When you begin a journey into investing, you are bombarded by so-called professional investors fighting for your attention. These “gurus” who entered the market recently and won big on Tesla try to sell you their course with the guarantee of making a 30% compounded annual growth. That statement alone should make you run for the hills. They struck gold in the last bull market, which now qualifies them to give you financial advice under the disclaimer of “this is not financial advice”. They promote terrible, unprofitable stocks whilst compensated by the company responsible.

One company promoted heavily on the YouTube scene was Tattooed Chef. a plant-based food company that produces and sells a portfolio of frozen foods to the vegetarian and vegan market. A market that performs well when everyone has disposable income but finds people leaving their beliefs behind when skint.

The Chef has been destroyed since the highs of 2021, losing over 90%, and if anyone had done the smallest amount of research, the warning signs were everywhere.

I am always intrigued by the stocks these individuals promote and like to look over the company myself. From the start, I could see the Tattooed Chef website looked like it was designed by a 10-year-old with products not updated or missing and the search engine optimisation poorly managed. The quarterly reports were always issued late but, once released, made interesting reading; money was paid to unknown individuals; questions were raised with no real answers given in return. The money left was burned through rapidly due to the shallow gross margins, which were reduced more each quarter until recently, when we saw gross margins at negative 8%. This means that the products are selling for less than the company is purchasing them for; crazy! The company is now taking on more debt to keep its head above water.

In the risk section of its annual report, the company states the dangers of making a mistake in listing ingredients on its products’ packaging. When I read the reviews, I found one from a lady complaining that the product contained wheat when the package stated this was not the case. The company responded, “sorry, we will look into this.” You cannot make it up; it was at the top of the risk assessment! This all shows that the management doesn’t care. To top it off, we now see that stock-based compensation for the management team has increased. It appears this company was set up to provide income to the management team. Where is this money coming from for the compensation? Well, all the cash has now gone, so the company is working its way through the $40 million loan it has; then, it is very doubtful the banks will lend the company anything more, so dilution of the stock is on the cards. The company is finished or soon to be, taking all gullible “investors” money with it.

The YouTubers promoting these companies sound so confident when advertising the stock. I have never heard better salespeople, and the promises of riches will easily influence an inexperienced investor. On the other hand, I think sometimes these investors, after one big win, do consider themselves to be gurus, experts in the stock market, able to produce a 30% growth rate, making Warren Buffet look like an amateur.

Individuals like Jeremy’s Financial Education on YouTube promised this stock would go to the moon. He claims to be a growth investor and buys the story, the vegan meal made by a tattooed chef that will one day be the biggest food company in the world. The one metric he looks at is rising revenue, and from all this in-depth research determines that this stock will be 100x in the next five years.

I have never followed anyone’s trade. I like to listen to YouTubers Vlogging about the market, hoping to flag ideas. It is a great research tool, and many on YouTube provide excellent company analysis and macro news. Always listen with scepticism and do your own research.

The YouTube scene changes with the market. In recent years, the growth and crypto investors had the limelight. Their style of investing/ trading worked briefly with no thought of what happens at the end of the bull market; the idea was to buy the dip, which was easier said than done. All now have suffered devastating losses and only a few remain, still clinging on, buying the dip with the bit of revenue they get from their videos, videos that are ridiculed by the new dominating force; the Index investors. These investors slowly dollar cost average into the whole world index to create wealth slowly and sensibly over time. All carry a “told you so” attitude and declare war on the YouTube ‘scammers.’

I am a trader, a swing trader, and a trader that adjusts to the market. I will, however, invest in companies for the long term when I feel the timing is right, but I think the market has further to fall yet. This is called ‘timing the market’ and is looked down on by many, but I do not have the cash flow to average into a market that could give more devastating falls and then spend the next decade trying to make new highs. I have no confidence in the economy at present. I do admire the investors with more cash to hand. If I do not get the timing right, then I look forward to swing trading the next bull run.

Everyone has their style and will be told they are wrong by the next person, but I will never tell anyone they’re wrong as long as the work has been done. It took years to find my position in the market, and I explored all categories and encourage you to do the same.