Phew. July flew by. This week, the calendar flips to August and the heart of earnings season. We’re also just three months from the U.S. presidential election.

Amid the busy news cycle, we like to sit back, zoom out, and talk markets.

So, today, we're sharing our interview with our very own Shawn O’Malley, who discusses markets, investing, and learning from the very best in the business.

All this, and more, in just 6 minutes to read.

— Matthew

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"My job is essentially just corralling more and more and more facts and information, and occasionally seeing whether that leads to some action.”

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Studying Markets With Shawn O’Malley

Always learning

In 2020, Shawn O’Malley made a rational but bold bet that Russian stocks offered good value, particularly in the oil and gas space. Two years later, he got a lesson in the risks you can’t always see: His position was wiped out when sanctions made it illegal to own Russian assets after the country’s invasion of Ukraine.

For O’Malley, the wipeout functioned as an invaluable lesson about investing.

“My initial thesis to be bullish on oil and gas and that Russian stocks offered a good value at the time was sound, but I failed to continue doing the necessary diligence on the investments as I kept holding them,” O’Malley recalls. “I blindly dismissed the geopolitical risks and failed to truly understand what I owned — it never really dawned on me that I didn’t have the same legal protections in owning Russian stocks as with, say, owning American stocks. I treated stocks as all being the same, with little care for how risks can vary from country to country.”

The mistake helped O’Malley become a more sound investor, and it goes down as another educational moment in a life spent studying and learning about the details of how financial markets work.

That interest led O’Malley to Elon University, where he graduated magna cum laude in finance and entrepreneurship. He also obtained Level 1 of the CFA certification from the CFA Institute, then landed a job at S&P Global before joining The Investor’s Podcast Network in early 2022.

Over the past two years, he’s been a writer, editor, and podcast host with us. In this Q&A, O’Malley discusses his early influences, his fascination with markets, lessons learned, and more. Enjoy!

Where did you grow up, and when did you first become interested in financial markets?

Growing up in Northern Virginia, I was much closer to the federal government than I was to Wall Street. It felt like most people’s jobs were directly or indirectly tied to D.C. in some way — either working for a government agency or working for a contractor supporting the government or military. So, finance wasn’t obviously on my radar, but I remember distinctly thinking as a kid that if I could just understand how to manage money well, I’d never have to worry about it.

As in, being financially literate and knowing how to budget and invest across a lifetime would hopefully ensure that I could live comfortably without needing a top-1% income.

So with that idea in my head, as I’d scroll through the channel guide watching cable TV at around 12 or 13 years old, CNBC caught my interest. I was quickly entranced by the whole thing — fast-paced flashing numbers, sophisticated commentators, the promise of riches. It also wasn’t lost on me that stock investing was something adults did, but if I could start early and understand it, that would give me real advantages in life.

And from there, for at least a year probably, I spent everyday watching CNBC before school, after school, on the weekends, and read a handful of books on investing, too. I found all of it really exciting and committed myself to mastering all the jargon, because there really is a lot of it, even on more mainstream programming like CNBC.

A part of me probably thought I was absorbing exclusive insights from Wall Street, and that if I watched enough of these shows, I could find enough ideas to get rich on.

I became set on building my “portfolio,” and with some help, I set up a custodial stock investing account. I’d sit around reading about stocks and waiting for them to get mentioned on TV, as if that was how I’d get the secret sauce of investing — waiting for it to be revealed on daytime television.

I remember buying into Fitbit shortly after its IPO, and watching the stock run up enough such that I’d made something like $500, which felt like an incredible amount to me at the time. With a mix of wanting to protect those gains and also a feeling that there was just too much hype around the stock, I sold out 10 minutes ahead of the company reporting its quarterly earnings. I spent that whole day laboring over the decision, trying to figure out what was likely to happen and what the market’s response would be.

I probably just wanted to not have to think about it anymore, but I felt like a genius when I locked in my profit before the stock promptly plummeted a few minutes later on an earnings miss.

From there, I invested in a pretty diverse range of companies. Jet Blue, General Electric, Marathon Oil, and a few others. None of those worked out nearly as well for me as Fitbit, but I had a whole vision for what role in my portfolio each company played.

That interest in tracking stocks followed me through middle school and into high school, until I got busy with sports, classes, friends, etc. I became less religious about tracking my portfolio, but I also knew that I wanted to study finance in college, so I was really looking forward to the opportunity to more formally learn about investing.

Can you tell us about your journey from watching Jim Cramer's “Mad Money” as a teenager to becoming the chief editor of the We Study Markets newsletter, read by 30,000 investors worldwide?

Yes, watching Mad Money was very much a part of my daily CNBC routine. I truly thought Jim Cramer was some oracle who had meaningful knowledge about nearly every stock. The tradeoff was that, although his show exposed me to new aspects of markets I wouldn’t have otherwise had a window into, I outsourced much of my own thinking to his opinion du jour. 

I came from the perspective of wanting to collect insights from experts that I could benefit from, not necessarily with the hope of constructing my own independent investment ideas.

I wish I could say that this is when I discovered Ben Graham or Warren Buffett, who taught me how to think for myself as an investor, but that turn in the story wasn’t until a few years later. Alas, in my early years as an investor, I was soaking up a ton of information but not as much wisdom.

Flashing forward a few years, the March 2020 pandemic-era market crash rekindled my passion for investing and ultimately led me to study Buffett and value investing. 

When the market started plummeting, I knew from my past investing forays that this was the right time to be aggressively buying. So I did, scrounging up pretty much every dollar to my name to put into index funds. Naturally, I started reading financial market news more often, too, to take the temperature of the markets. Around that time, while trapped at home during lockdowns, I remember simply typing into Spotify’s search bar “investing shows” and finding The Investor’s Podcast Network.

The first episode I listened to was a recap of the annual Berkshire shareholder meeting, and I remember feeling excited again about investing in a way that I hadn’t been since I was a 13-year-old first watching CNBC. The way Preston and Stig riffed together, the wisdom from Buffett, the long-term perspective during a turbulent period in markets, it all resonated with me.

I binged as many episodes of We Study Billionaires as I could and continued listening weekly for another two years until I heard an ad that they were looking to hire a YouTube host.

I didn’t know if I’d be any good at that, but I knew I wanted to do anything to get my foot in the door. So I applied, and after six months of back-and-forth and interviews, we determined that I was probably a better fit to be a writer. We started We Study Markets in July 2022, and it really has evolved along the way, but two years of working on it almost daily have brought us to today.

What drove you to pursue the CFA Program, and how rewarding or educational was that experience?

The CFA is a great program; there are three levels to it, and each level requires about 300 hours of studying. If you see someone with the CFA charter in their credentials, you can rest assured they earned it. What stood out to me was that I remember hearing the program presented as an alternative route to earning an MBA, one that was considerably more affordable and more focused on investment management specifically.

I also spent much of my senior year of college participating in the CFA Institute’s stock valuation competition for universities. A team of six of us was selected to represent Elon University, and we spent months researching a company and putting together a presentation trying to value it. I had a bunch of fun doing that and competing against other schools, so I already had a positive perception of the CFA program from that.

I passed level 1 of the CFA program and haven’t yet ventured onto level 2. I’m not sure if I ever will, not because the education isn’t good, but just because my career goals have changed. Since my goal isn’t to “work on Wall Street” in the same way anymore, I don’t feel the same urgency to complete the rest of the program, nor is it as relevant.

But who knows, maybe I’ll circle back to it someday.

What are a few of your favorite books?

Nassim Taleb’s Incerto (Fooled by Randomness, The Black Swan, and Antifragile) 

What I learned About Investing from Darwin by Pulak Prasad

Boom Town by Sam Anderson (not an investing book, but an incredible story)

The Undoing Project by Michael Lewis

And, of course, Richer, Wiser, Happier by William Green

As someone who has transitioned out of a traditional finance career to where you are today, what insights can you share about the differences between these two worlds?

I sort of see myself as having transitioned from (briefly) being a player on the court in my first job, to now being a commentator of the game. I don’t consider myself to be a financial professional because, ultimately, I work in the media business now, but investing is my passion that I get to incorporate into my work. 

Both industries are extremely competitive and cutthroat. The barriers to entry into the media world are probably even lower, though. It’s much easier to start a newsletter, YouTube channel, or podcast that competes with us than to build a financial services firm or even launch a hedge fund.

My impression is that working in the media industry is more fundamentally shifting, too. If you work at an investment fund, even though markets are constantly in flux, your business model remains the same — collecting fees from the assets you manage.

Media companies' business models are far less stable. For example, many publications routinely switch between prioritizing advertising revenue and subscription revenue, trying to find the right balance.

You've observed friends engaging in risky trading behaviors, especially with options. What advice do you give to young investors who might be tempted by high-risk strategies, trading, etc.?

You need to scratch the itch. So do it. Buy some options. Trade some stocks. You will actually learn a ton from doing this. Go into it with the mindset that this is an educational opportunity, and you’ll get excited about trying to make money along the way, but just be really strict about how much money you put at risk.

I used to trade options. It’s not a sin to do so. I just never used more than a few hundred dollars at a time, and I saw it as a way to better understand markets.

What are some common misconceptions about the stock market that you frequently encounter, if any?

Misconception: When you buy a stock through your broker, the money is going to the company.

This is, of course, not true (usually). You are buying from someone else selling the shares, not from the company itself.

People get confused because they think — if I buy Apple stock on Robinhood, and the money doesn’t go to Apple, what makes this “investing?” How does Apple benefit from its shares trading?

That’s a more complicated answer, but if people are interested, this usually leads to a conversation about the difference between primary and secondary markets.

What is your favorite part about The Investor’s Podcast Network?

The commitment to lowering the educational barriers to investing. I’ve always found it stimulating to share my knowledge about and passion for investing with others, and it’s very rewarding to work at a place dedicated to doing that.

How do you approach risk management?

“Via negativa” — the study of what not to do. I focus a lot on identifying what I don’t want to invest in, which sets the stage for the opportunities I’m interested in. For a variety of reasons, for example, I avoid investing in Chinese equities, which right there helps me filter out a lot of opportunities.

What helps you create a sense of calm and peace?

Long walks outside with a good podcast or audiobook!

What does a typical workday look like for you?

Now that I’m taking over hosting our company’s Millennial Investing podcast, my days have been consumed by setting up audio equipment, learning to edit podcasts, and prepping for my first episodes to go out—researching stocks, reading books, studying from legendary investors, and condensing insights from those activities into interesting podcast episode scripts.

And, helping out with We Study Markets as much as I can, too.

What are your future plans at The Investor’s Podcast? Any upcoming topics or guests you’re excited about?

My first two episodes as a podcast host will break down the music industry, how Spotify disrupted it, how music labels make money, and my process for calculating an intrinsic valuation of Spotify and Universal Music Group.

I hope you’ll give them a listen!

Anything else you’d like to touch on?

Thank you to everyone who has read We Study Markets over the last two years. It’s been a tremendous pleasure to work alongside you, Matthew, on it each day. 

I’ve had the chance to connect with so many readers in that time as well. We don’t take a second of your time for granted — I’ve always strived to ensure each newsletter is worth the time it takes to read. And that won’t change anytime soon.

Dive deeper

Follow Shawn on X (formerly Twitter), reach out to him on LinkedIn, or check out his latest podcast regarding Charlie Munger.

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