This Rule Breaker Investing Mailbag picks up where Pet Peeves left off. Listeners wrote in with their own linguistic grievances.
Along the way, we touch on Evernote in an AI world, foreign exchange risk from a Fool down under, and the eternal market phenomenon of buying the day before the drop. It's playful, pointed, and a reminder that words shape how we think...and how we invest.
To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy.
A full transcript is below.
This podcast was recorded on Feb. 25, 2026.
David Gardner: Countless. Is it, though? Ten straight unanswered points, as opposed to ten straight answered ones at the end of the day. Well, which day? Why the end? It started last week with my pet peeves, but something interesting happened, you wrote back. Now it turns out we have well, at least for one mailbag, we have a movement, a linguistic uprising. It's a quiet rebellion against lazy phrasing, verbal shortcuts, small erosions of precision that if we're not careful, dull the edge of our thinking. Because this movement on Rule Breaker Investing this week isn't really about grammar. It's about clarity and clarity is an investing advantage. At this month's close, well, for February 2026, at least, the mailbag fights back. Only on this week's Rule Breaker Investing.
Welcome back to Rule Breaker Investing. Happy. Almost March. February has been a month. Gosh, it's been a very cold month on the East Coast, and we just got another blizzard. It's been quite a February. I love winter. I'm always cheering on snow, but once we've had enough of it, many of us look forward to March. On this podcast, I hope you'll also look forward with me to March Market Cap Madness because starting next week with Lauren Hurst and Andy Cross, and then the week after with Emily Flippen, and Bill Barker, we are going to have our final four of the Market Cap Game Show. Of course, the third week of March will battle off my two finalists. Yeah, March Market Cap Madness starts next week. Keep in mind, you're playing along with us, while I will name a world champion among one of my four, and Emily Flippen is our defending world champion. The truth is you know it. I know it, too. The truth is, playing along at home, you can outscore my world champion, whoever that is, and I hope you'll play along with us all March long. March Madness is a big thing in college basketball in the United States. March Market Cap Madness, arguably, an even bigger deal globally. All right. Well, as I look over, as I pop open the mailbag and look at it, first of all, I'm amused because it turns out I'm not the only one who has some pet peeves to share through this podcast. We don't do this very often.
As I mentioned last week, it had been 27 months since our last pet peeves episode. Not only did I have something, actually, several things to get off my chest last week, but you did, too. We're going to do that this week. Not all of our notes are your pet peeves, but most of them are. I want to talk about this briefly upfront before we get into it because many of these notes while on the face of it, they're about something in other people's language that annoys you or me, specifically this week, you. It's when people say this or that thing, it drives you a little bit crazy and they keep doing it, which drives you crazier. But what we're really doing, and I said this a little bit at the top, is we're trying to speak with precision, we're hoping for clarity in our own speech and those of others, including the media at large, precision, clarity, and I would say intention in our language. I want to underline that. That is really good. This is not pedantry. This is not whining this week. This is in part why I think I've been a great stock picker and a somewhat successful entrepreneur, because I care deeply about the language that other people are using. Because those people tend to be selling us their shares if we're buyers. Sometimes they're shorting the stocks that we're holding long, if it turns out not just their language, but their thinking is contrary to what it should be or getting dulled by imprecise language, that is greatly to our advantage. You might think, this is all just a grammar exercise, but no, really, it's not. It is a thought exercise, and I believe it's profoundly important to my own investment success. I hope yours too. In fact, I want to share a short section from my book Rule Breaker Investing. It's entitled Opportunities Greater than Sign "Bargains" and Bargains is in quotes. If you listen carefully, you'll see this is just, again, all about the language that we use and words matter. I quote myself here, starting with a line from Samuel Johnson. Language is the dress of a thought, said Samuel Johnson. Go on myself. I love majoring in English literature. It's lines like these that have stayed with me and continue to add value. The quality of our thinking is often linked to the language we use and vice versa.
The quality of our language often influences the quality of our thinking. Scrutinize your own diction, as well as the word choice of others. Language matters. It's worth more than its weight in gold, especially in light of its being abstract and weightless. The word bargain is a good example. Many investors love it. It speaks to them like a retailer's 30% off sign. They're ever preparing for when stocks are on sale. If you liked it at $100 a share, the thinking goes, you're going to love it if it's at 52, and sometimes they're right. Bargain Hunter Nirvana. But bargains of this kind don't come along frequently. Meanwhile, the market rises day by day. Two years out of every three and over almost every decade, many great rule breaker stocks show up as early stage companies never priced as bargains, offering us the great opportunities of our investing lifetimes. This is why I favor the word opportunity. I don't seek bargains. I seek opportunities for market whacking returns, opportunities have always served me better. If you start saying and seeking opportunities, you're much more likely to find them. Adopting this mindset will serve you well when investing new money into existing investments, habit number two of the rule breaker investor add up don't double down is to pursue opportunities, not bargains. I'll close it off right there. Yeah, as I said, language matters. In fact, language shapes our thought. Diction, which is just a fancy word for which words we choose addiction drives behavior. That is my lived experience. You know, just thinking about words like correction, which is the wrong term to describe always a market drop, never, of course, a market rise as if it's correct for the market to drop wrong term. I have made hay in my book, in my stock picking career and on this podcast around what the word overvalued really means to me. Yeah, as I said at the start, the mailbags fighting back this week. This isn't about pedantry or grammar. It's about clarity, which is an investing advantage. Before we get into the mailbag, every month, I like to look back at the month that has been and just briefly review our path forward. Through February, it all started off February 4. Let's talk about the future in 2026 with Kevin Kelly, the wired co founder, a delight to have Kevin back on this podcast and have him share his thoughts about the future.
A few things are more important, by the way, to me, to my kids, and now to my grandchild that was just born this week. Probably than the future. Few things are more important to investors as well, than the future, because anything we say about the stock market, if we're looking even at today or backwards has already happened. All that really happens is what happens next. Let's talk about the future in 2026 with Kevin Kelly. February 11, it was ten years later, five stocks to feed the bear. Yes, this podcast is a rare and daring thing every ten weeks. Over these several years now, we are reviewing a group of five stocks that I picked ten years ago that very week. Using the long arc of history, I would even say ten years isn't that much if you're invested for your whole life. But for most people, ten years is a long time. For podcast talking about stocks, well, I think it's very rarefied air. It's a delight every ten weeks in this podcast. To do our next ten years later, in this case, it was five stocks to feed the bear. Go back and listen, February 11, if you'd like to hear lessons and performance from a five stock sampler picked ten years ago this month. Then last week, of course, Pet Pees volume nine, which we entitled By now Pay Later. Right? We'll let that one speak for itself. It dominates this week's mailbag. All right, so that was the month that was. All right. Before we hit our six mailbag items, let's kick it off with two hot takes from Twitter X. The first is from Yavus Macun at YY Majun, which is spelled I think Yavus is Turkish. If you're Turkish, it's Macun at YY M-A-C-U-N Yavz, you were reflecting on two mailbags ago. It was the end of 2025. You wrote, In regards to the December Mailbag episode, probably my favorite at RBI podcast.
Listened every week for more than ten years, no skips, no repeats. You wrote The eloquent poetic narration. I'm dropping some other kind words because it sounds too self aggrandizing from At David G Fool were words of wisdom, where authenticity is in abundance. Last 4 minutes of this particular episode was particularly epic joy, friends from Yavus Macun. Thank you very much for that Yavus. It does give me an opportunity to mention that those were the last 4 minutes of last year for this podcast. I really did love speaking to the question that we got at the end of that mailbag, which is, Am I a Fool. This is somebody who wants to be a Fool. Many people go through life never, ever wanting to be or look like a fool. But this was a positive question. Am I a fool? I did my best to speak to how I would answer that question. Am I a capital Fool. Yavus thank you you for that call out. That was a delightful end to 2025. One more hot take from Twitter X. Again, we're at RBI podcast on Twitter on X. You can also follow me. I'm at David G Fool. This one is from frequent correspondent Andrew Gibson and at Andrew Gibbs, 53446. Andrew, you wrote speaking to Kevin Kelly, my guest a few weeks ago earlier this month. Andrew, you were calling out that podcast with Kevin Kelly. Couple of weeks ago, you wrote at Kevin to Kelly and Bard Shannon. Of course, my talented producer. Thanks, guys, for all you do. What an incredible episode this week. This will be a multiple listen episode for me. I'm going to say the same back to you right now, Andrew. Anytime we can have wired co founder and senior Maverick Kevin Kelly on this podcast is a week worth listening to. As you're just pointing out, relistening to, you go on to say, at David G Fool, I love the point about how people instinctively lean toward fear when it comes to technology. The reference to automotive crashes really drove it home. We accept thousands of fatal car accidents every year as a normal part of life and barely bat an eye at the statistics. Elon Musk often says about how routine crashes in traditional vehicles go largely unnoticed.
Any incident involving a Tesla draws intense scrutiny and headlines. It sells in for profit media, Andrew adds. It takes real effort to study the data, grasp what the tech has actually achieved and is achieving and maintain optimism. Negativity is the easy path. Optimism requires work and consistency. Andrew closes, I will take on Kevin's challenge to intentionally surround myself. With people whose views oppose my own and to truly listen without interruption or rebuttal until they have fully expressed everything they have to say. That is where true genius lies, and Andrew, you quote at the end, F. Scott Fitzgerald, his classic line from one of the short stories, and I quote the test of a first rate intelligence is the ability to hold two opposed ideas in the mind at the same time and still retain the ability to function cheers and Fool on. Well, cheers and Fool on back to you, Andrew. Thanks for writing in. Speaking of thanks for writing in six Mailbag items this month. Let's get started with Mailbag item number one. This one from Paul. Thank you, Paul. Hi, David. Your pet peeves always make me laugh. As an avid basketball fan, as I know you are, too, one of my pet peeves is when an announcer says a team has scored, for example, in quotes here from Paul, ten straight unanswered points. I always want to ask that announcer if he or she really meant that the team scored ten straight consecutive unanswered points in a row without the other team scoring in between. Fool on.
That one's from Paul. I appreciate that Paul. You are 100% right. Ten straight unanswered points. Is the linguistic equivalent of a fast break with maybe three extra dribbles because, you know, if they're unanswered, they're already ten straight points. We don't need the redundancy to pad the stat line. Now, sports is, of course, replete with clichés stereotyped phrases that are repeated ad nauseum, whether it's by the fans, whether it's by the announcers themselves, or them interacting with each other on talk radio. There are a lot of thoughts and phrases that often dominate people's thinking. When you hear an analyst say another team just wanted it more, I'm always wondering how they're measuring that. I mean, I don't even know that it's possible to get inside one person's head, let alone an entire team's head and decide,yeah, well, clearly, they wanted it more. Usually, the phrase is used after we already know the result, and then we're able to say that team wanted it more. It does happen sometimes. Rarely do you hear an announcer say ahead of time, this team wants it more. Therefore, I predict this team wanting it more as they clearly do shall win. You rarely hear that. Last year, I had my friend Kimball Crosley on this podcast. We did some Rule Breaker thinking around sports and sports cliches. In fact, it was called breaking the rules of sports. It was April 23rd last year for any sports fans who want to think more like a Rule Breaker and missed that one. Kimball talked a lot about momentum, that concept which I think we can all say, yes, momentum exists in life. It certainly exists in the stock market, and some people classify some stocks as momentum stocks. But it is widely overused. It dominates the thinking and commentary often of play by play or color analysts. As we're watching a game, we're hearing that the momentum is on someone's side, and usually in my experience, it comes after some big plays have happened. Fans are usually not reacting in advance to great plays, they're reacting afterwards, which creates a sense of momentum. Then we start saying, the reason they're winning is because they had momentum. Then as inevitably that momentum shifts, as Kimball and I talked about last April, no one really says, the momentum has shifted. Momentum is really only used as a backward looking phrase the vast majority of the time to analyze sports and whether or not exists or how powerful a force it is, I'll leave that up to you. Anyway, thank you Paul, for opening up a little bit of sports thinking on this podcast as we begin to close down February and get ready for March. Paul, I hope you have a great March madness and a great March market cap madness.
Let's move on to Mailbag item number 2. Mailbag item number 2, this one from Rick K. Thanks for writing in, Rick. Why is it, you write, that so many educated spokespeople, particularly those in the business and investment field, use the word scale at almost every opportunity to describe what used to be referred to as expand, increase, grow, build, and other words, indicating that the individual had a vocabulary greater than a few words. There probably are young parents who are business savvy individuals, Rick goes on, who tell their friends and business friends that they are in the process of scaling their family. Perhaps business advisors are telling their clients as words of eternal wisdom, if you are not scaling, you are dying. Let me pause it there for a second. It's just a reminder to me. This was not a word that jumps out to me as something I object to personally, but this is your mailbag, not mine, and so I air all viewpoints. I can certainly any word that gets overused, Rick, I start to hop off that bandwagon, and I think you a long time ago hopped off this bandwagon. My lack of objection here is I don't feel like the word scale is in any way, particularly misleading or puts the wrong idea in people's minds, it's just maybe a little bit overused. Let's go on with your note, and you write that these same business and investment oriented individuals who are otherwise articulate, such as one often found on the Motley Fool broadcast, have to remind us that the response they give immediately after the previous speaker has spoken is to say this phrase, to your point, sometimes several times within one minute, yes, this has happened, Rick writes. With respect to the Fool broadcast, I thought the individual was either caught up in some unconscious verbal or compulsive loop or going for the record in the Guinness Book of World Records for subjecting listeners to unnecessary references to which she was replying. I'll pause there for a sec, Rick. I don't know exactly who you're talking about, but I will say this, to your point is a popular phrase these days. I think I started noticing it becoming okra about 10 years ago. Initially, I thought it was a nice phrase because it shows the person who's about to speak has listened to you or at least they're seeming to claim that they have, and they're saying whatever they're saying is speaking back to what you just said, which though it can be repetitive is also a nice nod. It's a little bit of a kindness from that person to use the phrase to your point. But I think I'm getting from you again that if somebody is doing it all the time or if we're saying it too often, then it loses any value and becomes verbal dead weight. Let me go on with your note as we close this one, and at risk of me, Rick K being guilty of this last pet peeve oftentimes on Rule Breaker Investing, Rick would be referring to this podcast a point that can be made in one minute can take outwards of several minutes, if not far longer, as the communication is made to seemingly cover every possible nuance of the meaning and references to what is being said. At times, Rick says, I feel like screaming. Make your point already.
Well, I'll pause it there and respond back. Rick, I would say guilty as charged. I do think I may sometimes repeat myself. I do feel like this medium, the podcast is interactive, especially because I welcome in mailbag at the end of each month. I'm actively soliciting your reactions. I do feel a need sometimes, probably to speak ahead of time to several different viewpoints in anticipation of getting mailbag notes if I haven't spoken to them properly in the first place. I do think you're right, I do sometimes elaborate unnecessarily. I'm sure I repeat myself. I try not to, but I appreciate you pointing that out. I do want to say, in the end, I'm probably most of all, a writer. That's what I grew up doing, that's what I love doing. In writing, we can excise all redundancies, and I one of the things I loved about my Rule Breaker Investing book was trying to cut out every imaginable, unnecessary word and make it the tightest, fastest, most fun read I could for as many people as possible. I don't actively try to do that with this podcast. We're a little bit more voluble, a little bit more off the cuff without that much opportunity to edit. I'm going to say, Rick, thank you. Guilty as charged. Rick does close out his note. I'll share this as well. Years ago, people communicated without overuse of all these words with no loss to listeners ability to understand the exchange. Appreciate that point. Postscript note here, personal pet peeve, you write, the market waits until the day after I have bought an equity to reveal in "bad news" concerning a company resulting in a large decline in market price. Rick writes, I think if I had waited just one more day, I could have bought in at a price 40% lower, such as with the recent price drop in gold and silver ETFs. Rick, I'm fairly certain that particular market phenomenon which you are underlining there has been independently verified by investors everywhere. I certainly have felt it myself, so I guess we just reflect that the market does sometimes have impeccable comedic timing, even if it's not just our timing. It's also true, though, that if waiting one more day were the key to riches, we'd all be billionaires. But that sting is part of the tuition, I think that we pay to stay in the game. Fortunately, persistence matters more than perfect timing.
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David Gardner: On to Mailbag item number 3. This one from Adam Nelson, one of my personal heroes, I'll explain why near the end of this note. Adam, you write. Hi, David, thanks for sharing your peeves again. Here are a few of my least favorites. One, starting a statement with listen. Are you assuming I'm not? Two, at the end of the day, Adam asks, does what you just said not apply or matter as much as at the beginning of the day? Three, we aren't smart enough to figure out X. Adam writes, if you don't know, just say, I don't know, rather than using this preface, then stating an opinion, which I wouldn't want from someone who's not smart enough to know. To sum it up, Adam writes, listen, at the end of the day, I'm not smart enough to know if this is an email worth sending. Haven't written in too long, and I'm still a big fan. Keep up the good work, David, and Fool on. Best, Adam Nelson. Well, I mentioned earlier that Adam, for me, is somebody who I think it's Adam Nelson's world, and the rest of us are just living in it. He is the one who changed forever the Market Cap Game Show. I was doing a little history check here. It was the January 2021 mailbag. Now over five years ago, where Adam wrote in and asked, basically, David, why not just have the guesser have the ability to state a range of market caps? Then the opponent, you and me, if we're playing at home, after hearing that range of market caps, we just say inside that range or outside that range. That is a direct quote from the great man himself, Adam Nelson. Adam, from that point forward, the Market Cap Game Show has changed forever. Before then, as you and older ears will remember, before then, I would just state a given company and have my single contestant, not two just try to guess within 20% of that market cap range. We haven't made many changes to the game over the years. We've added a bell here or a whistle there. But as we'll be on evidence starting once again next week, the game is now one where one player states what they think the market cap of Microsoft is, let's say, and gives a range, and the other person says, along with you and me, I agree inside that range or outside. That changed our Market Cap Game Show forever, it made it better.
Thank you again, Adam Nelson. I want to say, I like all three of your pet peeves here. Listen, probably I don't think I do that very often, but I hear you. It's not necessary to tell others to listen. It's almost a desperate plea in some cases, but it's definitely unnecessary. The second one, at the end of the day, such a cliche. Of course, so many people are saying that. I'm sure I've done it myself in this podcast. But what about the beginning of the day or just which day are we talking about? Then we aren't smart enough to figure out X. Well, if the speaker isn't just admit it. You don't need to say all the rest of us aren't smart enough, either. Let's move on to mailbag item number 4. This one from long time Fool, Jason Newman. J New, thank you for this note. David, I love your latest pet peeves episode. Classic as always. My question is admittedly a bit inside baseball but inquiring minds want to know. In the past, you regularly mention Evernote as your preferred tool for keeping lists. It even led me, Jason writes, to pay up and use it for many years before ultimately moving on. I found it a bit too clunky for my taste. Since then, I've struggled to find something that truly works for me. When you reference that your pet peeves list was "on my iPhone" this time without mentioning Evernote, I could not help but wonder whether you are still using it or if you have found a better system. If Apple Notes is the simple answer, fair enough, though I often find it becomes a long stream of randomness.
In today's Cloud and AI driven world, J New closes, what is best in class for you? I'm genuinely curious perhaps other Fools might share their go to tools in a future mailbag. Well, let me mention that, yeah, that is the purpose of mailbag. Jason, as you well know, it's for all of us to share our best thoughts, and then I try to share them back out. We learn together. If anybody has an amazing notes app that is usable by many others that you would recommend, we're not going to turn this into the Rule Breaker productivity month of March. March is all about madness for this podcast. But certainly, if any bright light or inspired listener has a great tool they think all of us would benefit from in this cloud and AI driven world, as Jason writes, do share, it might well make the mailbag. It's worth mentioning, by the way, not everything makes the mailbag, so thank you always to those who write in, even if I didn't get to your wonderful note. Just to cut to the quick here, I absolutely still use, always pretty much have used Evernote, so that I didn't mention Evernote, Jason. Well, maybe I was trying to be more spare with my words. But I started using Evernote in 2008, and for me, now 18 years later, I've invested so much in this system. I've organized dozens, hundreds of notebooks, thousands and thousands of notes. One thing I like about Evernote, it accepts all different media. Your note could be a few words, it could be a picture, it could be audio, it could be all the above. You could drop tables, files, other things in to it. I still think of Evernote as the standard. But as you mentioned, there are lots of other options these days and more cropping up all the time. As I thought about your question, you mentioned you struggle with clunkiness. You just felt like Evernote was clunky, and that had me thinking three different things, I'll share them quickly. Essentially, the question is, what cognitive mode are you in when you take notes? Because if you're capturing thought number 1, ideas in motion. Something fast and minimal is probably what you're looking for. If, number 2, you're building a library of connected thought. I would say something linked. Something link friendly and link heavy might be what you're looking for. As you take notes, Jason, you're in the cognitive mode of, let's call it, managing projects, managing notes, managing stuff, maybe something systematic might serve you there.
Without actually knowing what your clunkiness around every note is or was, and we're not going to be diagnosing I know you don't want me to diagnose our personal problems on this podcast, but I do want to say there are a few different options I've seen or heard mentioned from friends to speak to each of these cognitive modes. The first one, something fast and minimal. Again, most of these I have not used, but Bear. Yeah, B-E-A-R like grizzly Bear, Bear is a pretty simple notes app. Elegant writing is what it supports, capturing ideas in motion. There's also simple note. That's for fast capture. There's also Apple Notes, as you mentioned, although if you're not organizing your Apple notes, you're right. It can read in your words, like one long stream of randomness. If on the other hand, you're looking to build up a library of connected thought linking lots of things with each other, Obsidian and Roam, I have a friend who's a programmer. He loves obsidian. I heard somebody else mention Roam R-O-A-M, haven't used it, but it's great for idea linking. Then finally, projects and notes, project management notion, which is more for probably database people or OneNote, which is more of a notebook style, these different apps in a lot of ways. There's a lot of overlap among all of these. But for those, something systematic, something that lets you manage and keep on top of things. We all take notes for different reasons. One of my favorite books in the last several years is Build a Second Brain by Tiago Forte. One of the things Forte says in the book is when you write a note, you're writing it to your future self. You're sending every note you write to someone very special. Your future self. Here's the thing about our future selves. They're busy. They don't necessarily have time for those old notes we're trying to send them.
The world's probably more complicated. You have to be really respectful of that person's time. You have to think ahead what is really going to be most useful as I take down this captured thought. That's always my thought framework for when I'm taking notes, but whether the note takes the form of, something fast and minimal or something you're trying to link or something systematic, that's for each of us to decide, and I hope I gave you a few thoughts to work with. Thank you for writing it as always, J New. Good luck on your noting. Two more on to Mailbag Item Number 5, a fun one from Gary Carr. Thank you, Gary. Dear David, thank you for Pet Peeves Volume 9. I always enjoy the way you inject a little humor into listing Pet Peeves so you don't sound like you're in that Simpsons meme of the Old Man yelling at the Cloud. Here's mine. Gary goes on. Countless. I like precision in language whenever possible. Gary Carr writes. When I read the word countless, I immediately think, well, you could count it, but it's too much trouble. Gary goes on Stars in the universe. I use countless. But when someone writes and he links to an article that has this phrase in the title, when someone writes a building with countless oversized windows, well, that's just lazy. The number of windows could be counted or in a story about a disaster. Countless buildings destroyed. They are countable. Just right. Gary writes hundreds or thousands. I have relayed this complaint countless times. Alas, to no avail. Fool on. Gary Carr, Gary, you note you're our neighbor again as you move back to Washington, DC, where the Motley Fool was originally based, the DMV.
Welcome back. You write after listening to the RBI podcast since its start in 2015, in these locales in order, Oakland, California, Rome, Italy, Washington, DC, Tucson, Arizona, and Geneva, Switzerland. Well, again, Gary, welcome back. I appreciate your point about countless. One of the things I've enjoyed is trying to save transcripts of my podcast. I can look back, therefore, at my podcast, thanks to the transcripting possible on the Internet these days, increasingly available and free in our society, and I can actually count the number of times the word countless has been used in Rule Breaker Investing history. Indeed, with a few taps of my keyboard, I see that the word countless has appeared in 16 of our over 550 episodes over time for those keeping scored at home, and I'm pretty sure nobody is. It was first mentioned on December 6, 2017 in my podcast Block Chain of Fools. I think I was joined by Aaron Bush for that one. Until this week, of course, where Countless has appeared once again, it most recently appeared in the November 2025 mailbag Thanksgiving of last year. I'm not gonna go back and count whether we were using the term appropriately or not. I'm pretty sure you would have noted that yourself at the time. Anyway, we're in way too deep. I went down a rabbit hole. I apologize. I really appreciate your point about countless Gary. I will try to be more aware. Now to Rule Breaker, Mailbag Item number 6. This one from Down Under. Thanks for writing in. Dylan. Greetings from Australia where I am writing to you from tomorrow. Dylan writes, literally, given the time difference. I'm writing to you as a newly minted rulebreaker who has just finished your latest book on audio and immediately ordered a paper copy. It's a lot easier to highlight and underline a paper copy. Well, thank you, Dylan. I agree with that statement. Thank you so much for the support. While I've always appreciated the numbers, your framework has challenged me to look beyond the spreadsheet and I'd begun focusing on the Dylan's word uncountables. Well, in a podcast that featured countlessness, the uncountables feels connected in.
Anyway, as an Aussie investor, Dylan writes, I find myself in a bit of a geographic conundrum. While the ASX has its gems, I believe in diversifying into the world's most innovative companies, which means a large portion of my portfolio is in US stocks. My question for the mailbag is about the so called invisible hand of foreign exchange. I'm in my mid 30s. Have no end date for my investing career. I'm a disciplined net buyer adding to my positions and best ideas every two weeks after I get paid. However, I struggle to internalize the risk of currency fluctuations. Since I refuse to time the market or the currency, I realize that a swing in the Australian dollar to US dollar exchange rate can turn a business winner into a portfolio loser through no fault of the company itself. How should a rule breaker think about foreign exchange risk for the long term? In a 20 plus year journey, is the currency just noise? Is it just ultimately a moot point that washes out in the tide of compounding, or is it a fundamental risk that requires a different gumption to ignore or a particular strategy? I'd love to hear your thoughts on whether I should be losing sleep over the FX factor, or if I should just keep my eyes on the innovators and let the math settle itself over the decades. Signed foolishly, Dylan, a Fool down under. Well, first of all, thank you for writing in, Dylan. I want to say before giving my answer that you're doing everything right. I love hearing that you are saving on a regular basis. I love hearing that you are not somebody who's jumping in or jumping out. You said, you're a disciplined net buyer. Every two weeks, you're adding to your positions. Actually that's much more important than anything that has to do with foreign exchange rates, which often tend to cancel out over time. Just as a fellow Rule Breaker, I want you to know that I think everything you heard on that audiobook or might highlight on paper still applies. I think those are the most important lessons, finding greatness and adding it to your portfolio, holding much longer than most other people do.
Getting in touch with your own habits before thinking so much about ticker symbols and having principles upon which you build your portfolio, all of those are more important than foreign exchange movements. Now, I want to mention in case you didn't know, we have Motley Fool Australia. Scott Phillips, our wonderful leader, and our Capitol F fool employees down under create at fool.com.au a lot of great content, stock picking advice, premium services, free articles every day. As somebody who may have found my book without realizing Fool AU exists, I want to make sure you do you bet that you're surrounded by many other Aussie fools who have the exact same question you do. In fact, I took the time just to google fool.com, currency fluctuations USA and it called up an article that was written just a few days ago called Should ASX Investors Worry about a Rising Aussie Dollar? You're going to more thinking in there that I'm going to summarize here at the end of this podcast. But I want you to know many people in your country have the exact same question you do. I think most of us feel as if if you're playing the long term game, this is not something you need to think in the short term about. Just before starting the podcast this week, I dropped a note to Andy Cross, our chief investment officer here at Motley Fool headquarters in the US, and Andy shared back a few thoughts, which I'm just going to share with you here at the end. He said, I look at currency impacts in two ways for the company and for the investor who chooses to invest in another currency. The former, for the company Andy shared with me, it tends to be mostly noise, with the market typically sniffing out and adjusting for big changes. Though, ultimately, it does hit the company's financials, but still the market tends to account for and discount really any currency impacts.
At least, Andy writes, for larger multinational companies now for investors who buy a stock in a different currency, for example, an Australian investor who owns a lot of US companies, that means that investor has exposure to owning US dollars. When you go to convert those US dollars back to Australian dollars, there will be, of course, currency conversions. Andy writes, it gets a little nuanced to the individual, but the impacts could be like this. A, you do need to consider how much exposure to have to owning other currencies. B, realize there could be currency impacts when selling or buying more, and C, but if you don't convert those US dollars back to Australian dollars, but just keep them invested in other US holdings, then the realized currency impacts will be minimized. He shares his own experience with me at the end. He said, this has worked both in my favor and against when I have bought international stocks. My suggestion is to make sure that any investor has an understanding of the allocation and potential currency impacts. Again, I think, Dylan, you can follow a lot of this through our full AU team as they continue to report and opine on currency swings in the markets. There have been more noticeable and meaningful ones in recent months over the last couple of years than for many years before that. I think this is on more people's minds. Andy closes out. The good news is for great compounders, companies like Apple, that you're going to own for, let's say, ten years.
Currency impacts are going to be minor. They're going to matter more than any change in currency fluctuations. Andy shares one angle is the shorter your time horizon the more impactful currency will be. The longer your time horizon, the more you minimize those impacts to close Dylan. You already shared with me that you're playing the long game you're in your mid 30s. You don't have any end date your phrase, love it for your investing career. You are a disciplined net buyer, I think, based on my overall horse sense here, combined with some of Andy's specifics, I hope that's helpful. You should know at fool.com.au, everyone has a wonderful, Aussie team Fool behind them. There were some thoughts at the end about currency, but, of course, this mailbag was dominated by thinking that the language that we choose to use matter, words matter, language shapes thought, and our choice of words drives our actions in the real world. In the marketplace, the marketplace for stocks, the marketplace of life. I hope for each of us we can make the best choices in terms of the words we choose to use. I'm thinking back to last year's author in August, Sam Horn, talking on eggshells, as well. Words really matter. I also hope that we'll be choiceful in who we listen to and what language they're using to us because that's going to affect, again, the advice that we listen to and the actions that we take. I think it's pretty obvious to state at the end, but that's sometimes what a fool will do. This matters a lot with your money. It matters a lot with investing. It matters probably even more across your whole life, because we use language in pretty much every context. Let's say goodbye now to February. Thank you for joining me this week on our Mailbag. Very fired up about March market cap madness. The final four kicks off next week, Lauren Hurst versus Andy Cross versus you. Fool on
