The Art of Finding a 'Keeper'

We have a special surprise in this week’s edition of Filthy Rich Animal! Kate is taking some time off to study for the Certified Financial Planner exam, so Earny decided to ask his friend and TheStreet Pro contributor Louis Llanes for thoughts on being a collector.

Louis, besides being a expert investor, is also a musician and guitar collector. In this week’s article, he walks us through some of the favorites in his collection and tells us that “true collectors are willing to let go of good-but-not-great instruments in pursuit of the next keeper.”

Earny keeps it focused on investing. Sort of. In this week’s Earny asks, our Squirrel friend wonders how trading options is like hockey. It’s a complex topic, but we dive in for an introduction to options trading.

✌  Jason Meshnick

PRS 513 10 Top (No Longer in Production):  The most versatile guitar I own with 13 pickup configurations

The Art of Finding a 'Keeper': Guitars, Stocks, and Long-Term Value

There are many parallels between collecting guitars and selecting stocks. Here's how to identify the 'it' factor in both.

There's a big difference between being an investor and being a lover, fan, or collector. 

As you may know, I’m an avid guitar player and have a collection of electric guitars.

One thing I’ve discovered is that when you collect something — whether it’s Porsches, guitars, or stocks — there’s a distinction between loving something and finding a "keeper" versus having a short-term love affair that lasts six months or six years, only to eventually sell that asset in exchange for another opportunity that might become the true keeper.

What Makes a 'Keeper'?

The keeper is the investment that has all the characteristics of not just being a great long-term asset but also something you truly love. In the world of guitars, I have a core set that belong in my keeper category. 

These guitars have a unique combination of scarcity, playability, tone, beauty, and feel — qualities that make me want to keep them forever. I have no intention of selling them.

Left: Martin D28 (Keeper) and Right: Gibson (1 Year Love Affair - Sold)

Identifying Guitars That Have 'It'

In the electric guitar world, I can think of a few guitars that fit this category, each with a specific purpose. Take the Stratocaster, for example. While they are abundant — almost "a dime a dozen" — not all of them are special. 

I often joke that most Stratocasters are expendable, even the higher-end Custom Shop models. The reason is that, despite being made with the same materials and specs, some guitars simply have an unexplainable magic. You could line up ten Custom Shop Strats, and only one or two will stand out as truly exceptional.

What helps add the magic to unique instruments? Louis Llanes explains ...

Earny Asks: What Do Stock Options Have to Do With Hockey?

We discuss call options and how much money you can make or lose when you trade them.

There are basically two kinds of options:

A call option is a little bit like owning the stock. If the stock goes up in value, the option will, generally, go up, too. If the stock drops, the option has a floor.

A put option is sort of a bearish bet on the stock. If the stock goes up, the put may lose value, again, until it hits that floor. If the stock goes down, the put will gain in value.

Jason gets more into it here, and believe Earny when he says you should read it more than once...

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