Episode 022 - Nick Roberts - From Rockstar to Successful Investor | Limeworks

Episode 022 - Nick Roberts

From Rockstar to Successful Investor

Nick Roberts has performed opening acts for Bon Jovi and toured the USA with his band October Rage. While cherishing those experiences, he's found a passion for investment. 

Launching his book The Rockstar Investor he's sharing his knowledge with a growing worldwide audience.

We talk about life on the road, lessons learnt from investing, how mindset can change your life, and so much more. 

See more from Nick:
https://www.therockstarinvestor.com/
https://www.facebook.com/therockstarinvestor/

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Transcription

Please note, while an effort is made to provide an accurate transcription, errors and omissions may be present. No part of this transcription can be referenced or reproduced without permission.

Rob: So Nick Roberts, the rock star investor. Thanks so much for coming on the podcast today.

Nick: Thanks for having me, mate. Good sport you got here.

Rob: Thank you.

Nick: Love it.

Rob: And it's really cool, we did manage to get you in the studio. Doesn't happen quite so much at the moment, but. But nah, it's really cool. So you've obviously got a book out, The Rockstar Investor, and doing some really cool things there. And we'll get to that shortly. But I really want to sort of go, wind the clock back a little bit. And, because I know you're actually the front man for your band, October Rage. But one of your claims to fame is that you opened for Bon Jovi back in about 2010, if I'm not wrong there

Nick: Yes. That's correct. Yep, yep.

Rob: So, I think there's a pretty cool story there. Can, can you give us a bit of a rundown of how that came about?

Nick: Yeah, so I started that band with my brother Will. And we were kind of semi serious to begin with. But then we eventually decided, hey, this is actually a really cool avenue. We want to do this professionally. It'll get us attention from girls and all the rest. So we were like, yeah, let's definitely do it. And it wasn't too long into our career when we heard this ad for this radio competition where your band could be the one that plays in front of Bon Jovi in front of fifty thousand screaming fans. And we were like, okay, well, you know what, what could possibly go wrong? Let's just submit and see what happens. And then eventually we got a call and it said that you're in the top five for the public vote. And that was kind of like, you know, if you get to that final stage, then it's up to public vote. You've got to get all your fans to vote. And if you win that final round, then you're the band. And so we were like, okay. So for the last, for the next two weeks, we just didn't sleep and we just went absolutely just great guns, just going like spamming everyone we knew. We spammed letterboxes. We just like, you know, started all these Facebook chats and everything. And finally we got the call saying that we'd won and that we were gonna, you know, be the opening band for Bon Jovi, which, who at the time in 2010 was the largest grossing live performer, I think. So that was like, you know, we get to jump on one of the biggest tours, briefly, for, you know, for that whole year. And so, yeah, we were so stoked. And then obviously going there, playing the shows, they were freaking awesome, there were like 50,000 people in Sydney Football Stadium, which is what it was called at the time. And man, the sound the audience makes when you get them excited is just, you can't, there's nothing to compare it to. It's like that scene in Gladiator where he describes what it's like inside the Colosseum,

Rob: The absolute roar of the crowd

Nick: Yeah. It rises up like a storm and that kind of stuff. So that's kind of what it was like. And then we got to meet the band and meet John and everyone. And man, he is a humble do like he so cool. And he was like full of all this, like, friendly advice. He was like, yeah, come get a photo for like a promo op and that sort of stuff. We were like, wow, this is really cool. And if I wasn't so star struck, I probably would have remembered half of what he said, because he was just so cool and so down to earth. And I wasn't expecting that. But it's cool and it kind of inspired me, like if I ever get to that level, that's how I want to be. I want to be humble. I want to be down earth. I want to be, like, relatable, you know? And so from there, it just kind of took off. We, like, made good friends with the crew and the crew were really awesome people like, they were just so cool. And they were like, "you know, you should come to the states. We've got some people who can help you out with like a smaller tour, you know, off your own bat kind of thing". We were like, Yeah, okay. We'll definitely do that. And so we did. And that's what got us into the United States. And from there we just hit the road and never stopped kind of thing.

Rob: That's cool. I did wonder about how you got to the states. And we'll touch on that in a second. But was there anything that you kind of picked up, you know, recognizing that, that Jon Bon Jovi is, like, really humble and cool and, and just really smooth, was that sort of surprising or was there a bit of life education of, you know, what it's actually like to be a successful rock star?

Nick: Yeah, I kind of did think that, like, it gave me hope that it wouldn't change me if I did get that success. Like, I've always thought that, you know, absolute power corrupts and all these kind of things. And I'm like, man, I hope I can, you know, stay on the ground if that ever does take off. And it kind of gave me a little bit of hope knowing that that is a possibility, because he's just, he's all about service and he's all about people like he's got these awesome soup kitchens and stuff in the states where you just go there and pay what you can afford. And if you can't afford anything, then it's free. And it's just like he's a philanthropist and all these other things that he's just so helpful. And that was the biggest part that I thought was the most inspiring, because, like, if I can be in a position to do that, then, you know, that'll make my whole life, you know, that that'll be the epic moment where I can just be like, yeah, that's why I'm here. I'm here to give back and I'm here to provide value and to serve others and that sort of stuff.

Rob: That's really cool.

Nick: Yeah.

Rob: And certainly, like Jon Bon Jovi's had a, You know, like, what, 40 year career in, you know, in in music now. And so there's certainly some interesting lessons that that can be learnt there. So you guys decided to kick off a US tour and there's probably a few expectation versus reality moments there. Can you get can you give us a bit of a rundown about that experience?

Nick: Yeah, so it kind of started off like we thought like, oh, this is gonna be great. Like, you know, the expectation. You see those memes, on Facebook where it's like expectation and it's like crowds and girls and all this kind of crazy stuff going on. But reality is, it's like, you know five dudes sitting there on their phones, bored out of their minds. But really, what kind of, the best, like the short version is that when we did hit the road, we had shows to start with, but then they kind of dried up. And we ended up with kind of no money. We were living in our van for a while in Los Angeles and there were six of us with our gear all packed inside this van, kind of camped by the beach. And we were like so broke and we couldn't afford a hotel. We were so broke that we would go to the, like the McDonald's or whichever restaurant there is and they'd have these, like these one dollar menus and you can get like a one dollar burger or one dollar sandwich. And we get that we'd cut them in half so that there was enough to go around. And I just remember feeling like, man, this is just this isn't how it's meant to be. Like, I was totally thinking it would be something completely different. And it was then I kind of had like a bit of an epiphany. And I was like, imagine doing this, but having money to do it, that would totally change the game because then, you know, we could get a big tour bus and we could go on tour with whoever we wanted. And we didn't have to, you know, play these little shows that no one cares about, no one comes to. And so that was kind of like the moment where I'm like, well, I could just pack it in and go home, or I could just stick it out and see where this goes. And, you know, here we are all these years later and still doing it. Still touring from time to time, not as much now, obviously, there's COVID and everything. But it's still a lot of fun. Just finished writing a new album and man, it's just, it's exciting. But yeah, we didn't think that anything was gonna happen like that when we were in that spot. And we were just like, well, you know, how will we get out of this mess? Like, they're just, like it seems hopeless. So that's a far cry from what we expected, obviously, at first.

Rob: And because there were a few challenges along the way that weren't that long ago. I know you guys had a, your tour bus broken into.

Nick: Yeah.

Rob: You had the engine catch fire, that I think that was in the same year. And, you know, dealing with South Dakota cops and, and a few other things, I think I did see a photo where there was maybe five police cars pulled over, your, your bus on the side of the highway.

Nick: Yeah they searched the whole thing, man. Yeah, So we were going to the Sturgis Motorcycle Rally, and we were due to play there and we were really excited and we almost made it. And then this cop pulls me over, and I'm the guy driving the bus at the time. So I'm like, oh, you know what's going on here? He's like, "you got to step out the vehicle, man". We were like, okay. So he has me in his cop car and he's writing this report and like, "okay, you're in here because your windshield is, or your windscreen is is busted and it's you know, you've got to get that replaced, so here's a written warning. No, fine. Just a warning, all good". I'm like, okay cool, so. And then he's like, "so do you mind if we search the bus? And are we going to find anything if we search it?" And we keep like a pretty clean ship because, you know, we are from another country and, you know, we could get deported if we do the wrong thing. So we were just like, okay, let's just, you know.

Rob: 'Banged Up Abroad' appearance probably wasn't in your...

Nick: Exactly.

Rob: Yeah.

Nick: So we, we keep it pretty tidy. So I was like, yeah, it's cool, whatever, you know, go ahead and search it. Oh, there is a shotgun on the bus, just so you know. And he's like "yeah that's school, we, you know, we're cool with Second Amendment, whatever". And so anyway, then all these cops just start pulling up, and pulling up and there's like, yeah, about five cop cars and they all get on there and they're just tearing the place apart. And we're like, even though we're innocent, we're still freaking out because, like, "what if they find something and they think it's weird?"

Rob: That you don't think about.

Nick: Yeah,

Rob: Sure yeah.

Nick: It's just, and so they, they get off the bus and they're like, "come over here for a second". I'm like, oh, here we go. So I walk over to this guy and he's like, "so we found something on the bus". And I was like, oh, what is it? And he's like, "You've got this drawer full of posters. Would you mind signing one for me?" And I was like, Oh, alright. Yeah, that's fine. That's fine, absolutely. So we gave them all a free poster. We signed them all. And they were really, really cool. And they were like, "man, that's a tidiest tour bus with ever searched". It was like, all right, that feels good.

Rob: Tick.

Nick: Yep, so it could have been way worse. But yeah, that's just one of many things, like all these little hold ups, like yeah, tour bus catching fire at one point. We were driving through construction and just tons of smoke coming out the back. All these trucks are going past flashing their lights at us, like, dude, you've got to pull over.

Rob: Someone's dying.

Nick: Yeah, that's it. And eventually there was flames and everything, and we kind of had to abandon it for a little while and send somebody back to come and get it. But, yeah, it was just like everyone's freaking out and no one knows what to do. And yeah, we had to get somebody to pick us up so we can go and finish our tour. And we did, and we had like a lot of, the best, the best thing about the states is the people, like they gave us so much extra support. Like we had friends that bailed us out of tough spots, like I don't know how many times. And so, like, we can just like absolutely thank those people. We can't thank them enough because they just, they just, they will bend over backwards. Like, that phrase "Southern hospitality" that they have over there. That's probably true in most places in America. Like it's just awesome. So yeah, we are we're very thankful and we can't wait to go back there. Man it's an awesome spot.

Rob: That's very cool. One thing I'm curious about, having some interesting sort of, you know, rock star aspirations as a teenager, was, like you mentioned Sturgis before, which for anyone listening who's not aware is a massive, massive motorcycle event that happens in, is it Nevada?

Nick: It's in South Dakota.

Rob: South Dakota.

Nick: Yeah.

Rob: So, and so that was obviously a massive event, and it's probably comparable to say, Big Day Out, just with motorbikes.

Nick: Yeah,

Rob: Yeah.

Nick: Pretty much, yeah. So, like, they basically take over the whole town. It's not a huge town, but it's just, the town is built for the event. And so there's like all these different like fairgrounds and like stages that are permanently set up. And it's just huge, like and there's so many bikes and there's, like the sound man. The sound is awesome. So just like walking around town and just like seeing so many bikes, you've never seen that many bikes in your whole life. And I think, last time I went there, they recorded about two million bikes come through town, which is just insane. And I don't ride. I'm not very coordinated,

Rob: Sure.

Nick: But I love looking at them and I love the sound they make. And I'm just like, man, it was just so cool. But the the whole atmosphere is awesome because this is one big party vibe and it's throughout the whole town. You can grab a beer, walk across the street. No one's gonna bother you. It's just like, yeah.

Rob: It certainly sounds like an experience. What was it like playing something like Sturgis? And how does that contrast to, say, you know, just a small backyard pub?

Nick: Yeah, so it's very similar. You just have to make sure that you cater for the people that are watching you. So like bikers, obviously they have a certain style that is, you know, different from your typical, like 21 year old female audience member. So we just have to make sure that the set was really energetic and really kind of like the performance was really visceral kind of thing. But other than that, like it was still like, you know, business as usual. They were awesome. Like, we got a really good response. And, yeah. It was just as fun as any other gig, really. Just the fact that you're in Sturgis and it's like, yeah, this is actually pretty cool. There's bikes around and I get to play and it's awesome.

Rob: That's cool.

Nick: Yeah.

Rob: But so, in parallel to this rock star journey, you kicked off a bit of an investing career and I understand you worked for an investing company at one point.

Nick: Yes,

Rob: Can you give us a bit of a rundown on that?

Nick: Yeah, so when I first started investing, I started doing like a lot of options trading and that sort of stuff. Kind of learnt from my dad. I used to pester him. He was in his study, you know, just working away. And I'd be like, what's this book, Dad? What's his book? What's this book? And eventually he gave me one. And it was the Robert Kiyosaki's 'Rich Dad, poor Dad'. And yeah it's awesome, I've read it like five times now. And but he was like, "yeah, read this, see what you think of it". And so I read it. And I was like, I think I caught a bit of a bug when I read it because I read something in there about like passive income and assets and that sort of stuff. And I was like, I've got to get involved in this. And so, and that was just coming out of high school. So even before my music career was taking off, I was getting involved in this. And so, even though I put the investing stuff on hold when we went on tour and that sort of stuff, when I came back, it was somewhere around maybe 2014-2015ish. We were taking a break from the road and I started doing a lot more trainings and a lot, like classes and that sort of stuff because,

Rob: So this is self education?

Nick: This is self education,

Rob: Yeah.

Nick: And so to start with, I was not educated at all. I was just trading and doing what I'd read out of books. And it was working until I decided to get really, really impatient because I was like, "no, no, no, I want to be super rich and then, like, get a really nice tour bus", you know? And of course, I got really, really impatient. Started making a few dumb decisions and got the margin call on my account, which is when the broker says, "dude, you're overexposed on this account, and if you don't, you know, take care of these trades or top up your account with more cash, I'm shutting your trades down. And of course, I didn't have anything with which to do so. So I was like ah, bummer. And so, that was kind of like a painful lesson. And no one wants to get that call as a trader or an investor. But to me, it was kind of like a wake up call, like you really need to figure out exactly what it is you're doing. And so I started taking a lot more classes and started taking it really, really seriously. And it was about that time when I started, I signed up with this prop trading firm in Sydney. And prop trading is basically when you trade company money, like it's not yours, it's theirs, and hopefully you don't lose it. And thankfully, I didn't. But what they do is if you make a profit for that month, they give you like 80% of the profits. It's a really, really good deal. And so they've got all these traders on the trading desk. And I would go down there and I would trade. And from there, it kind of gave me like this huge bout of confidence, because if I can trade with other people's money, with leveraged instruments like things like forex and options, and, you know, all these other kinds of things, then I can do anything. And so after doing that, I started to get some people that were like, "dude, will you teach me? And I at first was like, no, nah, nah I couldn't teach. I don't even like teaching people how to play guitar or sing like, I'm just not a fan of that. But after a while, like, more and more people started asking, and then some people were like, well, you trade company money, do you want to trade my money? I was like, actually, that's a pretty good feeling, like people beating down my door asking me if I'll trade their money. I guess that's kind of cool, you know.

Rob: Sure.

Nick: But it wasn't until I went back on the road and was still just like, you couldn't shut me up about it. Like people would be like, you know, I want to talk about, you know, my favorite hair metal band. And I wanted to talk about investing. Like, it was just like, I got the bag back and it was just huge now and ever. And now I'm kind of like, I could say that I'm just as passionate about music as I am about investing. So, yeah, it's just like that's kind of how that started. It was just conversations. It was just talking to people. And I didn't really want at first to be like a stock market guru or anything. I still don't think I am. But I, that's kind of like, I didn't. That's not the path that I wanted to be on. You know. Because then I might have to talk on a stage. Heaven forbid. Singing on stage is fine, but, you know, when I get up there and start talking like, you know, what if I, what if my stutter gets bad or what if my dyslexia gets bad or whatever it is. And I was just like, I can't, I can't do it. I'm not going to do that. But then when I started to hear stories about people's, like their pension funds or their retirement accounts just like taking big dives because people doing dumb stuff on Wall Street, I was like, well, okay, maybe I, maybe I should help. And then if I remember back to Bon Jovi being inspiring, I was like, well, he exists to serve, why don't I just help other people? Make it less about me. And so now it's kind of a lot different because like, you know, this situation here where there's microphones and there's cameras and that sort of stuff, I would have freaked out at that previously. You know, that whole idea, like I think most people would like, you know, they'd rather get shot by a firing squad than do any kind of public speaking.

Rob: He.

Nick: But for me, it was once I started to think, "oh, it's for other people, it's not about me", then all that stuff just melts away and you just, you don't think about it anymore. So, yeah, that that kind of made the decision like, ah, maybe I should help people out with this, too.

Rob: That's pretty cool.

Nick: Yeah.

Rob: And so that that obviously led to writing the book Rockstar Investor. Was there a sort of a pinnacle moment where you sort of recognized that there was an opportunity there and this was something that you were going to commit to? And like, right now, I'm gonna write it?

Nick: Yeah. At first, I didn't want to write the book at all, because I thought this is going to require so much focus and I don't have focus like, you know, I can't do this. But then obviously that's, you know, a terrible voice in the back of the head that it's just, you know, all excuses and lies. So I, I sat down and I just bit by bit, time at a time, like before we'd hit the road that morning, I would ride a bit of the book. And I don't really know what I wanted the book to do or what I wanted it to be or what it, what it was even going to be called. I just knew that it was in there, and I was like, well, if I just tap into that creative part that writes songs, maybe I can use that to write a book that makes a bit of sense. And so, yeah, at first, to answer your question, I didn't want to do it. I hated the idea. And like, if you were to ask me to write another one, I'd probably again go, no, no I'm not going to do it. Even though I keep thinking about what the next one's gonna be anyway, so it'll probably happen. But it was wasn't until I think around like 2018 that I really started to think, okay, I've got the time to sit there and write, I'll do it. And because we weren't on tour at the time and I didn't really have much else going on because I was in the States, but not touring. And I was on a visa where you're not allowed to work, it's only music stuff. So I was like, okay, I got to do something while I'm here. So that's what I started doing. And once I started to write and it started to get a bit of flow going, then I couldn't stop. And I was like up to a point where I was writing like 2000, 3000 words a day, and started to actually really enjoy it and started to see what potential it might have. So, yeah, it wasn't too long before I kind of got a little bit of a bug for that as well. Not as much as the other stuff, but

Rob: Sure.

Nick: Yeah, still really good.

Rob: Because I've read a little bit of your book and and I really like, I can see your personality come through in it where, you know, you're using song titles, you know, to kind of like well-known songs,

Nick: Describe chapters, yeah.

Rob: Exactly. And I think, do you think that your songwriting history has sort of played a part in assembling that book in an entertaining kind of way?

Nick: I think so, because here's the thing, when you're talking about shares and investing and all this kind of stuff, to most people that's really boring. Like it is not a sexy topic, because this is like, when I start talking about chart patterns and, you know, market fundamentals and all this other stuff, a lot of people just be, like, zone out for a second here, let's let somebody else handle this. Like, I don't want to be in charge. This is boring. So you kind of got to explain it in a way that's kind of like relatable and fun and entertaining and that sort of stuff. So in the book, obviously, if you've read a little bit, I talk about how investing is like driving a car. Like you decide how much danger you're in at any given time. It's not the car that decides that it's the driver. And so I kind of have this analogy where if you're like, you know, taking turns at superfast speeds, and if you're just like, you know, driving recklessly, then you're probably going to end up in a gutter somewhere sooner or later. By the same token, if you're really shy and you know, you inch out onto the edge of your driveway and then inch back, you know, then nothing's going to happen for you there either. And so it's always the people that are most calm and collected that get from A to B and are most reliable drivers. So it's the same thing with investing. And So I kind of like, all those little analogies, I reckon they're the most important things when you're like, especially if it's someone who's just starting out, like they've got like a pool of funds, and are like, what should I do with this money? Like, how should I invest it? They don't know the jargon because often that jargon is there to keep people away from the industry and to keep them from doing, like they want you to hand your money over to somebody else who's a so-called professional. But really, no one's going to look after your money as well as you do. So,

Rob: And so you mentioned jargon there a little bit, and, so, you talk about investing and trading. Can you give us a bit of a rundown on the clear differences for someone who doesn't understand?

Nick: Yeah, cool. So for some people, it's the same thing. But for me, I kind of like I have them in two different groups. For investing, that's kind of like the more longer term, like kind of the safety bucket. Like, that's kind of where you would say, like, I want to trade like Warren Buffett does. Like I want to find a company that I would love to own myself and just buy into it. And I don't really care what happens from the day to day aspect. Like, I don't care if, you know, it's up two percent today and down one percent the next day. Like, I just want to see long term growth. I want to be involved in something that's like long term sustainable in a good company, like, and that's kind of how Warren Buffett does it, and, you know, certainly a big inspiration for me. Because that is the kind of investing where you take a bit more of a sniper approach. You sit back, you wait for the right time, and you buy when it makes sense. And, you know, you might plan on never selling. Like, you know, Warren Buffett very rarely exits a position that he is chosen to invest in the long term. So that's kind of like in the investing side. And then the trading side is more kind of like the short term, you know, kind of after a quick kind of capital gain. And this can be anything from day trading, which is like you sit there watching a market all day, or it's like position trading or swing trading where you're waiting for the price to bounce or, you know, hit a low and then come back up again. And you want to trade like that movement when it starts to change direction. That's kind of, you know, short term trading, as well as anything to do with like, I like to do a lot of options trading, so writing options, getting passive income from the share market that way.

Rob: Can you explain what the options trading is?

Nick: Yeah. So it's kind of like, I do this thing called writing covered calls, which is like a well-known options strategy for people who already like options. But in essence, the simplest way to put it is you have some shares that you own and you're renting them out for a monthly income. So, you know, a share that's trading at $50, you might write an option on the shares for fifty five dollars for that month and you'll get paid regardless of what what happens with those shares, you'll get paid in an income for that month just because you have essentially rented out your right to profit from those shares at anywhere above fifty five dollars. And so what that is, it's kind of like you're kind of selling off the future potential capital gain, in exchange for a guaranteed monthly income. And so, like, when we're looking at, you know, passive income strategies and that sort of stuff, like, that's probably one of my favorite strategies to do and probably one of the things I started doing. And I've never kind of stopped, really. So, yeah.

Rob: So essentially, because obviously everything has an upside and a downside. The upside is the consistent passive income. But the downside is that you may make less than you may have done if you held onto it yourself.

Nick: Yeah, that's right. So if you have, like chosen a really good stock and that stock goes up to like a hundred dollars, you would have doubled your money. And of course, yeah, that's a risk that obviously you have to take because in the market, there's no free lunch. There's always a tradeoff. So what is the tradeoff for you? And I guess it depends on your investing goal. Because if your goal is to get passive income and get a regular monthly income coming in, then you don't really care about the capital gains side, and you've shown that by, you know, sacrificing a portion of that. The way it works with trading covered calls is because if the price does go up and you're forced to sell your shares to somebody else, then at least you're still doing it for a small profit anyway. And so that's kind of the attractiveness behind that aspect. Obviously, if you want a capital gain and you think it's gonna go up real, real fast and sharply, you probably wouldn't do that. You probably just hold the position or something like that.

Rob: Sure. And for someone who's starting out, do you recommend a balance between these two, and, you know, between long term investing to sort of mitigate the down risk and something more risky to make potentially better profit?

Nick: Yeah, I kind of, look for me, that's that's how I like to do it. I kind of like have to, like I kind of like having these two different buckets. One of them being the longer term, like kind of like the portfolio manage side of things. And then another one where it's just like, I'm just doing small trades that will pay me every month. And so that's like a guaranteed income. And then this bucket here is like, we're just leaving that there and seeing what happens. And so, like, if you're, you know, funding your own investment account, you can just like, you can allocate that evenly or depending on your goals, like if you don't really want to spend a lot of time watching the market, you might go more into the investing side and less onto the trading side. Or if you really like the action and you find it a little bit exciting, you might do less of the investing and more of the trading. So it's really just personal preference mostly. Yeah, for sure.

Rob: Because on that, on that risk side, as you said, you know, you've found yourself in a bit of trouble with that before. And we know there's been a few highlighted challenges with, say, COVID and ASX volatility and people trying to time the market. Does that, is that some sort of a skill that you can develop over time? Not to time the market necessarily, because the market will do what the market will do, but but to mitigate that downside and take a more measured approach?

Nick: Absolutely, yeah. So, like I always say, no one's got a crystal ball, and if there was someone who knew exactly what the market was going to do at any time, like they'd be richer than God, you know, like it's just how it works. But what you can do is you can improve your odds. And to do that, you can mitigate risk. And I talk about it ad nauseum in my book, just because, like I feel like that is one of the most important parts to master. Like, if you're gonna quote Warren Buffett, he had the two rules. Rule number one, don't lose money. Rule number two, never forget rule number one. And so if we're going to take a leaf out of his book, then number one for me is just all about capital protection. And so what I like to do is if I'm in a position, whether I'm trading or investing, I like to have something in place, like some kind of insurance in place where if the market takes like a huge dive, like, you know, something COVID happens or, you know, another 2008 crash or something even bigger maybe, I want to know that I'm safe and I'm protected. And I want a good night's rest at night, too. So a couple of things that I do is there's these things called stop losses that you can get, where you have an automatic order sitting there in your trading platform where if the price goes down, let's say it goes 10 percent real sharply, I'll close out of my trade automatically.

Nick: There's also insurance, so you can actually insure your stock portfolio. A lot of people don't know, but it's called a put option. And sometimes really inexpensively, you can get these options that basically give you the right to sell your shares for what you paid for them at, regardless of how much or how badly they tank, which is just absolute gold for someone who wants to protect their position and wants to kind of go through their investing career not really worried or, you know, getting a restless night, because, you know, anything could happen at any moment. And we know that stocks, you know, do and can crash at any time. And so having that peace of mind is often worth it. And even, hopefully it's like insuring your car. Hopefully we don't need the insurance, but it's nice to have, if you do. And obviously like, that insurance becomes very expensive if the car is already on fire. Yeah. So.

Rob: Absolutely.

Nick: Yeah.

Rob: That's a good way to put it. So obviously you're an advocate for people taking control and getting stuck in and having a crack at this sort of thing. Do you think there's ever a scenario where you maybe wouldn't recommend it, and that they should just kind of, you know, hand that to someone who does know what they're doing so they can focus on where their passions are or what they're good at?

Nick: Yeah, I think that if you're a very emotional person, then trading is not your thing.

Rob: Sure.

Nick: Obviously, that can be managed and you can work on that. But emotion is the enemy of trading and investing. It's usually, like if we look at where I was, I was impatient, and I just wanted to get rich real fast. Yeah, that was emotional trading, you know, I was overexposing myself because I wanted a result quicker than, you know, was realistic. So, yeah, emotion has really no place in trading whatsoever. And the more you can make trading mechanical and do it from a calmer, more objective perspective, the better it's gonna be for you, like if you look at, again, Warren Buffett, he's one of the calmest looking guys that exist on the planet. And that's how he operates because he's always the calmest guy in the room. He's always in control. So, yeah, if you find that like a news announcement, like another COVID or another, you know, something comes and rattles the market. If you find that that also rattles you, then that's the time to stay out.

Rob: Yeah, I mean, certainly crossing fingers and hoping isn't going to make the stocks go back up.

Nick: Never works, I've tried it.

Rob: Yeah, need to, need to certainly go on the data. So, I know that you have a few bits of content out around myth busting investing. And can you give us a, like maybe one or two tidbits about probably the biggest myth that you think you can bust.

Nick: Yeah, so one big thing that you've heard, probably constantly, is if you want to be a good investor, you've got to diversify. And for me, I found that that is kind of like, it's almost, it's kind of like something that's been said over and over and over again, and no one really understands what it means. The idea behind it is that you don't want to keep all your eggs in one basket. But then what happens is when you start to trade that way, when you are right about a particular stock, you're in it for such a small amount that it doesn't really do what you're hoping that it does, which is, you know, get you to the next level of wealth that you're trying to get to. But when the market crashes, it typically takes the whole fleet down with it. So in terms of like safety, there are better ways to be safe. And we talked about those earlier stop losses getting put options, like insuring your position. Like those are ways that you can control your own investment. You don't really have to spread yourself so thinly out. And so a lot of people think that, you know, because I'm diversified, I'm covered. But, you know, something like 2008 happens again or even COVID for a brief moment there, like that affected every single stock almost. And so it didn't matter how diversified you were, you're in it for such a small amount. So, like, yeah, in terms of safety, didn't really help. But then in terms of growth doesn't really help much there either. So I find it's better to focus on one particular stock or one particular strategy, and really just do like your homework on that stock. Like stalk the company, stalk the management, you know, do everything that you can to understand everything about that business. And then you can make a really, really informed decision, especially if you're on the investing side, where like more longer term approach, like really act as if you're going to own a portion of this company, because that's effectively what you're doing.

Rob: And does that come from, again, obviously, Warren Buffett is a pretty big inspiration for you. And we know that he basically reads annual reports all day long. And is that, is that where that kind of comes from? That similar thinking.

Nick: Yeah, very similar thinking, so he will sit back and he might not pull the trigger on that particular stock for years, until finally it becomes a stock where, you know, some news announcement's come out that did not really actually impact how the company was run overall, but it affected the stock price. Then he goes, ah, there's a bargain. And bargain hunting is something that I think kind of, it gets a little bit lost in translation on Wall Street and that sort of stuff, because when I was touring in the States, we just had Thanksgiving dinner at a friend's house. And we rock up at this Walmart and I'm like, "I'm just gonna go inside and I need to buy some shades", right. I lost my sunnies at the last show. I need to go buy some more. So I walk in there and it's a madhouse. There are people everywhere. You can't move through the aisles. It's just so packed. I'm like, what is going on? What is happening? I didn't realize my, you know, kind of ignorant self, didn't realize that it's a Black Friday sale. They have it after every Thanksgiving in the United States,

Rob: Of course.

Nick: And I was just caught in this trap of people and people are pushing and shoving each other. And just like, man, I just, it was a spectacle to me. It's the first time I've ever seen it. And I was taking photos and everything. And it made me realize that when there's a sale on, most people understand the value of a good sale because here they are crowding the shops. But when Wall Street has a sale, it's crickets, like it's doom and it's gloom and everyone's saying stay away from the market. But that's where all the best deals are, you know? And so, like, you know, for regular things, like a TV or a phone or something like that, well people will trample over each other to get a good deal? But when it comes to their finances, it's like it's crickets. And I don't understand. And so that's a phenomenon that happens like all the time. And people just, I think, again, it comes down to emotion. People get scared when markets go down. But really, those are the most exciting times, because you can get a good deal on a company that, you know, is really, really still good fundamentally.

Rob: Yeah, of course. And obviously, you know, the decisions that we make with our finances can have huge, long lasting impacts over time for good and for bad, like for someone just getting started. How do they really anchor themselves to sort of try and mitigate that risk while still driving good growth and good futures?

Nick: Yeah. So I believe it comes down to two things. Number one, work on your own mindset. And I know this is a bit lame saying this because, you know, it's a business podcast and,

Rob: It's a bit woo woo maybe, but it's true.

Nick: It's a little bit. But if we can agree that our actions are based on how we think, then our actions, are the things are gonna determine whether or not we are good traders or not.

Rob: Absolutely.

Nick: So it just makes sense that that is the logical step. So if you can control your emotion and control how you're thinking and just be calm in the face of potential danger when it comes to finances, I think that's probably step number one. And then step number two, if you, if you're getting started, do a simulated trading account, like a demo account, like play with fun money, because most broker platforms offer that. And it's so, just it's so valuable because you can trade your strategy or the way that you think it should be done and see if it works, like test it and test it again. And you know, do that for a couple of months if you have to, because what that does is it builds your own confidence. It builds your own, you know, opinion on how well your strategy is working. And you can do it all risk free. And you can get started, like even if you don't have any money right now, you could start a trading account with paper money now, get good while you build that nest egg. And so that's the best thing, and even me to this day, if I'm on a new broker's platform for the first time and getting used to things, I'll do everything on a paper account first, and I might do that for a whole month.

Rob: It's a bit like playing Monopoly, but with tangible results.

Nick: That's right. And it just, that is the best way to learn because simulations, you know, we learn just as much from simulations as we do from doing the real thing almost.

Rob: Absolutely.

Nick: Yeah.

Rob: That's how they trained pilots still,

Nick: Exactly. Yeah. So, yeah, trade like a pilot.

Rob: Yeah.

Nick: Yeah.

Rob: And so I do agree with the mindset, and and I think it is really pivotal to any good business or personal strategy that deals especially with high risk situations. But we can get a little bit caught up in being, say too optimistic. And and does does that, can that cross over into crossing your fingers and hoping the stock will go back up as opposed to the data just being, you know, invalid?

Nick: Yeah, that's true. And so what happens is sometimes a lot of people will do all the right things. They will find a company that has great fundamentals and they'll time it perfectly, like they'll look at the chart and they'll be like, yes, there's you know, the Fibonacci's are lining up or whatever, you know, the sequence you've got

Rob: Sure.

Nick: Going on. But it'll still turn against them. And even though they've done their homework correctly and checked all the boxes, it still doesn't go the way we think it's going to go. And that's just the market. That's just how it works. But I think the best way to combat that is to obviously, again, risk mitigation, make sure that you're not overexposed on any one particular trade. But then the other thing is, you've got to realize that it's a numbers game overall. Like that data that you were referring to, it takes a while for that, like, you know, you might have to do 100 trades before you start to see, like, exactly what your strategy is doing, because there's things like recency bias and that sort of stuff where we look at it and, like the first two didn't go well, so we're like, this doesn't work. But the next 98 might have gone perfect. So, yeah, it's definitely, like you said it's a, it's a way of thinking about it that determines how well it does. And so the data is important. Like really the data is everything, because that's where, that's the thing that tells you exactly what's going on. And so, you know, you can cross your fingers and pray and hope as much as you want, but it never moves the needle in the market one single little bit. So you kind of got to realize that certain parts are out of your control, but there's a lot that's still in your control. And it all has to do with your mindset, your strategy, your timing, and making sure that, you know, if trade isn't doing what you want it to do, just exit out. And, you know, if you've done everything else right, then it won't be, you know, won't be such a harsh lesson for you. So,

Rob: It sounds like it's really a game in being objective and and not letting that confirmation bias creep in and and skew that perspective that you've got.

Nick: Yes, I'd say that's probably 80% of the work is, is just making sure that, you know, you remain mechanical in your trading. And just, yeah, read the numbers. Let that give you, and a gut feel probably has a little bit to do with it, because I'm of the belief that we know a lot more than we give ourselves credit for. But by the same token, the gut feel, I think is different from emotion. You know, instincts are very powerful things, whereas emotion kind of decreases our intelligence. So knowing to tell the difference between the two, I think is probably pretty important. And that's probably a journey that I will always be on, just understanding that, like, you know, sounds a bit, you know, Sun Tzu a little bit. But that's kind of like, know thyself, and you'll become better in just about everything that you do.

Rob: Sure. Do you think that, coming back to your touring and the rockstar side of your life, do you think that that sort of acuity and intelligence around how decisions are made and just having a different perspective on life that maybe you had prior to this investing career, do you think that makes for better music or, you know, just better outcomes on a tour?

Nick: I feel like it does, because since I've adopted this mindset, I've been a lot happier. And when I'm happier, I write better songs. I make better decisions. And I'm just like in a lot more peaceful kind of mindset. And I don't know why that is exactly. I think maybe it's just, I'm in my creative space a little bit more. But it definitely plays a role. Like sometimes there were years where I didn't write a song because I just had this constant writer's block and I had, like, you know, Foggy Head and just didn't really know what was going on. But I feel like the more I detach from a situation emotionally, it frees me up in some other area that lets me, you know, make better decisions and write better songs and connect with people. And I guess it always comes back to, like, focusing less on myself and what others might think of me and focus more on what I can do for other people. Like, I'm writing songs now that are a lot less for me and more for, well, how can I inspire someone to do something else? Or how can I help somebody else out of a tight spot? Or, you know, if I was, you know, down in the dumps and I wanted to hear an inspiring song, what would that song be? And it's kind of like, yeah, it's just opened my eyes a little bit more in general, just. Yeah. That kind of, that kind of way of thinking.

Rob: Cool,

Nick: But, not to sound woo woo, but it's just I've noticed the result.

Rob: Interesting. I do enjoy the perspective. Absolutely. So we're starting to come up on time, but I do have a few quick questions that I've that I'd love to get out. One thing that I did pick up in your book, which I'm going to read off here, so I don't muck it up, but "if you don't quit, if you don't quit, you end up winning. Period". Thinking about that across your career, how does that contrast with when the odds are stacked against you? And maybe the outcome won't be desirable. And you need to know when to fold your cards?

Nick: Yes. So I have this kind of theory that anything that happens to you is actually happening for you. So even, like we were, you know broke, homeless, living in Los Angeles out of the van. That was an experience that gave more than it took from me. And I say that because I really believe that anything that can help you grow and push your comfort zone is important. And anytime that you can persevere in the face of those overwhelming odds, you actually grow and become better. So when you're, like, whether you're investing, whether you're doing anything in business or, you know, trying to be a rock star or anything like that, you've just got to look at it as though if you don't quit, that means you learn something. So there's no failure, if you learn from those mistakes that are made. If you learn from that experience and keep applying it, then eventually you're just going to keep, you're going to reverse those odds eventually because you're gonna know how to make your own luck. You're gonna know more about yourself and about the industry that you're in. And it's just a matter of time.

Rob: So it's more about a long term view than a, applicable to a particular trade where you just need to bail?

Nick: Yes, that's right. Yeah, absolutely, if the ship is sinking, don't be on it.

Rob: That's certainly, certainly good advice. If you had to pinpoint, say, the single biggest money lesson that you've learnt that you could share with our listeners, what would that be?

Nick: Single biggest money lesson, it would just be again, know thyself and control your own thoughts, like realize that you are the master of your own thoughts. And once you get that, you can do anything. You can become anyone that you need to be. And so I kind of, one thing that I've been reading a lot of now, kind of recently, is about thought control and how minding your own mind and observing your own thoughts is one of the most powerful skills that you can have. And what that means is you can decide where to steer, where to steer the ship when it comes to your finances or really anything in life. Like it's kind of like a universal principle. But how you do one thing is how you do everything. And so if you've got control and discipline, that's going to be the thing that moves the needle for yourself the most in finance.

Rob: Interesting. So lastly, with COVID right now, touring is a bit of a challenge, but it sounds like you're eager to get back and obviously investing and touring can go hand in hand. So what's next on the plans for what you're doing?

Nick: Next thing I am going to finish writing my next album and I'm going to book a tour as soon as I'm allowed to. So now I've just been champing at the bit. I can't wait to get back on the road, both in Australia and back in the USA, I know I've got a lot of US friends and fans that I'm dying to see again. Can't wait. It's going to be awesome. So, yeah, just waiting for the world to be a little bit less crazy. But it will happen.

Rob: That's really cool. And so we are out of time, but Nick Roberts, where can people find more about you? Where can I grab your book? And where can I connect with you?

Nick: Awesome, so yep, therockstarinvestor.com, that's the best place to go. therockstarinvestor.com, and, yeah. Get a free copy of my book there. And you'll laugh, You'll cry. It'll change your life.

Rob: Amazing. Absolutely. I thoroughly enjoyed what I have read, and I'm sure our listeners will as well. Nick Roberts, thanks so much for coming.

Nick: Thanks mate. Cheers.

Rob: There you have it. I hope you really enjoyed this episode, and if you did, please like it, share it or leave us a review on your favorite platform. It helps us show more of this content to people just like you.


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