Ep400: Marcus Udokang – Just Because You Have the Knowledge Doesn’t Mean You Won’t Fail

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Quick take

BIO: Marcus Udokang is an IT consultant, writer, and presenter. He specializes in project management and business analysis.

STORY: Marcus was working for a company that was open to investors. Because he trusted his company and had met many other happy investors, he decided to invest. Unforeseen circumstances brought the value of the investment down, and he never made much out of it.

LEARNING: Do thorough research, diversify your portfolio, and start small. Have a devil’s advocate or a sounding board for your investment ideas.

 

“Research the market to be aware of unpredictable financial forces and be vigilant and disciplined when it comes to making, spending, and saving money.”

 Marcus Udokang

 

Guest profile

Marcus Udokang is an IT consultant, writer, and presenter. He specializes in project management and business analysis; specifically, business applications, requirements analysis, and business process management. He has worked in various industries, including Financial Services, Oil and Gas, and IT Training/Education.

He’s also the host of The Inquisitive Analyst Podcast and YouTube channel that focuses on the triumphs and challenges within the areas of project management and business analysis.

Worst investment ever

Marcus was working for a certain company that was open to investors. Due to his trust in the company, he figured it was a good investment opportunity.

Encouragement all around him

At the time, many people had invested in this company, and they had reaped good returns. There were so many happy investments all around. Marcus even met one at a car dealership where he had gone to buy a car. As they were getting to know each other, Marcus mentioned that he worked at the company. The guy told him excitedly how he had put in money in the company, waited for 10 years, and got his money.

A good friend of Marcus’s also told him of how he had put money in the company, cashed out a few years later, and made good money. Now Marcus was totally convinced that this was a good investment opportunity.

It just was not the right time for him

Marcus invested in the company and waited to start receiving dividends. Unfortunately, due to uncertain market forces beyond his control, troubling economic times, a bit of happenstance, and negligence on the company’s part, the investment was sold and resold several times to different investors. This caused the investment to devalue, and eventually, it became worth almost nothing.

Lessons learned

Take your time and do your market research

Think twice before you invest in anything. Do thorough research to understand the investment and to ascertain the level of risk involved.

Diversify your investments

Do not put all your money into one investment. Invest in several options to manage your risk better.

Start small

Once you have done your research and found a couple of different ways of building a diversified portfolio, start small, then grow over time.

Andrew’s takeaways

Have a devil’s advocate or a sounding board for your investment ideas

Have someone that you can trust who will help you look at all the reasons you shouldn’t invest in the ideas that you come up with. Such a person will be your voice of reason and help you help better decisions and avoid making investment mistakes.

Understand the difference between managing and assessing risks

When it comes to assessing and managing risks, those are two very different things. Risk assessment comes before you get into something, while risk management is about how you handle it once you’re in it.

Timing is everything

Timing is everything when it comes to business and investing. You may have an excellent idea and even execute it well, but it fails just because the market is not ready. Also, just because an investment has made money for another person doesn’t mean it’s going to make money for you. The market conditions, industry conditions, change, and management, and other conditions may have changed.

Actionable advice

Save for contingencies. Save, save, save for a rainy day.

No. 1 goal for the next 12 months

Marcus’s number one goal for the next 12 months is to continue doing what he enjoys and do it well.

Parting words

 

“Canadians, be open to financial literacy for you and your family. Start talking about money.”

Marcus Udokang

 

Read full transcript

Andrew Stotz 00:01
Hello fellow risk takers and welcome to my worst investment ever stories of loss to keep you winning in our community. We know that to win in investing, you must take risk but to win big, you've got to reduce it. To join our community go to my worst investment ever.com right now, and you'll receive the following five free benefits first, you get the risk reduction checklist I created from the lessons I have learned from all my guests. Second, you get my weekly investment research email to help you increase return. Third, you get a 25% discount on all as Dance Academy courses. Fourth, you get instant access to our Facebook community to get to know guests and fellow listeners. And finally, you get my curated list of the Top 10 podcast episodes fellow risk takers, this is your worst podcast hosts Andrew Stotz from a Stotz Academy, and I'm here with featured guest, Marcus udang. Marcus, are you ready to rock? I am ready. So let me introduce the world to you. Marcus udah gang. Kang is an IT consultant and a writer and presenter. He specializes in project management and business analysis, specifically, business applications and requirements analysis and business process management. He has worked in various industries, including financial services, oil and gas, and it training and education. He's also the host of the inquisitive analyst, podcast and YouTube channel, which focuses on the triumphs and challenges within the area of project management, and business analysis. Marcus, take a minute and fill you further tidbits about your life.

Marcus Udokang 01:50
Well, I think you've said it all, pretty much you've summed it up in a very poignant, short, to the point, matter of fact, way. Hmm.

Andrew Stotz 02:00
And maybe I can just ask a question that you and I were talking about before? You know, I think everybody understands project management. But the other part business analysis, why does a company need business analysis? And what is it?

Marcus Udokang 02:14
Well, there's a long and short of it is a business business analysts really are conduits of change. So what business analysts do is they help to create change, they help to manage change within a business. And that means that you have to be able to see the big picture, what does the business want to change? And how can you help them do that? How can you go from a current state to a future state, and that's kind of what business analysts do. I mean, there's a lot of documentation involved. There's a lot of talking to stakeholders involved, there's a lot of back and forth between, we've upgraded the software today, we have to tweak it here and tweak it there. There's quality assurance analysts involved, it's over. It's many people involved in this whole entire process, including project managers. But the business analyst really is there to help put the glue to help bring all these things together to take you from a current state, to a future state, to be able to implement those objectives of the business.

Andrew Stotz 03:11
And I guess a senior manager is not going to be a specialist in a particular area, like oh, we need to upgrade our software, or we need to come up with a better operating system or something. So a business analyst can bring that expertise at the point at the point that the business needs it. That's interesting. And one last question is for people that that, that listening to your podcast and YouTube channel, what would you describe is kind of the key takeaway that they get from that, so that maybe some of the listeners would love to, you know, find a new podcast to listen to and get the winnings from that.

Marcus Udokang 03:43
I like to ask my guests the beginning, tell me how you became a business analyst or a project manager and take us through that path. You know, I find that 95% of the time, people tend to get to where they're going almost in a similar way. Usually, it's by happenstance, usually it's by circumstances, you know, they never planned it out. It just happened. But there obviously was a mental there was a mindset behind it to make them continue to get to where they were. And each person, each person has a different story. So I like to listen to their unique stories. That's what gives it life. That's what gives it uniqueness. That's what gives it something different for each person is that each person has a different story to tell, with a slightly different path. But they all kind of got to the same place. At the end,

Andrew Stotz 04:30
I guess that's also pretty valuable for a young person that's working on their career and thinking about how they go when they hear these different pathways. I didn't like pay attention to that kind of stuff when I was young. And I'm surprised that so many young people do you know, they're much more engaged and listening in to stuff you know, where I felt like I was just kind of on my own. I mean, there just weren't the resources in the same way that they are now. So hats off to you for doing that. And, you know, for all the listeners out there, go check out the Inquisitor Do analysts podcast and YouTube channel and learn more. So now it's time to share your worst investment ever. And since no one goes into their worst investment thinking it will be. Tell us a bit about the circumstances leading up to it and then tell us your story.

Marcus Udokang 05:17
Well, I should start by saying that I have been financially literate for many years. So just because you have the knowledge doesn't mean you won't fail. That's, that's important to say, just to start up. Now, I'm not great at financial literacy. But I'm good enough that I knew and I know what I do. Most of us has been self taught, I haven't really taken a course in it. I've watched the you know, I've read a lot of books, I've watched a few these days, it's all to YouTube. But back in my day, it was all books. You know, read, I've watched financial gurus espouse all these sorts of ideas and the do's and the don'ts. But at the end of the day, I think that it's just being aware of the market, being aware of unpredictable financial forces, really being vigilant, and somewhat disciplined when it comes to making money, spending money, and saving money. So that's kind of where I'm at. So having said that, there's a certain degree of happenstance, risk, and also a large part of trust, I think that one really takes in any investment. Whether it's high risk, or whether it's low risk. So that's important to know. And I took a big risk, very big risk. Looking back, I knew it was a risk, but I think it was a huge risk. It was just a big risk in investing in what I invested in now. Probably because I worked for this company. So I trusted them a bit more than I would normally. And I believe that was probably a sound investment. At the time many people in the city had invested in this company. And they had done very well. I went off to buy a car and the guy said, Where do you work? I told him, he said, I put money in with these guys. And I you know, I waited 10 years and I don't make money. Haha, I'm working for a good company. A good friend of mine said, Oh, where you work? I told him, oh, I put money in them. And few years later a cash and I made my money. I thought you know what? This is? This is solid, this must be good. I know there's risk. We all know there's risk. But I'll do it. I'll put the money away. Oh, invest with them. And of course, well, due to uncertain market forces beyond my control, troubling economic times, a bit of happenstance, maybe even negligence on the part of the company, or even the investor. Well, the investors and the investors too. So who knows it's a combination of all these things. So never Nevertheless, the investment was sold and resold a number of times to different investors. And of course, it devalued because of it. And eventually, it became worth almost nothing. Now, technically speaking, I still get my little piece of paper every quarter telling me that there's money in it, but it's not anywhere near what it used to be. So whether or not I'll receive back any of the Pitons that's left. That's remaini. I don't know. But that's my story.

Andrew Stotz 08:18
Got it. So tell us, how would you summarize the lessons that you learn from this storms story?

Marcus Udokang 08:27
I knew prior to investing, what I was going into, like I said, but I thought the risk was much less than it turned out to be. I don't if you know that there's risk. Think twice. That's one lesson, think twice, even if it's a little risk. And looking back, I'd be inclined to even three think three times about it, you know, oh, there's little risk, there's no risk. The second thing I'd say is diversify your investments. It's not to say I wasn't diversified, but I had a lot invested here far more than I did in other areas. So diversify your investments, think two three times before you invested even if the risk is low. And if you decide to go through with it. If it seems like it's a good investment, assuming that you've done your research, that's another part. Definitely part three, do your research, invest small, don't invest big. Like I said, spread out your eggs, so that if one doesn't hatch, you got two or three others to deal with. So that's what I would say.

Andrew Stotz 09:34
Great, great lessons. Maybe I'll summarize what I took away from it. I wrote down a few things. You know, first of all is kind of the you talked about validation. You know, when you got the feedback from the guy in the car dealership and your friends and this and that and you see it in the newspaper. It's like it validates your idea. And this is very dangerous and in fact, in really, really Professional financial world investment companies, some of the best out there, they have a devil's advocate on the team. And so when one person proposes an investment, because you know, you're investing other people's money, it's funny how we can get really loose with our own money. But when we invest others, we get really serious. And they'll have a devil's advocate. So someone will present the thesis that which buy this company, and then there'll be one person assigned to say, we should never buy this company, we should never touch it. And here are all the risks. And that's just one way of kind of managing the assessment of risk. And that brings me to the next thing, which is the difference between managing and assessing risks. So when we talk about assessing risk, we're talking about before we get into something, when we talk about managing risk, we're talking about how we handle it, once we're in it, what's the percentage, let's say you bought in and went up, you know, and all of a sudden, you thought, Well, I was gonna put, I was already putting 20% of my money in it, which is a lot. And now it's 25%. Because it went up, Hmm, maybe I can always go down to 10. So it's that concept of diversification, like you say, you know, and then taking that money and putting it into something else. So that brings us to the other one, which is managing your risk. And that means keeping an eye on it, and deciding how much you want to allocate to it. The benefit of investing in publicly listed companies is that you can generally get in and out until if they get in trouble, and then you can't. And that really takes me to the last thing that you that I thought of when you were talking and that is timing is everything. Because there's great, I mean, every dog has its day, and every great company starts to fail. And the fact is, just because it made money for another person doesn't mean it's going to make money for you. And, you know, it just can be that market conditions, industry conditions, change and management. And all of a sudden, your timing was bad. Anything, you

Marcus Udokang 11:59
know, I think you're 100%? Correct. It definitely was timing it for timing for the other folks, it works just fine. timing for me, Justin. Yeah, definitely.

Andrew Stotz 12:08
And I think I'd add on to that. One of the things, it's not that common in the world of investing, because particularly like long term investors, they say, I like this company. And if the stock price falls, I'm gonna buy more. But for the typical, let's say, the average investor that doesn't really know that much about investing, I think my lessons that I that I teach is number one, you know, be diversified, try to have maybe 10, different investments, 10 different stocks, if you're going to invest in the stock market. And then the second thing is use stop losses. And I've found a lot of value in that, particularly for someone who's not super experienced. So you just say, Look, I'm buying this at 100. And if it goes to 85, or 80, then either I'm automatically telling my broker today, when I buy it, you sell it if it gets to 80, or you have a signal that tells you I'm out of it, if it hits 80. And I've found by just testing kind of randomly selected portfolios in different markets and imagining, let's say, 1000, people picking randomly invested portfolios and 10 stocks and, and doing that over and over for like 20 years, what I found is it stopped losses added a lot of value. So that's an important part because, you know, sometimes, if it's the wrong timing, a stock could just fall or an investment could just fall in, you know, you may have been, you may have picked the right company you just bought at the wrong time. So get out and wait for it to come down and then reconsider it. So yeah, lots of lessons from that experience. So let me ask you, based upon what you learn from this story, and what you continue to learn, what one action would you recommend our listeners take to avoid suffering the same fate?

Marcus Udokang 13:53
If anything, if anything COVID I think has taught us the necessity for saving for contingencies. I say it again. COVID has taught us the necessity for saving for contingency, save, save, save for a rainy day. And I heard this so many. Over the so many years, my father told me my mentors told me my financial investors told me, but what's a rainy day? Well, the day that it actually rains and I can't go out or the day that my favorite TV shows not on I don't know, you know, small things like that. But when it really hits you, okay, fine. I didn't get paid today. I'll get paid next week. But you're always getting paid. Now, people don't have jobs. People aren't getting paid. Now, it's not just one rainy day. It's many rainy days. It's not just one week or two weeks, not just a few months. It's been a year and a half. I seen businesses open up, obviously. And during COVID. Two months later, they're gone closed down. They've been around for years. How did that happen? Well because they didn't save for a rainy De. And that goes not just for businesses, but also for people, individuals like you and I. So they say have more than two months of salary saved or have six months big thing was have six months of salary saved, because it takes about six months to find another job. But you know, what I'd say, I'd say have at least a year's salary saved. Now that you know, we see it, you know, so irrespective of any, any investment for GPA, or some basic financial tenants, I think anyone and everyone should abide by. And that's also there's nothing better than the story of the turtle and the hare. There's an old story that we've all had, I grew up with it as a child, slow sometimes wins the race, take your time to invest over a lifetime, start early, that's a given. If you're going to start when maybe if you're a teenager, and your parents taught you a great even better, but you know, once you graduate from university or college and you start working, even if you don't go to university or college, they say put away 10%, I'd say put away 20 or 30%. Yep. Because, you know, I know people even say 50%. And I know it's harder when you're married, you have kids and so on. But if you have two incomes, maybe you can talk about it and try and minimize I'm not saying be a minimalist, but you know, just be careful. So do your research, do your own investing, keep up with financial news, you know, regardless of whether whether you make investments or not.

Andrew Stotz 16:27
So that's it. There's some real science in that recommendation, because money that you save and invest at a young age has many more years to multiply and grow exponentially. So it is true that you should be actually saving huge amount at a young age, and it will make your life so much easier. Last question. What's your number one goal for the next 12 months?

Marcus Udokang 16:52
Keep doing what I enjoy. Could be reading, writing, speaking at events, maybe doing a bit of travel when allowed to after COVID enjoying the weather taking a bike ride, keep investing, keep saving, but do what you enjoy and do it well. Beautiful, but I should say last but not least, keep loving, even your enemies. I hate to say that but you never know.

Andrew Stotz 17:17
Yes, resentment rots the container it's in. Alright listeners, there you have it another story of loss to keep you winning. My number one goal for the next 12 months is to help you my listener reduce risk and increase return in your life to Jesus. I've created our community at my worst investment. ever.com. See you there. As we conclude, Marcus, I want to thank you again for coming on the show. And on behalf of East Arts Academy, I hereby award you alumni status for turning your worst investment ever into your best teaching moment. Do you have any parting words for the cheering crowd?

Marcus Udokang 18:00
I'd say and this also this goes more so to Canadians and Americans be open to financial literacy for you and your family. Money is taboo in this country. And no one likes to talk about it. But everyone likes to make it and spend it. So I think it starts from the family. We rarely talk about it as a subject. I think families should be talking about money on a regular basis. That doesn't mean you have to be an open book about intimate financial dealings. No, but it means that on the topic of savings on the topic of investing in the US it should be at the core of daily conversations and I think it's central to many Asian countries. Talk about money all the time, money in a Family Center. So I think I think we should probably start doing the same thing. You know, talking about money.

Andrew Stotz 18:48
Great, great stuff. And that's a wrap on another great story to help us create, grow and protect our well fellow risk takers. This is your worst podcast host Andrew Stotz saying. I'll see you on the upside.

 

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About the show & host, Andrew Stotz

Welcome to My Worst Investment Ever podcast hosted by Your Worst Podcast Host, Andrew Stotz, where you will hear stories of loss to keep you winning. In our community, we know that to win in investing you must take the risk, but to win big, you’ve got to reduce it.

Your Worst Podcast Host, Andrew Stotz, Ph.D., CFA, is also the CEO of A. Stotz Investment Research and A. Stotz Academy, which helps people create, grow, measure, and protect their wealth.

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