All right, welcome back to part Two of Blue Chip Stock versus Small Cap Stocks today. We're going to be talking about, you know? And oh, by the way, make sure to check out part One. Okay, and go to the channel if you happen to stumble on this. I got, uh, in part one I Kind of got a lot of the groundwork terminology terms Etc laid out and if you didn't see part one, it's probably because you're not subscribed to the channel.

You should subscribe to the channel and ring that Bell That way, you'll get notified every time we drop a new video and you would have known about part one. All right. Everyone actually let me know in the comments. Did you watch part one? Let me know? Yes or no.

Did it help? Okay, that being said, we're going to talk about the pros and cons of investing in Blue Chip tax stocks as well as small cap stocks. Now, what's great about the Blue Chip The big companies? You know those names. those household names as they say. Whether that be an Apple or a Ford or an IBM or a Google or an Amazon or a Microsoft, You know these are the greatest, most well-known names.

And what's awesome about them? They have strong financial performance, so people like to put their money there. They know. Remember, the stock market is forward-looking The stock market is always looking forward towards potential growth and profits. If you're hitting your goals, whether that be sales at the Top Line profit, on the bottom line, you will be rewarded by the market.

whether that be through hedge funds. institutions like uh, you know Pension funds, retirement funds, Uh, you know a big Union funds Etc They want to put their money in those safest companies because they want to grow it, but also respect their constituents that have entrusted them to invest the money on their behalf. If you continue to have growing sales, growing profits, the money is going to continue to flow, which is going to continue to increase your market cap, which is going to continue to increase your earnings per share, which will increase your dividends, which everybody's happy. Now one drawback is stocks move slower.

Okay, but by moving slower, there's less downside risk. Okay, when it was I mean obviously any stock can pull back, especially in uncertain times like this. But when was the last time you saw an Apple or a Microsoft or again a Ford or some other big manufacturer that that has a solid 100 Year business? When have you ever seen them gap down monstrous amounts? Five ten percent. You know, 20 like penny stocks do.

Okay, so your downside risk is limited. Now because of that, it doesn't mean your upside risk is limited or your upside reward. It just means you have to have patience. Okay, there's that idea of risk to reward.

Okay, the more risk you take on the higher the potential reward, the less risk you take on the lower the potential reward. Now, what's great about if you especially focus on technology stocks like an Apple or a Tesla or an Amazon. Even with multiple months or maybe a year or two, you can see great gains. If you've got a proper trade plan based on the risk or based on the chart which is what we do all the time.

We use technical analysis to guide us through that trade and we use trailing stops to keep us in the trade until the momentum shifts. If the momentum shifts, we take profits and we move on. Okay now um, what's great? You know again, the drawback of these bigger cap stocks is you know you're never going to see what we call like that multi-bagger Okay, well I should say you know is if you're willing to wait a decade. Okay, if you're willing to wait a decade, you could see a triple bagger.

Okay, that's when we see a stock go. You know three times what it's trading at. Like let's say a hundred dollar stock that goes to 300 now. um, they're few and far between.

It does happen, but less likely now. What's great about the small cap stocks is we see that every day now. they're scary and you have to know when to stop out and you know I have to know how to you know actually pick levels on the chart to recognize the momentum shift. But if you learn those techniques which a great way to really get in depth is to check out Stocks To Trade Live.

So I mentioned it already. but if you click that link below, go to Stocks Trade Live. We go live several times a day. Different Traders Different approaches: morning, midday, even into the evenings.

We do them as late as 9 pm. Eastern great for you West Coast Uh West West Coasters that maybe you're getting home at 5? 30 at night? you can jump on that webinar at 6 PM Eastern Live. That's the greatest thing. and we do so many of these so that you can join the one that fits your schedule.

We do weekends too, so definitely check that out. But anyway, once you learn how to trade these stocks, you learn how to chart them. That's where you can really recognize those multi-baggers So small cap stocks always in the short term outperform the large caps. Now long term, it's an absolute disaster.

Okay, but we know what these penny stocks are. That might be the one biggest thing that I always push on this channel is understand what you're trading your these stocks. These small cap stocks are what we call trading. Vehicles Okay, they are a chart pattern and they're a vehicle to take you to profits.

Okay, these aren't long-term Investments You never believe in any penny stock. You just recommend. It's a recognize that it's a chart pattern that repeats day after day after day. That's a great thing.

So um, small cap stocks. One of the drawbacks and a lot of people are scared of this is the extreme volatility. Now if you know how to take a stop which a lot of learning how to take a stop is just getting in the Reps it's seat time when I say seat time. like sitting in that chair every day.

Okay, the more you're there, the more you recognize how these things move and the more you recognize the chart patterns you can understand. The volatility is a good thing. Okay, volatility. May Shake out.

We don't have problem taking a stop and day trading. If you have problems taking a stop in low price stocks or any stock, you need to fix that. Okay, you're going to not to get too off topic. You will struggle forever until you get to the point where you are okay taking a stop.

You have to recognize taking stop losses is part of trading. and this is where Sports analogies I Think work so well. Okay, listen, you have to understand in basketball you will miss shots. You'll miss layups.

Okay, you'll miss a wide open layup. It happens Okay, but what you have to do is be okay and recognize the fact. Oh man. I Just missed a wide open layup here.

but I'm going to calm down I'm going to regroup I'm going to play some defense and I'm gonna make the next shot now if you lose your mind if it breaks you emotionally, you start throwing stuff. Listen up throwing stuff. But if you lose your mind and it it completely destroys your attitude, then now the market is one and you're probably going to repeat the same thing if you can understand that. I Missed the layup I missed I missed a trade I I said I was going to lose 100 bucks I lost 500 bucks I'm not doing that again.

You can learn and you can ultimately have a much higher odds of success. Now what's great about the small cat stocks? They move in packs too. Uh, the Blue Chips They kind of just do their own thing based on their business, you know. and Amazon is like this huge freighter just going across the ocean.

What's nice about the small caps? You get one mover, then typically the next day there's another one in the same sector or the same business. Next day there's another one. So they move more like you know. It's like a school of fish versus this huge freighter doing its own thing.

The school of fish. So what's great about it is you don't have to catch the first one. I Often advise, um, just you know. it's those day wonders as we call them a lot of times, especially for risk-averse Traders I'm just like, avoid the day Wonder We want to see day two.

We want to see confirmation. We want to see sympathy plays because the higher probability is day two. Day three. Day four.

So all right everyone. Hopefully you enjoyed this video. Drop me a comment below. Do you like the breakdown of the true stocks versus the penny stocks? I Love them both.

If you know how to trade them, check out stocks to Trade live. Would love to see on those webinars again Four times a day and weekends and we'll see you next time for part three of Blue Chip Stocks versus small cap stocks.