Max Macaluso sits down with Motley Fool co-founder David Gardner to talk fear, investment, and biotechs. 

In this video segment, Gardner explains that -- from medieval mapmaking to modern investing -- fear is often born of the unknown. He sees two options for investors who are intrigued by the health-care industry but don't have a lot of personal knowledge on the subject. The full version of the interview can be seen here.

A full transcript follows the video.

Max Macaluso: Hey, Fools, I'm Max Macaluso and today we have a special guest joining me -- David Gardner, co-founder of The Motley Fool, and chief Rule Breaker. Thanks a lot for taking the time, David.

David Gardner: Thank you, Max. It's my pleasure.

Macaluso: David, I spend a lot of my time looking at health-care stocks -- stocks in the biotech space, pharmaceutical space, health insurers...

Gardner: It's an amazing space.

Macaluso: It's amazing, and also complex. That's why, when I talk to a lot of investors, they tell me right off the bat, "You know, Max, I'm scared of this sector and I completely avoid it."

But your investing style is a little different. I see you as a fearless investor. You just look for value in any corner of the market, so the first question is why are investors scared of complex industries and should they be scared?

Gardner: A great question. We probably could spend our entire conversation just on that question, but we can get to some others, too.

Max, let's dig in a little bit there. I think, first of all, there's a natural human tendency to fear what we don't know. When the medieval mapmakers got over to an edge and they hadn't been there before, what they wrote -- as you probably well know -- is "There be dragons."

That would be a typical thing you'd see, and what that really meant was, "We have not been there. We don't know what's there." But they didn't write that. They would write, "There be dragons."

I use that as a simple way of thinking about complexity and stocks you don't know much about or businesses that seem intimidating to you. I -- who may have picked as many or more biotechs in my Rule Breakers and Stock Advisor services as anybody else at The Motley Fool -- I can assure you as an undergrad English major, I am by no means either a scientist or a proven biotech guy.

Macaluso: Actually, have you ever taken a science class?

Gardner: Not in college. You kind of had to take it in high school, and I did OK in chemistry. I never took physics, and I didn't do so well in biology. I think I liked chemistry, of the sciences. What about you?

Macaluso: Well, I'm trained as a chemist, so ...

Gardner: Yes, OK. I think I knew that by reading your profile, but you and I hadn't hung out before and really talked chemistry, which we may or may not do today.

I think there's that natural human tendency to fear what we don't know, so I think each of us as potential investors can take one of two paths. They're pretty obvious.

The first is, don't go there. After all, there are thousands of good companies that you can invest in, and you can make an incredibly great professional investment career never investing in a single health-care -- let alone biotech -- company.

Truly. There are sector funds that do pretty well, and they just buy restaurants. So answer No. 1 is: Don't go there.

Answer No. 2, the other path, lean in. I think answer No. 2 is appropriate for people who are intellectually curious, who believe life is an adventure, and who want to grow -- and who are comfortable looking really silly out there on the ice. They're learning to ice skate, on a regular basis, right out there.

I've done it in our services as a professional stock picker, and I fall all over the ice. That's part of my learning process, and every one of my returns -- any numbers you've ever seen for my services -- include all the losers, and I've had a lot in my services.

I'm not here to say that Path 1 or Path 2 is the right one. I truly believe you have to pick your path and know what you're doing. You at least know what I'm doing.

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