A "Rule Breaker Investing" Highlight Reel

In this podcast, we've stitched together 35 snippets from Motley Fool co-founder David Gardner about his new book, Rule Breaker Investing: How to Pick the Best Stocks of the Future and Build Lasting Wealth, into a chronological highlight reel. It's a mini audiobook that traces the arc of Rule Breaker Investing, from first principles and habits, through stock-picking traits and portfolio rules, to the capstone ideas that tie it all together. Order the book here. A full transcript is below. This podcast was recorded on Sept. 10, 2025. David Gardner: Last year, around this time, I let you know I was nearing completion of a book, my final stock market book. The title may sound familiar. Rule Breaker Investing. Then at the start of this year, I told you that with each passing week of this podcast, I would randomize a few sentences from somewhere in the book. Random as maybe a teaser, a preview. Since I was randomizing, I myself didn't know which page would be coming next, as we did Page Breaker previews, week in and week out. Now just days away from the book's debut, I thought it would be fun this week to take all of my Page Breaker previews done this year. Reorganize them into the actual sequence in which they appear in the book and now reshare them one final time in this new more logical format. If I do my job right, this week's podcast will be like a mini audiobook version, or if you're a golf fan, one of those fly bys where the drone camera runs from the first T through the course, providing a good look at what's ahead prior to anybody playing the course or reading the book. This special edition, I'm going to call Rule Breaker Investing highlight reel, only in this week's Rule Breaker Investing. Welcome back to Rule Breaker Investing. I really enjoyed doing last week's podcast. Thank you again to Rick Munarriz for joining me to look back at five stocks we picked 10 years ago last week. It was really fun to talk about what happened to each of them. Some of those companies aren't still around anymore, but the dollars you would have invested in them are. We scored each of those picks all the way through the 10 years. Rick helped us understand why each stock had done what it had done. You should know that that was the start of a new episodic series. As I mentioned last week, because every 10 weeks for six years on this podcast, I picked five more stocks toward a certain theme, whatever felt right to me during that quarter or so. Every quarter, about for a year, we did a five stock sampler, and the 10 year review we just did last week was the first. There will be 29 more coming in the weeks months, and perhaps years ahead as we look back and learn at a really great vantage point, 10 years, which is much more what a capital F foolish investor does, I think. It was fun to pick the five stock samplers for the three year periods, sort of the gamification that we had going for each of those five stock samplers. But for most of these stocks, we owned them well before I ever picked them on the sampler, and for many, I hope you still own them well after the final review of Palooza for each of those samplers, typically three years later. So 10 years later kicked off last week. Next week, it's the Market Cap Game Show, something else that recurs around four times a year. In fact, exactly four quarters a year, we have a competition where we see who gets a seat in next year's March Market Cap madness. Two talented Fool guest stars will be appearing. You will, too, because you play along. It's the Market Cap Game Show coming next week, and something else happens next week, too. I think you know that. It's the debut of Rule Breaker Investing, a book I wrote last year, and I've been sitting on my hands for the better part of a year now waiting for it finally to make it to readers and listeners because the audiobook version, I also recorded, and that's out next week as well. It comes out hardback. It also comes out eBook form for the Kindle and, of course, an audiobook as well for those who enjoy audio book. I could not, of course, be more excited. This is my final stock market book. If you haven't preordered and if you're interested or excited by this news, I really hope you will pre-order. That helps a lot for best-seller lists and buzz. I would appreciate any and all pre orders, and perhaps today's podcast will inspire you to do so if you haven't already because as I mentioned at the top, I am going to be flying by that book in abridged form, bringing back all of my Page Breaker previews reordered in proper order now sequenced as they occur in the book. This is a one of a kind podcast this week. As I mentioned at the top, it's in the title of this week's podcast. It's a highlight reel of Rule Breaker Investing. Yes, I've been kicking off every podcast this year with a Page Breaker preview. But this week, I'm not going to do it anymore. The book comes out just days away. This whole podcast is, in effect, a Page Breaker preview. Let's get started. Now the only Page Breaker preview I did not randomize was the one I presented back in the first week of January this year. I intentionally wanted to pull right then, from the first page of the book, which is the frontispiece, and I quote. "Everyone is an investor, and everyone can make a 100 bagger." I'm going to resist the temptation to provide additional commentary on each of these. Otherwise, this podcast would be way too long. This is a flyby. We're having fun, so I'm just going to keep moving. But obviously, I included that line in the frontispiece. That means a lot to me, and I really do believe everyone is an investor, and I firmly believe everyone can make a 100 bagger. In a lot of ways, that's the purpose of the book itself. Next, this Page Breaker preview was shared from Chapter 0. Yep, that's right. Since I'm a rule breaker, and I've always thought some books should have a Chapter 0 or a Chapter O, I included one in mine, and I hope this quote will speak for itself, and I quote from page 13. "Here's my longest sentence of the book. Apologies ahead of time, but it just feels right to deliver this in one mouthful. Even though we disagreed on one key point with Jack Bogle, the founder of both Vanguard and of the Index Fund Revolution that individual investors should not, he said, buy individual stocks, we say you should. We dearly love Jack as a person, and what he stood for and did in this world, which was to help wipe it of bad advisors and the compensation systems that drove those people because of overpriced opaque schemes, Ponzi, but others, too, that were enabled by a status quo where the average person wasn't educated about money and thus, as an adult, was walking into a red light district of financial choices where even some of the cops couldn't be trusted." Next, this little bit of personal finance mindset thinking that I wanted to share in the book. It's not a personal finance book at all. Rule Breaker Investing is a stock market book, but setting context ahead of time to bring everyone in and getting them to think capital F foolishly early in the book helps this from page 14. I quote, "For me, I like to think forward 42 years, which allows that seven-year double to happen six times. What does that mean? It means every dollar bill you're holding or spending at Starbucks or investing today is actually worth $64 to your future self." Page 17, and I quote, "It took years for me to articulate what started as intuition and eventually evolved into this question. Why do the most esteemed investment books of the past often cause their readers to miss the best stocks of their own generation? I won't claim it's true of every revered book, but it's strikingly true for many." I'll just leave that one out there for you to think about. The final page of Chapter O sets up what comes next, page 21, and I quote, "From early days, I was inspired by my elders to study, follow, and figure out stocks. Years later, our dad would give us not just stock picks, but stock savvy and our own portfolios. I learned to build habits, and habits are what Part 1 is all about." Indeed, Part 1 of the book is the six habits of the Rule Breaker investor. I want to speak to that for a minute because I think a lot of people, when they pick up a stock market book, the first thing they want to know is what's the big pick? What's the next Amazon. Certainly I do my best within the body of this book to speak directly to that in a number of places. A lot of people would probably want that upfront, but what I've learned, being a fellow Fool over the years, talking to so many of our members at member events over this podcast, Mailbag, our own employees, I've learned that what a lot of people need first are better habits. Because if my brother Tom or our Chief Investment Officer, Andy Cross, or I say, this or that stock, and we might be right about it. It might be a great stock to hold over the next 10 years. But if the person who receives that stock pick just holds it for 10 days or 10 months or is the first to back out when it drops 10%, then we didn't really do them as much service as we could have by giving them first, the habits that they need in order to take in the stock market advice that they receive the next pick. The first part of the book is very intentionally organized as the six habits of the Rule Breaker investor habits not yet stocks. Jack Bogle's rowboat syndrome sets up a crucial extended metaphor that I throw down early in the book. Bogle talked about the robot as an example of what too many people who don't invest well do, which is as they paddle down the river of time, with their money, they're looking backwards because that's the direction we're facing in a rowboat. Bogle called that the rowboat syndrome because people tend to only use the rear view mirror looking backward. If the market's already been really good, they think, my gosh, I've missed it. I need to finally now get in. When they do, guess what's about to happen. Market's probably about to drop sometime soon. It does, after all, lose value one year in every three. As the market goes down, they're looking backward, going, I should never have got started with investing. I knew I wasn't ready for this. Look, what's happened? I should just sell. Guess what's about to happen next. This is Jack Bogle's rowboat syndrome, but in Rule Breaker Investing, I make it more of an extended metaphor. I think the word for that, as I recall, is allegory from my undergraduate studies. I know many of you will know that word. I turn it into an allegory with a few different boats, and that sets up a really important part early in the book. I'm going to quote from page 32 now, and I quote, "Now I want to extend this metaphor in my own way in support of Habit Number 1, because to the rowboaters I say this, toss away your rowboat and at least try a canoe. Because when you're in a canoe, you're facing forward. You recognize that what truly matters is what comes next around that bend in the river, as you paddle forward, paddle, paddle, paddle, looking the right way." From boats, we move on to baseball. Baseball is my favorite sport. It's probably the sport most analogous in many ways to Rule Breaker Investing. Swinging at a pitch is picking a stock. Coming back up to bat over and over, is your investing lifetime. That's the time frame I think you should be investing in your whole life. You keep showing back up in the batters box. To continue this a little bit further, hitting home runs is our goal. Not sweating strikeouts is key. From page 32, I quote, "A single home run is far more impactful than a single strikeout. In fact, even if a player strikes out four times every single game over and over, known as a golden sombrero, but hits a home run on his fifth at bat, that player would be on the short list every year for league's most valuable player. What's true in baseball is truer in investing, where the contrast is even sharper." This next one should speak for itself. Any regular longtime listener here will understand the what and the why, but I suspect for many a new reader in the year ahead, anywhere on planet Earth, these lines may quite surprise them from page 46. I quote, "Add up. Don't double down. Make it an option only to add to your winners to what's doing well in this world, never the opposite. Do so with the knowledge that most others, including most professionals and almost all large mutual funds, as a requirement to maintain diversity are doing the opposite, rebalancing, averaging down, cutting the flowers, and watering the weeds as the old saw goes." Sometimes when I randomized my Page Breaker previews for this podcast over the year, I would pick the very next page in the actual book. A page later, page 47, we began talking about one of my favorite lines, which holds, to me, such a powerful insight. From the section of Chapter 2 entitled Dips Wait for Dips a one liner. I quote, "Those who inveterately wait to buy on dips, very likely miss or badly have to chase the best performing stocks of this or any era." Continuing on page 53. I quote, "Another podcast listener once threw me what I take as a high compliment, and he did it in so few words. From you, I learned the difference between trading and investing. I hope this book does the same for you" you know, one thing that I didn't bother with in my Page Breaker previews throughout this year was footnotes. My writing style lends itself to humorous asides. Footnotes are a recurring feature throughout the book. They're there for fun most of the time, and I made the decision as an author to number them continuously from the very start of the book to the very end. A second option would be, of course, with each new chapter to renumber the first footnote number 1. But as I love chatty fun footnotes, and I feel like they're a trope in the book, I wanted them numbered from one to, I think it's 106. On a small side note, the quote that I just shared with you from a listener about the difference between trading and investing has a footnote inserted in the book, and it just says, thank you, Art Burke. That's the name of the podcast listener who sent me that feedback. Art you might be listening right now via a Mailbag. There are a few brief call outs to you, dear listener, you and your ilk like Art Burke for providing some of my favorite lines in the book. For those keeping score at home, that was Footnote 22. Alright, back to baseball, page 76, and I quote, "Just like hitters aiming for 400 hit over 300, Rule Breaker Investors should aim 100 basis points higher than conventional wisdom. Conventional wisdom suggests beating the market averages would just be a coin flip, 50-50 or here, batting 500. Whether or not this is true, aiming high is crucial." Jumping ahead now to the heart of the book, Part 2, all about stocks and the six Rule Breaker traits, especially that first one, the power of SNAP COLA. Page 95, I quote, "Tesla, Facebook, Intuitive Surgical, Adobe, Netflix, Axon Enterprise, Salesforce. All are top dogs and first movers in important emerging industries. These SNAP COLA examples are not just correct answers on a Rule Breaker Investing Chapter 7 pop quiz. These rule Breakers have offered the best investment returns of this generation, and all seven are stocks I picked early and continue to hold years later. They help power market beating results that some academic observers will dismiss as luck." Since this is a highlight reel episode of the podcast Rule Breaker Investing, we won't go deeper into SNAP COLA for now, but key phrase. Page 98, and I quote, "Clayton Christiansen, one of my academic heroes, formed his theories about disruptive innovation largely by examining competitive advantage. He noticed the irony that the larger companies get, the more vulnerable they become as they focus on sustaining their advantages, while upstarts, I call them rule breakers, quietly revolutionize their industry from the ground up." Page 102, and I quote, "Tony Hsieh turned his shoe company Zappos into $1 billion enterprise bought by Amazon." His understanding of the power of happy employees made Zappos the envy of its industry. Tony was asked once, how do you get all your employees to smile? He deadpanned, "Easy. We just hire the applicants who smile." That's from the chapter on sustainable competitive advantage. Yes, in my experience, having employees who smile when the competition doesn't can be a great sign of a sustainable competitive advantage. Let's move on to Page 141. "I see this most clearly and feel this most acutely because I've literally watched the company I co-founded grow over the past 30 years from a paper newsletter to $1 billion enterprise. Instead of only researching other people's companies, I have had the privilege and heartbreak and glory of watching a tiny, foolish acorn grow to an oak. I would never ignore or underrate brand, leadership, culture, and innovation." That from Chapter 12, maybe the most important insight in the book, especially for those for whom valuation is paramount to their investing. Yet who seem to keep missing the Amazons and INVIDIAs because their valuation-focused investing causes them to say overvalued and so they never buy Amazon. Not in 1997 or 2007 or 2017 and probably not in 2027, either, and it's been the greatest stock of our time. Overvalued. It's a key and recurring line here, which actually never got randomized into my page breaker previews, but here it is. There are no numbers for the things that matter most. Page 148 provided the page breaker preview I just shared with you randomly last week. It's about my seven historic 100-bagger picks for Motley Fool members, maybe one or more of them for you, perhaps. Dear listener? From Page 148, I quote. "What matters most to me about this list is making it not just imaginable, but real. For millions of people. Each row is special. The prices have fluctuated since the publishing date, and these stocks will go in and out of favor. Some may, don't go and these stocks will go in and out of favor. Some may fall from the 100 bagger ledge, while others near but not on the list, like Shopify, Salesforce or Chipotle, may arrive. In the end, there is no specific magic to the number 100. Heck, I prefer 1,371." That last bit reminding us that even sweeter than a 100 bagger would be, any number greater than 100 and thus far for Motley Fool members, I have picked two 1,000 baggers, plus. Page 171, and I quote. "Probably the biggest driver of portfolio purpose hinges on whether there will be new money coming in or not. In my parlance, I ask, is it an odyssey or a Phoenix?" For now, I'll just mention that anyone listening who knows about Motley Fool's Super Nova will probably get what I just shared. If you don't, well, I hope you'll read the book. Moving on as an English literature major in college at the University of North Carolina Chapel Hill, I especially enjoyed my Shakespeare classes, and I have a lifelong love of language. I hope that comes through constantly and persistently throughout your reading of this book because I loved to write it and highlighting the language we use as investors, as business people, just people going through life. Well, I like us to think hard about the language we're using and maybe imagine from time to time how if we were to change our diction, put a different or new word in place of another, an old one, how the course of our own destiny might change just from words. Page 173, and I quote, "What's in a name?" Shakespeare's Juliet says that which we call a rose by any other name would smell as sweet. But I think names are more powerful than that. In fact, had she named her plan to fake her death project rebirth and shared it with trusted allies beyond just the Friar, that name alone might have changed Juliet's fate. Page 178 and I quote. "Speaking of circles, Warren Buffett has famously championed a related idea, one's circle of competence. An imaginary perimeter drawn around yourself, your circle of competence contains inside it all the things that you know, love, and care about, areas where you're competent. Your money should be inside that circle, too." As you might expect, I quote Buffett a bunch of times in my book. In fact, I count 31 citations altogether, which may be somewhat ironic since my rule-breaker approach to beating the market probably strikes many all-out Buffett fans as heretical. Well, I like to think that I borrow liberally from the Oracle of Omaha, all of what I consider his best stuff and circle of competence is certainly one such example. From a page later, page 179, and I quote. "Way back in the book's introduction, I mentioned the most common question from new listeners of my Rule Breaker Investing podcast. What's the right number of stocks for my portfolio? Well, I said, then no such number. We'll talk about this later. Well, later has arrived." Now I am talking about talking about you again, my RBI podcast listeners. In this case, we're now into Part 3 of the book, The Six Principles of the Rule Breaker portfolio. All of my thoughts written down and organized for you to start and maintain your portfolio, that thing that we're all managing. Though in my experience, most people don't have frameworks or coaching or good guidance as to how to build and maintain their portfolio. Page 189, "As an entrepreneur, my biggest holding is ownership in the business I helped found. It's both a luxury and a curse that so many other small business people can appreciate. Your own business is very likely the greatest source of your wealth. That fact alone has allowed me to take more risk in my equities portfolio than I would have otherwise." That one's about why entrepreneurs are sometimes more overloaded in their asset allocation than we think. Page 190 and I quote. "Many investment advisors and much of the regulated fund industry, when facing rebalance. This is the practice of automatically selling positions that have risen in order to reinvest the proceeds into those that have fallen. It enables various investment instruments to achieve their objective to remain well-balanced across their holdings." Yet, as Peter Lynch taught the world back in the 1980s, though I'm sure it goes back to the Greeks, ultimately, when you water your weeds and cut your flowers, you will underperform what you could or should have earned if you'd done the opposite. As Lynch said, water your flowers, cut your weeds, except if you just invest in mutual funds, you'll never gain control over that dynamic. In the book, I decide that the flowers and weeds comparison has maybe gotten a bit threadbare at this point in history. I introduced some new language possibilities, new words to say the same thing. Fuel your rockets and ground your anchors, feed your tigers, and starve your snails, light your stars, and dim your lanterns. Build your castles and abandon your ruins, polish your gems and ignore your pebbles. Or the one I ended up using, which comes from the world of horse racing. Let's move on now to page 198, and I quote. "Sports betting by its nature is zero-sum, and your expected return is always negative. The handicaps are set very effectively, whether we're talking about a 6.5 point favorite in basketball or 7-5 odds at a horse track, one better will win, the other will lose, and the house will always take its cut. Over time, almost all consistent sports betters lose money." Really, I had to speak to sports betting because of its oncoming popularity, which is a huge mistake for everyone, really, except the gambling industry, and in some cases, the media businesses that are supported by the advertising money from the gambling industry. Those media businesses, of course, by their very nature, are helping greatly prop up the gambling industry. As you might imagine, I'm not a big fan. As the book nears its end, I begin to wax more poetic because much of the work of Rule Breaker investing, especially all the stock market bits, at that point, have been accomplished for the reader. In the final pages, it's time to think of even bigger things like why we invest and about how some things mean more than money and what they are, and about who are our heroes, and what can we count on in this world? Page 200 and I quote. "Thomas Payne, 1737-1809 was the American Revolutionary War pamphleteer and author of Common Sense, who brought tremendous eloquence to the cause for American freedom, despite himself being born British. His famous and most timeless line speaks to you and me at every dark turn. These are the times that try men's souls." I had to speak some more to selling and when to sell even near the end of the book. People are always going to ask about when to sell, Page 205, and I quote. "Last chapter in discussing when to sell, I noted that it's not always as simple as trimming a position back to your sleep number or dumping a loser to zero out a capital gain. Sometimes your quarterly review asks a tougher question. What will you sell to buy that new stock you're excited about or to fund a down payment on a home, which is why we invest in the first place." More bigger picture thinking, Page 209. "At the end of his landmark work, Candid, Voltaire offers a timeless reminder. In five words, he tells us that while we can't control what happens in the world at large, we can shape our own circumstances." For now, I guess we can just leave that as a literary quiz for you, dear listener. Do you know in five words Voltaire's great closing to Candid? Some of you will know my brush with Jeff Bezos' story. Most probably won't it still makes me smile, Page 218, and I quote. "There were so many people. Wasn't this place governed by fire code regulations? Many people elbow to elbow, it felt comic. I half expected a clown car to pull up and unload a few more. I began to realize, OK, I'm not going to be getting to Bezos tonight." Well, I think these last few stand on their own. Here we go. Page 222, quote. "For decades at The Motley Fool, one core value stands above the rest. Your Motley. The value you bring to work every day. In a word or a phrase, it's what you care most about, what you aspire to, what defines you. It's how you choose to tell your story." Page 223. "What's your Motley? Mine has been the same from Day 1, and I don't expect it to change. In Latin, it means ever higher. Excelsior." Page 223, again, "I try to find excellence, buy excellence, and add to excellence over time. I sell mediocrity. That's how I invest." Page 225 and I quote. "To quote the British historian Thomas Babington Macaulay, on what principle is it that with nothing but improvement behind us, we are to expect nothing but deterioration before us? Excelsior." That's not quite the end of the book, but it's a spiritual and there are a few. I always loved the final Lord of the Rings movie, The Return of the King. When the movie you thought was over, it went dark and then it came back up with another scene, closing out another thread of the story and then went dark again, then came back up and there's a little bit of that going on near the end of Rule Breaker Investing. I truly loved writing this book and I truly hope that you get half as much enjoyment or more out of reading it or listening to it. There was one more page-breaker preview. This one was some weeks back, not too long ago. It's from Page 239, and I quote. "Explore additional resources for readers and fans of Rule Breaker Investing, including a downloadable bonus chapter, a discussion guide for book clubs and investment clubs to explore and apply key ideas together." That is the last of my page breaker previews and the end of this week's podcast. It is an opportunity for me to mention at the end of the book, there's a QR code. You can take a picture of it and end up on a web page dedicated to additional resources for fans of Rule Breaker Investing. As mentioned there, it includes a downloadable bonus chapter. I wrote up a short discussion guide because I think, especially if you're in a book club, or if you're in an investment club and you're the leader, I wanted you to be armed with something that could help you guide and lead your group. It's just a single discussion. It's not an elaborate guide, but I hope that discussion guide is helpful because at the very heart of the Motley Fool, not just Rule Breaker investing, but at the heart of our company is a belief in the power of community. We're stronger together than we are apart and so many of us, even if you were raised as an investor, many of us were just taught to do it from our armchair or money is a very private subject. Just do it yourself. But I think a big part of the power of the Motley Fool is that you and I have each other. That's what this podcast has represented every week for me these past 10 plus years or so and Rule Breaker Investing, whether you choose to purchase it as a hardback, which by the way, most people still read hardbacks these days, or as an eBook, it'll be out next week as an eBook, as well, or of course, as an audio book, which in some senses, I really did preview for you today because I am the reader of the audiobook, and I had a lot of fun, not just reading a few quotes here and there, but 230 sum pages of Rule Breaker Investing. I hope whichever format you select that you will love it, and that you will pass it on and create a community around yourself of people who can truly come to understand what investing really looks like and how well it works if you follow it foolishly on your journey down through the path of life. Thanks a lot for joining with me during this special podcast this week, before a special one next week. I mean, both my book and next week. The Market Cap Game Show. Fool on.