 Love to welcome everybody back to the Independent Investor Channel. We put these videos out on a fairly frequent basis. This is part of my wealth building series, Basic 101 Investing in the Stock Market. What could help people who have no experience in the stock market, nor do they have a lot of experience before they get started, but these are aimed at providing those fundamental baselines that you have to adhere to, and they are not negotiable. If you are going to stray away and deviate from these fundamentals in investing, you need to set yourself up for realistic expectations to, yes, potentially outpace the market and become the guru of the stock market that everybody attempts, but you also have to be willing to accept the latter in results that you may get that may not be what you signed up for. And I think this escapes a lot of would-be investors out there that are looking to get started in investing. Unfortunately, they hear about all of what they should do in the market, and typically that what they should do in the market is a far cry from what they should actually do in the market, in sitting back and saying, you know what, maybe I don't know everything there is to know about markets. There are analysts out there that do this every single day with their profession, and they fail in a lot of different respects to beat the market, which is the goal of any of the analysts out there. But I think now with the availability of information, I think people think if they consume enough YouTube, or they get that right mix of YouTube channels out there, that they can somehow put themselves into this elite category of analysts who may in the acute beat the market for one or two or three years, which is very, very rare. But over the long term, the failure rate of those analysts and anybody in the retail community, the success rate falls to 0%. Nobody can successfully anticipate and remain on par with, or dare I say, beat the market over time. And there might be investors out there that catch this video, and they may suggest, you know, why even invest. And I say, now you're thinking, because if you're not willing to adhere to the tried and true principles of sound investing over the long term, you may as well not invest. You may as well just enjoy your money. You may as well just take your money and go enjoy it, because it's not going to be an enjoyable ride for you to try to define the rules in the investing game, in the way that you see them fit. A lot of people attempt at doing this. A lot of people succeed in the short term from doing this. And they want to share with others what they have discovered in the market as being the correct formula for beating the market. I'm here to tell you that a lot of that is utter garbage, and it will mislead a lot of investors down a path of disappointment and failed returns when compared to the S&P 500 year over year. Now this tried and true fundamental that I'm going to share with you in this video is one that you're going to need to memorize. It may be one that you've heard of, but this is one that you're just going to have to commit to memory. Your definition of diversification will be defined and fine tuned over the course of your life as you evolve and you advance as an investor. But diversification is the sheer nature of spreading out your risk across multiple holdings. And I'm very, very careful not to award equity holdings in that statement. I think with the products out nowadays, there is mutual funds. There is index and ETF investing. There is single stock equity. And then there's a ton of other different speculative investments out there that you can pursue. You can pursue the passive investing route, which is just investing passively in financial markets, which is what I consider that everybody should look at as a primary option if you get started in investing. And then there's dividend growth investing and a lot of other strategies out there that can be prudent for you. But for the beginning investor, seeking out diversification in your strategy is absolutely key in baking in that defensive mechanism to your portfolio. And in times of flush markets when everything is going bananas and everybody is invested in the Amazon and Google and Facebooks of the world, and those companies are rattling off earnings reports that are absolutely killer, it's very easy to become subject to the euphoria that that can create and move you away from the investing philosophy and into more of a speculating camp by nature of you looking at that and saying, why can't I do that as well? And I would encourage investors to understand that the tried and true method of investing in times of flush markets is going to seem like you're missing out. It's going to seem like everybody else is making money while you are not. You are adhering to a rule tried and true principle and you wake up every day and look at your portfolio and it doesn't seem to move very often. But in times of volatility and in times of bear markets, it's going to provide invaluable validation for those investors that adhere to this tried and true fundamental of diversification. And you're not going to hear so much from those equity investors when it was all flush and they come on and they provide YouTube content to provide you some indication that they are a stock guru or a stock God and to follow them at all cost. And oh, by the way, just go ahead and send me $5,000 to join my personal VIP group for you so I can provide you that same level of tutelage. None of that matters, okay? Because on the flip side, nobody ever comes on and admits how bad they're getting crushed in the equities market right now by holding a basket of single stocks in the stock market. Nobody comes on and admits to say, look, I don't hold any diversification in my portfolio. My companies are doing great, but the overall market is rolling off and my companies are accelerating to the downside. Whereas the market or the S&P might be off 20%, your equity holdings might be down double and dare I say triple. And in some cases, in some cases on some of these extremely high growth companies, some of those are off 80% and 90% right now. Those investors or speculators do not want to come on and admit their losses to the grander YouTube audience that they've been so adamant about selling on the idea that you can beat the market by going about speculative investing. And you don't even have to do any research. All you have to do is tune into them and they'll provide you all the answers. Now, a lot of investors out there might be saying, okay, I'm a brand new investor, how is it that I diversify? And it's so much easier than you would think. The number one ETF that I recommend looking at is the S&P 500 ETF. It comes in a lot of different forms, the IVV, the SPY, and my favorite VOO. I personally own this ETF. It is a wonderful way of getting exposure to the large cap domestic stock market here in the US. You're going to own the Amazons of the world. You're going to own the Facebooks of the world. But you're going to own all of the totality that make up the S&P 500. And there are going to be pockets of the S&P 500 that you may never even have heard of. They're going to help buffer the volatility because when those high-flying stocks roll off, you're going to find that those stocks that you would have never invested in on a single stock basis will end up actually outperforming and making sure that you stay in line with market performance. And that is the key, my friends. So many people out there are trying to outperform the market. So many people in reality underperform the market. And what's being missed is that tried-and-true method of investing one-on-one of meeting market returns. And you can do that by just looking at the S&P 500. You don't need to look anywhere else. If you're looking at true diversification, this allows you to buy a big swath of the US domestic stock market in the most recognized of indexes that we have through the Standard and Poor's 500. This is a wonderful grouping of stocks that continually revolve and they progress as our benchmark against market volatility and market progress from day to day. It is one that you cannot tune in and not hear where the S&P is from day to day, because it is the tried-and-true benchmark of understanding where the stock market is at any given time. So if you're a beginning investor out there and you want to seek out true diversification, the S&P 500 and no further is where you need to be looking to get yourself off of the sideline and go from a non-investor to an actual investor and avoid that speculation that I talk about all the time in the channel. You're going to be so glad you did it over the long term. Yeah, you might miss out on a little bit of acceleration, but you are going to protect yourself to the downside and you're going to live to fight another day. You can fund that up over time. You can enjoy the prospects of another fundamental that we'll talk about in another video, which is dollar cost averaging. And you'll be able to render results far in advance of any of those speculators out there that would have you believe that they've got all the answers. Guys, if you appreciate the message, I'd invite you to subscribe to the channel, leave your comments at the bottom of the video, share this message with anybody out there that you know is interested in the stock market, and bring them on to learn a little bit about what we've learned in this video. In diversification, this goes along with my free series that I offer through YouTube. This is Investing 101, guys, and it is the right approach to investing. You got a lot of fat. The whole idea is to trim that fat away to those tried and true fundamentals that actually work in investing. Guys, thank you so much for tuning in to the message. And good luck in your investment future.