 Good day, film investors! Today we're going to discuss a comment that is so important about the stock market because it discusses the risk, the fear of missing out, following the herd, and what are the most important psychological effects when investing. So let's see the comment. Nick Hill discussed this. Thanks, fans, for the video. I solved all my stock positions, including 401k, when the SAP 500 got to 1750 and sitting in 100% cash. I asked my family and friends to do the same but they didn't listen to me and now I'm the laughing stock of gatherings. I still insist them to sell but just made fun of calling a crash that never comes. I like your approach very much as sitting in cash can be a big miss so I have learned painfully. So this is very, very important because the SAP was at 1750 and our fellow investor said okay it's too risky for me, I'm going to sell everything. Now if you're a speculator and you sell everything then that's a different story because then you hope for a crash and that's something very difficult time the market. However if at that point Nick Hill said okay this is too risky for me, I don't like it, I prefer cash, then you sell and you stay in cash. Others might be getting rich. However this is something very important, something very important few people understand. If something doesn't happen doesn't mean that the risk wasn't there. The stock market didn't crash at 1700, it went to 2700 so it increased another 50%. However was there the potential that the stock market crashes back then? Yes there was, was there a risk? Yes, was there a risk for recession? Yes, was there a correction? Yes, didn't lead to a bear market? No, but this doesn't mean that there wasn't the risk. If you go to Las Vegas and you put it on red and then you win and you put it on black and then you win you have quadrupled your money in 10 minutes and now you go out of Las Vegas and you brag to all your friends that you quadrupled your money in just 10 minutes. Okay there is a 25% 22 whatever 20% chance for that being a successful trade if you go to Vegas. However does that mean that there was no risk because you succeeded? No of course if everybody goes and does that there will be exactly 20, 21, 22% of chance that they succeed. However in the stock market things are different. If most people do the same thing the odds change then the risk suddenly becomes much lower and the rewards also much higher. However this doesn't mean that two years, three years, five years ago the risk wasn't there and also if stocks continue to go up in the next five years it again doesn't mean that the risk isn't there. Nobody knows what will happen in the stock market. However you have to see whether you sleep well by owning stocks or not. It's all about risk reward again in relation to your personal goals. Nikil thought okay I cannot stand now a crash if it happens it won't be good for my finance it is what won't be good for me. So he sold everything. Okay he sold everything he slept well I hope for the first five years he think I think know what he's doing he's really balancing the risk between cash and not cash if the stock market crashes or it's always better to think in valuations and do that not so abruptly but in stages so rebalancing risk that's a different story which allows you for the upside and allows you for the downside. However moving such abruptly isn't really what has to be done but that's a different story. My message for today is really think about risk even if it doesn't happen the risk is there so that's something very important to learn. Secondly the fear of missing out are you watching the stock market from an absolute perspective what do I need where do I see myself and will the stock market lead me to my goals or are you watching the stock market oh my neighbor my brother-in-law my sister-in-law they do like this they do it like this I should catch up I should do like them and so are you following the herd or are you investing for yourself and your investing goals. When you're investing for yourself everything is much much easier if you know what are your goals you can find the vehicles for the risk or even no risk in the very long term that will lead you to your goals you have to be patient you have to diligently look for them and not care about what others do as I said some people go to the casino and win however this doesn't mean you should do the same so really assess the risks assess the potential rewards and doesn't matter what happens then the important is that you made the right call the investing life cycle lasts 50 years if you do good investment decision over the whole 50 years I'm sure that you will beat all of those who take too much risk who chase risk who chase yields who do whatever even if you are 100% in cash or so because you will not lose money and that's the key to investing the key rule not lose money so Buffett always keeps saying that it gets very easily forgotten as people chase risk and especially when the risk doesn't materialize because people then forget oh there is absolutely no risk so such a correction that happened is good to remind us of the risks and really see thankfully the market went up so it gives you another probability to cash out if you want if that doesn't feel good to own stocks now for the risk reward looking forward to your comments as there is a lot to discuss here how do you feel its emotions its personal goals its investing is is what stocks can give and the risk reward thank you for watching i'll see you in the next video