Investing In Yourself – Using Pillars to Build Your Core | |
Setting Budgets + Saving for Black Swans | |
How to Open My First Brokerage Account | |
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Also Coming Soon - a series on #HowtoInvest. People have been reaching especially after the spikes in Gamestop, AMC, and other stock to learn the basics. I self-taught myself how to invest beginning at the age of roughly 18 and have never stopped. To be a good investor and ensure you are not gambling (speculating), I'll cover (hardest parts of investing in RED):
Budgeting 101 - How to Fund Ur Investments?
Why Stocks as an Investment?
What is Ur Investment Profile + Personality?
How to Pick Stocks?
When to Buy Stocks?
How to Enter My Trade?
How Many Stocks Should I Own?
When to Sell Stocks?
Am I Speculating (Gambling)?
Stock "Euphoria" In Withdrawal
Did you see that episode of Euphoria? While I'm watching the show, I'm really watching the stock market euphoria evaporate. I want to be completely transparent that if your portfolio is NOT down and you are not feeling any pain then you are lying or you need to win stock investing award. One of my first rules is being transparent and my portfolio is down and guess what that is a normal part of the stock market. I'd like to take some credit that I've been calling for the market to top out for a while now. But the reality is even though I was right, no human being will ever get the exact day correct, so my portfolio is getting punished just like everyone else's. Like Rue Bennett on the show "Eurphoria" is in withdrawal, this market is shaking...we call it market volatility.
You may wonder what I'm doing in response. The simple answer is I've moved out of stocks in my retirement portfolio. You can call cap (or my bluff) but I too was surprised that I made the decision to move one quarter of my retirement portfolio in October of 2021 to safety. I chose the PIMCO Inflation Protected Bond Fund. One quarter did not stop my portfolio from declining but what it did mean that I declined less than the what the market did and I calculated my retirement account was down from it's peak by roughly 10%. I like to periodically review my portfolio's quarterly and just logged in last month. The next thing I did was analyze the current situation. I think the economy is doing well despite what you see on the news. It's pretty hot and INFLATION is up big time. How do I know, because I want to buy a 3rd property and I no likey any of the prices I'm seeing. The only price I like is the inflated value I see on the properties I own. Funny how that works ehh.
Why is this happening? Well, the Federal Reserve is committed to taming inflation and the only way to do this is to slow demand. Take your Starbucks coffee shop, if they keep selling out of everything the store will eventually conclude they may need to raise prices because the demand is so hot. A good business operation will raise prices until the demand slows down to something manageable. That is EXACTLY what the Federal Reserve is doing at the moment. They are raising interest rates and that is making mortgage rates and the cost of obtaining cash harder to come by. The goal is to SLOW down the economy as everyone is flush from stimulus and spending like crazy now that the think COVID is over. If you need a visual, think about Rue as she was going through withdrawal, it's NOT a pretty picture. So guess what, I'm taking my ball and going home. In my retirement account I put all of my cash into inflation protected investments for the mean time. I like to play games I can win. My personal stock investing account is still in stocks and it's not pretty. I still have a lot to learn about how to better hedge my investments as some of my high fliers came down to reality. ROKU, SPOTIFY, and UBER really don't want me to retire even earlier. Those #$#$#!!
I'll write more about what I'm doing in my personal stock account to try to reduce the amount of risk and volatility. My cybersecurity business is holding up well so I'm fully investing my time there but I'll keep you guys posted on how to continue investing in stocks for a brighter future.
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