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Well ladies and gentlemen we’ve done over a thousand videos in the history of this channel and i think we’re about to get into something we have never gotten into before which is panic buying there’s absolute panic buying going on in the stock market right now all right i want to touch on four points in this video i want to show you some charts that will illustrate
How much panic buying there is going on in the stock market right now okay i’m gonna go over a panic selling versus panic buying you hear a lot of times you know people talk about there’s panic selling in the market but you never really hear about people talking about panic buying there can be both okay we’re gonna talk about why this occurs why does this situation
Occur why does this all of a sudden there’s just a panic by going on and what do you do in this situation we’re going to touch on all four of those points in this video here today by the way today’s video is sponsored by by private stock market membership group that it’s a first link down there in the description if you want to join that i would love to have you in
There alright first off here let’s look at some charts all right this one just looks at the dow jones industrial average and what we will see this is a one-year chart going back if ever from a year ago and what we will see is we’re going to see pretty normal activity for the most part for most of the year all right pretty much nine months out of the year if not more
Nine months we’re pretty normal activity you’re gonna see some moves up here to see some moves down which so this is all normal activity on a daily basis on a weekly basis or monthly basis sometimes you’re gonna have some good months sometimes you’re gonna have some bad months overall you’re gonna have a lot more good months and bad months in the stock market that’s
Just how it is so pretty normal activity up until we get into around the december timeline and all of a sudden in a very short amount of time about a month span the stock market just falls in a dramatic fashion from over 26,000 to the 21,000 range in literally a matter of about a month it almost went down in a straight line that right there ladies and gentlemen is
What you call panic selling in the stock market when you can get almost a straight lying down for the markets you just move down and down and down alright but now we look and basically starting a rate around january we’re going to look at this chart and it’s almost a straight line up it’s not quite as dramatic as a drop and i usually panic selling is a little more
Dramatic than panic buying but what we will see is it’s almost up in a straight line pretty much as the market bottomed around that 21000 range 21700 we’re gonna see it’s just pretty much over the past two months has gone up and up and up and up some some days we’re down or some weeks we’re down but for the most part it’s pretty much up in a straight line just not
Quite as dramatic as a panic selling situation now we’re back to around that 26,000 range and it’s not just the dow jones if you look at a chart of the s&p 500 we’re gonna see almost an identical situation where the markets were pretty fair pretty normal most of the year and then you see in around that november december timeframe a dramatic drop in the markets
Almost down in a straight line in on a rapid fashion from the s&p 500 being near 2,800 – dropping down to the 2300 range and literally about a month’s time and then look at the climb straight out of that just buying buying buying if we look at the russell 2000 which tracks a lot of the smaller companies out there right we’re gonna see very normal activity for most
Of the year and the same exact situation happened and look at the panic buying that has happened since then it’s just been up in basically a straight line and then lastly this last one we’ll look at the nasdaq same exact situation all the stock markets have done it the dow the s&p 500 the nasdaq the russell you can look at any of those indexes and you’re gonna
See basically there was a dramatic drop and around the december timeframe november december just down in a straight line and since then since basically as soon as we got into 2019 it’s just been up and up and up okay no it’s be very clear both of these situations are very silly whether we’re talking about panic selling in the market or panic buying in the market
Both and do not make a lot of sense okay they just don’t this is what i call fear of missing out it happens whether you’re talking about the market going down or the market going up what you’re gonna see is you’re gonna see if there’s all sort of trends start to go and this trend gets stronger you’re gonna see us on a lot of money out flow out of the stock market
If the market’s going down and it’s just gonna push the market down in a much more rapid pace there’s gonna be more and more panic selling and you’ll just see these ridiculous down days where the market just goes down and down but it’s just a silly pretty much coming on the upside because you’re gonna see people just flooding money into the stock market all of a
Sudden and it’s like why weren’t you doing that you know two or three months ago or four months ago when the market was going down and down and down the fear of missing out can happen whether we’re talking about a stock going up or an asset in general going up real estate doesn’t matter whether we’re talking about it going up or going down there’s always like a
Fear of missing out that can happen in the market in general that freaks people out and say i got to get out of these stocks right now i got to get out of real estate right now or man i got a flood in all my money right now this is what ends up happening we gotta ask ourselves who is really at fault for panic buying and panic selling in the stock market our right
And a lot of people might say well it’s those retail investors the guys like you and me okay that you know are investing i don’t know tens of thousands or hundreds of thousands of dollars at a time it’s us it’s us retail investors we must be the ones that are freaking out in panic selling and panic buying the market and that’s a really cute idea that it could be
The retail investors that are causing these panic buying situations of these panic selling situations one retail investors don’t generally make dramatic moves like that like sell out of position so fast or get into position so fast like that it’s generally not that situation also retail investors we just don’t have that type of capital to move markets like that
You’re talking about you know when you get dramatic moves like this you could be talking about outflows of money or inflows of money in the tens of billions or in the hundreds of billions of dollars us retail investors that might buy $10,000 or sell $10,000 at a time or a hundred like it we just don’t have that type of capital so who is really responsible for the
Panic buying or a panic selling in the stock market at the end of the day it’s the wall street fellas let’s be very clear about this okay the fund managers the massive hedge fund managers the massive mutual fund managers these are the individuals with billions of dollars of capital tens of billions of dollars of capital or even hundreds of billions of dollars of
Other people’s capital that is pulled together and they move that money around based upon where the market trend is at a particular time and they don’t want to get caught with their pants down meaning if the markets going down a bunch they don’t want to be necessarily a net buyer because they they make it look bad to their peers or their other investors who don’t
Really understand how the market works and why it being a contrarian a lot of times can make you a lot of money in this game they just like to follow whatever the trend is so you have these type of individuals that will follow each other around and it’s like kids playing tag at the end of the day if you ever watched kids playing tag right the way they play tag
Is they don’t play to the smartest way right they they follow right behind another one and they try to chase after that one then they don’t really worry about where that kids going where the weather the next movement for that kid’s gonna be they just go wherever that kids at okay so the kid goes left they’re gonna follow right behind them and go left they’re not
Gonna think oh they’re probably gonna go left next let me already start cutting left right they’re just going to follow directly behind that person and that’s exactly what a lot of these hedge fund and mutual fund managers do that manage billions or tens of billions a hundreds of billions in dollars then like kids like playing tag out there whereas all sudden a
Trend will change in the state shoot i got a fear of missing out if everybody’s selling i got to sell out of these positions too oh everybody’s buying shoot i don’t want to underperform what all the other hedge fund managers are doing all the other mutual fund managers are doing i need to buying these stocks the stocks are going up like crazy i got to buy in i
Can’t miss out on this or what might end up happening as those people might end up saying you know what the other hedge fund manager over here the other mutual fund manager is doing a lot better then you why did you underperform the market so much here’s what i’m going to go ahead and do give me a b give me back my money that i have invest in you i’m gonna move
It over to them over there they don’t want to be in that type of situation so they they don’t necessarily care about our performing the market a lot of times they’re just trying to like stay with everybody and play tag so they can be somewhat close to them not worrying about where the next move is worrying about what the move is right now and so the great thing
About being a retail investor right someone that you’re just investing your own money whether it be thousands of dollars or tens of thousands of dollars or hundreds of thousands or even a few million dollars right the great thing about being a retail investor you don’t have to answer to anybody you can make moves how you want to make moves you can ask yourself do
You want to be a wolf or do you want to be a sheep in this situation do you want to be a contrarian so in situations like october/november in especially december those are unbelievable buying opportunities because it was just panic selling in the market and there are ton of great deals in the stock market right and you could have been a buyer stocks ended buying
And buying and buying right or you could have just said you know wait i’ll wait till the markets back up and then i’ll start buying stocks like a lot of these fund managers have done they’ve waited for the markets to come back and get to a certain level all markets back to 23,000 all the markets back to 24,000 now i can start buying again all the markets back to
25,000 now i can start buying again it looks like the market safe again because they’re trying to worry about their clients and all this type of things when they missed out on great games like the amount of stocks that are up twenty thirty and some even forty percent since just the beginning of january is an astounding amount like if there’s a lot of stocks that
Are up twenty thirty or forty percent just since the beginning of january and keep in mind in this vid what’s today february 19th like we’re not even two months into the year we’re talking about massive amounts of stocks are up twenty thirty forty percent from their lows they hit in that late december and early january time frame and so that’s the most beautiful
Thing about being a retail investor investing your own money you don’t have to worry about you aren’t investing other people’s money you don’t have to worry about that you could be a critic contrarian and while the markets drop and like crazy and everybody’s panic selling and you’re buying and everybody for buying you know you’re gonna look very smart when things
Flip around right and at the same time when you get in a situation where the market gets really elevated you don’t have to buy anymore you can just hold or are you gonna sell stocks if you think they got overvalued and you can make moves like that when everybody’s like oh look at the market it just keeps going up you need to be buying still right it’s the great
Thing about being the retail investor it’s the best thing ever because you don’t have to answer anybody you don’t have to worry about you know who’s gonna judge you out there and who’s gonna say oh man i had a million dollars invested with you i don’t need that million back now because i’m gonna go invest it with them because they’re doing a lot better over there
Which is the game fund managers are playing out there and that’s what really causes the pot of the panic buying out there and the panic selling guys and honestly you can just look at the charts it’s straight panic buying over the past month or two it’s just it’s just pretty much up in a straight line it’s just not quite as severe as when panic selling whenever
You see panic selling in the market it’s always more violent than panic buying it’s just the way it works out but both or what i would call panic buying and panic selling at the end of the day when you see moves that dramatic the amount of money that needs to inflow to the stock market or outflow to the stock market – cause you know markets to move thousands and
Thousands of points like that guys we’re talking about dramatic amounts of money it’s not like it’s just a small amount of money right so anyways i hope you guys enjoyed this video today kind of talking about panic buying is something that’s almost never talked about in the media and you just never really hear about it like i said i got a thousand plus videos on
The channel i don’t think i’ve ever talked about panic buying situations but it absolutely is a real thing and absolutely does happen hope you guys enjoy this make sure you hit a thumbs up if you did thank you for watching and have a great day
Transcribed from video
Panic Buying The Stock Market Is Going On Right Now By Financial Education