Importance of Continuous Learning: Finally, investing is an ongoing learning process that requires adaptability and a willingness to evolve with changing market dynamics. Whether it’s keeping abreast of new investment strategies, technological innovations, or macroeconomic trends, staying informed and curious is essential for long-term success. Consider the example of legendary investor Peter Lynch, who famously emphasized the importance of “buying what you know” and conducting thorough research before making investment decisions. By adopting a mindset of continuous learning and intellectual curiosity, investors can enhance their decision-making abilities and navigate evolving market conditions more effectively.
As a part of my series about The 5 Essentials of Smart Investing, I had the pleasure of interviewing Joel Mallo, COO of University of Options.
Joel Mallo, the COO of University of Options, brings 17 years of mortgage lending expertise and a 4-year record of success in options trading to the role. With a deep understanding of finance, Joal excels in navigating complex scenarios, securing favorable terms, and building strong client relationships. At University of Options, Joel oversees operations, curriculum development, and student engagement, contributing significantly to the institution’s strategic vision and empowering individuals in the art of options trading.
Thank you for doing this with us! Our readers would like to learn a bit more about you. Can you tell us the “backstory” about what brought you to the finance industry?
I initially worked in the insurance industry; I was not thrilled working with claims and didn’t think it was something I could do long-term. I was having lunch with my wife when I overheard a conversation about mortgage finance, which intrigued me. I ended up introducing myself, and one of the individuals was a branch manager. We exchanged several calls over a few weeks before I landed the job. That led me to eventually cross paths with Dan, who would provide bond market forecasting to mortgage industry professionals. I found out Dan was a trader most of his adult life, and four years ago, I became one of his students and now help him run University of Options as COO.
Can you share with our readers the most interesting or amusing story that occurred to you in your career so far? Can you share the lesson or take away what you took out of that story?
One of the most memorable experiences in my career journey, transitioning from mortgage finance to trading in the markets, was when I made a significant error in judgment during my early days as a trader. It was both amusing and enlightening. I was eager to capitalize on what seemed like a lucrative opportunity, so I took a large position on a particular option trade without following my trading plan rules. As a result, the trade went south faster than I anticipated, leading to substantial losses. While initially, it was a humbling and somewhat embarrassing experience, it taught me invaluable lessons about the importance of discipline, risk management, and patience in trading. I realized the significance of conducting comprehensive research, understanding market dynamics, and having a well-defined strategy before executing any trade. This experience helped me refine my approach to trading and instilled in me a sense of resilience and adaptability. It taught me to embrace failures as opportunities for growth and constantly strive for improvement in my decision-making process. Ultimately, this amusing yet enlightening story has become pivotal in my career, shaping me into a more prudent and proficient trader.
Are you working on any exciting new projects now? How do you think that will help people?
One of the exciting projects right now is our rollout of copy trading. Copy trading allows individuals to link their accounts to our real-time trades without the need to trade themselves. Copy trading will help individuals who don’t have time to trade still be in the markets, with experienced traders executing the entries and exits. Copy trading can also assist those working to develop their skills as traders to leverage the product to generate profits as they continue developing the skills to trade independently.
Ok. Thanks for all that. Let’s now jump to the main core of our interview. According to this report in Fortune, nearly two-thirds of Americans can’t pass a basic test of financial literacy. In your opinion or experience, what is the cause of these unfortunate numbers?
The lack of financial literacy among Americans can be attributed to various factors, including inadequate education on personal finance, cultural attitudes toward money, and the complexity of financial products and systems. Insufficient emphasis on financial education in schools and limited access to resources for learning about money management contribute to this issue. Additionally, societal norms and behaviors around spending, saving, and investing also play a role. Addressing this challenge requires a concerted effort from educators, policymakers, and financial institutions to promote financial literacy and empower individuals to make informed financial decisions.
If you had the power to make a change, what 3 things would you recommend to improve these numbers?
- Integration of Financial Education in School Curriculum: Implementing comprehensive financial education programs starting from elementary school through high school would be crucial. These programs should cover topics such as budgeting, saving, investing, understanding credit, and basic economic principles. By providing students with early exposure to financial concepts, we can help them develop essential money management skills that will serve them throughout their lives.
- Accessible and Engaging Financial Literacy Resources: Creating easily accessible and engaging resources for individuals of all ages and backgrounds is essential. This could include online courses, workshops, mobile apps, and interactive tools that simplify complex financial concepts and provide practical guidance on personal finance matters. By leveraging technology and innovative teaching methods, we can reach a broader audience and make financial education more engaging and relatable.
- Community-Based Financial Literacy Programs: Establishing community-based financial literacy programs that offer workshops, seminars, and one-on-one counseling sessions can have a significant impact. These programs can be tailored to meet the specific needs of different demographic groups and address common financial challenges they may face. By fostering a supportive learning environment and providing personalized guidance, we can empower individuals to take control of their financial futures and make informed decisions. By implementing these recommendations, we can work towards improving financial literacy levels and equipping individuals with the knowledge and skills they need to achieve financial stability and success.
You are a “finance insider.” If you had to advise your adult child about 5 non-intuitive essentials for smart investing, what would you say? Can you please give a story or an example for each?
- Emotional Discipline and Patience: One of the most challenging aspects of investing is maintaining emotional discipline and patience, especially during market downturns. Instead of succumbing to panic selling or impulsive decisions, it’s crucial to stay calm and stick to your long-term investment strategy. For instance, during the 2008 financial crisis, many investors panicked and sold their stocks at steep losses. However, those who remained disciplined and patient eventually saw their investments recover and even thrive as the market bounced back over time.
- Risk Management and Diversification: Diversification is often touted as a fundamental principle of investing, but its importance cannot be overstated. Beyond simply spreading your investments across different asset classes, it’s essential to consider factors such as correlation and geopolitical risk. For example, during periods of market volatility, seemingly unrelated assets can become correlated, leading to unexpected losses. By carefully assessing and managing these risks, investors can better protect their portfolios from adverse events and mitigate potential losses.
- Focus on Value, Not Market Hype: In today’s fast-paced and information-rich environment, it’s easy to get caught up in market hype and speculative trends. However, successful investing requires a disciplined focus on underlying value rather than short-term market fluctuations. Consider the case of Warren Buffett, who famously adheres to the principle of investing in companies with strong fundamentals and competitive advantages, regardless of market sentiment. By staying true to your investment thesis and avoiding the temptation of chasing hot trends, you can build a more resilient and sustainable portfolio over the long term.
- Understanding Behavioral Biases: Human psychology plays a significant role in investment decision-making, often leading to cognitive biases that can distort judgment and undermine returns. For example, confirmation bias, the tendency to seek out information that confirms preexisting beliefs, can lead investors to ignore contrary evidence and make suboptimal decisions. By cultivating self-awareness and actively challenging these biases, investors can make more rational and objective investment choices that align with their long-term goals.
- Importance of Continuous Learning: Finally, investing is an ongoing learning process that requires adaptability and a willingness to evolve with changing market dynamics. Whether it’s keeping abreast of new investment strategies, technological innovations, or macroeconomic trends, staying informed and curious is essential for long-term success. Consider the example of legendary investor Peter Lynch, who famously emphasized the importance of “buying what you know” and conducting thorough research before making investment decisions. By adopting a mindset of continuous learning and intellectual curiosity, investors can enhance their decision-making abilities and navigate evolving market conditions more effectively.
In summary, these five non-intuitive essentials — emotional discipline, risk management, focus on value, understanding behavioral biases, and continuous learning — form the foundation of smart investing and can help investors navigate the complexities of the financial markets with confidence and resilience.
What are your thoughts about investing in cryptocurrency? Can you explain what you mean?
Investing in cryptocurrency can offer potential opportunities for high returns but comes with significant risks due to its volatility and regulatory uncertainties. It’s essential for investors to conduct thorough research, understand the underlying technology and market dynamics, and only invest what they can afford to lose. While some view cryptocurrency as a disruptive asset class with long-term potential, others caution against its speculative nature and lack of intrinsic value. Ultimately, investors should approach cryptocurrency investment with caution and consider it as part of a diversified portfolio rather than a sole investment strategy.
What are your thoughts about daytrading, using apps like Robinhood? Can you explain what you mean?
Day trading, facilitated by apps like Robinhood, offers accessibility and convenience but poses significant risks due to its speculative nature and high-frequency trading. While it may provide opportunities for quick profits, it’s crucial for investors to be aware of the potential for substantial losses, especially given the emotional and psychological challenges of frequent trading. Investors should approach day trading with caution, ensuring they have a solid understanding of market dynamics and a disciplined trading strategy to mitigate risks. The above reasons are also why we provide an education platform on day trading and teach our members how to do it properly and effectively while also having the ability to trade live with us twice a day.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?
Absolutely, I’m grateful for the guidance and support of several influential individuals on my journey to success. Dan Rawitch, my trading mentor, provided invaluable insights and mentorship in navigating the complexities of the financial markets. Additionally, my mother-in-law, Geri Relich, and father-in-law, Peter Relich, have been instrumental in teaching me the importance of savings, investing, and proper budgeting. Their wisdom and encouragement have played a significant role in shaping my financial mindset and achieving my goals.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
One of my favorite life lesson quotes is: “The only way to do great work is to love what you do.” — Steve Jobs This quote has been relevant to me throughout my life as it emphasizes the importance of passion and dedication in achieving success. It reminds me that when you genuinely love what you do, you are more motivated, focused, and willing to put in the effort required to excel. Personally, this quote has inspired me to pursue my passions wholeheartedly, whether it’s in my career, hobbies, or personal endeavors. It serves as a constant reminder to strive for fulfillment and excellence in everything I undertake.
You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the greatest amount of people, what would that be? You never know what your idea can trigger. 🙂
As someone deeply passionate about financial empowerment and education, I’m already involved in inspiring a movement through the University of Options. Our mission is to bring accessible and comprehensive financial and trading education to people from all walks of life, empowering them to make informed decisions and achieve their financial goals. By democratizing access to financial knowledge and tools, we aim to uplift individuals and communities, fostering greater economic resilience and prosperity for all. I believe that by equipping people with the skills and confidence to navigate the complexities of the financial world, we can create a ripple effect of positive change that benefits society as a whole.
Thank you for your time, and your excellent insights! We wish you continued success.
You’re welcome! Thank you for the opportunity, and I appreciate your kind words. Wishing you all the best as well!
Joel Mallo of University of Options On The 5 Essentials for Smart Investing was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.