 Guys welcome back to the independent investor channel. I think in times like these where the markets are super volatile It's important that you get my spiel on risk tolerance risk tolerance is a tried and true fundamental aspect of investing that cannot go Undiscussed in markets like this a lot of people are losing their freaking shorts They're falling all over themselves to sell out of the market. It's the dumbest thing you can possibly freaking do Here's what they have failed to identify They have failed to identify their own risk tolerance and you say Ryan How the hell am I supposed to do that if I've never been an investor before I'm going to give you a couple tips If you're an investor and you don't know squat about the stock market This is going to really really help you and this is ten minutes of 25 years of experience jammed through in a few seconds To try and help you understand if you knew nothing about the stock market whatsoever To understand risk tolerance as it applies to you and start defining this and understanding in so far as it's not going To be something that you are going to be able to nail down on right away I've been investing my whole life and I'm still evolving in my risk tolerance every now and then I'll stretch What I feel I'm tolerant to With regard to market fluctuations and it's not going to be any different for you All right, but if you deploy these Strategies that I'm going to talk about here. It will really help you buffer the storms and ultimately Remain true on what I feel is the most fundamental that I'll share with you last after I go through these Deliberations pieces of things to take into heart when you're looking to define your own risk tolerance number one invest defensively Defensively you might think what the heck does that mean Ryan? Do I invest in bonds? Absolutely not? I have an absolute affinity to stock market equities out there and the products that will Subject your money to those equities. Okay, they come in the form of ETFs index funds mutual funds Etc. There's a lot of products out there dividend ETFs a lot of different products out there that you can buy one product And it can diversify your money over the over the course of those products those it my friends are what I would consider to be defensively held Mechanisms to take your money and diversify them over the stock market to ensure that if a handful of those companies go belly up You still have a swath of invested dollars in those companies that are actually out performing at the very time that those Companies that if you had invested into them individually you would have lost all of your money Okay, and if you enter into these products, and you really are earmarking that importance of diversified Defensive exposure to the market you have no excuse not to invest and sleep easy at night Okay, and this is the safest way to enter into the markets This is the strategy of potentially entering into just investing in the entire S&P 500 which is 500 of the largest companies that make up the large cap Domestic stock market here in the US. It is the best Flagship ETF that you can use I talk about it all the time VOO is just that product I own it myself. I love it. I live it. I learn it. It is part of me It's ingrained in my investing philosophy to understand that that defensive mechanism always exists with me having my dollars pledged To the S&P 500 it matches the market year over year. I don't have to worry about, you know, if the markets up 20% I don't have to worry about my portfolio being down 20% I'm going to be up 20% in that portfolio because that is what the S&P rendered It is a sleep easy way of investing and it helps folks get new dollars invested to the market on the onset and it helps you to put time under your umbrella as an investor and Really allow yourself to enjoy being an investor without being skinned off of the market Furthermore, it allows you to understand the fluctuation in those dollars because I'm not suggesting that you'll invest in the S&P And it's just going to go up every day Far from it. Your investment dollars are going to fluctuate and on a scale of one to five an ETF like an S&P 500 ETF is rated four five Okay, on the higher end of risk tolerance But I would suggest that the defensive mechanism if you understand the makeup of the ETF or index fund It's really really going to help you and it's going to coincide with one of the other Strategic avenues of risk tolerance that can really help coupled with why you choose to go with ETFs as As opposed to more of a mutual fund type of approach We'll talk about that at a moment the next one on the list that's going to help you build tolerance to the market There's a lot of people who are really good out there in savings Look at your savings as a buffer to volatility to your investment dollars. You ever thought about that you ever thought about using the 25,000 in Savings dollars as an excuse to say, you know what now's about time where I can maybe segue I don't know five hundred dollars into an investment program for yourself If you're one of those folks that are sitting on a wad of cash I would commend your ability to save money and also scrutinize your inability to Identify the importance of segwang Whatever percentage of dollars you can stomach to the stock market because I can tell you what that twenty five thousand dollars 20 years from now is going to be twenty five thousand and it's going to be worth significantly less due to the impacts of inflation Over that money. Okay, so you need to almost invest out of necessity Not because you get excited about investing because you tune into my message and I give you this grand idea of segwang 500 or a thousand dollars out of that twenty five thousand and Introducing it into the stock market in the capacity that I do But having that savings there can really help buffer and help justify look, maybe I've never considered Entering into the stock market over here But the way Ryan explains is like look you got a buffer and you can use the savings account as one of those buffers or Rational or justification to enter into stock market me I use my pension as part of that justification and I also use You know the amount of idle cash that I have to justify some of the positions that I take look If I'm taking ample risk over here and over here. I'm taking no risk It seems to be a neutral application for me and that one helps me justify the other And I think that philosophy can really help you as well number three We want to avoid fees this takes me back to the ETF recommendation that I have and looking at those vanguard ETFs That are very very low expense Enter into and get you exposure in the maximum capacity to make the maximum amount of money But also subject your money to the least amount of fees in the industry This is why shy away from mutual funds because active management has been failed failing to meet the benchmark for many many decades They don't want to admit to this. This is the facts Okay, and guys like myself will come out through a social media conduit and share that with the masses now If you're a retail investor, you don't know squat about investing you're not going to understand what I just said But I'm going to say it again because it's worth saying 96% of active fund managers Failed meet the returns of the S&P 500 the very ETF that I just talked about a few minutes prior to okay Now by underperforming you might think okay. Well, is there times of outperformance? No, not really They consistently underperform the market from year in year out There are going to be those fund managers that on an isolated year take over and above average risk Or attach a beta to the risk that they're taking to outpace the the market But over time the failure rate falls to a hundred percent of fund managers failing to meet the index You might as well just invest in the S&P 500 and sleep easy doing so But the real kicker is the fees that you're going to pay for that underperformance And that is the key to maybe avoid doing that because that can be a real hamper Not only are you underperforming the market, but you're paying and Subjecting your dollars to paying exuberant fees to the fund managers who's sitting on their freaking high horse Making their fat-ass money while you're losing money and taking all of the risk You can eliminate all of that jargon by just taking a passive approach to the market entering into ETFs or index funds You want to avoid fees all together that can really help you understand on the risk tolerance side But yes, you are taking a little bit of risk to enter into an equity product Okay, but you can be rest assured that that risk is being taken with the littleest amount of Fees that you're taking in in your in your strategy On the onset you want to avoid single stock very very important avoid single stock go with the passive products out there It's very very important. I'm not suggesting that single stock is a bad way of investing I invest in single stock myself However for those new investors out there that are looking to define your risk tolerance You are going to find either by nature of a rude awakening or You're going to identify the single stock is a whole different Bailey Weck requiring Do diligence on your part to enter into the equities that you're looking to take part in You're going to identify that even if you do that due diligence a stock can be cut in half by 50% Very very quickly a lot of stocks right now are down from their highs 50% plus or more if you start to get into the hyper growth that everybody was hyping Everybody wanted to buy Shopify. Everybody wanted to buy Spotify everybody wanted to buy zoom media. Everybody wanted to buy Peloton I can keep going and going and going down the list. Most of those names are down 80 90% Avoid it. You don't need it. It can be lucrative But it can be lucrative to those savvy investors that pay attention and they want to take on more of an active profile in Their application when you're looking to define your risk tolerance It is not something that you need to be messing with on the onset It will help you identify your risk tolerance if you focus in on one strategy one strategy alone live to fight another day identify the range of Expectation over your dollars within that one strategy as opposed to coupling or confusing that strategy with multiple Strategies on top of it. You're just going to get confused You're going to get overwhelmed and what we want to avoid is your inevitable exit from the market Okay, the last thing and the reason why we talk about all this risk tolerance in the market and doing the things that I suggested to you is to at all cost and I do want to stress at all cost Remaining long on the market. We want to deploy a strategy that you can remain long on no matter what market rolls off 20-30% you remain long you Invest in a strategy that you never ever get shaken from you identify all kinds of different people out there who have all kinds of different pipe dreams for you, but you stay tried and true on this method Because you have the tolerance enough to stay within your range of comfort in the strategy that you've selected And to remain long on the stock market no matter what is the ultimate foundation of realizing The best amount of returns into your future by defining your risk tolerance in the stock market Understanding what you can and can't handle in stock market investing I award you guys on a scale of one to ten A neutral risk tolerance if you're going to adjust it adjust it down toward the one Which is a safer investment move as opposed to being a 10 most new investors They come to me and they're like right i'm a 10 I want to be a millionaire tomorrow i'm a 10 The fact of the matter is you are not a 10 you need to get over yourself And you need to award a neutral risk tolerance to start and look to define that risk tolerance as you age and evolve In your investment strategies and potentially broaden out your approach to Stock market investing as you add on different strategies to your portfolio and your objectives going forward guys If you appreciate the message comment through the channel make sure and subscribe hit the notification bell Leave your comments at the bottom of this video share the message with anybody out there that you know Can resonate with this idea that I have about how to Discuss and define risk tolerance as it has evolved for me over the last 25 years And I've been able to summarize that in a 10 minute video for you guys It can scale to the masses people can really resonate with this idea of some of the elements that I've outlined in this video guys Really appreciate you tuning in to the totality of the message and good luck in your investment future