 The market has been all over the place it's up one day down one day it's been a crazy week crazy volatility but here today we're going to talk about what calls that volatility we're going to give you six ways to take advantage of the big market dips and we also want to talk about drips and of course the disadvantages so you keep it locked right here on the Prince of Investment right here with your host the one and only Prince Dax once again ladies and gentlemen boys and girls and children of all ages you are now tuned in to the Prince of Investment live here on Think Tech Hawaii coming all the way from the beautiful state of Denver, Colorado via the beautiful state beautiful beautiful city of Haluulu Hawaii once again don't forget to hit that like subscribe comment and share button drop comments below if you got questions and always hit that bell icon to keep well hit the bell icon to get the notifications as the new content drops and always I don't have a lot of time and I definitely know you guys and girls I have a lot of time so we're going to jump straight into it the market has been all over the place I think it was on Wednesday we had the market dive down 800 points seeming like out of the blue out of nowhere what happened are we headed towards another recession or we headed towards another market downturn what's going on what happened so first let's talk about what caused that volatility so the volatility came from of course as you all guys and girls already know the trade wars the trade wars that has been going on now for the past year or two or whatever the case may be one day we're friends next day is the terror next day China does put a tariff on us we put a tariff on China we shake hands then we come with another tear then we remove the tear we don't know what's going on right but this is the thing as we talk as we have trade agreements across the world the market is random by fear and greed anytime trade talks have happened even though nothing has financially happened the market reacts when people just hear something going wrong the market reacts because what is the market the market is a leading indicator it's the indication of what's bound to happen next so when you have a leading indicator the market is something that we look at to see where the economy is heading so when we see this disruption going on with tears and China is saying this and America is saying this with President Trump everybody automatically becomes fearful because hey if China raises their prices of the goods and services guess what how many companies like Apple Nike Disney whoever else does business with China because China makes a lot of our stuff if they put a tariff on our goods that mean the prices our goods and services are going up right and if the prices of our goods and services are going up that means people buy less and when people buy less that means companies make less money and when company makes less money that means the stock doesn't perform as well gas catch my drift right so there's one big change that's going on so what China in them doing China end up devaluing this currency for prime example let's say if a product causes let's say China charges Apple a hundred bucks to have an iPhone made in China and shipped to Apple there in America so what President Trump came and said hey we're going to put in a 10% tariff on phones right this takes the price of the China iPhone and it takes it to a hundred and ten dollars something that's probably going to be passed off to a customer now essentially what President Trump is doing when he places a tariff on something he's raising the price when he raises the price of something what happens when he raises the price that makes it less desirable to other customers maybe a person may look at a Samsung phone now because it's cheaper and he does that to give domestic companies an advantage over foreign companies right so with this spat you guys heard me say it 10 million times if a customer gets into it with a business owner the customers will always win because what is the business owner with no customers nothing right but what is a business on what is a group of customers with no business on somebody's going to become a business owner for prime example if no more if we just came out and just say hey China you can no longer make the iPhones do you think Apple is just going to stop making iPhone no I guarantee you somebody in Mexico somebody in Texas somebody in New York will say hey guess what I could make the iPhone because the customer will always win when he's in the argument with the business on so I think if you read President Trump's first book the order-to-deal he has a stream leveraging this situation in my opinion of what I know so that's what causes the volatility now we're going to get into six ways to take advantage of the market dip the market took a dive you watch it take a dive you probably watch your portfolio go all over the place and you're wondering hey what can I do of course if you're a swing trader if you're a day trader you know you look for perfect entry points or forex trader you look for poor perfect entry points and exit points but let's say if you're a regular person you don't have time to sit there and watch a portfolio all day when to buy when to sell you're like me you got a regular job you every day Joe blow right what can you do when you see the market takes a huge dip like this every time I see the Dow Jones dropped more than 500 points in a single day it already it automatically triggers me to look for something to buy every single time right so the first things what it take advantage of the market is rule number one you got to have cash people love to say cash is trash cash is no good uninvested cash is this that or what not but cash is awesome because guess what when the market takes a dip and you have no money to build a buying thing you can't take advantage of the dip what good is it I always use this analogy what good is it there's a 90% off sale at Walmart but you have no money that's no good because you can't take advantage of the market so one thing you got to have cash right to now that you have cash what's another way you can take advantage if you want to keep it simple and conservative and you're like hey I'm not really into stocks but I like to invest a little bit one thing you can do head on over to index fund S&P 500 index fund something like stock symbol SWPPX no I'm not sponsored by I think that's Charles squad S&P 500 index no because the reason why recommend them because they have the lowest cost which is like a point two zero no point zero to index expense ratio it's only like 40 45 bucks right now in the market pays a 1.8% dividend and it's commission free meaning you can buy it if you have to the Ameritrade you can buy with each rate and not catch that $6 $7 fee if you know something better drop a comment below but that's one thing you can just say hey market took a big dip guess what I'm a long term me I'm a long-term bullish person meaning that I believe that the market would do well over time yes it will have dips yes we will see another recession yes we will probably slide into a depression hope we don't get that bad but if we do I believe over time we will dig ourself out of it over time so long term I'm a bullish person so when I see a big dip slide on over there grab yourself an index fund now another thing now this is a little bit more riskier grab some stocks that are hitting that a hit the hardest by the market I like tech stocks I like an apple for prime example or Microsoft these companies got hit hard 5% drops Disney got hit hard 5-6% and one day when I see the overall market just takes a huge slide that goes off and tell me there is some type of fear in the market why did Apple take such a big hit most of time they're just collateral damage everybody's down this day so I look at I like to look at a tech company or a tech company I know very well a sturdy company a company that you know nothing has happened to nothing has happened to Disney nothing had happened to Berkshire Hathaway nothing happened to Google nothing had happened to Facebook it's just the whole market took a big wave and everybody was down doing a wave so I like to pick out like an apple that took a big hit and those are the ones I like to get into because it's a company I've been watching already anyway I like to get in to see it turn around gotta be careful we're gonna get into that we're gonna that's gonna be in a disadvantage of this but that's one of the things I like to do to be able to jump in and grab a dip because when you guys see the dip you guys and girls see the dip you don't know what to do it's just hey a dip just happen now another thing you can do a little bit more riskier something they'll often would tell you not to do I'm giving you the disclaimer we're gonna go over it in it we're gonna go over in the disadvantage as well grabbing a bullish a bear's ETF on the S&P 500 you can do it on the Dow Jones you can do it in the Aztec as well the thing about it is a bullish or a bear's ETF something like SPXL that's a bearish that's a bullish I meant to say it's a bullish it's a leverage bullish ETF that means that whatever the market does if the market does good it does very well the market is not doing good it does very bad so when the market takes a huge dip down and you're probably waiting on the rebound you can jump in there with with a stock symbol something like a SPXL which is a leverage bearish why keep saying bearish bullish ETF now on the reverse side of house when you see the market rebound it's gonna go back up to all-time high and the market is scorching hot and it hitting all-time highs that's when you may want to look into a bearish ETF leverage ETF something like SPXS what that does is that when the market takes its next nosedive which it will do it will reign again when the market takes its next nosedive this is something that your portfolio could be doing very well you can sell it off to be able to make a long-term play for prime example when the market slid down on Wednesday 800 points in one day SPWX went up nine ten percent and one day when the whole market was down 800 points nothing was doing well you had SPXS that had done well and let's say if you had a nice little chunk there to hedge your portfolio that could have been something you could have sold and then jump into some long-term plays that could have provided you the capital to do long-term plays and on top of that let's say if you brought it when the market is at all-time high and you're waiting on the next dip you could be collecting dividends along the way I don't know why my lips will dry had to take a swig of water there now let's go on to the next one you have gold and bonds gold and bonds of course when you see that market take that big slide what's gold going to do it's going to spike what bonds long-term bond long-term bond ETF something like bravo lima uh what's the v stand for victor bravo lima victor or a um i l t b that's another one those are long-term bond ETFs they pay monthly dividends and when the market takes a big slide downward they kind of hold their own weight sometimes and most time they go up they go up when the market goes down because people run into gold and commodities and bonds when the market is doing bad so guess what gold is going to hit that spike i'm not a long-term gold person but it is a way to hedge the market and bonds are another way to do it as well so to take advantage of the dip you could if you already own the bonds if you already own some gold that could be a time to sell some gold and bonds to be able to provide you some cash to be able to make long-term plays while the equities just live right another thing um we had that we want to want to go to the six we said bullish and bearish leverage ETF index fund stocks that took a big slide gold and bond having cash and another one the volatility index vix today is up by seven percent on friday today the market slid all the way down 300 points and then did a reversal and went back up and went positive all over the place how can you take advantage of volatility anytime there's volatility in the market there every time there's fear in the market there's volatility one of the ways you can take advantage of that you can invest into the vix that's victor india x x-ray that's something that you can take advantage of when the market starts to go all this volatility index that's when these things got to go up now let's get into the disadvantages of buying the dip there are disadvantages when you try to go out here and buy the dip number one you're speculating right a long-term conservative investor you don't go out and you don't go out here and try to speculate and take a dip on the market now one thing is a very conservative move you're going to buy some index funds close your account don't worry about it but when you are speculating if you're telling me hey the market is down i'm going to buy a bunch of it because you're speculating that it's going to go back up let's say the market went down 800 points and you went out there and brought a leveraged ETF like spxl then the next day the market continues to slide and continues to slide and continues to slide you know you don't you don't know like when i saw the market go down 800 points and i saw china manipulating its economy not its economy manipulating manipulating its its currency i got the hiccups for some reason i got very i got nervous because i haven't seen china manipulate its currency and my modern time are following the market so i had to call some of my overheads some of my mentors who got a little gray on their hair out of new york and i just had to say hey you know explain this to me break it down to me they broke it down to me and i made some very uh long-term plays right some of the ones i just kind of went over and discussed market returns happy day for me i'm collecting dividends along the way but the disadvantage is if you are someone who's trying to chase the market oh what is it going to do next move what is it going to do tomorrow what is going to do next week this stuff stuff like that oh the federal government is going to cut rates and the market is going to react this way now you're speculating and the disadvantage of speculating over 92 percent of speculators doesn't know what mr market is going to do so when you're trying to buy a dip and you're trying to hey let me get a bearish etf let me get a bullish etf let me jump here and there you could be running yourself into a rut of trying to time the market we don't want to time the market we just want to take advantage of the dip what i do oh boom i see a company that's been on my watch list for a while apple facebook whatever the case can be it went on sale i go in buy a couple shares log out i'm done right i go in buy some more of my index fund log out i'm done i may go buy a bullish a bullish etf because i'm long term log out and i'm done right let the dividends work their magic let compounding interest work is magic and go head on right but don't get into the point where you're trying to speculate speculate speculate because only the top five six eight percent only got about one or two friends that i've seen do that that are extraordinary at that and the rest of everybody's trash because they were so good they wouldn't be on youtube and radio and stuff like that trying to sell it to you right they'll keep them secret to themselves go off and become wealthy like larris pro just said and invest in demystified if you know what the market is going to do and you got an edge on the market turn this off go get rich but if you don't stay tuned you might be able to catch some stuff now another thing is the disadvantage of that are fees when you jump it any out of the market you're buying and you're selling and you're selling and you're buying you get in transaction fees which is horrible for a very small account i count with five hundred dollars in it six hundred dollars a thousand dollars sometimes even two three thousand anything up on the five thousand dollars it's a very very very small account and if you're in there buying and selling buying and selling you get you collecting all these trade fees to what you know could be killing your portfolio don't do that stay away from that you got to be very mindful of what you're doing that's why i'm giving you guys smp 500 indexes that are commission free right so but if you don't keep it for more than 90 days then the commission is not longer free no longer free you stack your cash in there you wait till the market takes a downturn maybe buy a little bit more uh you're buying every month anyway you don't worry about it now another thing we're going to get into we're going to talk about how drip and dollar cost averaging helps you out drip dividend reinvestment plan what happens is let's say myself i am apple or let's say if i own a Verizon 18t those are companies that pay dividends some will pay monthly some pay quarterly some pay semi-annually some pay annually and what you what drip does is just saying hey when you're paying the dividends don't send them to me just buy me more shares now if your drip was kicking in when the market was taking a a slide guess what you got some more shares at a low price if you was doing that great on you right now if you wasn't doing that if you wasn't uh taking advantage of the market right if you wasn't um let's say even if i'm not buying anything like in my son's portfolio my wife's portfolio guess what they got stocks that are constantly the dividends are constantly buying new shares at different intervals and the market happens to be down guess what you get some things at a lower price that goes back to dollar cost averaging that's how drip can be your friend because you don't have time to be in there watching the market every day but if you're using things like the drip program or things like that you could be taking advantages to buy you shares over time at a lower price so let's go what we talked about we talked about what caused that volatility in the market we gave you six ways to take advantages of the dip we gave you the disadvantages of trying to take advantages of dips and we also gave you some pros and cons of how we gave you the pros of how drip the dividend reinvestment plan and dollar cost averaging is your friend doing market volatility or could be your friend well that concludes this this that concludes this episode once again thank you for tuning in i'm your host prince dykes the prince of investing until the next video podcast cartoon or whatever else you seem to do crazy around the globe peace be safe i'm out and thank you