do that as a competitive strategy.
Short term it will lead to precise bidding on content.
Medium long term, it will lead to precise budgeting for specific content.


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## MrMatt (Dec 21, 2011)

cainvest said:


> I normally don't watch netflix but Queen's Gambit was a very good mini-series done by them.


I think that's really the point, that series has no appeal to me.

However if they routinely deliver a few hours of "very good" content every month, people will likely pay.


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## Eder (Feb 16, 2011)

I cancelled Netflix awhile back for various reasons but now my T-Mobile account throws in a Netflix account at no cost. I wonder if I am a "new" subscriber for their quarterly report even though I'm not really.


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## MrBlackhill (Jun 10, 2020)

bgc_fan said:


> Here's a question, do you subscribe to Netflix?





MrMatt said:


> As far as Netflix targetting a microaudience, I think that's the future. Maybe microaudience was the wrong term, I'm thinking niches that don't have widespread appeal



Yup, depends of your target audience. That's me and my spouse. We don't have cable because we don't need anything more than Netflix. My spouse has been binge watching series for years non-stop and she still finds stuff to watch. Myself, I have never found enough time to watch everything I'd like to watch on my list. We're watching almost exclusively quality foreign content, mostly series, something that we can't find elsewhere. So many people pay $100+/month for cable+Internet. We have Netflix at $15 and Internet at $35. That's it.


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## cainvest (May 1, 2013)

MrMatt said:


> I think that's really the point, that series has no appeal to me.


Not good for everyone of course but most people I know thought is was very well made, a friend recommended I watch it.



MrMatt said:


> However if they routinely deliver a few hours of "very good" content every month, people will likely pay.


Yes, if they could make good "new content" every month they'd have a winner system. I browsed their inventory after each show ... very little interested me and many shows I've seen already. I personally wouldn't pay for right now.


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## sags (May 15, 2010)

Netflix has tens of thousands of movies that aren't on the main browsing screen.

They are available by using the search bar by entering a letter of the alphabet.

You can also access specific genres of movies by the Netflix codes.

I don't know if it is kept updated but appears to still work.



NetFlix Streaming by Alternate Genres


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## james4beach (Nov 15, 2012)

P_I said:


> This is starting to sound a bit like the philosophy that guided Peter Lynch and was published in his book _One Up on Wall Street_ (1989). It is a good read.


Yeah I was going to say this too. It's Lynch who started selling this narrative that you just have to think of companies you use, and those are good stocks.

It's silly. This is not how to build a stock portfolio; this is the "pop culture" view of what stock investing means.

His book might be interesting, but there's no reason to listen to Lynch. He had a very short track record in the middle of an extremely powerful bull market (easy to have strong returns). There is no reason to believe he's particularly good at stock-picking. He did not even manage his portfolio through a single downturn.


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## Eder (Feb 16, 2011)

*Magellan Fund +604%

S&P 500 Index +233%*

Oh...and he managed his fund thru 1987...-22.8% in one day on Black Monday...bit of a downturn?


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## james4beach (Nov 15, 2012)

Eder said:


> Magellan Fund +604%
> 
> S&P 500 Index +233%


Meaningless; his track record was very short, and he quit before a market downturn.

You've got to think critically about these kinds of things, otherwise it's easy to be fooled into thinking results are "amazing" when they are meaningless.


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## Eder (Feb 16, 2011)

...he spanked the S&P with Dunkin Donuts & Taco Bell.

"Hold no more stocks than you can remain informed on." was a common quote of his.

Bit contrary to todays "aim to be average we all get a ribbon" investing though.

Fun quick read... 









Peter Lynch Turned His Wife's Retirement Account Into $11 Million - After Dinner Investor


I got an awesome surprise today. This morning I woke up with the intention to enjoy my Saturday and to do a lot of reading. But this afternoon when the mail arrived, I got hit with a day-changing surprise. Barron’s arrived and the legend, Peter Lynch, was on the front cover! I stopped what I […]




afterdinnerinvestor.com


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## P_I (Dec 2, 2011)

james4beach said:


> Yeah I was going to say this too. It's Lynch who started selling this narrative that you just have to think of companies you use, and those are good stocks.


My point was more to the OP that their 'strategy' or 'type of investor' theme isn't new and if they wanted to learn more about it then the Lynch book was a good read. 

Investors should always be open to learning and educating themselves. And don't just read material that confirms your bias, keep your mind open and learning. I've probably learned more from reading and listening to things I disagree with, it gives me pause to ponder my own thought process and whether I there is a better way or a slight modification or improvement I can make.


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## MrMike (Sep 30, 2020)

P_I said:


> My point was more to the OP that their 'strategy' or 'type of investor' theme isn't new and if they wanted to learn more about it then the Lynch book was a good read.


OP here  I wasn't really saying I had a strategy and it's new but more that I always thought of myself as able to handle volatility. I could buy a stock, watch the price go up and down and not care. But what I realized is that I don't care because I was buying for the dividend and small growth over long term. Where as with Netflix, the first stock I considered buying without a dividend, I was more scared that the price would fall and never recover, and ultimately decided not to buy because I didn't want the stress. 

I was just sharing. It feels really good to know yourself more.


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## MrMatt (Dec 21, 2011)

Eder said:


> ...he spanked the S&P with Dunkin Donuts & Taco Bell.
> 
> "Hold no more stocks than you can remain informed on." was a common quote of his.
> 
> Bit contrary to todays "aim to be average we all get a ribbon" investing though.


If your goal is to be slightly better than average, an index based couch potato is virtually guaranteed to get you there.
Remember, if things get too bad, the government will just seize assets and redistribute anyway.


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## Just a Guy (Mar 27, 2012)

I bought Disney a few months ago when it bottomed. Every marvel film adds about $1B, their parks, merchandising, streaming, properties (Star Wars, Pixar, marvel, etc.) can’t even be seriously compared to Netflix. They even repurposed the parks to host the nba finals Last year. These guys know how to print money. I’d have to check, but I’m pretty sure I doubled my investment already.


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## MrMike (Sep 30, 2020)

Just a Guy said:


> I bought Disney a few months ago when it bottomed. Every marvel film adds about $1B, their parks, merchandising, streaming, properties (Star Wars, Pixar, marvel, etc.) can’t even be seriously compared to Netflix. They even repurposed the parks to host the nba finals Last year. These guys know how to print money. I’d have to check, but I’m pretty sure I doubled my investment already.


Ya, I had about 10 shares prior to this and my avg cost was $97US. and when I put the $5K in, it was at $198  haha obviously i wish i had bought more at $100. but what can you do? I'm confident it will go higher than $200 in the future so all is well.


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## Just a Guy (Mar 27, 2012)

So, you never really said what you learned about yourself...for me Disney was a value buy and a long term hold as well as being on sale because of covid...that fits with my being a buy and hold, value investor who buys stuff he knows and uses when it comes on sale...I learned that about myself when I tried, and failed to buy a pump and dump stock and cash in...didn’t work since I don’t like to follow the market.


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