Edition #3: Gift Giving, Fractionalization, Metromile, Buy a little, and The Laws of Wealth

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written by oz chen

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The Weird Psychology of Gift Giving 🎁

Some people’s love language is words of affirmation.
Some people’s love language is giving and receiving gifts.

Hint: Mine is not the latter. 
Tl;dr most of us should ask for what we want, or we’re giving, we should try asking people what they want. Research shows that this is the best approach for most people.

If you hate the dance of giving and receiving gifts, I wrote the Weird Psychology of Gift Giving for you:

I also cover different nuances of gift giving, including why giving a “selfish” gift sometimes works.
Also, gift cards outperform cash for interesting reasons.

Everything is being “fractionalized” ➗ 

If you’re curious about investing in something, most likely you don’t have to pay full price of it anymore.
Just as Uber and AirBnB have normalized the sharing economy, new tech enables “fractionalization” of ownership into smaller shares anyone could invest in. This makes investing in shares of startups, fine art and even expensive bottles of wine possible.
What’s the next thing to be fractionalized?

Stock I’m following: Metromile (INAQ) 📊

I’ve been a user of Metromile since 2015, when I moved to Downtown LA to be close to my job. I was barely driving and wanted to save money on my car insurance. Metromile was the only per-mile insurance I knew of, and they’ve saved me a ton of money (I pay about $35–40/month for coverage).
Now, there’s the opportunity to invest in Metromile via a SPAC (which I’ll cover in a future issue). It just means that there’s a holding company that is a public stock called INAQ, which will convert to MLE once it merges with Metromile.
As a user (and designer) who loves Metromile’s app and overall UX, I’m bullish and own some stock in INAQ right now.
One neat thing about the Metromile experience: they give you a tracking device to plug into your car’s OBD port. This device is necessary to track miles, but it can also read engine error codes and locate your car from the app. I’ve used the latter more than a handful of times when I forgot where I parked 😅

Money tip of the week 💰: Buy a little, not a lot

Find yourself judging Bitcoin but don’t want to miss out?

Similar to the idea of fractionalization, you don’t have to buy 1 whole Bitcoin, which is sitting pretty at about $22,000 right now. You can literally buy $25 worth of it to see how it feels and start understanding cryptocurrency.
I recommend the crypto-curious to buy a little, not a lot of Bitcoin.
Dipping your toes in is a totally valid strategy not only for investing, but also as a way to assess risk.
Not sure you like salsa dancing? Take 1 class. Dreaming of retiring in Canada? Save up and spend a winter there first. Moving to a new neighborhood? Rent an AirBnB there for a few nights.

Similarly, it’s not strange to watch movie trailers or read the back cover of a book before plunging in.

Book highlight of the week: The Laws of Wealth

I’ve been allergic to the idea of hiring financial advisors, especially after one lost my mother a lot of money. So I was surprised to read this from Daniel Crosby’s The Laws of Wealth:

Advisors don’t just help their clients to weather difficult periods by providing lists of statistics and probabilities. The best advisors also act as behavioral coaches, giving their clients a much-needed reality check when it comes to their emotional decisions.”

Now, a “behavioral finance coach” sounds like a great idea.

I’ll sign up if that coach is an AI that plugs straight into my Robinhood and M1 Finance accounts to reflect back to me…

  • “Hey, you’re hot on the button today. Take an extra day to think about that trade.”
  • “Do you actually know the company you’re buying? Do some more research.”

In lieu of such a pet robot, we can just do the more boring thing and talk to people. Just having to explain your thinking and rationale to anyone can help identify blindspots in thinking.

I’m thinking of new names for this newsletter. Let me know what you think of:

  • Mutual Fun
  • Index Fun

I’m also taking submissions. Pun names will be considered first. Hit “reply” to this email or Tweet at me.

End Note

If you’re enjoying the newsletter, I’d love it if you shared it with a friend or two. You can send them here to sign up. I try to make it one of the best emails you get each week, and I hope you’re enjoying it.

Should you find anything interesting this week, send it my way! I love finding new things to read through my online community.

Until next time,

I’m just a guy on the internet with an opinion, so please just treat my content as entertainment. My content is may contain referral links to products I use or love. My content is for informational purposes only, and you should not construe any such information or other material as legal, tax, investment, financial, or other advice. 

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