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Good day subscribers thank you so much for joining me today i am jeremy this is the financial education channel and today we’re talking about five ways that if you’re a beginner in the stock market you actually have an advantage over some longer term investors guys some people like me that have been invest in a while some people like that are way older than me
That have been investing for 20 30 years you actually have some advantages over them and we’re gonna kind of go into those i’m gonna tell you the five advantages i’m also going to be doing a couple honorable mentions that almost made the list in this video i thought would be a interesting one to do after last week’s video when i posted the video about ten ways
Beginners in the stock market get screwed and that was actually a pretty popular video that did very well on this channel so but at the same time you do have some advantages as a newbie in the stock market so let’s go over those today guys hit a thumbs up if you enjoy this today and let’s talk about this so number one way you have an advantage as a new person in
Stock market versus an older person is you have no skeletons in the closet yet you have no skeletons in the closet hiding what is that even mean well okay here’s the thing if you’ve been investing in the stock market for long enough you’ve probably been invested in some poor stocks here and there may be some ones where you lost a lot of money maybe some ones where
You lost a little bit of money so you’ve got some skeletons in that closet you have some things hiding in there that are haunting you that are making you a little more scared to maybe invest in a certain type of company if you invest in one of those type of companies in the past and you got screwed for instance let’s say you were into let’s say you were investor
And fitbit at forty fifty dollars a share or whatever and you thought you know that was a great company well you might have gotten screwed because now fitbit’s at five six bucks a share right so you might have launched a massive amount of money and maybe you’ve sold out at $20 or $30 or something got out of it and so you certainly lost money but you didn’t lose
As much money as you could but at that point it might be very hard for you to ever trust another wearable type company again because you got screwed so bad so maybe you did maybe you got in on a facebook ipo facebook i peeled it like 38 bucks a share about six months later they book was trading around $20 to share you might have some skeletons in the closet there
In sage snapchats about to come out you might be like hell no not touch the ipo i got screwed on the facebook ipo i don’t want to touch any ipo so you might have some skeletons that closet that just because a certain company was in a certain industry and it kind of reminds me a little bit of some other kind of a company you might never touch another company just
Because you’re too scared because of those old skeletons in their closet where you lost money whereas if you’re a beginner you got nothing you got no track record you’ve got nothing to scare you away just because some company is similar to another company that was in the past that doesn’t mean you’re scared of it you have nothing to fear because you don’t have
Skeletons in the closet guys so that’s a number one way that you as a new person have an advantage actually over experienced investors guys number two way you don’t have any positive skeletons in the closet what does that mean well it’s pretty much the exact opposite you know when i said sculpting the closet that means like bad ones you know that are haunting you
Also there’s something called positive skeletons in the closet where if you actually had let’s say a great investment you did really good on investment if so if another stock comes around sometime and it reminds you a little bit of that stuff you might be more inclined to invest in it just because it’s somewhat similar to that star so maybe you were invested in
Apple right apple a hardware company something i’m talking about maybe you were invested in them in the in the mid 2000s you know when they had the ipod coming out and then they had the iphone coming out and whatnot and so you saw that growth and you investing you made a lot of money on apple stock right well the next hardware company that comes out you blame be
More inclined to invest in them thinking oh that’s the next apple i can make money on that because you’ve got that positive skeleton that caused it reaffirming that yeah yeah go into this one maybe you invested in facebook you know i’m not talking about you right at the ipo but there you know when facebook was like 2000 to share maybe you were buying it at that
Time i was and unfortunately i sold her $23 a share that was really stupid but maybe you were buying at that $20 a share and maybe you held it until it was over $100 a share and you made a ridiculous amount of money in a three-year span so maybe now i’ll send you like oh snap they’re gonna do that same thing you know that stocks gonna drop and then i need to buy
It and then snapchats gonna go up five five hundred percent like facebook did or whatnot and maybe that’s not even gonna happen so maybe you’re just seeing that positive skeletons and saying oh because that stocks that way because it’s similar to this one i’m gonna make a ton of money on it like that of it where’s your fear for dinner you don’t have any type of
Track record where you haven’t great gains on stocks you don’t have to think old man that stock similar to this one that i made money on the past maybe i can make money again guys so that’s a number two way you have an advantage over more of an experienced investor if you’re newbie number three you’re open to learning a lot more in you’re not set in your ways yet
You’re not set in your ways you’re open to learning everything about investing the older you get the more set in your ways you get it’s just how human nature works guys if you’re gonna okay let’s let’s say we’re talking politics for a second who do you think is gonna be more open to thinking about some different ways of thinking about politics a 14 year old or a 44
Year old i’ll make guarantee that 14 year old has a lot more open mind on subject it will give you a lot of different various points if you say what do you like this better or that better versus a 44 year old who’s probably set in their ways they’re either probably a republican or a democrat and they really only see what things one way because they’re probably set
In their ways there might be a few here and there that are still open and thinking those kinds of things but most people at that age are set in their ways let’s think about another way say you go to a local mcdonald’s let’s say you’re the supervisor of you know mcdonald’s chains of 20 stores or whatever who do you think you’re gonna have an easier way of teaching a
Manager a new way of doing things a manager that’s been there for 20 years or manager has been there for two months i’m gonna guarantee you the manager that’s been there for two months is gonna be much more willing to learn about this new way of operating the mcdonald’s then the guy that’s been there for 20 years doing it the same damn way for 20 years he’s probably
Not gonna want to change the way that he’s been doing he’s probably gonna be like this is a way we’ve been doing it for 20 years i don’t want to change this new way he’s probably gonna give you more flack in and make it a feedback and whatnot where does that guy who’s been there for two months he’s like okay i’ve been doing it that way for the first couple months
Of my job but you know what i can change you we do it this way so same thing with investing when you are when you’re a new new investor you’re just much more open to all the different ways of investing you know whether it be short term whether it be day trading whether it be long term investing whether it be super long term investing like warren buffett style
Whether it be modern long term investing like i do which is a one to three year outlook so you’re gonna be a lot more open to learning about all these different ways and different ways of thinking about companies all those kinds of things guys so it’s it’s a huge advantage to you as a beginner versus someone that’s already set in their ways and they’re not gonna
Change i mean you think warren buffett’s gonna change the way he invests in companies no look guys you know 80 something years old he made this huge success doing it the way he did it and he’s gonna do that way until he retires or dies guys that’s the way it is you know people just get set in their ways number four way you have an advantage of the beginner over
Experienced people is it’s easier than ever to invest now as it begin on the stock market now you have an easier path to investing than ever in history of mankind never has it been easier never ever ever has it been easier guys reason being it’s so easy to learn information guys look at this channel i told you guys about all these investing tips that i use in
My life and all these different ways you can invest and whatnot youtube didn’t exist prior 10 years ago this channel only started in 2016 this but now also in this channel built out and there’s a different way for you to learn you can google anything you want about the stock market to learn about it in an instant in an instant guys you can google it it’s like
Ridiculously easy you know back in the day you might have had to rent a book from the library or something now you can buy that book on amazon a second on you’re buying it on your ipad and reiterate them in there guys you want to know what a p/e ratio is you can google it in a second and know exactly what a p/e ratio is you want to know what koko is about and she
Is typing coca-cola investor relations into google click on their page click on their annual report and boom right there their balance sheet is gonna be rating that annual report showing you exactly what their balance sheet looks like for coca-cola it’s never been this easy guys it’s never get back in the day you would have had it like you know try to write them
A letter cuoco investor relations and try to find the address somehow write them a letter can i have an annual report sent to my house please and then they would have to send it to you it was a mess guys and then never mind that investing in trading you do right on your smartphone now you do it right on your ipad your tablet whatever your computer back in the day
You would have to like call a brokers hey can you please sell me five years of blah blah blah that was like ridiculous guys that’s why investing back in the day it was really only for wealthier type people or retirees worse now it doesn’t matter you could be an eighteen year old with five hundred bucks in your pocket you’re gonna be a fifty year old with 50 million
Dollars in your pocket it doesn’t matter everybody’s on a level playing field now because information is that easy you can google anything you want in a snap of a finger guys information is so easy to get nowadays so you have a huge advantage it’s easier and ever to pick investments guys easier than it’s ever been in history by far and it’s not even close number
Five where you have an advantage as a beginner over advanced investors or people that have been doing it a long time is a lot of times beginner investors or focus more on looking at the business and focus more on looking at what’s inside their gut instinct on a stock then most men versus financial metrics now personally i think you should focus on the business and
You should focus on financial metrics i think that’s the best way you’ll get the best result but the bottom line is when you focus on the business sometimes i can yield you a lot better results a hot bigger stock gains and then focusing on financial side of things guys for instance there’s been so many stocks over the years that i’ve loved from my gut instinct and
From just judging the business but the financial metrics told me to stay away from that for instance amazon holy smokes i could have made a massive fortune investing in the amazon i felt so confident in amazon and it’s proved to be right and the stock just gone up and up and up but they traded a ridiculous p/e ratio i just can’t touch it tesla another example you
Know i stocks up you know eight nine times eight hundred nine hundred percent in the past five six seven years guys netflix another did a ton that’s up just ridiculous amounts facebook remember i told you about facebook at $20 i stole that 23 because i was looking at the financial metrics i was like the financial metrics tell me no on this company so therefore i
Gotta get rid of facebook facebook’s up five hundred six hundred percent since i sold out you know four years ago guys so sometimes going with your gut instinct going with just judging the business and not focusing so much on financial metrics sometimes they cannot see you’ll do a lot better results in looking at all those financial metrics but i still recommend
The financial metrics are key and looking at investment on top of looking at the actual business and going off gut so those are five main ones now let’s do a couple honorable mentions that almost made this list guys so number one honorable mention that almost made the list is a lot of times beginners take less risks which sometimes he gives them that are a better
Chance of not having as big of a loss so frank says me personally some of the companies i’m invested in right now back when i was a beginner in the stock market my first couple years i never would have touched these companies because they were too risky for me they were too risky they traded a too high of a pe or or too risky for me basically overall so years ago
I wouldn’t have touched these head the company so therefore on a position like a go probe where i’m down i don’t know 20 30 percent right now on my shares i never would have even touched them in the first place i never would even touch that so i would never be down that twenty or thirty percent right now now i’m hoping for obviously way bigger gains in something
I would have done in the past but regardless sometimes beginners of stock market they stay away from the riskier stocks and they go into more of the the the coca-cola type companies the johnson & johnson the walmart’s those high companies that are a little safer and yeah maybe they don’t get as big games but at the same time they don’t set themselves up for
Big losses or to be down big on a position guys so that’s an advantage beginners in the have when the last honorable mention here guys is beginners in stock market focus a lot more on industries that they understand very well that their net is in their circle of confidence they don’t get to and i’m speaking generally a lot of beginners are stock market don’t get
Too unfocused they’d like to focus on around industries maybe its tech they really understand so they’d like to invest in tech companies look into tech companies or maybe it’s our oil companies they like to stay around the will companies so beginners in stock market they’re a lot more focus on that circle of competence staying in there or sometimes investors have
Been in the market for 5 10 15 years they think like they can figure out any industry all again just research out and i’ll figure out that industry and maybe they still don’t even really understand they go and invest in it guys so that’s another advantage of the beginners in the stock market have over advanced investors and i hope you guys really enjoyed this if
You’re a beginning out of stock market or your advanced investor because maybe there’s some lessons to be learned from all these type of tips today guys if you enjoyed this hit a thumbs up if you just came across it and maybe you’re new to the channel you might want to subscribe we talked personal finance that you know i’m a business owner i give away a lot of my
Business tips and we also talk the stock market the most of anything else channel including some beginner in stock market type videos like we did today guys i hope you enjoyed thank you for watching and have a great day good day subscribers thank you so much for joining me today i’m jeremy this is the financial education channel today we’re talking about mmm i
Can’t remember what we’re talking about me
Transcribed from video
5 Reasons why Beginners in the Stock Market have an Advantage over Experienced Investors By Financial Education