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How’s it going everybody this is beat the bush today i’m gonna talk about investing at the bottom of the market and how i do it today i have a few interesting insights for you guys that you might have o to take and kind of give you some realization about the market conditions right now the market bottom is likely gonna hit before anything starts to turn up better
For example lower transmission rates so if you wait for this i feel like it’s a little bit too late historically things bottomed out maybe a month to three months out so i think the bottom might come very soon considering the rate at which the market decrease it feels like it’s gonna happen sooner rather than later it might have happen already so this is why i do
A tiered level of investing because i don’t know when the bottom is gonna be in so i just try to invest every single 10% that the market is down i invested a little bit more in a little bit more no i think some thoughts i might go through a lot of people’s head is that when you’re investing in this market the sky looks like it’s gonna fall down it looks like the
Market is coming to an end this is the end and i think the thing you have to realize who make yourself feel better is that if it does happen it means the united states dollar is gonna go to zero and you probably have a lot other things to worry about because if the stock market goes to zero on the streets there’s gonna be riding people are gonna try to invade your
Home they’re gonna try to take your food it’s just gonna be just pandemonium out in the streets so if you think this is gonna happen in other words if you are too afraid to invest in the market right now in essence what you’re thinking is that this is the end which means you probably should be prepared a lot more in other ways such as buying more protection for
Yourself you’re gonna need maybe a year or two worth of food probably you want to hold some real actual physical gold somewhere in a secure location in a sense you are not investing in the market nor preparing for any days even so which one are you right so if you’re not preparing for any days if you don’t think it’s gonna get that crazy you’re in a way kind of
Voting for that the market is then i come back up eventually is it gonna come back within two years is gonna come back within one year or maybe ten years or something well the way i think about this is i need to keep enough cash around so that i can survive this downturn maybe for two years five years ten years just so that i can keep all those securities in there
And let those appreciate one thing that you want to think about is for a certain company if let’s say they don’t make money for a year they still have a lot of capital you have a lot of patents something that was of value that they can actually sell if it’s a company that doesn’t have a lot of debt if they have a lot of cash pile just waiting to be tapped into that
At the end of a really long downturn they’re still worth something maybe one year from now they’re still gonna make a profit then yes you can probably still invest in it and then this is just a really cheap opportunity to buy all these stocks now i want to talk a little bit about investing in cruise lines and airlines because these are the hardest hit stocks out
On the market right now the thing that worries me is that we are going into this new phase of an economy maybe right if this situation prolongs itself if it mutates you know whatever right if it turns us into self isolating type of people where we don’t go out we’re really scared of coming into contact with anyone we’re really scared of ever taking an airplane ever
Going on a cruise ship because this is an ongoing thing that keeps on coming back again and again then you might have an argument saying that well these companies they’re going away for good this might be a very core shift in the whole economy so if you put money in there and the economy completely shifts away from it right no one cares about something that’s out
Of fashion maybe these cruise lines they can shift how they conduct business maybe they can change it do some sort of you know hospital ship or something instead of a cruise ship where people do it for pleasure you do it for you know maybe they can sell the room and have people live on it or something i don’t know whichever way right they can pivot somehow and
Still possibly make money airlines maybe they have the sell tickets for a lot more expensive maybe going forward in the future if you go trial to any other country maybe they have to quarantine you for maybe two or three weeks before they’ll letting you go to another country maybe you want to go to rome okay you fly there you stay locked up somewhere for three
Weeks and then they’re gonna let you you know see the sights you see the sights and then you come back home and then yet you’re going to get locked up for another three weeks before you know you can go home again so if this is the case you can imagine a lot of people is not really gonna want to travel anymore because of the hassle so how am i investing right now
Previously i made a video where i said i’m holding on to about 60% cash since then i kind of al you ated everything yes i held on to some energy etfs in the short term it did not do well okay so some people might look at this and go oh you’re stupid because you bought into it and it went down i don’t know if it’s gonna go up or down but my whole theory with this
Is that i’m gonna make money in the long term probably in the one-year or two-year term i’m not gonna be able to guess this right right some people like to say oh it’s gonna go to 1,700 1,500 or something and they have a number in mind i personally don’t have a number in mind but a good strategy for me personally and i’m doing this right now that’s why you see
My cash holdings going lower and lower i said it was 60% before now it’s around 40% because i invested a little bit more and a little bit more every single week i’d say every single 10% and it goes down i invest another 10% this is roughly a strategy of mine so in order for me personally to get this 40% cash i actually had it in a lot of different accounts and i
Had to do some transfers i transferred some money away from my high-yield savings account because i estimate this is gonna go to zero or 0.1% so i’m like if i’m not gonna get money in it anywhere i better put my money in a brokerage account i need it sitting there because it takes a few days to transfer my money in i need it sitting there so that i can pull the
Trigger when i think it’s the right time i am not doing daily trading but i want to do it at a moment’s notice when i feel like it’s the right time so let me just give you a concrete example of where i think i’m gonna be invested right now it’s minus 30 percent right and i am about 60% invested in if it goes down to minus 40% it’s gonna be 70% minus 50% i’m gonna
Be eighty percent in minus sixty percent ninety percent in if the snp 500 is minus seventy percent this is crazy stuff right if it’s 70 percent i’m gonna be 100 percent in at that point i might vary my strategy slightly from this but this is my current strategy and after i’m 100% in i’m just gonna be like okay you know i i put all my capital in already i still
Have about 50 k in cash i say 50 k because my burn rate is around $1,350 times 36 months which is about three years it’s 48 thousand and six hundred dollars in cash and i want this sitting around because this is my sh t f fun just in case youtube is not gonna pay me even though some of my videos are not being monetized i see the money drying up a little bit it’s
Starting to slow i see it you know contract about 10% so if my youtube revenue goes to zero or goes you know something very very low i still want this $48,000 just sitting around just so that it can pay my bills a note about if i do not call the absolute bottom of this smp 500 or the entire market perfectly right if it never hits 70% it’s okay i’ve lived through
Other recessions where it dips a little bit i had this really pessimistic target in mind my idea was i’m not gonna invest in it at all until it hits that point and sometimes that point that i had on my mind it never hits it so then i never take advantage of that short dip so this time i’m shifting my strategy a little bit so i’m gonna invest in the stock market
A little bit every single milestone let’s say that it makes when it goes lower and lower now personally i don’t think we have seen the worst of it i think we need to wait a few weeks because this spreading of the situation i think it’s not under control yet and people are just way more optimistic than i think they should be every single time the government does
Something right the federal reserve does some sort of stimulus they’re like oh we’re gonna give away checks right every single time bad things happen for a few days they introduce something they like say something on the news and then the stock market comes up you know wildly it might go up for one day or two day and then it goes down some more if you look at the
John hopkins data we’d have four hundred fifteen thousand confirmed cases worldwide with a daily increase of 41,000 confirmed infections now this is the most it has ever been and yet if you look at the sp500 it popped 9.38% i don’t think i’ve ever seen it go high in my lifetime 9.38% in one single day this is not normal they’re doing some quantitative easing the
Federal reserve is probably buying all kinds of stock indiscriminately just to prop up the market so i think just because you see the stock market doing a positive swing this is not the end of it i think this is manipulated if you’re aware that the federal reserve is buying a lot of stock then it’s not manipulation it’s kind of expected that it’s gonna go up a
Little bit but the cycle basically goes like this there’s a health scare there is more infection there’s more spreading there’s more restrictions going on people get scared the market then goes down for a few days and then the government goes okay what else can we do to assure people that this is all fine and stuff the market goes up for a day or two and then more
Bad news comes out and then it goes down some more so right now i still think it’s gonna go down some more i mean minus 30% is not that crazy right now i don’t think there’s blood on the streets yet there’s a few splatters but what i think this is gonna happen in the end is that there’s gonna be a complete pool of red it’s like completely covered you can’t see one
Spot where there’s like the ground anywhere so that is when i think people are really scared and it might then be time to invest a lot more so from this point on i anticipate there’s gonna be many weeks of bad news still coming unless there’s some vaccine that some drug company miraculously find then we’re gonna see a complete and quick recovery but i don’t think
That’s gonna happen i think it’s gonna take a while and even with all these measures that the government is being put in place yes it helps a little bit but eventually i think or health bad news is gonna come up more people are gonna die and it’s it’s still heading downwards i don’t see it recovering for now because of this i am slowly buying into the market when
You buy into a falling market it hurts a lot and especially when you’re not trying to time it perfectly when you’re not like waiting for it to go now – seventy percent and then go okay i’m so smart i’m gonna put in 100% of my cash because you’re not invested for this whole downturn then you’re like a genius right but i don’t think i can bri take something like
This so that this is why i am kind of investing in tiers knowing that every single tiered i invest into if i wait a few weeks it is gonna drop a little bit i’m gonna be losing huge amounts of money and currently i already am it doesn’t feel good but i have my stash of cash that you know will keep me alive it’ll keep food on the table it’ll keep the lights on and
Stuff i’m gonna be comfortable i’m gonna be warm so this is how you invest basically you take the money that you can invest and you keep the money that you need in order to live so that the money that you invest will have time to grow thanks for watching this video everybody i hope you guys enjoyed these various insights i’ve been reading the news a lot all the
Time just keeping up with everything thanks for watching don’t forget to give me a like comment down below let me know what you guys think and as always push that subscribe button and ring that bell icon thanks for watching
Transcribed from video
Investing at the Near Bottom By BeatTheBush