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Top five stock market lies oh my goodness when you were in your first year of investing you were almost guaranteed to hear all of these five big huge lies and i’ve heard them all when i start investing when i was in my first year to investing i’ve heard all of these five and they’re just bold-faced lies guys i cannot wait to share these with you today and kind
Of break them down and kind of explain to you why they are such lies in their fabrication they’re put out there and it’s like told generation and generation time after time again guys and it’s painful for me to see but we’re gonna get into this guys i’m gonna kind of explain it to you i hope you enjoy today’s video hope you get a ton of value out of it let’s get
Into it all right guys the first one out of the five is the you can’t beat the markets oh my goodness i heard this from several family members and friends when i was first getting involved the stock market you can’t beat the markets basically meaning you cannot get a better return than with the stock market so the stock market on average goes up around 8 percent per
Year okay on average basically that’s saying that you cannot go up more than 8 percent per year and it’s just such a bold-faced lie and usually who tells this lie okay they’re usually the people that tell this or people that are on the defensive okay people that have never even tried to do it okay first off just they heard from their father or they heard from their
Friend who may be trying to do something in the stock market they heard from this person in that person you can’t beat the markets and they just kind of fabricate that over and over and over and over again guys and it’s so painful because it’s it i wouldn’t say it’s easy to beat the markets but i wouldn’t say it’s hard to beat the market it’s okay you could be in in
Some of the simplest stocks out there and probably still beat the market guys amazon apple google the biggest companies in the world facebook these companies all well outperform the market last year okay the market did amazing last year in all those very simple companies they all even outperform the market never mind if you were in some of the more complex stocks
I can nvidia or one of those right then they blew the markets out of the water so this whole notion that no no you can’t do it it’s just told time and time again by people who were on the defensive in life okay these are people that are never gonna take this these are the same type of people that say you can never start a business you can never be successful at
This that they’re people on the defensive guys and they’ve never really tried these things they just makes them feel good to kind of like stay in their cocoon and just live their mediocre life and whatnot and that’s fine that’s their choice but i’m just telling you there’s a whole different life out there that you can beat the markets guys and as long as you’re
Staying diversified you’re gonna have a lot more protection against yourself you’re sticking this companies that are profitable have great balance sheets and things you’re gonna have a great opportunity to beat the markets year and in the year out is it possible that maybe one year you don’t beat the markets absolutely but the majority of time you should be able
To beat them as long as you are putting in the work the second and big lie is you need to buy and hold stocks forever now this this fly started because of one of the people i look up to more than anybody warren buffett he’s kind of got this like famous thing of all you know all body hold stocks forever well that worked back in the day it does not work today and
Even warren buffett himself does not stick to that philosophy anymore even warren buffett trades and now stocks much more often than he used to back in the day why is this well technology has changed the world and forever the way companies can get disrupted now in such a rapid pace it is on real guys the way technology is changing it’s completely changed a whole
Landscape you used to be able to let’s think about things for a minute let’s say i’ve got some great device okay i’ve come out with some great device and i sell it at walmart and target in some other stores okay now walmart and target if somebody comes in there and tries to knock me off with something cheaper that that’s you know cheaper product right but it’s
Pretty much almost as good or just as good as my product wal-mart and target are the retailer’s back in the day sears or whatever retailers i was in they might look at that and say you know what we don’t want that because this one’s already selling great the way it is and it’s higher price than yours you’re trying to undercut them we’re gonna make less money when
We sell each one of these products so we don’t want that the game has been changing out guys with amazon in the online services somebody can go direct to market something go directly on their shopify store whatnot and sell a comparable product right on there and amazon they don’t look at it as all you know what we might make less money if this this knockout comes
In no they look at it we’re just trying to you know do numbers get more customers that’s what we care about who worry about everything else later on down the road it’s completely change the landscape and the way tech has changed the landscape as far as you know the old dogs that could you know get in with the company you know the cisco’s and those type of companies
Ibm or whoever they get in with the company and then they’re good for the next several decades now there’s a thousand startups trying to eat away this little part of their business this little part of their business and as cut by a thousand knives it’s changed the world and forever guys the whole bi let me buy a stock hold the stock forever it’s just not realistic
Nowadays guys there’s too much changing we’re changing too fast social media has changed everything and so buy and hold forever it doesn’t really work anymore number three biggest lie is dividend stocks are safer now this is a half lie i called this is a half lie why does a half lie is it is kind of true that dividend stocks are safer than like you know say you
Know some random company out there that’s a growth stock or something like that that doesn’t pay dividend that’s that’s somewhat of a truth but the lie part comes if you compare dividend-paying companies are usually bigger companies okay usually they’re very big companies if you compare them versus their peers who don’t pay a dividend right bars of similar size it’s
Not really like dividend stocks or much safer okay it’s just when people point at dividend stocks it they’re usually pointing out huge corporations that are massive that are hard to knock off that usually have big competitive moats that takes them you know to be hurt for a long long time before that business is really hurt right those some of those dividend-paying
Companies well versus some other company and might have a 1 billion dollar market cap that’s a little tiny corporation yeah their business can change fundamentally for the better or for the worse very fast right it’s different so dividend stocks being safer it’s it’s a half lie half truth yes if if if you’re comparing it versus growth stocks yes they’re safer
But if you’re comparing against their peers of equal size it’s not really much safer guys you can make an argument that sometimes dividend-paying companies are in a less good financial position the reason being is they’re paying out that money to shareholders while the other company of similar size might be adding that money onto the balance sheet for a rainy
Day or to acquire another come that’s gonna help transform the business so dividend stocks being safer not so sure about that all right guys two left coming in at number four this is my favorite lie of them all well between this one and number five they’re both my favorites okay averaging down on a position is bad what this is this is a lie that’s fabricated out
There constantly out here averaging down on a position is bad meaning you buy stock abc that you really love for the long term you buy that stock at $10 a share it goes down to $9 a share and you say no i should just sell it now i shouldn’t buy anymore that makes no sense to me maybe if you’re a short-term trader maybe you could make an argument that you know buy
Winners sell losers if you’re a short-term trader once again short-term traders don’t really make money over the long term but that’s a whole other argument we can get into there don’t call yourself a long-term investor if there’s a company you really love for the long term it goes down in share price and you don’t take an opportunity to buy that stock when you love
That stock for the long term okay it makes no sense to me it’s like saying i love cheeseburgers but in mcdonald’s they just went down on their big mac from from $3 to $2 but you know what i don’t want big macs now oh but big macs they went from $3 to $10 so now i’m gonna buy a big neck it literally makes no sense guys if you were a long-term investor in companies
And stock dips it means by if you really believe in that company a lot over the long term okay and you’ve done all your research into that company if it goes up in price a bunch it doesn’t make it make sense to buy it if you often think it’s overvalued at that point in time you i make decision i make business decisions based upon whether company’s overvalued or
Undervalued on based upon where i feel the business is going over the long term long term meaning over the next few years okay that is how i make my decisions i don’t make my decisions based upon oh the stock price went up 10 10 percent today let me sell out or let me buy more shares now that went up 10 percent no i’m actually hoping those shares go down so i can
Get more shares at a better price that is long-term investing 101 as warren buffett’s philosophy is my investing philosophy that’s value investors philosophy long-term investors philosophy is when stocks dip that you love you go and buy them okay and then you sell them once they begin to get fair but fairly valued or overvalued it’s a name of the game it’s rinse
And repeat time and time again let’s get into number five so i got in the stock market in 2008 really started getting in in 2009 okay the stock market was crashing during those times that economic you know turmoil was going like crazy at those times right and starting to 2010 and pretty much every year since then i’ve heard people tell me i’m waiting to get in
The stock market until it crashes i don’t know wait till we have a recession to get in the stock market i’m like man can you imagine the games these people have messed out on can you imagine i’ve gotten throughout all the years i would have never got those if i was on the sidelines the whole time waiting saying oh man i’m waiting to the day that the stock market
Crashes to get in this market like like that makes no sense ultimately what’s gonna happen is yes you’re gonna have a few crashes in your lifetime absolutely that’s gonna happen but the chances you’re gonna time it out perfect and get in right when it crashes or whatever you’re gonna miss out on so much opportunity already it’s unbelievable when i start investing
In the stock market the stock market was a rat i mean the dow jones was around 7,000 points 7,000 8,000 points okay and when it when it dipped to those lowest level it was at like 6700 now the dow is at what 25,000 plus okay imagine the games so many stocks i mean the massive amount of corporations are up hundreds of percent throughout that time other stocks
That are really out performers like the nvidia and stocks like that or thousands of percent during that time and meanwhile people were like oh no i don’t want to get involved yet it’s 2010 you might go with a double-dip recession 2011 oh we might have a double-dip recession might ever this happened oh i don’t want to get in yet people always making up stuff old
Trump selected i don’t want to get in the stock market now people always make it up there’s always so many worries out there right people always all north korea i don’t know they got a nuclear bomb they might try to blow us up or something people always like fabricating whatever it is in their head to make themselves not get in the market and you can do that
Absolutely but the the chance you’re gonna time it out where else in you get in when a market crashes at the perfect time or whatever very slim to none however if you participate all along the way and you just mints okay you’re gonna probably do very well and that’s what i do i just make adjustments based upon the market if i felt the economy was really going
South unemployment numbers are getting really weak gdp numbers are starting to get really weak and i felt like we were having a lot of problems coming i would be getting out of the market but not just really getting out of market i would start shorting shares i would start buying put options and things like that i just adapt okay i just adapt to whatever’s going
On the market i’m gonna adapt but i can tell you every single time in the past you know almost decade i’ve been the market i have bought every single dip and guess what’s happened it’s worked every single time for the past decade and when i feel like there’s a dip and it’s for good reason believe me i will start selling out shares i don’t start buying put options
And stocks in short selling stocks and things like that but until i have good reason to sell off positions and not buy the dip i’m not gonna be selling my stock anyways this was a five biggest allies i hear in the markets all the time guys you were gonna hear these you’ve probably already heard these if you’re starting to get into the markets and you told other
People you’ve probably heard some of these lies already i hope you guys enjoy this hope you got a lot of value thank you for watching and have a great day
Transcribed from video
Top 5 Stock Market Lies By Financial Education