A 15-stock portfolio that wins, ft. Stephen Arnold

**SPEAKER_1** (0:00)
Amazon Health AI presents Painful Thoughts.

**SPEAKER_2** (0:04)
I, um, I can't stop scratching my downtown. Mm-hmm, yeah, but I'm not itching to go downtown and tell a receptionist I'm here to talk about my downtown.
Some things you'd rather type than say out loud.

**SPEAKER_1** (0:19)
There's no question too embarrassing for Amazon Health AI.
Chat your symptoms and get virtual care 24-7. Health care just got less painful.

**Owen Raszkiewicz** (0:30)
The market doesn't always agree with your collection of 15 companies.

**Stephen Arnold** (0:34)
The AI winners, the semiconductor businesses, the data center winners, and that's been a big contribution to the market's return over the last 12-12 months.

**Owen Raszkiewicz** (0:42)
How do you think about sticking to your knitting when it seems like the market disagrees?

**Stephen Arnold** (0:46)
We come to work every day not assuming that we're right. We think very hard about what we can be missing, how we can be wrong, what might be threatening the business. We stay away from businesses where the behavior suggests that success will just happen naturally to them, that will just fall into their lap.

**Owen Raszkiewicz** (1:00)
Maybe people are familiar with the Ascension name. Most people know it as the consulting business. Why did Ascension get removed?

**Stephen Arnold** (1:06)
Well, well...

**Owen Raszkiewicz** (1:10)
Hey there, here's a quick note. This podcast contains general financial information only. That means it's not specific to you, your needs, goals or financial objectives. So don't act on the information until you've spoken to your financial planner. You'll find our full disclosure, disclaimer and link to our financial services guide in the show notes. Stephen, welcome back to the show.

**Stephen Arnold** (1:28)
Thanks for having me, Owen.

**Owen Raszkiewicz** (1:29)
It's always good to chat.
Many folks that are watching or listening will know you and know the Aoris brand. You've done podcasts with us before, you've written things for us before and that's been disseminated, but it's going to be a lot of ground that we're going to cover. Going back to your roots and well before Aoris started, kind of what led you down this path. But for folks that don't know, you first appeared on this network in 2019 I've got to say, you still look very much the same. I've lost a lot of hair, some things have changed, some things haven't. I think that's the real core message that I want to get across in this episode is, the things that don't change are really important to understand in investing. You're definitely someone who's carried the same narrative for such a long time, and it's worked so well for you and your clients. I really want to drill into that.
But maybe to kick things off, for folks that haven't heard you on a podcast before or come across Aoris, can you go back in time and tell us where did this journey towards investing start?

**Stephen Arnold** (2:33)
Well, I think I worked out my true north relatively early. I think back in my latter part of my high school years, I was fortunate enough to have teachers for commerce and economics that made the subject interesting. I remember, this is really interesting, how the economy works, how businesses work. It was also at an interesting time in the Australian and world economy. The Australian dollar was being deregulated. Financial services in Australia were being deregulated.
So there was an influx of foreign banks and similar measures were happening in the UK and US and trade barriers were coming down and political barriers were coming down. The world was starting to globalize and move a bit closer together. And some of the labour unions, the labour market was becoming more fluid. So things were changing and that made economies and businesses really interesting.
I also remember in that time sitting in the sun on my carpeted living room at home in my 1986 and 1987 and reading the Sunday papers, which I made a habit of doing and we used to get the Sun Herald delivered and reading the business section as well as the sports section, which I loved, but reading about the big figures in Australian business at the time and many of whom became subsequent corporate disasters. But it just felt like things were happening, things were interesting. And so that set my path through my university and into my working years. I would say that my first job wasn't in investing. I wanted it to be, but I was hired by Bankers Trust, missed out on the investment side of the business, but was hired into the credit side, which in hindsight was a really good place to start an investing career. In credit, the risks are asymmetric. The best that can happen is you get your money back plus a bit of interest. The worst that can happen is you lose it all. So that is a starting point for my career. And I shortly thereafter moved into the investing side of the business, but credit, I thought, set me up well with a naturally conservative wiring, which is what credit is all about.