 So right now I'm down 46% on this one stock market investment and this actually marks the worst performing investment, the worst investment in terms of a percentage value loss that I've ever had in my investing experience in my investing career and I actually didn't incur this loss because I didn't sell the shares yet so technically I didn't lose any money but the fact is that I'm down 46% and I've never been down that much on any stock or any ETF in my investing experience so in this video I want to show you guys the screenshot for full transparency of how much I'm down right now what it takes to actually invest in speculative companies because this is a speculative company and what you have to understand before investing in speculative companies and understand how to allocate money in your portfolio if you are investing in the speculative stocks and just kind of my experience so far with investing in the companies like these so if you enjoyed this video feel free to go down below and hit that like button consider subscribing if you want to see further content involving investing trading the stock market and personal finance in general this is the channel for you and let's get right into it so before we actually talk about my speculative investment and what stock I'm down 46% on let's talk about some characteristics three in particular of speculative companies that you should know about and to consider and understand why you should maybe not put a lot of money into these speculative companies in terms of your investment portfolio so the first characteristic is that a lot of the time these spec stocks these spec companies they've only been around for a couple of years maybe they just IPO'd a year ago maybe they just IPO'd two years ago and they don't have a proven track record of success they don't have a proven track record of paying out consistent profits maybe dividends maybe increasing the dividends because they're fresh out of the gate pretty much right they're brand new they're dumping a lot of the money back into the company to propel that future growth so the second characteristic is that a lot of these spec companies a lot of these spec stocks they're unprofitable right they are literally not making money and a lot of the time they're burning through cash and a lot of cash at that right they're burning through more cash quarter after quarter after quarter it just gets worse and worse and worse in hopes that again they can reinvest that money into the business invest that money into the business to propel that future growth but a lot of people in terms of investing in the stock market they want to invest in a company that has a proven track record and that is profitable which might steer them away from investing in these spec stocks so the fact that they're unprofitable is definitely something that you should know so the third characteristic of a speculative company is probably obvious is that it's a high risk high reward investment meaning that when you're hopping in let's say with a thousand bucks into the stock there's a chance that you can 10x that money to ten thousand dollars that's a huge huge reward there a thousand percent that's pretty big right but there's also a chance that that money can go to zero if that company bankrupt goes bankrupt and that's a 100% loss so you have to think about it that way you can make a lot of money but you can also lose all of that money potentially where in terms of other stocks let's say you hop into Johnson and Johnson for example here hypothetically you know there's no way you're going to 10x your money in this lifetime maybe who knows right but in this lifetime probably you won't 10x your money right but you also won't lose all of that money you know at most you're going to be seeing consistent returns with consistent growing dividends which is very good for some people so now that we talked about the three characteristics of speculative companies let's talk about what i'm invested in guys what is the speculative company that i'm down 46% on drumroll please that is neostock ticker symbol n i o and i know a bunch of you long-term viewers if you've been following the channel you probably already knew this you probably could have guessed it because if you watched those videos in the past a lot of them i mentioned it from time to time that i'm down big on neo and believe it or not this stock fits all of the criteria that i just mentioned a couple of minutes ago it just IPO'd in 2018 so it doesn't have a proven track record of profitability it's burning through a lot of cash right it's burning through a ton a ton of cash and the company is a high risk high reward investment i can literally 10x my money on this three billion dollar market cap company if you guys think about it hypothetically here let's say tesla it's right around last time i check like a 30 40 billion dollar market cap right and that a lot of people argue most likely is the leader in the electric vehicle market it probably is the leader right and since neo's a three billion dollar company let's play with some numbers here hypothetically if it went from a three billion to a 30 billion dollar market cap that is a 10x in the company so the stock could potentially go from three dollars a share that it is now all the way to 30 dollars so that reward there is astronomical right that's a great reward but also on the flip side the risk is insane right i can lose all of my money i'm already down nearly 50 percent on this investment so if they went bankrupt if they lost enough money that they couldn't really burn through any more cash right this can literally go bankrupt and i can lose all of my money so the goal for neo stock along with many other speculative companies and many other speculative stocks out there is to continue to execute to continue to grow market share and to continue to get the brand out there and right now neo is doing a pretty decent job at that in the fourth quarter neo's revenues rose nearly 134 percent on a sequential basis to 3.4 billion yuan or 499.7 million dollars a solid 144 percent positive sequential increase in the company's car delivery growth in the fourth quarter helped boost the revenues neo's fourth quarter revenues were also better than the analyst estimates of 2.9 billion yuan so it's no question that neo's doing exceptionally well on executing on those revenue numbers so hopefully guys over these next couple of years that continues to happen their cars continue to sell well and i'll show you some of their cars right here here we have the neo es6 pretty nice suv looking vehicle you know we have the es8 right if we zoom down a bit we can see some more of it right here and then we also have the es9 which is a pretty sick looking car right one of the fastest electric cars in the world and then we also have the eve which is a concept vehicle right now so if they continue expanding their brand continue growing this and hopefully they stay financially sound neo can definitely be a player here in the chinese market but this also comes with a lot of risk right china has just built a factory in shanghai for tesla and tesla which like i mentioned is the leader in electric vehicles right now they can pose a huge risk and a huge threat to neo so that is one thing to definitely keep an eye on as neo continues to try and grab market share and this video guys it's not really a neo based video it's mostly me talking to you guys briefly about my investment here in a spec stock and what you guys should look out for but really that's what i'm looking at in terms of neo now we can go a lot deeper into neo stock but i don't want to do that in this video because it'll be very very long so when you're looking at these spec stocks ultimately you have to realize how risky they are we can see here on the chart neo has gone from 13 dollars and 80 cents all the way down to two dollars and 35 cents which is a ridiculous move to the downside it's also gone from six dollars all the way up to 10 dollars and 50 cents nearly which is a very good move to the upside so understanding the volatility in these stocks will help you realize and help you be like okay i shouldn't put too much money into these right so how much should you put into these well me personally guys i only put around two percent maybe even three percent of my portfolio sometimes four five percent it depends on the specific time period of my entire portfolio into companies like neo into companies that don't have a proven track record that aren't profitable but have a lot of reward in the future and that's what makes me comfortable and you have to ask yourself you know if you had 30 percent of your money in neo stock if you had 50 percent of your money in this company or any other speculative company at that would you be able to sleep at night guys be honest with yourself would you be able to go to bed at night comfortable knowing that your wealth your hard-earned money is tied up in a stock that can go down potentially 30% in a day 20% in a day or maybe even bankrupt right i bet you guys couldn't sleep well which is why i only put in again two percent three percent four percent maybe five percent sometimes at any given moment in these particular speculative companies and just because i'm saying this guys don't just do it for yourselves this is not financial advice this is me just simply documenting my journey here on youtube and telling you guys what i'm personally doing in that moment in time so that's kind of it for this video right speculative stocks they're very risky but they have a lot of reward and you have to understand that when you're getting involved with them you can lose all of your money which is what i knew getting into neo right i was comfortable putting in that five six hundred dollars with losing it completely right i'm literally okay with that which is why i got into this position you have to know not to put in a lot of money of your portfolio again you can if you want to but i'm just saying my personal experience it's not a good idea to do that right maybe put two five percent maybe ten percent at most into these types of companies and that's pretty much it guys right invest at your own risk invest in what you understand and invest in what really provides you long term value or at least you think will provide you long term value so i hope you guys enjoy this video if you did feel free to go down below and hit that like button consider subscribing if you want to see further content for me and drop a comment let me know your experience with speculative companies have you ever owned a speculative stock have you lost all your money on it have you made a five extra turn i'd love to know what you guys have to think so i'll catch you all in the next video thanks again for watching peace out