Editor’s Note: The Smart Money family has exploded since the beginning of the year, and while you’ve been reading and enjoying Eric Fry’s content, we realize you may not know the “man behind the curtain,” so to speak. So after an in-depth interview with Eric earlier this week, Dave wrote this edition to show a bit of Eric that you may not have seen before… and how he went from studying comparative literature to becoming “Mr. 1,000%” with more than 40 quadruple-digit winners to his name.
Dave Gilbert here, Editor of Smart Money.
At the early age of seven, Warren Buffett borrowed a book from the local library called One Thousand Ways to Make $1000.
When he graduated from high school in 1947, his senior yearbook picture was accompanied by the words likes math; a future stockbroker.
Somebody made a good call, though not a surprising one. The Oracle of Omaha’s path was clear early. And as they say… the rest is history.
Warren Buffett is one of the greatest investors the world has known. That’s how he accumulated his current net worth of $124.3 billion. He has so much money he purchases entire companies with the same ease as he invests in stocks.
Most of us would be happy with even a fraction of Buffett’s success, but very few are destined for something legendary at such a young age.
That’s okay. You can still be a successful investor.
Like the man who went from waiting tables to winning Wall Street’s most prestigious investment competition…
Talkin’ Sports, Talkin’ Stocks
When Eric Fry was seven years old, he wasn’t borrowing investing books from the library. He was playing baseball. Like most kids, he wanted a career as a major leaguer.
Growing up in Southern California, he also liked the beach. You could often find him playing beach volleyball as much as he was playing baseball.
And he loved reading and writing. By the time he was in college, he had set his sights on a career as a screenwriter. He was, after all, a stone’s throw from Hollywood, and he graduated with a comparative literature degree from UCLA.
Through it all, there was still a path that led to investing, though it went largely unnoticed. It was simply part of the scenery.
Eric’s father, a “super overachiever” as Eric puts it, was an accomplished attorney and physician. And he loved to talk about stocks.
Eric and his dad talked sports, too, the way a lot of fathers and sons do. Eric loved talking baseball. His dad loved talking golf. And they both like talking about stocks. Eric told me:
We didn’t talk like, “Hey, here’s how we’re going to make a billion dollars.” It was more like, “This is kind of a cool stock. What do you think of this idea?”
Those conversations at the dinner table and around the house were the seeds of a storied career as an investor. It just took a while for them to grow.
While in college, Eric started working at a restaurant to pay for his education. He rose from dishwasher to head waiter at the Chart House in Malibu. He was also a manager at the Hard Rock Cafe in West Hollywood.
As part of his comparative literature studies at UCLA, he needed to learn and read in a foreign language. He had an affinity for French, which led to him also spending considerable time in France after college.
In his late twenties, back in the United States and still working at restaurants, surfing, and playing beach volleyball, he thought it was time to “do something serious” with his life. He turned to something familiar.
That entire time in college and after, in the U.S. and in France, I followed the stock market on a daily basis. I was following certain stocks very closely, much like an analyst would. I never stopped doing that.
He even spent time working at an investing office in Monte Carlo during one of his extended stays overseas.
After getting married and moving to San Francisco, he landed a job with Montgomery Securities. Montgomery was enjoying success as one of the preeminent firms in the city by the bay, which was a hub of technology companies and IPOs.
Eric was firmly on the investing path.
Much more happened along the way, of course. Eric went to work growing his own money management firm. He started his own newsletter and even landed one of the most famous investors in the world (Jim Rogers) as his first paying subscriber. There were people who helped him learn and grow, and there were successes and failures.
Looking back, Eric says those bumps had an even greater influence on him than the successes.
I would say I am largely self-taught, both educationally and experientially. I researched and learned what I didn’t know, and I learned a lot through experience.
I think you learn more from your mistakes than your successes. Successes can actually blind you. They can give you a false sense of confidence in your ability. But your mistakes, if your intentional about it, help you sharpen your skillset and hone your insights.
I made my share of mistakes early on, but I made them almost entirely with my own money. I took more risks with my own money than I did with client money.
He learned well, gaining a reputation for his 10-bagger calls that make his subscribers money and his early recognition of dangers (like the 2008 housing crisis) that could have lost his subscribers money. He beat 650 of the biggest names in finance when he won the prestigious Portfolios with Purpose competition in 2016.
With all that investing success, the comparative literature degree was kind of a waste, right? Definitely not. Eric says studying the humanities made him a better investor:
The stock market is a socioeconomic animal. You get both the quantitative and the qualitative.
The market responds to data over long periods of time, but it also responds to animal spirits and psychology in shorter periods of time. I think my liberal arts background has been very helpful in providing psychological context to quantitative datasets.
So that’s how someone goes from dishwasher to a comparative literature graduate to world-class investor. It’s not Warren Buffett’s path, and it isn’t yours or mine either.
Fortunately, we can look to and learn from people like Eric. The most rewarding part of his career hasn’t been the money he’s made but helping other investors find their own path to financial freedom.
In future editions of Smart Money, we’ll look at more of Eric’s story, the most important lessons he’s learned, and how we can put them to good use in our own investing journeys.