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Bankrate found that only 18% of investors plan to boost their stock holdings in 2022, and many signaled that they weren’t going to invest ANYTHING, AT ALL.
https://www.bankrate.com/investing/survey-market-volatility-stocks-may-2022/
In fact, “Nearly 16 percent said that they had SOLD stock investments or withheld further contributions in 2022”….and, this is where we have a problem.
I recently posted an article by the blog, MarketSentiment, that cited research which suggests that - when stocks are DOWN - CONTINUING TO BUY yields greater profits, long term, and that, GENERALLY, the MORE you try to TIME your investments…the WORSE people generally do.
Another study from UC Davis in 2010 concluded that only 1.6% of traders were actually profitable…and, were even quoted as saying: “Persistent trading in the face of losses is inconsistent with models of rational learning”
In fact, during the 20-year timeframe where REITS Oil, and the SP500 averaged an almost 10% return…the retail investor…BARELY managed to outperform inflation…at 2.5%. That’s because, it’s largely summarized that most retail investors are prone to jumping in at peak hype, selling as soon as they’ve lost money, and then repeating the process over and over again…while, proceeding to lose a lot of money.
Plus…the data doesn’t lie: since 1930, had you just missed the top 10 BEST trading days of EVERY DECADE…just because you decide to sell, or “wait” for things to recovery…your return would be 28%…VERSUS 17,715%…IF you just carried on as usual, and DIDN’T SELL.
Even MORE GUT-WRENCHING, is that “Americans in the lowest-income group were also the most likely to be active investors due to inflation, either buying, selling or withholding additional investment due to market volatility.” Or, in other words…the investors who need the money, the most…are the type to make the biggest mistake, and see the lowest overall return.
So, as part of my “Personal Finance 101” rant, I just have to say: regardless of what the media says, regardless of how difficult it is to see your portfolio drop in value, and regardless of what you might THINK will happen…EVERY SINGLE STUDY, throughout the last 100 years, reinforces the fact that BUYING AND HOLDING a well diversified portfolio is the BEST WAY TO MAKE THE MOST AMOUNT OF MONEY…and, GENERALLY…when prices are DOWN, investing MORE leads to higher returns.
Obviously, this doesn’t apply if you’re aggressively buying meme-stocks and random penny stocks you heard about at the casino..but, if you’re in a globally diversified, low-fee index fund…this advice holds true, and - when most people LOSE MONEY…do the opposite, by sticking with a plan and buying normally - regardless of what you think you should you. THAT should help you overcome an otherwise VERY costly mistake…and, HOPEFULLY…make you a LOT of money in the process.
My ENTIRE Camera and Recording Equipment:
https://www.amazon.com/shop/grahamstephan?listId=2TNWZ7RP1P1EB
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
*Some of the links and other products that appear on this video are from companies which Graham Stephan will earn an affiliate commission or referral bonus. Graham Stephan is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. This is not investment advice. Public Offer valid for U.S. residents 18+ and subject to account approval. There may be other fees associated with trading. See Public.com/disclosures/
GET YOUR FREE STOCK WORTH UP TO $1000 ON PUBLIC & READ MY THOUGHTS ON THE MARKET - USE CODE GRAHAM: http://www.public.com/graham
SUBSCRIBE TO THE MARKET SENTIMENT BLOG: https://marketsentiment.substack.com/
GET MY WEEKLY EMAIL MARKET RECAP NEWSLETTER: http://grahamstephan.com/newsletter
The YouTube Creator Academy:
Learn EXACTLY how to get your first 1000 subscribers on YouTube, rank videos on the front page of searches, grow your following, and turn that into another income source: https://the-real-estate-agent-academy.teachable.com/p/the-youtube-creator-academy/?product_id=1010756&coupon_code=100OFF - $100 OFF WITH CODE 100OFF
Bankrate found that only 18% of investors plan to boost their stock holdings in 2022, and many signaled that they weren’t going to invest ANYTHING, AT ALL.
https://www.bankrate.com/investing/survey-market-volatility-stocks-may-2022/
In fact, “Nearly 16 percent said that they had SOLD stock investments or withheld further contributions in 2022”….and, this is where we have a problem.
I recently posted an article by the blog, MarketSentiment, that cited research which suggests that - when stocks are DOWN - CONTINUING TO BUY yields greater profits, long term, and that, GENERALLY, the MORE you try to TIME your investments…the WORSE people generally do.
Another study from UC Davis in 2010 concluded that only 1.6% of traders were actually profitable…and, were even quoted as saying: “Persistent trading in the face of losses is inconsistent with models of rational learning”
In fact, during the 20-year timeframe where REITS Oil, and the SP500 averaged an almost 10% return…the retail investor…BARELY managed to outperform inflation…at 2.5%. That’s because, it’s largely summarized that most retail investors are prone to jumping in at peak hype, selling as soon as they’ve lost money, and then repeating the process over and over again…while, proceeding to lose a lot of money.
Plus…the data doesn’t lie: since 1930, had you just missed the top 10 BEST trading days of EVERY DECADE…just because you decide to sell, or “wait” for things to recovery…your return would be 28%…VERSUS 17,715%…IF you just carried on as usual, and DIDN’T SELL.
Even MORE GUT-WRENCHING, is that “Americans in the lowest-income group were also the most likely to be active investors due to inflation, either buying, selling or withholding additional investment due to market volatility.” Or, in other words…the investors who need the money, the most…are the type to make the biggest mistake, and see the lowest overall return.
So, as part of my “Personal Finance 101” rant, I just have to say: regardless of what the media says, regardless of how difficult it is to see your portfolio drop in value, and regardless of what you might THINK will happen…EVERY SINGLE STUDY, throughout the last 100 years, reinforces the fact that BUYING AND HOLDING a well diversified portfolio is the BEST WAY TO MAKE THE MOST AMOUNT OF MONEY…and, GENERALLY…when prices are DOWN, investing MORE leads to higher returns.
Obviously, this doesn’t apply if you’re aggressively buying meme-stocks and random penny stocks you heard about at the casino..but, if you’re in a globally diversified, low-fee index fund…this advice holds true, and - when most people LOSE MONEY…do the opposite, by sticking with a plan and buying normally - regardless of what you think you should you. THAT should help you overcome an otherwise VERY costly mistake…and, HOPEFULLY…make you a LOT of money in the process.
My ENTIRE Camera and Recording Equipment:
https://www.amazon.com/shop/grahamstephan?listId=2TNWZ7RP1P1EB
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
*Some of the links and other products that appear on this video are from companies which Graham Stephan will earn an affiliate commission or referral bonus. Graham Stephan is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. This is not investment advice. Public Offer valid for U.S. residents 18+ and subject to account approval. There may be other fees associated with trading. See Public.com/disclosures/
What's up you guys, it's graham here so usually when i see a mistake or something that shouldn't be happening, i like to call it out and share my thoughts, because investing is something i take extremely seriously and today is no exception during a time where investor sentiment Has fallen to extreme fear, it's all, but confirmed that we're very likely to head towards a recession and unfortunately, according to his study, the vast majority of investors are already making a huge mistake and quite literally doing the exact opposite of what they should be. If they want to make money, this comes at the same time that the fed nears another 50 basis, point rate hike in both june and july. Earnings are getting worse with morgan stanley warning of another 10 pullback and a wild. Turkey is attacking people in dc, while multiple agencies are in pursuit and one man protected himself with a rolled up plastic fence.
Yes, that is a real story. Anyway, let's talk about the current state of the market, the impact of a potential recession coming soon, whether or not housing values are falling as fast as millennials would like, and then finally, we'll address the mistake that the vast majority of investors are currently making without even Knowing it and it's bad, although before we start, my current analytics tell me that you have not yet smashed the like button for the youtube algorithm and i'd like to change that. So how about this? If you hit the like button or subscribe in the next five seconds, i'll show you this really cute picture of a baby turtle. So thank you guys so much and also big.
Thank you to ftx us for sponsoring this video, but more on that later. Alright. So, in terms of where we are today, the good news is that we don't have that much bad news kind of, even though multiple companies are warning about slowing demand, weak earnings and less consumer spending on the bright side, it seems, like expectations, are already relatively priced In and we already know, what's going to happen, for example, initially the first sell-off began when the fed began raising rates which increased the cost of borrowing and led to a quick sell-off among investors from there consumer demand began to slow down as people cut back, bought Less and held cash because of rising costs, leading to, of course, less profits for businesses and less attendees in your brokerage account. But now not all bad news is bad when the federal reserve signaled that they would most likely raise rates by another 50 basis points the market rallied because hey you know what it could have been worse, and at least we know what to expect now for those Who miss the meeting and want everything summarized in the next uh 20 seconds here you go, and this is why the stock market reacted so positively.
In the meeting they mentioned, that all policy makers on the committee supported the 50 basis. Point move in may. In addition to the plan to begin shrinking, the fed's 9 trillion balance sheet beginning in june, this unanimous decision simply manages investor expectations and, as long as nothing unpredictable happens, the market could price it in and then move on. It's kind of funny by the way, because earlier this year, the 50 basis, point rate hike was seen as a worst case, dangerous scenario, and now it's seen as good news that it's only going to be going up by 50 basis points. So you see what i mean about managing expectations anyway, even though the market's going up americans are still worried about the state of the economy and with cnn's index at extreme fear, along with the rising risks of a recession to mass layoffs. There is one aspect that very few people are talking about and that's the signal that the federal reserve could soon be selling off their assets onto the open market, and that is something that we have to talk about see in the beginning of the pandemic. The federal reserve took an abrupt action to stop the losses by buying corporate bonds and mortgage-backed securities as a way to ensure that corporations and people who needed money got money. This was how they were able to inject 120 billion dollars a month into the economy, and it's largely agreed that this strategy, bolstered the market, to the point where businesses could stay afloat, loans were available and inflation could reach a 40-year high.
Okay, now jokes aside, they did provide a backstop to what could have possibly become the next great depression but beginning in march. They completely cut back on their stimulus and now they've indicated the possible sell-off of their balance sheet, which could have a pretty serious implication throughout the market. Think of it like this, when things got bad, the fed basically said no problem guys. You want a mortgage, yeah we'll buy it, your company needs money.
Here's a 10-year loan go, have fun and spend it wisely. By doing so, they essentially built up a portfolio of their holdings that they could either keep until they're paid back or that they could sell on the open market. The federal reserve president recently said that, once your balance sheet reduction is well underway. That is an option that the federal open market committee could consider.
If this happens, mortgage rates will likely begin to increase loans will be slightly more difficult to come by and in turn, the federal reserve will be removing money out of the market and in turn, reducing inflation and lowering costs. Obviously, this puts additional stress on the housing market, which is already showing signs of slowing down, but it also signals to investors that maybe right now is not the best time to begin deploying cash and, as a result, a new study found that only 18 of americans Are planning to boost their stock investments in 2022, with the belief that things are about to get a lot worse as we watch all of this unfold, although before we cover that listen, i know how difficult it is to watch your portfolio drop in value or see A year's worth of profits wash away in a bear market, but if you're a long-term investor, these drops could be viewed as a potential opportunity and that's where a sponsor ftx us comes in they're, one of the largest u.s regulated cryptocurrency exchanges in the world. With millions of users who trust them to buy, sell track and trade, both cryptocurrencies and nfts, all in one place with fees that are up to 85 lower than the top competitors, for example, there are no fixed minimum fees on transactions, no ach fees and no gas Fees for the top ethereum and solana collections, plus they make it extremely easy to dollar cost average into the markets over time. For example, if you want to buy bitcoin you're there with one click, decide how much you want to invest and how often you want to invest and then with one swipe you're set to automatically invest on a regular basis without any more work. On your end, they're also founded by sam bigman freed one of the wealthiest people in the world under the age of 30, who plans to donate 99 of his money to charity and they've recently partnered with steph curry, tom brady coachella and the miami heat arena. Not to mention, i also love the fact that you can track prices throughout more than 10 000 different options and their debit card is accepted throughout millions of merchants worldwide. Plus now you can sign up for ftx us down below in the description with the code. Gram and get all the way up to a hundred dollars, depending on how much you trade, along with free crypto and every trade you make over ten dollars.
So if you're interested in signing up or learning more, the link is down below in the description with the codegram to get started today, and now with that said, let's get back to the video all right now i know in the beginning i alluded to a big Mistake that the vast majority of investors were making that's nearly guaranteed to lose the money, and this is it like. I mentioned bankrate found that only 18 of investors planned to boost their stock holdings in 2022 and many signaled that they weren't going to be investing anything at all. In fact, 56 of us investors said that they had purposely not made any moves in response to the market's volatility and nearly 16 said that they had sold stock investments or withheld further contributions in 2022, and this is what we have to talk about. I recently posted an article by the blog market sentiment, which cited research that found that, when stocks are down continuing to buy yields the greatest profits long term and that generally the more you try to time your investments, the worse people actually do.
In fact, during a 20-year time frame where reits oil and the s p 500 averaged almost a 10 return, the retail investor barely managed to outperform inflation at two and a half percent. That's because it's largely summarized that retail investors are prone to jumping in a peak hype selling at the moment they lost money and then repeating the cycle over and over and over again, while losing a lot of money. Plus the data doesn't lie since 1930. Had you just missed the top 10 best trading days of every decade, your return would be 28 versus 17 715. If you just carried on as usual and didn't sell, even more gut wrenching was that americans in the lowest income category were also the most likely to be active investors due to inflation, either buying selling or withholding additional investment due to market volatility, or in other words, The investors who need the money, the most are the type to make the biggest mistakes and see the lowest overall return. So, as part of my personal finance rant, i just have to say, regardless of what the media says, regardless of how difficult it is to watch your portfolio drop in value and regardless of what you think will happen, every single study throughout the last 100 years reinforces The fact that buying and holding a well-diversified low-fee index fund is the best way to make the most amount of money and generally when the markets are down investing more leads to larger returns. Now, obviously, this doesn't necessarily apply if you're aggressively out there trying to buy meme stocks and penny stocks that you heard about at the casino. But if you're in a globally diversified low fee index fund, then this advice holds extremely true and when most people are losing money, selling and panicking, you should do the opposite of that.
By sticking with the plan and buying as usual, this should help you overcome an otherwise very costly mistake, and hopefully you end up making a lot of money in the process believe it or not. It was also found that 40 of investors who pulled money out of the market in the last year, regret it even when the market is down year over year. So that says a lot when they sell the market goes lower and they still have regrets. Of course, as far as my overall thoughts in terms of housing, the good news is that, even in the wake of rising interest rates, mortgage rates have actually begun to decline, as demand slows down, meaning that the housing market could begin to stabilize throughout the rest of The year, in fact, the chairman of riverfront investment group believes that, due to strong supply demand conditions, we believe most markets are likely to rust than bust.
By rust we mean that nominal prices not adjusted for inflation, could decline somewhat or stagnate around current levels. For several years, it's also worth noting that, pending home sales have plunged to the lowest level in a decade, mainly because higher interest rates don't just affect buyers, but they also affect sellers. After all, if they sell, they have to move somewhere else too, and it's quoted that the vast majority of homeowners are enjoying huge wealth gains and are not under financial stress as a result of having locked into historically low interest rates or in other words sellers. Don't want to give up a fixed, fixed-rate 2.8 mortgage when a new one would cost them 5, so they're staying put. That means! Yes, we could see some softening, but the chance of a crash seems pretty unlikely with the information that we have available to us today. Now cryptocurrency, on the other hand, did see the largest sell-off down about 40 year-to-date, but jp morgan believes that this could be a great opportunity for investors and that they say it's actually undervalued by 28. Although take that with a grain of salt, because a guggenheim analyst also believes that the bottom could be eight thousand, so basically, everyone is just throwing out a random guess and eventually one of them is going to be right. But the one thing that we don't have to guess on is that market volatility is your friend it's a great opportunity to buy in cheaper and don't be discouraged if you're in the negative and feel like throwing in the towel.
This is what a realistic and healthy market should be looking like so embrace it dollar cost average and over the next few months or even years, the markets will recover and at that time you'll be glad that you stayed the course and subscribed. If you haven't done that already so with that said, you guys thank you so much for watching also feel free to add me on instagram and do not forget to get that free stock down below in the description. That's worth all the way up to a thousand dollars when you sign up for public.com using the code gram, you may as well do that it's pretty much like free money. Thank you so much again for watching and until next time,.
🙌🙏thank you for the value always ^-^
Lorem ipsum!!!!
Graham for President!
I’m leaving the middle class thanks to Graham, Jaspreet and Derek from moreplatesmoredates
The middle class is financially screwed because you folded a pair of kings when you won -.-
Dun dun dun!
Going poor one payment at a time with costs weather it’s a recession or not .
Does the king respond 👑?
I’ve never been this early before
Hello – third!
Awesome bro thanks!!!
😔
Millionares are the new middle class. The upperclass are the billionaires and the rest of us are wage slave lower class.
Oh I’m early early
Hi Rod, it's Graham !
Hi Graham i like your job you are a genius 🍿🇺🇸
Good thing I’m below Middle class lol
Screwed like your shameful defeat at the boxing match?
My man Graham !
Wooooo
Coming in real hot with these titles Graham.
It's the sloth spaceman adding to the algorithm here again!
First
not first!
Drat
Uh oh
I'm this early!?!?!
First