Preview:

When it comes to investing, are you picking winners or just playing favorites? In this episode, Ryan breaks down how our emotional biases, gut instincts, and misplaced confidence can sabotage even the best financial intentions.

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More About This Episode:

Using bracket-building and sports betting as a metaphor, Ryan explores how chasing individual stocks is a lot like guessing tournament upsets: unpredictable, addictive, and often disappointing.

We also unpack data from a massive 97-year study that shows most stock pickers don’t win in the long run—and explains why diversification, discipline, and humility are more powerful than hot tips or blind loyalty to a favorite company. This is a fun and honest look at the psychology behind investing and the behaviors that quietly work against our financial future.

Here’s what we cover in this episode:

🧠 Why emotional investing leads to poor decisions

📉 The surprising odds of stock-picking success

📈 Why diversification still beats “gut feeling”

⚠️ The hidden risks of being loyal to one stock

📚 How real market data can reframe your mindset

0:00 – Intro

6:46 – March Madness and picking the “perfect” bracket

7:53 – Parallels between stock picking and brackets

13:52 – Making picks based on emotional attachment

18:20 – The illusion of being in control


Resources:

Retire Pilots – https://retirepilots.com

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Pilot Tax – https://pilot-tax.com/

The Pilot’s Advisor Podcast is also on video. Watch & Subscribe on YouTube: https://bit.ly/3EIEBW2

Connect with Pilot-Tax: https://pilot-tax.com/

Episode Transcription:

(Note, this is an automated transcription. Please forgive any errors.)

Walter Storholt 

Well, you know, March Madness just happened, and it was kind of exciting to see the tournament not as many upsets as we’ve seen in years past, but it means some of the top teams made it all the way to the finish for some great final matchups. And this whole culture around brackets and betting in general got us thinking a little bit about some of the parallels and the lessons that can be learned from kind of betting in the sports world and filling out your brackets to the financial landscape, and we’ve got some really good takeaways for you on today’s episode. So I’m going to grab Ryan. We’re going to talk a little bit of sports up his alley as well as finances. So should be a fun collision today. Let’s get to it. It’s another episode of the pilot’s advisor, Walter Storholt, alongside the pilot’s advisor himself, Ryan Fleming. Ryan, how’s it going do?

Ryan Fleming 

Wonderful Walter and I hear we’re talking about March Madness today, so I’m excited. Yeah,

Walter Storholt 

now I know we’re releasing this episode post tournament. We’re recording it, though, right as the Final Four is getting ready to start. So I’m curious, did you have all these one seeds making it to the championship game and into the Final Four, or were you picking upsets everywhere? Well, you

Ryan Fleming 

know, just like, uh, stock picking, it’s a losers game. I tend to donate money every single year, yeah, but historically, I mean, you have to pick a bunch of upsets, so you’re going to have no chance at winning a bracket. And I think it’s funny the people that are touting this year like, Hey, I did great. Well, that’s because all the number one teams are in the final four this year. So

Walter Storholt 

yeah, all the people that just picked the Favorites did really well this year.

Ryan Fleming 

And I don’t know, I don’t even know when the last time it happened where all four teams were number one seeds. Do you know? Yeah,

Walter Storholt 

I did see a stat on that. I think it was like 2008 I think, was the last time that we had the all one seed Final Four. So it’s only happened one other time. So it was a little bit unique, believe it or not, kind of unique to have all the top guys make it to the finish.

Ryan Fleming 

So yeah, the top seeded ones, which, you know, like I said, I know that hasn’t happened very often, let alone, like you talked about not having massive upsets, and that Cinderella team, per se, and not, you know, like I said, I donate money every year, but my bracket blew up earlier this year than than it did, because those, those few upsets that I did pick just didn’t happen. And I had those teams going on for a little while. Yep,

Walter Storholt 

I’ve got, I did okay, and I’ve got the chance to, maybe, I think, get a top three finish if things break my way. But doesn’t matter if, you know, if you’re not first, your last, I think, is the old Ricky Bobby saying so. And I don’t think I can win mathematically first, so well. And

Ryan Fleming 

I wager, I wager a massive amount of money. You know, I always laugh when I talk to prospects, and they’re like, Well, I’m playing with some money over here. And I go, Well, I don’t play, you know, with any of my money or saving for retirement. Obviously, I very much care about investing, and know the power of it, know the power of compounding interest and all that. So my wager on the tournament this year was 25 bucks. 25 Okay, so I’m, I’ve been crying myself to sleep, you know, the last week and a half, once I knew that that money was probably gone.

Walter Storholt 

Yeah, well, sometimes you just enjoy the tournament. Then, for what it is, once you’ve kind of been eliminated from it, which I’ve know a few people now that don’t do brackets anymore because they thought it, they found that it was ruining their experience of the tournament, and instead, they enjoy just watching the games without having, you know, a bracket riding on it. So that’s another

Ryan Fleming 

approach. I think it’s more fun. I think it, you know, then you have at least something to watch or maybe root

Walter Storholt 

for a team that you want, right? It makes me care about some of the games well. And I

Ryan Fleming 

think, unfortunately, that’s why people gamble with sports anyways, because whether they care or not, once they have money on it, then they have more of a reason to watch. But yeah, it’s amazing how, you know, I have a 12 year old son, and he asked me some questions now, like, Hey dad, you know, who are we rooting for today? You know, if there’s a team up there and and, you know, it’s funny, more and more as I don’t know if this is as I age or as I get older, you know, I’ll have certain reasons to root for one team or over the other. But really, I just want to watch a good game. I don’t want to watch a blowout. I want to watch a game that it’s coming down in the final couple minutes and you’re sitting on the edge of your seat and go, Oh, that was just an awesome, you know, sweet 16 game, or what have you. Maybe

Walter Storholt 

it is something with getting older. But I’m less, a little less passionate about the especially the random, oh, I want this team to win, because it’s just give me a good game. And I really don’t care who wins, and that’s maybe it is something about getting older that lets you accept that. I don’t know

Ryan Fleming 

of the equation. It’s also, and I apologize to our listeners that want to hear all about the market, but I just think this is a great sports conversation in general. But as I’ve gotten older, I realized that my relationship with certain teams was unhealthy. You know, I was born in Columbus, Ohio, Die Hard, Ohio State. Buckeyes fan. Played at, you know, the Air Force Academy. So of course, wash Air Force. And if those teams didn’t do well, it ruined my whole week. Yeah, and one of the things that has been very healthy for me as I’ve gotten a little older is we moved right near Clemson University. And. Now I watch Clemson, and I root for Clemson quite a bit, and it kind of spreads out or diversifies my my Saturdays to where I’m not just totally devastated if that one team or that one stock doesn’t hit right? Yes,

Walter Storholt 

you become a fan of of a couple of different teams, and then at least maybe you hit on a few of them. Yeah, yeah.

Ryan Fleming 

So it’s diversifying my passion a little bit, so it lessens the blow if one of those teams doesn’t show up or or, you know, loses that Saturday. You

Walter Storholt 

know, I wonder if that’s why people have also become fans of players more, because I don’t remember back in the day being a fan of a particular player so much it was about the team as always. But I feel, and I don’t know if this was, maybe LeBron was the first that I feel like people were going to be fans of LeBron no matter where he played, and they were going to get his jersey and be a LeBron fan. So even if the Cavs lost back in the day or the heat, or now the Lakers like, if LeBron has a good game, the Lebron fans are like, What a great day. Who cares about

Ryan Fleming 

Yeah, and that is a new thing. It’s funny, I’ve heard that a lot. I think it’s been more prevalent in basketball for years. You know that you mentioned the NBA, and I could see that, but I’ve seen it pop up a lot more in football now, where I’m like, Oh, you’re a Bengals fan. No, I’m actually just a Joe burrow fan.

Walter Storholt 

Yes, maybe fantasy, fantasy football, might have a little bit of something to do with that, like speaking of gambling and kind of picking winners and things like that. That’s obviously had a big impact. Where you’re rooting for particular players to do something versus a team. Well, I don’t know, like

Ryan Fleming 

I normally do. I know Walter, I have you totally sidetracked from what we were going to talk about on this podcast, but I’m sure our listeners, if they are sports fans, are really enjoying it. So anyway,

Walter Storholt 

they probably are. They probably are. Well, let me throw out some stats, and we’ll get we’ll start dovetailing these two things together a little bit more. There was almost $3 billion wagered back in 2024 on March Madness. I’m sure when we get the final numbers for 2025 I’m just going to guess we’ll be past the 3 billion mark, given the continued rise of gambling and the opportunity that’s out there to do those kinds of things. Interestingly, though, you know the stats, no one’s ever gotten a perfect bracket. You can never like, I think it was Warren Buffett was like, I’ll give a billion dollars to somebody who can get a perfect bracket. And it got like free publicity for them, and he knew that he would never have to pay that out, because it’s basically impossible for somebody to get that’s only 64

Ryan Fleming 

teams, right? Yeah, exactly. Imagine doing that with stocks where there’s like 30,000 or something. So

Walter Storholt 

that’s a that’s a great, great way to look at it is, how are you then supposed to always pick winners when it comes to your stock portfolio, and keep in mind that, like you know, you’re entering into that pool with a whole bunch of other people making their picks, the chances of you coming out ahead and being that one left standing at the end of it is just incredibly small. So we kind of paired this with an article that we found, and it was based on some findings from an economist, Hendrik bessem binder, I believe, is the pronunciation of the last name. He closely analyzed the returns of those almost 30,000 publicly traded listed common stocks from the period of 1926 to 2023 is when the study stopped. And what we want to do is compare what he found to some March Madness and betting takeaways and see if, you know, there’s any parallels we can draw between the two. And this is one of the really interesting ones. It was that, you know, many people guess the winners, but the majority end up losing money in March Madness. Since that just happened recently, there’s a one in 120 billion chance of getting that perfect bracket. Your chances are better of winning your individual maybe office pool, but still not very great. And Hendrix study was interesting Ryan, because it showed that most stocks led to reduced rather than increased shareholder wealth during that study period. And it’s interesting because that’s contrary to what the market as a whole has done, but individual stock picking has often left people with less money than more money? Yeah,

Ryan Fleming 

I see it all the time that people that fool around and stock pick, they have far less money, and their returns are much less than those that have a, you know, very diversified plan. And I hate when people say the market, because I go, what are we talking about? The S, P. We talking about the NASDAQ, we talked, you know, Brussels, you know, 2000 3000 what are we what are we what are we talking about? What is the market? But, you know, I do watch dal bar and all their studies and their data, because, I mean, the average investor takes home less than 4% and that’s that’s just horrible, and and when they look at that, why investors do so poorly, exactly like we’re talking about, it’s because they’re stock picking, their market timing, their track record investing. They’re not they’re not being long term, they’re being or they’re being emotional. They’re making those short term, emotional decisions and and I look at returns of the average investor out there with 4% that’s that’s a loss. You are losing. Probably not even keeping up with inflation. And it’s sad

Walter Storholt 

in this study period, only 31 stocks of the 29,000 plus that were in the database for the entire 98 period, only 31 stayed in there. So you had 29,000 companies essentially fail during that time period. Now I realize we’re looking at a long time period there, Ryan, but still, it’s a great lesson in that, you know, the stock that you’re thinking is the winner today may not even be around X amount of years from now. And so there’s, there’s, should be a lot of caution, given those failure rates of all those companies. Yeah, and

Ryan Fleming 

it doesn’t matter how big the company or how good the company is. I mean, you know, Apple almost failed multiple times. What’s happened to GE and Boeing? I don’t think anybody could have predicted right with the downfall there, and that could be half their portfolio. Do

Walter Storholt 

you think Apple and Google and some of these major companies, even Nvidia and some of these, do we think that they’ll be in existence in, I don’t know, 50 years, 100 years, well, I don’t, you might say, Yeah, but the probabilities are kind of against them, aren’t they? Well, it

Ryan Fleming 

takes one bit of legislation, and we’re watching it right now with these tariffs, where it could really cripple a company. You know, you put a 50% tariff on and suddenly the video, if you’re looking at it just being in some overseas country Now, granted. I mean, think it’s going to get a lot of them to put some some roots here on American soil, which is the whole reason. But one bit of legislation, or with Boeing, one big screw up, could, could cripple the whole company. And so you don’t want a leveraged portion of your retirement assets in one company like that. And I see it all the time, and it’s really, really good, until it’s not, you know, yeah, you had talked about sustainable success. And when we’re looking at the tournament, I know that there was a, I think it was like four teams that have been in the tournament half the years. What were those four teams again?

Walter Storholt 

Yeah. So since the tournament began in 1939 only five schools have made tournament appearances in more than half so most schools have not even appeared in the tournament half the time. And

Ryan Fleming 

if I was guessing, yes, you know, I’m just trying to think of the this, the teams are always there, and the Duke to North Carolina. But I wouldn’t know beyond that,

Walter Storholt 

yeah, Duke and Carolina definitely in there. Kansas is on the list. UCLA obviously had, you know, some incredible runs over the years, so they’ve made it to more than half. And Kentucky, so the True Blue Bloods have been able to make it. But even when you look at it from that standpoint, Ryan like we’re still talking like a 5050, chance that they’re making the tournament over that period of time.

Ryan Fleming 

Yeah, well, not just that, that they’ve been in the tournament half the time, but when they start talking about consistency of making the tournament, when I was growing up in Cincinnati, the Kentucky Wildcats were, you know, off the charts. I mean, what a powerhouse. And that was back when what patina was there and but we were looking at just, I think Tom Izzo might have one of the one the biggest runs where Michigan State’s been in the tournament for an X number of years in a row. Yeah. But what was crazy when I started looking at some of those stats is those big names like Kentucky, North Carolina, they’ve been down and didn’t even make the tournament a few of these years. And, you know, that’s crazy to me, yep. So it doesn’t matter how good that stock is or how big that name is of that stock. I mean, you could have some, some down years where it really, really crushes your overall portfolio. Yeah,

Walter Storholt 

one or two bad years of recruiting, and you’re, you’re rebuilding what feels like almost from scratch. Carolina was the last team into this year’s tournament. Lot of discussion of whether they deserved to be in or not, so that was kind of interesting to see play out. This is the issue often when it comes to filling out our brackets. Ryan, I knew Carolina wasn’t that good this year. Last team into the tournament.

Ryan Fleming 

Promotions. You got some ties there, don’t you? It’s where I went to school. I

Walter Storholt 

worked for the University. I worked for the women’s basketball team for seven seasons as their play by play guy. I I covered the men’s basketball team during some of their best seasons when I was a journalist in the local community. And so I’ve got emotional tie ins there. I’m not going to not pick them to go far and likely win the tournament almost every single year, no matter how bad they’ve been, and that usually that is, you know, bad to do and blows up your bracket, as it did this year for me. And so picking your whole your favorite team is not a very good decision when it comes to the brackets. Yet we can’t help it. I bet you see people doing that pretty much the same with stocks, just picking maybe what

Ryan Fleming 

amazing to me how emotionally attached people get to certain stocks. I mean, they get emotionally attached, and it’s almost like they’re a family member. I mean, it’s unbelievable to me, and I get it. I mean, you know, Clemson went to the Elite Eight last year, and I’m like, well. Course, they’re going to make a nice tournament run this year. They beat, you know, they beat Duke, they beat Kentucky, yeah, North Carolina on the regular season, they’re obviously going to make a run. And I don’t even want to bring up the team that they lost to. I think they had like 22 turnovers. I mean, it was, it was the ugliest game I’ve ever watched. Yeah, so, so, just like you’re talking about, where you make emotional play, well, my bracket blew up on day one.

Walter Storholt 

Yeah, and why do people do that with stocks? Is it usually some familial thing, like dad loved this stock, so I’m gonna keep investing in it, or is it more like they have a cool logo? Like people pick their sports team sometimes, right? Because I like their logo. Like my mom used to pick all of her favorite football teams. She would always when we would do like family football pools, she would pick, she’s gonna kill me for saying this on on the air, but she would say, Which coach has the cutest butt?

Ryan Fleming 

Well, I’m not gonna comment on that.

Walter Storholt 

Sorry, mom, with

Ryan Fleming 

stocks, it’s kind of crazy. I see a lot of different, like, a lot of big mistakes, to be honest with you. You know, my father in law, he worked for GE for 30 years. All his money was in GE stock, you know. And it had been great until, you know, he lost 60% of all his money. And I told him to, you know, change his his ways, years before it actually happened. Or I’ll see Delta pilots. They’ll buy a bunch of Delta stock. FedEx pilots buying a bunch of FedEx stock. You know, I think it’s becoming less prevalent now to buy stock of the company you’re with, because very few companies are actually giving you that discount to buy their stock now they, you know, it made a lot of sense if you got a 10% 15% discount. But if there’s no discount, why would you buy something that your whole life is already tied to? One of the other ones, I’m just trying to answer your question, like, what do you see emotionally? Yeah, another one is, Hey, Dad bought me this Coca Cola stock back in, you know, whatever year it was, and they’ve owned it for the last 30 years. You know, obviously that there’s a problem with that. You have a massive capital gain to handle at some point, and you’re not diversified at all. But I see it all the time.

Walter Storholt 

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Ryan Fleming 

Well, you know. And I even look back on my my experience being in this industry. I mean, I’ve been an advisor since, oh eight, been watching it and wanting to learn about it my whole life. But if I was a stock picker, I’d probably be pretty bad about pretty bad at it, to be honest with you. And I look at some of these stats, where 50, almost 52% of the companies had negative cumulative returns. So you have a 50 I look at that as like you have a 50% chance, if you’re stock picking, of having negative returns over that whole time period. Yeah, you know that screams to me, diversification. You know, when you diversify those market returns on average. You know, should be, you know, seven to 10% but if you’re stock picking, you have a 51% chance of picking something that’s going to be negative that whole time period I’d be running, running for the hills. Yeah,

Walter Storholt 

it’s not a fun prospect. I mean, that those are not odds that I want to be, you know, essentially, we’re talking about gambling with your money at that standpoint, that’s like picking, picking sports gambling, a 5050, pick for who’s going to win the game. I don’t want to do that with my money. I’m planning to retire on 100%

Ryan Fleming 

you. You actually bring up the great lesson here, and what’s the lesson? I mean, it’s fun to do the March Madness brackets. It’s fun to, you know, watch those, those games, but you shouldn’t mix that with investing. That’s not a good comprehensive investment strategy for your retirement assets. We want to be unemotional. We want to be very, very diversified, and we need to have a unemotional system helping us through the ups and downs in the market and all the turbulence that we’re going to

Walter Storholt 

face. It’s a great point, Ryan. It’s really helpful to take that perspective. And let me tell you what, folks, if you like data, if you like stats, kind of like some of the things we were throwing out on today’s show, then definitely pick up Ryan’s toolkit. It’s going to help you prepare for retirement. You can get it for free. It’s going to be packed with both of Ryan’s books, pilots retire early, and the original pilots advisor book. It’ll help you light the afterburners on your 401, K specific information for pilots, lots of data driven research in the guides and in some of the information and in those books, especially, that’s going to come along with the toolkit. So if you’re looking for a foundation, if you’re looking for a great starting point for when it comes to your finances, for retirement planning, pick up the toolkit today. You can get it for free right now. Just check the link in the description of today’s show or go to retire pilots.com and you can get more great information, like we talked about today, maybe a little less sports talk in that information, Ryan, but some good stats data and helpful information nonetheless. Ryan, thanks for all your help today. This was a fun chat about March Madness. I know we both had our brackets pretty much blown up, but it was still fun to talk about. And hey, there’s always next year, right?

Ryan Fleming 

Always next year. And I don’t think too many of our listeners would be upset most pilots, or a lot of pilots are sports fans too. And I thought it was a fun episode. Yeah,

Walter Storholt 

it was good stuff. We’ll see everybody next time, right back here on the pilots advisor.

Speaker 1 

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