PRASHANT MOHAN | Sharesight Portfolio Tracking

In this episode I had the pleasure of welcoming Prashant Mohan, Chief Marketing Officer of Sharesight, to discuss the importance of tracking your investments and optimizing your portfolio.

Prashant's journey began as a software developer, eventually leading him to roles at Google and Westpac before diving into the fintech space. His experience at Google, a company known for its data-driven approach, taught him the importance of prioritizing and analyzing data for business decision-making.

One of the key takeaways from our conversation was the concept of emotional investing. Prashant shared his personal experiences, highlighting the challenges investors face when trying to time the market or reacting to news. This often leads to buying at the peak, a common mistake among retail investors.

Prashant emphasized the importance of having a well-thought-out investment thesis and sticking to it. He also discussed the value of financial journaling, a practice that helps investors keep track of their decisions and learn from past mistakes. By recording the reasons behind each investment, investors can better understand their actions and avoid repeating the same errors.

We also delved into the world of ETFs and LICs, exploring how they offer diversified investment opportunities. Prashant explained the significance of understanding the underlying assets within these instruments and how Sharesight's exposure report can help investors avoid over-diversification.

Another branch of our discussion was the role of fintech in democratizing investing. Prashant believes that fintech companies are making investing more accessible to the everyday person, breaking down barriers that once existed only for serious, large-scale investors. Tools like Sharesight provide valuable insights, allowing users to compare different asset classes and understand their true performance.

Prashant also touched on the importance of empowering women in the investment space. Sharesight's Women in Investing series aims to showcase inspirational stories of female investors, encouraging more women to take control of their financial futures.

In summary, our conversation with Prashant Mohan shed light on the importance of tracking investments, avoiding emotional decisions, and leveraging fintech tools to become a better investor.

Tune in to the full episode to learn more about how you can become a smarter investor with the help of Sharesight and other fintech innovations. Don't miss out on these invaluable tips and strategies!

TRANSCRIPT FOLLOWS AFTER THIS BRIEF MESSAGE

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EPISODE TRANSCRIPT

Chloe: Shares for beginners Phil Muscatello and Fin pods are authorised reps of Money Sherpa. The information in this podcast is general in nature and doesn't take into account your personal situation.

Prashant Mohan: Something's going up and you feel like you need to be part of this story and, you know, it's already crazy. And that's how a lot of retail investors like ourselves catch, uh, an investment right at the top. If something's already made the news, then it's already quite late.

Phil: G'day and welcome back to shares for beginners. I'm Phil Muscatello. What's the true return for your investments? What are some of the key metrics you need to optimise your portfolio? Joining me today to tell us about the power of tracking your investments is Prashant Mohan. G'day, Prashant.

Prashant Mohan: Hi Phil, thanks for having me on this podcast.

Phil: Thanks very much for coming over. Prashant is the chief marketing officer of Sharesight. He leads a team of talented marketers who are on a mission to provide superior performance tracking to help users become better investors. But before we start in that, just tell us about your career, because you started at Google and at the tech giants, you know, before you got down to the fintech end of the market.

Prashant Mohan: That's right, yeah. Well, actually, even before Google, I used to be a software developer. So started out with the hardcore technical side and then made my way into the business side through a job at Westpac. And then I worked at Google as the strategy and sales ops manager for Australia and New Zealand. And then, yes, as you said, I've been in the smaller fintechs of Australia, generally speaking. And it's been a phenomenal journey in terms of getting to learn the ropes of the trade in the big corporates and then I would say, apply them in more and more independent ways in the smaller companies that I've worked for.

Phil: So what was it like though, at Google? I mean, everyone sort of thinks of Google as this huge monolith.

Prashant Mohan: It is.

Phil: Is it like that or is it a bit more personal than that once you're inside?

Prashant Mohan: Yeah, I would say it is very personal. All of those fancy things that you see in the movies and there's food everywhere. Yes, that is true. There's lots of food. And over time, I think they've tried to optimize and make it more and more healthy. But it's a really fun environment where a lot of things are taken care of so that you can invest your creative juices in actually solving big problems. And it's a lot of fun actually learning about the whole online world. There are really smart people there and they give these perspective and analysis of pretty much everything possible, as you can imagine, a, uh, Google analyst to be. So you get a lot of data. The challenge is then to kind of cull and see which one's more important and prioritize what data, uh, you need for business decision making. And I think that's the key part of the whole learning. And, of course, Google's always broken into two broad categories, the engineering side and the non engineering side. So I was on the non engineering sales and marketing side, which is fairly different. You know, you're sticking to the 90 day cycle, the reporting cycle that drives everything. It's very much a sales organization from that point of view. But at the same time, because you are in this mix with a whole bunch of engineers and they are thinking about these big, big hairy ideas and trying to solve all of those things, it's just intellectually very stimulating to be in that environment. And, yeah, it is very inspirational.

Phil: Do you ever get the sense that you're working inside one of the largest companies on the planet?

Prashant Mohan: Absolutely do, especially because of how connected you are to the whole world. So, for example, I was working here in Sydney, which is the Australia New Zealand office, which then reports into Asia PaC, which is Singapore or Japan at that time. And then you're part of this whole big, big region, and then you have peers from literally everywhere in the world. You know, I would talk to a guy in Brazil to Spain to Israel, as well as all my japanese and indian and southeast asian colleagues, which is more natural in this region of the world. But it's just, you're part of this massive machine and the kind of ideas that come out of different parts of the world. There's a lot of exchange of these ideas, and that's what is really encouraging and quite stimulating, actually.

Phil: M so what was it like transferring to a much smaller company? Sharesight's not one of the largest companies on the planet, is it?

Prashant Mohan: No, not at all. And the beauty of it is, you know, after Google, I made the transition more towards the marketing side, and then you kind of become the user of the tools that Google produces. So literacy is ingrained in you, and that is something that I took away to other jobs as well.

00:05:00

Prashant Mohan: Being in a smaller organization is very different, and I find it extremely empowering simply because you are much closer to decision making. In a lot of cases, you are the decision maker. And so it's kind of like actually implementing a lot of these things that you would normally recommend others to do. In this case, in a very short period of time, you need to quickly make these decisions and obviously with much lesser data than, say, a company like Google would have. And in a lot of ways, it's extremely empowering. I think the other side of the empowerment is the fact that it's a fantastic, fun team. You're all building something together, you know, versus in a big company, you kind of have this us and them feeling, or they have built it and we have to sell this, whereas in a much smaller business, it's all us. We build and we sell and we market and educate and all of those things all in one single piece, so there's no us in them. It's much more empowering. And you can see the impact of a lot of your decisions, as well as what you're building in a very quick period of time.

Phil: Were you investing before you went to Sharesight?

Prashant Mohan: I was, actually, yeah.

Phil: You were interested in investing?

Prashant Mohan: I was interested in investing. In fact, I was a user of sharesight way before I became an employee at sharesight. That came in handy during my interview. In fact, my first investment was back in India. This was back at the height of the.com boom, and I did work for a technology company. I was a software engineer. So it made sense to invest in the software world, and it was. That was the time when nothing could go wrong with.

Phil: And as long as you had.com in.

Prashant Mohan: The nineties, as long as you had.com dot, and that is all I knew about, honestly, I just knew about software companies. There's nothing else that I knew about. And obviously that means that, you know, that was a classic example of exhibiting that local bias. You know, you don't see your blinkers are on. This is the whole world, and that's something that you kind of stick to because that's your known world. So, yeah, in short, yes, I was investing. My first investment in Australia was thanks to the barefoot investor. I m used to read the Barefoot newsletter, and I think that's when I got introduced to the concept of lics. And I think my first investment was in AFic. I still hold on to it. I use a, uh, DRP. So that's compounded nicely over the last few years. And like I said, I was already a user of sharesight even before I was an employee.

Phil: Yeah, it's interesting about the LIc thing, because everyone talks about ETF's now, but it's interesting, I guess you were at that stage where ETF's weren't quite as possible and weren't quite as popular, but then Lics were quite common, and they're kind of like a progenitor, I guess, of ETF's, or achieve similar things, but just via a different method.

Prashant Mohan: Yeah, absolutely. And I think Lics are sort of more actively managed funds, I would say. And although this particular one is one of the oldest lics, so it had been a for a long time, and I think the key differentiation, and, like, you know, when I think of, like, do lics exist anywhere else in the world? And we were having this talk in the office the other day, and, well, we came up with the idea that, well, in some ways, Berkshire Hathaway is actually an LIc.

Phil: It's just not called that, really, isn't it?

Prashant Mohan: Yeah, it really is. It's a fund that goes and picks and invests in a bunch of companies. They have a thesis on why they picked a certain company, and it works exactly the same way. The key kind of difference is, in an LIC, the actual value of the underlying assets could be over or under.

Phil: How it's priced, and that's net asset value, which is really important to look at in lics.

Prashant Mohan: Yeah, that's right.

Phil: M you don't want to buy when the net asset value is higher than the price that you pay on the market.

Prashant Mohan: That's exactly right. And I guess, yes, to answer your question, ETF's weren't as popular back then. Certainly now they're the preferred choice of investing in a much broader range of diversified portfolios.

Phil: So you're part of the fintech ecosystem, and we know lots and lots of small companies that are trying to do work that will help investors. What's your view of this space? How do you see this space and working within it? What's it look like to you?

Prashant Mohan: Yeah, I think it's a really wonderful space to be in. We're all trying to do the same thing in different ways. We come at it from different angles. I think the key part of it is the underlying message is, in some form, we are all trying to democratize or make investing much

00:10:00

Prashant Mohan: more accessible to the common man, and therefore bring more people into the journey. And I think that's where the mission of fintechs, a lot of fintech, and when I say that it's particularly, I'm, um, narrowing it down to the investing related fintechs, where we have kind of devolved this. Lots of tools from that were available to only really serious and, you know, big whale investors to the everyday man. It's very much the evolution of technology and what possibilities technology can bring about into investing. In particular, my first share, just to go back to my first investment, was at the time when online investing or online brokers weren't that popular. So my first trade was actually placed on a phone.

Phil: Wow, really?

Prashant Mohan: I actually called up my stockbroker and placed an order, and then I had to go in the evening to his office and hand over a check. So kind of giving away my age.

Phil: Here, but you look much younger than that, prashant.

Prashant Mohan: But, yeah, I think, like, the way fintechs, particularly in the investing space, have brought about this change and made it possible for every individual, even my kids, to be involved in this journey of investing has been a really positive one.

Phil: So we recently hosted a panel, the festival of failure, which was a lot of fun, just discussing failures and some of the things that people, the mistakes that we all make, you know? And I never got to make my confession. We'll have to do another one. So I can really make my confession, because while we had some great panellists, they took over and they kept talking over me. And I'm shy, you know, I'm shy about this because I'm not from a finance background. Everyone else around me is an expert anyway. So what are some of the failures that you've come across? Some of the worst mistakes that you've come across? Have you had any yourself?

Prashant Mohan: Oh, plenty myself. Absolutely. I think my biggest failure, I would say, is not knowing when to sell. Um, and I would call that a failure as well as a, uh, learning opportunity for me, I think that's a, uh, really hard one. When something's going up, you think it's going to keep going up. And, you know, when you know really well that the macro situation is going to change, you know that something is going to happen, and then you kind of, you know, coming back to the root of what that emotion is. It's fear and greed.

Phil: Right. M so when you say knowing when to sell, like, when to sell when it's going up or when to sell when it's gone against you and you need to cut your losses.

Prashant Mohan: Yeah. So I think, okay, I'm trying to trace back or double click backwards into what that core part of it is to have a thesis. When you invest, and as part of that thesis, you determine an intrinsic value or a fair value for that investment, and to have the discipline then to say, okay, this is achieved what is possible. And therefore, I need to tap out if the market is exhibiting irrational exuberance and it still keeps going, and then you get caught up in it. That is clear, uh. Cause for being caught up in the wave. And so I think, like, basically what that amounts to is emotional investing, and I think we all have fallen prey to that in some form or the other. So, yeah, basically, to overcome the fear as well as the greed side of your investing, waves, I think, is really important.

Phil: Well, waves is a good way of putting it because it's riding the volatility. Because people, unless you look at a chart and think about the chart and study that chart, I'm not saying about being a technical analyst, but it's just to look at a chart and see where a share price goes or where an index goes up and down. That is what is going to happen to your investments.

Prashant Mohan: Absolutely. And that's the key challenge. And how do you remove yourself and go to the real fundamentals? Again, like some of these great investors that you come across and the books and their writings and sayings, they all seem to be extremely rational, and they have very well thought out hypotheses, and they stick to them.

Phil: Of course, you get out into the real world.

Prashant Mohan: Exactly. In the real world, minions like me don't have the ability to rise above all the emotion that's going on, and we leave it till it's too late. And I think a lot of the emotional investing decisions come from there, and it's exactly the same thing in the opposite direction. When something's going up and you feel like you need to be part of this story and, you know, it's already crazy. And that's how a lot of retail investors like ourselves

00:15:00

Prashant Mohan: catch, uh, an investment right at the top. If something's already made the news, then it's already quite late as a kind of rule of thumb. So I think that's, I would say that's my side of investing mistakes. And the event itself was a fascinating one. Thank you for coming up with that idea.

Phil: I want to do more of them. I think I might do an x space very soon on that. I think it's a great fun idea.

Prashant Mohan: It was such a fun idea. And we can all learn so much from each other rather than having to go through each of those mistakes ourselves. So there were really good learnings from that event itself. I think emotional investing and the fear and greed came up a lot. The other one was around timing the market, so attempting to time the market.

Phil: Uh, that old one.

Prashant Mohan: That old one, exactly. So, you know, as clever as we think we are, and you might have got it right once. You might have got it, write twice, but eventually it catches up on you. And timing the market has definitely been. Was one of the mistakes that was quite heavily discussed. I also have these other ones, I think fundamentally lack, uh, of research was the other one where not understanding the proper t's and c's of a particular investment vehicle. I think one of the examples that was quoted was of this particular type of investment where you had a legal obligation to pay a certain amount after one year of investing in something. I think the case discussed was of Brisbane airport, where there was an initial amount put down, and then a year later, irrespective of what the price was, you had to pay that original amount that you had agreed as part of your contract. And, um, that is clearly because you didn't read the actual terms and conditions. So that was a really good eye opener, especially when it comes to some of these less publicly traded instruments. That's something to keep an eye on. And, yeah, we can definitely go on about all of the other mistakes as well. But these were the top three or four that came up during the event.

Phil: Yeah. Well, just a little plug here for sharesight from my point of view. I, uh, think I've avoided a mistake this week because a small holding I've got is cochlear in cochlear. And they came out with their report disappointed that the stock dropped by 7%. But I'm able to look in my Sharesight record keeping of it. When you look at that 7% drop, in the context of the last eight years, I think I've been holding it. It doesn't really matter. It hasn't really changed the overall return that much, and I'm happy to hold it. I think it's a great company. It's one of the biggest companies on the ASX. Something would really have to go wrong for that to drop down a lot more than that and to make it a really poor investment. So, yeah, it's been great to be able to use sharesight to look at a particular company like that in context of the volatility which we all have to expect.

Prashant Mohan: That's right, yeah. And I'm guessing the part that you got a lot of value out of was the dividends that you've got.

Phil: Yeah. It's not a big dividend payer, but it does contribute as well.

Prashant Mohan: Yeah.

Phil: To the return.

Prashant Mohan: Yeah, that's right. Similar one for me as well. Like, uh, you know, I'm probably invested in one of the less performing stocks on the ASX. Telstra. Every Telstra shareholder is kind of, you know, it's one of one that has a lot of hope, but doesn't everyone keep. But again, it would have been much worse had I not been tracking dividends from Telstra. Just looking at capital appreciation or the lack thereof would have been even more disappointing than the fact that it does pay a decent dividend every now and then.

Phil: So do you think share side helps you apart from that? There's other ways that it helps you to minimize your mistakes?

Prashant Mohan: Yeah, I think it does. And the key part of it is around just keeping track of everything that you have. You know, with so many options available today, like you mentioned, there's a proliferation of online brokers, micro investing apps, and, you know, you could go into other types of asset classes as well. It's tricky to keep track of everything. You have to log into a separate place, and they're often not on common denominators. You know, the classic barbecue situation where your brother in law has made a killing out of crypto or property or whatever the latest flavor of the month is, and you don't understand what that means. Those are just headline numbers. Now, when you want to compare different asset classes, different types of investments, all on the same common denominator, that's where I think Sharesight provides incredible value, because you might have two or three brokers plus a micro investing app,

00:20:00

Prashant Mohan: plus a crypto exchange or, uh, whatever. You bring it all together, and everything is kind of compared on the same common denominator. Annualize all performance. And that's when you know the true performance of all your investments. And, of course, it also helps to know what your net worth is, in effect, by tracking all of these things. And to come back to your question, how does it help? There are very nice ways in which you can, you know, one is like, take notes. It can be your, uh, active financial journal. So you have an annotation for.

Phil: That's actually something that I've heard from many great investors, is to keep a journal, to actually record the reasons why you bought a particular company or instrument.

Prashant Mohan: That's exactly right. And why you bought a particular instrument. Keep a proper financial journal. Every single decision. If you look back over time, you forget no one remembers exactly what happened. Even the stock market fall of last.

Phil: Week, the great recession of 2024, as.

Prashant Mohan: They call it, lasted all of 24 hours, probably, uh, who knew about yen carry trade and all of these things. All these things we learned new on that day. But again, it's really good to note why you acted in a particular way, why you topped up maybe the next day. And all of these decision making points are best done through a journal. And rightly, like you said, I think that's another discipline which helps. The third part is keeping proper records and making your tax time life extremely simple. Once you've kept all the records, it, uh, becomes really easy to just have a proper note of everything. And that simplifies your tax filing time so much easier.

Chloe: Are you confused about how to invest? Life Sherpa can ease the burden of having to decide for yourself. Head to lifesherpe.com dot au to find out more. Life Sherpa, Australia's most affordable online financial advice.

Phil: Look, I just want to also ask about, and I put down a question. I've forgotten where I got this question from, but I think I read something online and it's about the anti broker thing. Do you remember what he said and what this anti broker thing is? Not that we're anti brokers here.

Prashant Mohan: Yeah, that's true.

Phil: Because sharesight likes to plug into brokers to get exactly feeds.

Prashant Mohan: Yeah, that's exactly right. Well, I wouldn't call it anti broker. I would just zoom out and say, well, what's the incentive? So Charlie Munger's famous saying, show me the incentive and I'll show you the outcome. The brokers are necessary, they exist to, you know, every business exists to make a decent amount of revenue. But if you think from an investor's point of view, the broker primarily earns money through your trading. The more you trade, the more Money a, uh, broker earns. Now even if it's a zero dollar brokerage, they still earn because you trade. And that transaction creates something that is monetizable. Now that's their job. And so they have no incentive to actually work on behalf of the investor to show you all the critical parts of your portfolio. So what Sharesight does is it comes from an investors point of view. It was created by investors for investors to solve a real investors problem. And what that does is it creates a story for you through the numbers and the data in it to then give you a perspective where you see your actual return. Now what a, uh, broker typically shows is what is called time weighted return, which is basically the first time you bought a particular stock to its current price. And irrespective of how long you've held it or what costs have gone in holding that particular stock, it all gives you a common return. Like say you bought something for 100 today, that is 300, 300 -100 that's 200 over 100. So that's 200% return. That's all it'll show you. Well, the underlying detail is what is really important from an investor's point of view. How long did you hold it? What are the costs of holding that? So the cost of holding it is particularly relevant when it comes to other asset classes. Let's say you have an investment property. Again, just looking at headline numbers for an investment property doesn't make sense. You know, you bought something for 500. Today it's a million. Well, what happened in that journey of bringing it from 500 to a million? What are the costs that went in? What is the actual

00:25:00

Prashant Mohan: return you made on it? And these are the points that are really important from an investor's point of view. And that is what a tool such as Sharesight provides you in an ease. You know, normally an investor would have to work all this out on a, uh, pretty detailed spreadsheet, trying to gather all the data from various sources and bring it all together. What Sharesight does is it automates a lot of that work and provides you the headline numbers, as well as numbers through which you can make decisions in a much more simplified manner. So the anti broker part is just purely aligned to incentives. We love brokers. We love working with them. Like a lot of our fellow fintechs are brokers, and they have done incredible work in democratizing investing and brought it to everyday person. Without them, we wouldn't have trades. So that is the core of all investing anyway.

Phil: And it comes down to that one number, doesn't it? The cager, isn't it? The compound annual growth return, right?

Prashant Mohan: That's right.

Phil: And that becomes the common figure no matter what the asset class is.

Prashant Mohan: Exactly. Yeah, exactly. So it includes any kind of money in and money out. Everything is factored in. And so you might have this situation where your broker might show a really positive return, but what has actually happened underneath is actually not as rosy as it looks, or vice versa. Sometimes the capital growth might have been really poor, but you might have got a lot of dividends. So there's a lot of story behind every single holding, and that's the part that comes together through the numbers in sharesight.

Phil: So what are some of the key metrics that investors should pay attention to to help them to become better investors?

Prashant Mohan: Yeah, I would start with that total annualized return. And particularly when it's properly Money weighted, it makes a big difference. That gives you a true return.

Phil: Uh, how do you mean Money weighted?

Prashant Mohan: Okay, so that's going into a bit of a rabbit hole.

Phil: Oh, good. We love a bit of a rabbit hole.

Prashant Mohan: Okay. Let's take a particular investment. Let's say you put $1,000 at, you know, let's start the clock from there. At the end of year one, you've put in another thousand dollars. And those $2,000 together at the end of year three has now become, say, $5,000. Right. So what the time weighted return, which is what normally you see on in a brokerage, would be the 5000 or, uh, like the equivalent of the stock price when you have that as 5000.

Phil: So it's just the percentage, it's just the beginning to that point of time.

Prashant Mohan: M. Whereas when you have a Money weighted return, how long was that Money invested carries a certain weight, and therefore, the next round of investments then come towards counting at a slightly different weight. So that's the super high level version of it.

Phil: Yeah. Uh, because each particular component as it comes in, like, say you've got an investment that you're doing a dividend reinvestment plan for. In that drip, you're going to be buying the stock at, uh, all sorts of different price levels depending on what the underlying stock is doing as well.

Prashant Mohan: That's exactly right.

Phil: And so it's calculating all of those individual returns exactly right, and then aggregating.

Prashant Mohan: It at an investment level.

Phil: Why is it important to know what's in an ETF that you own? Because Sharesight offers you that look through service, doesn't it?

Prashant Mohan: That's right. Yeah. So, yeah, we launched the exposure report, and one of the primary reasons we did that was a lot of ETF investors were buying several ETF's. And in the process, one of the reasons, or one of the drivers could then become over diversification. Maybe you held the same exposure to a certain stock or sector, uh, through a particular ETF, and you bought the same thing in a different place. So people wanted to understand, actually, okay, if I'm already exposed to that particular stock, why not I just do more dollar cost averaging into the same ETF. So it was also really a helpful tool for investors to then go on and see, well, how much true exposure to Apple do I have? Let's say, for example, you went and bought Apple directly, and then you have three or four other ETF's that also hold Apple. Now, that then helps you determine, okay, if a particular thing happened to Apple, how much exposure do I have? Or if you want to zoom out a little more and say you look at it at a country point of view or a sector point of view, well, how much exposure do I have towards australian equities

00:30:00

Prashant Mohan: versus say, international equities. And let's say you want to increase your exposure towards a particular country, it just arms you with information to see that, okay, I've got exposure to all of these sectors and geographies. And that then helps you decide whether you need more exposure or less exposure, and then that makes those decisions much easier to make.

Phil: And speaking of international stocks as well, the currency is factored in as well. So at any particular time, whatever the exchange rate is, will be reflected in the value of your overseas holdings.

Prashant Mohan: That's exactly right. And that was part of the total annualized return question that you asked me. So you get the capital gain, the dividend gain, and the currency fluctuation associated with it, or the currency gain associated or loss, depending, uh, on how currencies have gone. And again, if you think of it as a dividend paying overseas stock, then you also need to keep record of the dividends in both in australian dollar as well as in the overseas currency. At every single instance, the dividend was declared. And that's another part that shares that, uh, completely automates. And not that we are going to become as individual investors, currency hedges or anything like that, but it just helps to know what contribution that had in a particular ETF going up or down. And that's really useful that, yes, you have exposure to a particular stock, you have exposure to a particular market and currency, but then that did something to your portfolio. And just understanding what are the key drivers of the ups and downs of your portfolio return makes your life as an investor much more interesting, I would think.

Phil: What do you think Sharesight's doing to help women become empowered as investors? Because we all know this investment space, it's mainly blokes that are listening or watching this. Uh, we just want to point out, we know what you're doing, what's going on, what are some of the stories you've heard and what's sharesight doing to help with female investors?

Prashant Mohan: Yeah, so one of the key reasons or key ideas that we had in mind was we want to change that ratio of male to female investors. Now, depending on which broker or survey you read, typically the ratio is at, um, like 80 20 at best at the moment towards male to female. And we want to change that equation. Now, we do have a lot of inspirational women who need to tell their story, and in order for them to tell their story, we wanted to provide a platform for that. So one of the initiatives we did earlier this year was to launch a, uh, women in investing series. And that was just to bring out the stories of truly inspirational women who have invested for themselves, who are individual investors, and make it completely normal for women to get into the investing space. One of the reasons I believe that women hold back is this idea that it's a risky asset class, that equities.

Phil: Are very risky because men have got a much higher risk tolerance in general to what women do.

Prashant Mohan: Absolutely spot on. So women are, you know, mostly providers. They want to conserve and keep things safe so that they can invest in the right thing. And by nature of the headlines that we hear every day, you know, one day you hear about something going up, another day you hear about something going down. And obviously the things that go down amplify a lot more in our brains, right? Men included. But you're right, it's just the risk appetite that men seem to have a higher risk appetite compared to women. And also, I think the other side of it is, if you think about it, it's only, I would say, a generation and a half of women that have gotten into workplaces as commonly as it is today. And it's all that catch up that needs to happen both in the workplace as well as in the investing world. So, firstly, they never had that disposable income. Now that they do have that income and the ability to save and provide for their family, in a lot of cases more equal than men. And that's the kind of mindset change that we need to bring about. And it was towards this that we started showcasing more women investors and making it completely normal to have these conversations among women. We continue to do that. We provide this platform on our, uh, social platforms as well as on our website. You'll see a lot of case studies of women investing. And the idea is to bring more women into the investing world.

Phil: Do you ever see the light bulb coming on with people that come to work at Sharesight? Because obviously, people that come from a

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Phil: marketing background, they most probably have got no investing experience, and then they come and work with you at Sharesight. Do you see that light bulb going on and going, oh, this is how you do it?

Prashant Mohan: I absolutely do. It's completely eye, uh, opening. A lot of people have been putting their investment decisions away. I need to learn more about it. I need to think about this a little more. And then once they join Sharesight and see all these stories of people that have invested and grown their wealth and how they've invested, and just the fact that we work with so many partners, so many fintechs, as well as traditional finance companies, where it's actually become so much easier now than at any other point in history to open a brokerage account, to open an account with any of these platforms, to then go about and start investing. And that light bulb moment is really fun to watch. And as marketers, I think the other fun part is how closely related marketing and investing are. There are a lot of concepts that can be interchangeably used. So it's the same concept. And in fact, any business is the same. So that part is also a very educational process. There's a lot of things that we can take back after learning from investing with the business world.

Phil: Do you get any interesting feedback or questions from sharesight users?

Prashant Mohan: Oh, yeah. Our users love giving feedback. We try our, uh, best.

Phil: Even if you don't want to hear it.

Prashant Mohan: Even if we don't want to hear it. Even if they're not the most pleasant ones. But look, most commonly they all love it. We've been making lots of changes. There's a change happening almost every day to the UI or ux, as well as the coverage. You know, we provide coverage to more than 70 different markets in the world, whether it be stock exchanges or other types of asset classes. So that universe is always expanding. The key kind of feedback that we always hear on the other side is mostly around making it more usable, more relatable. You know, that's something that we take very seriously on board and try to simplify the language. A huge part of our job is also to simplify the language of investors on the one hand.

Phil: Which is so needed, isn't it?

Prashant Mohan: Which is so needed. Like, why complicate something? It just means something really simple. So just to kind of demystify a lot of that, on the one hand.

Phil: And then you get that with the talking heads on tv or in the media or in the financial press or whatever is. And they just love throwing the jargon around.

Prashant Mohan: They love, yeah, exactly. I don't know why. Whatever. I think it probably makes them sound more important or authoritative. Authoritative, yeah. And look, again, can't blame them. They've grown up in that environment. To them, it might mean something completely normal and usable, but I think to make that as simple as possible, within sharesight, we have the other complication, which is that a lot of us came from a technical background or engineering background. So there is a lot of engineering jargon as well.

Phil: Yeah, like saying ux.

Prashant Mohan: Yeah, exactly.

Phil: User experience, ladies and gentlemen.

Prashant Mohan: That's right. Yeah, that is, that is exactly spot on. An example of what we need to do.

Phil: So what's the importance about knowing the tax outcomes of your investing.

Prashant Mohan: Yeah. So depending on your, you know, the different purchases that you've made over time, um, you can actually work out how much tax you want to pay. So that's on several levels. One is at the CGT level which is associated with capital gains. So that's capital gains tax.

Phil: So that's whatever the tax you pay on the increase in value of the company.

Prashant Mohan: That's right. Two is in terms of income tax. So, you know, any dividend income that you receive, whether from a direct stock or an ETF, gets added to your overall taxable income and that goes towards your overall accessible income. Now if you come back to the capital gains tax, there are several methods you can allocate by which you can then decide what gives you the best outcome. Now in Australia we do have the fortune that you are able to decide what possible sale allocation methodology you can use. Let's take for example, you bought BHP shares in 2010 and now you're selling some of them in 2024. Now you then can opt or decide which lot of shares you sold. Now, depending on what the stock price was at each of these points, your capital gain can be calculated with completely different numbers.

Phil: And this is what they call first in, first

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Phil: out, isn't it?

Prashant Mohan: That's right.

Phil: So like the default with most ways of looking at it is, uh, the first one you buy is the first one that goes out and that's what gets declared to the tax department.

Prashant Mohan: That's correct, yeah. But in Australia you can choose to then look at it as other methods, last in, first out. Or you could even look to do minimize CGT. So whatever methodology you can use to minimize the CGT, let's say the share price in 2000 was higher than the one in 2010, then you can choose that. Okay, that is a m parcel of shares that I've sold. So depending on the sale allocation methodology, you can get different tax outcomes. The third component of tax is particularly relevant for more, uh, retirees, which is on the franking credits part. Now when a dividend is declared, a certain amount of it is frank and certain amount of it is unfranked. If the company derives all its revenue from within Australia, then all of it is pretty much franked. And then that is another piece of information that you need to keep track of as an investor. The advantage again of using something like sharesight is that we automate all that information. And therefore the net impact is you don't have to pay more than what is necessary or you can even use that as a means to then actually get back any kind of refunds that you should be getting lawfully.

Phil: And what about in terms of dividends? Tracking your dividends as well.

Prashant Mohan: That's very important. Again, whether if it's a domestic share, you have to keep track of all your dividends. Even if you have DRP, even though.

Phil: You'Re not, it is taxable income.

Prashant Mohan: It is still taxable income.

Phil: Yeah.

Prashant Mohan: Even though you're not actually getting the.

Phil: Cash into your know about this tax because you might want to keep on adding be via dividend reinvestment plan, but there'll be a tax in, there'll be added on to your taxable income.

Prashant Mohan: That's exactly right. Yeah. So keeping track of every dividend is super important. And this is kind of where you, uh, know, a tool like sharesight triangulates the information from your broker, which has the base level information on how many shares you own. The share registry, which knows how many shares are actually in your name. If it is from a hin brokerage, that's another rabbit hole to go down. And then you can then keep track of all of the information in one place, which is in this case, Sharesight. If you have a foreign share. Again, it's really important for you to know what each dividend was in australian dollar terms and in the foreign currency terms. So most commonly it's us dollars. So what was the dividend declared in us dollars? And therefore how much did you get in Aussie dollars? And there's another sort of a certain tax associated with that as well. So keeping all that in one place makes your life as an investor way, way easier.

Phil: And there's also tax loss selling as well, isn't there? You can, I uh, mean, I always like the idea, and I've said this so many times, is treat your portfolio like a garden. You know, you let the blossoms grow and then you take out the weeds. And when you're taking out the weeds, that can also help to offset any capital gains that you've possibly made.

Prashant Mohan: That's absolutely spot on, Phil. You used my analogy. I love that. Yeah. It is very much a gardening experience, a gardener's life. You tend to your portfolio. So every now and then, whenever you want to get rid of some weeds, if you want to pair that with some nice harvest, or the other way around, when you get a nice harvest, you get rid of some weeds. You can reduce some of the, some of your tax bill by offsetting the losses against any of the gains that you've made. And that's definitely another tool that we provide in Sharesight through our, uh, unrealised capital gains tax.

Phil: Sapra Shan, thanks very much for coming around and having this chat. It's been great to, uh, see you face to face again.

Prashant Mohan: Absolutely. Same here, Phil, thank you. Really honoured to be here.

Chloe: Uh, thanks for listening to shares for beginners. You can find more@sharesforbeginners.com if you enjoy listening, please take a moment to rate a review in your podcast player or tell a friend who might want to learn more about investing for their future.

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