Episodes

On this week's Stansberry Investor Hour, Dan and Corey welcome Rupal Bhansali back to the show. Rupal is the founder, CEO, chief investment officer, and portfolio manager of investment adviser Double Duty Money Management. She's also the author of Non-Consensus Investing and a leading figure in value investing, with more than three decades of experience.

Rupal kicks off the show by discussing her investment philosophy, how she defines "winning" in the stock market, the main misconception about contrarian investing, and why it's more important to not lose money in the market than to earn money. She warns investors that they can still lose money when investing in a high-quality company. As she says, the key to value investing is low downside. Rupal uses the auto industry as an example of a low-quality, cyclical industry, but highlights the hidden opportunity in tires, which are a consumer staple and not cyclical...

It's supremely misunderstood. We know that tire companies are going to win no matter what. And in fact, if less new cars are sold, this is better for them because they make more money in the aftermarket replacement market than in the [original equipment] market. So I've just given you multiple ways to win, few ways to lose. That is my definition of value investing.

Next, Rupal talks about getting the best of both worlds with growth and value investing. She notes that this is very difficult to do today with U.S. stocks but that there are many untapped opportunities abroad – especially in Latin America. Rupal then delves into the world of diversification, including why having uncorrelated investment ideas in your portfolio is so crucial. This leads to a conversation about knowing when to buy more shares when one of your stocks is down versus cutting your losses and selling completely. Rupal outlines three core reasons to sell a stock, regardless of whether a stop loss was hit or not...

We never want to leave any decision to the market... The market is only telling you what the stock price is. It can be up or down, but the market is not telling you what the fundamentals of the business are or what to expect from them. That's your research telling you that.

Finally, Rupal gives her opinion on buying companies like Costco Wholesale that have very high multiples but keep trading higher. She says the reward isn't worth the risk, since there are 49 non-Costcos for every Costco, and trying to find the one winner is very difficult. Rupal reiterates that it's all about cutting your losses early, accepting that you'll get things wrong, and learning from your mistakes. She also covers the wider macro environment relating to President Donald Trump's tariffs, clarifying that she's "macro aware" rather than "macro driven"...

[Before buying a stock] we ask ourselves the question, "What if the stock falls 30%?"... The thing is, we don't ask the question, "Will this stock fall 30% because a new tariff or a new tax or a new government or a new competitor will come along?"... The specifics of why something goes wrong doesn't matter. [What matters is] will the company be able to sort of adapt or recover from it?