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Meet Josefina and Bogdan Ryabyshchuk of Zynath Group in Downtown

Today we’d like to introduce you to Josefina and Bogdan Ryabyshchuk.

Thanks for sharing your story with us Josefina and Bogdan. So, let’s start at the beginning and we can move on from there.
We started Zynath Group in 2016 as a personal investment fund. We had just sold our house and used the proceeds from the sale to buy stock and options in our favorite companies.

Our investment philosophy is simple: invest in undervalued companies. It sounds pretty straightforward but it can be tricky as anyone who has tried their hand at this business might tell you. Mr. Market does not always get the price of a stock right and it may take some time before he does.

I think it’s important to note that we are not day traders; we’re value investors. And, there’s a difference. Notably, day traders trade on technicals and instincts if you will, on a short time horizon. You have to be really lucky to win at day trading. Many investors who try day trading, get burned and leave the stock market with a bad taste in their mouth.

Unlike day traders, we trade with a medium to long-term horizon, sometimes that means waiting years for a company’s stock to be recognized as valuable.

Zynath Group in 2018 is bigger and more focused. The fund is still private and personal money but we’ve added regular blog posts on platforms such as Seeking Alpha to share our ideas with other investors, seasoned and novice alike. The fund’s focus is largely on high tech industries, biotechnology, and small local startups. We like to pick stocks based on solid business fundamentals, bright ideas, and sound management.

Bogdan Ryabyshchuk, my husband and co-founder of Zynath Group, is a fully licensed attorney with experience in criminal and real estate law. He left law when he realized his skills were best utilized elsewhere and has been a serial entrepreneur ever since. Some of his past businesses include: Folium Digital, a document scanning and IT company, which had notable clients such as the Four Seasons and the State of California, and he also built one of the fastest consumer drones (at the time) for which he designed the electronics and plastic moldings amongst other things for a Kickstarter campaign. He is a natural tinkerer and a prolific writer with dyslexia, which I think is cool.

My own background is far more boring. I have a degree in economics which I received from the University of California San Diego (UCSD). In the past, I’ve worked in a pathology lab and a preimplantation genetics lab as more or less a marketing assistant.

My role at Zynath Group is simple: find ideas. I am particularly curious about improvements in medicine, consumer electronics, and emerging technologies. I have a soft spot for companies that focus on innovation (aka disruption) and who have a management team that understands their market and can execute well.

Interestingly, I was a graduate of High Tech High School (Class of 2006). At High Tech High, I first heard about neural networks and 3D printing, amongst other things, and I even did some robotics. Believe it or not, many of these technologies are only just beginning to play out in the real world. For example, we’re at a turning point in human history in which machine learning will enable artificial intelligence to automate a lot of jobs and this disruption will create a monumental money making opportunity for some people.

Great, so let’s dig a little deeper into the story – has it been an easy path overall and if not, what were the challenges you’ve had to overcome?
Being a money manager is not for the faint-hearted. It can be very stressful. First, professional analysts working for large Wall Street investment firms may not always interpret the facts correctly and put out reports that can move stocks down, sometimes dramatically.

For example, in 2016 when Wall Street analysts were predicting the death of desktop computers and as a result predicting doom and gloom for Micron, a large American computer memory supplier, they failed to talk about the huge upsurge in cloud computing and server farms.

The truth is computer servers require a ton of memory and storage and it keeps growing every year. Just think of how many people are logging in to Facebook or uploading photos to Instagram right now. With the rise of cloud computing and more importantly, machine learning for artificial intelligence applications, the demand for large amounts of computer memory has grown dramatically.

As a result, memory demand has gone up and prices have gone through the roof. Micron has been one of our positions since 2016. I guess what I am trying to say is that numbers won’t always paint the entire picture of a company. You also need to understand the business and where you see it going in the future. Sometimes going against popular opinion is hard but when you notice disruptions in a business that is when you can make the most amount of money.

Secondly, we trade in options. When the stock market experienced a correction in February and April of this year we saw our stock portfolio value decrease dramatically.

Thankfully our options are long options. However, in the event of a stock market crash, it is always better to own stocks. You can hold stocks for as long as you need to especially if you invest in a company with a sound business and lots of cash that can weather any economic condition. The stock of that company usually bounces back in a few quarters.

Options, on the other hand, are time sensitive and can expire worthless if the company’s stock does not behave the way you expected it at the time of expiration. With options, you can lose your entire investment. Thus, it is not for everyone. On the bright side, the more time you spend studying businesses and observing the behavior of the stock market you come to appreciate the irrational behaviors of humanity.

Please tell us about Zynath Group.
We like to think Zynath Group is a tech-savvy investment fund. Of course, since we’re investing our own money we’re literally putting our money where our mouth is. We set ourselves apart from other funds in two ways. First, we believe numbers won’t always paint a clear picture of a company. Secondly, to paint a clearer picture of a company we like to examine where we see the business going in the future, say 3-10 years ahead or maybe longer.

If a company is doing well right now, we like to see what’s in their pipeline and assess if they are innovating or staying in their comfort zone. Companies need to grow and evolve just like anyone or they will become stagnant. It happened to BlackBerry. Blackberry did not see the iPhone as a game-changing competitor and it became irrelevant.

And today, cable companies are struggling because they did not anticipate how YouTube, Netflix, and other online media streaming platforms would change consumption of media especially with younger generations who are always glued to their mobile phones.

Do you look back particularly fondly on any memories from childhood?
When I was in high school I participated in the Gavel Club, an arm of the Toastmaster’s Club for children, and I remember giving a speech to the Point Loma Rotary Club about the importance of investing in stocks for wealth creation. I skimmed through Investing for Dummies and I hardly knew what I was talking about. However, I beamed with pride about my new found interest in stocks and wanted to share it with the world. Looking back, the group I was talking to probably knew more about stocks than I did.

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1 Comment

  1. Steven Jay Slomkowski

    July 15, 2018 at 7:44 pm

    I know these 2 for 4 years now.

    They cover every topic of life, living and business from economics to startups.

    Everything about them is awesome.

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