Investment Analyst Reacts to Finance TikToks – Part 7 #Finance

ladies and gentlemen welcome to the plane Bagel I’m your host Richard coffin we are back once again uh it’s been a while but but coming back with another investment analyst reviews investing Tik toks part six part six it’s been a little while in part because the online

Financial advice space is is seemingly healing a bit we’ve had some time to to cool off but with recent events in the market and perhaps retail interest coming back to the investing space I figured I’d take some time to touch base and review again some

href="https://cashnews.co/finance" style="font-weight: bold; color: #1a73e8; text-decoration: none;">Finance Tik toks now if you’re new to the channel welcome my name is Richard I work as a registered Portfolio manager with my CFA and cfp designations and my goal today is

to help uh clear up any misinformation that might be circulating on Tik Tok uh obviously over time Tik Tok and other social media sites have become more widely used by younger individuals to learn about text-decoration: none;">Finance and investing and for sure there’s a lot of great information you can come across but likewise there’s also a lot of lower quality content that can either misrepresent or just misconstrue and important details about

href="https://cashnews.co/finance" style="font-weight: bold; color: #1a73e8; text-decoration: none;">Finance and how investing Works uh so my goal is to review some of these bits of content and try to make it educational and productive uh so that we can walk away learning more about

financing and investing and before hopping into it I do want to give a big shout out to Tik Tok investors in the past I’ve gone and found a lot of these Tik toks myself this time around a lot of them are coming from Tik Tok investors directly which is a Twitter page directed to finding these

uh tidbits of of knowledge so if you like this type of content definitely go check them out but without further Ado let’s get into it four ways to avoid Taxes legally we’ll see love those Tik toks oh man the IRS is going to love that one uh I don’t know about the

other CashNews.cos but but they’re going to love this CashNews.co so let’s dissect this for one yes it’s true that you can deduct certain expenses from your Income uh if you’re self-employed meaning you reduce your Income

Taxes by lowering your total reported taxable Income and that includes things like if you’re running a home office some of the expenses related to that as well as if you travel you can deduct your travel expenses uh lodging and even some of your meals but for

one you can only do this if you’re Incorporated not if you’re a typically salaried employee and two there our criteria here the expenses have to be quote unquote reasonable the principle of this mechanism is to allow businesses to deduct expenses that are required or contribute to the

generation of the Revenue in some way uh so lodgings during a business trip can be covered meals with potential clients might be covered uh with some restrictions and anything like that can yes allow for a deduction because it’s helping you grow the business or again

contributing to the Revenue generation but tax authorities do consider intent with expenses and if if you throw your wife into a corporation when she’s not actually doing any work there uh and you go on a vacation you expense every personal expense and all these lavish meals

and then you post a Tik Tok about how you legally avoid Taxes you and the IRS might have some words especially if they see that these restaurant expenses and the like make up a significant portion of your company’s expenses so hopefully this goes to show that tax is a

complicated matter and if you want advice uh Tik Tok is not the place you should reach out to a professional like a CPA someone who knows what they’re doing this is what Index Fund gurus don’t tell you about index funds that make me so angry yes investing in index funds is better than

not investing at all and I think if you follow me you probably understand the importance of investing so that’s not the issue right after I grew my Investment Portfolio from 500 bucks to millions of dollars I decided to listen to one of the index fund gurus that popped onto

my social media and I’m like you know what let me add an index fund to my Portfolio do you want to see the results and the difference between individual stocks and Index Fund I’ll show you understand that even index funds the best of the best index funds majority of

their growth are basically carried by like a handful of stocks uh that’s actually true uh I think I know where she’s going with this but uh it is true that especially with the S&P 500 which is one of the most popular uh us Stock Market indices uh that a bunch of

people invest their money through um it is true that a lot of of its return especially recently has been sort of dominated by just a few positions first half of 2024 there were five stocks I think it was a top five biggest stocks in the index uh made up 2third of the S&P 500’s return uh

year-to date so it is true that at times the index’s performance can be dominated by just a handful of positions although that does have to do more with the The Waiting mechanism of the index and the fact that larger companies uh recently have seen some of the the best performance if you just

spend a little bit more time a little bit we’re talking about 1 hour per week this is how your results can be different watch here’s my $4 million Portfolio look at the gains here on individual stocks starting from 200% until we finally get to VU here which is way lower

than my top performing stocks that are basically carrying my entire $4.7 million Portfolio and I do it all in only 1 hour per month even though I’m super busy and not a math W thought we were 1 hour a week it’s getting getting better the deal is sounding pretty good

following my simple five-step Diamond system comment Diamond I’ll send you my free master class on it sounds super fake I bet let me see if I can let me see if I can find what this diamond process is if you’re a long-term value investor all you need to know really is have certain if

this company or asset is going to be around in five or 10 years so we had Capital intentional fundamental Point number four Wait no that’s why I’m here I I thought this was a step-by-step process on how to analyze you can’t just put fundamental analysis as as step

three so right away a lot of red flags here that should really make you question or be critical of of these claims here uh for one very strategically hiding a lot of the details while cherry-picking the figures we see uh the gain percentage for example we don’t know what time period that gain

is showing over it could be 2 days it could be 10 years uh which would obviously impact how impressive the performances and we’re sorted by gain and starting at the top and and going down the list and very strategically again stopping at vo refusing to go lower to show the the negative

performance in the Portfolio which would lead me to believe there’s probably some very ugly performance figures that are being hidden under vo uh and obviously makes it impossible to gauge how well she’s actually performed and the point is that the idea that all you

have to do is pick the best stocks is a really flawed way of thinking because well it sounds very easy or feasible when you frame it that way to say hey all you have to do is pick the best 10 stocks to see great performance it’s actually quite the opposite where because a lot of the indexes

turn is is fueled by just a few positions it’s incredibly difficult to find what those 10 or so positions are in the mass field or ocean of of positions that exist out there to put a different way imagine it as probabilities imagine you want to to invest in the best 10% of the S&P 500

picking just one of the top 50 stocks has a probability of 10% which is not bad but but clearly difficult you have a 90% chance of picking a stock outside of that top 50 and building a Portfolio or let’s just say picking 10 of the best 50 stocks has a pretty low probability

and you might think well yes that’s a flat probability but let’s say I have a strategy that that gives me the advantage to go and find those top positions uh but there’s just nothing so simple that you could apply one hour a week or or a month um and find those positions it take

an hour just to read through a company’s most recent filings and learn what they even do let alone to use a five-step diamond system to analyze a Portfolio of 20 to 30 stocks now if you want a stock pick all the power to you but you do have to go into it with the proper

expectations uh education and understanding of how much effort will be required even the majority of mutual funds where you have teams of analysts spending their workday researching stocks the majority of them tend to underperform the nice thing about index funds is they do broadly diversify your

holding so that you limit your exposure to individual companies um and don’t put your your retirement Savings or whatever at risk of just a handful of positions failing or conversely missing the performance of the top performers driving the index’s total return I

definitely think that approach are going with another managed solution makes a lot more sense than the everyday Joe just picking stocks with 1 hour a week all right this is a red one how much I made today using teret and intuition uh to day trade options after scanning the market from 8:30 to 9:00

a.m. till 9:00 a.m. and picking the stock I’ll be trading that day today it was Amazon I do a single card pull to confirm my decision or get guidance uh today I pulled the ace of cups which represents abundance uh this gave me the needed Assurance to trust in my strategy I’m just

noticing the account name blonde Rich Witch 21% return in 8 minutes by trusting my higher self yeah the thing I said about nature healing uh might have been preemptive what’s interesting is there is actually a research article I think I’ve highlighted it before about how the

Stock Market seemingly sees different returns under different phases of the moon which might lead you to believe that there’s there’s something to this astrology thing and that we should all start charting the moon for our investment Portfolios which

quite frankly isn’t that far off of what a lot of day Traders do anyway but uh hopefully it goes without saying that uh no it’s just an example of data mining right if you look across uh enough numbers of of data sets and correlate it or run the correlation numbers with the market

you’re going to find something that uh has a rough statistically significant correlation to market performance uh even though of course correlation does not equate causation uh just because two things occur or move in the same direction does not mean one thing is causing the other and of

course like I mentioned you have to be incredibly skeptical of any performance figures provided especially just kind of one-hot screenshots really the only thing that you should judge someone on is their comprehensive long-term performance figures if you aren’t seeing how all of their how

their entire account has performed over a longer period of time and you can’t verify that figure you really shouldn’t even bother considering whatever numbers are being thrown at you whether it be 2% or 2,000% you need to have the full comprehensive view of things to really gauge

someone’s ability as a stock picker you studi the wealthiest I don’t mean Bill Gates and Warren Buffett I mean if you study Goldman Sachs that’s where the real wealth is okay study the wealthiest explain that why isn’t it Gates and Buffett because they’re only worth 80

million 80 80 80 million okay okay you know Goldman Sachs will destroy 80 million in an hour as far as their their Income their Revenues their you’re talking about um Vanguard controls $5 trillion dollar of

style="font-weight: bold; color: #1a73e8; text-decoration: none;">ETFs that’s money there’s endless amounts of money like I don’t know what the queen controls but it’s fre m or the Putin money you’re not talking about all that dark money all the black in the

shadows money where is this going what I don’t know what the takeaway was yeah if you’re trying to be like Bill Gates or Buffett you’re thinking too small if you want to be big you got to study the the biggest of the big I’m talking JP Morgan Goldman Sachs Black Rock if

you’re not managing in1 trillion in asset Center management by the time you’re 25 what are you even doing come on get a grip gr Cardone Treasure Trove of uh of this kind of content just always one-upping the the weird mental exercises best investment of the world today I’m not

kidding you better than Real Estate better than oil better than gas is silver because this is going down when this goes down the rupe goes down with so if you want to get rich get silver today best investment of all this is $35 man I don’t know what happened to to Robert

kosaki but if you aren’t familiar he used to be a very well-known author for some personal Finance books uh haven’t actually read them myself but Rich Dad Poor

Dad the four quadrants I think is the name of the other one uh and these days just predicts a crash every every month or so kind of like just the general movement of of the influencer space as a whole but silver uh to talk about precious metal investing quickly I’ve kind of touched on it here

and there yes it is true that historically we’ve seen precious metals like silver uh have seen their price increase during times of turmoil for example back in 2008 we saw it shoot up 350% in price from a low in 2008 to a high in 2011 but it hasn’t been without its issues and the price

of the metal has actually not been able to since reclaim that high it’s interesting that he’s talking about silver here uh silver and gold have actually long competed for dominance of the precious metal category uh and as a result investor dollars uh but gold has for the most part come

out on top uh and it’s trading at a much higher price and I’ve seen that much better return over the long term and what’s interesting with investing in Precious Metals is that obviously a lot of people will highlight how scarcity is what determines something’s value and

that’s why gold is is hard money and why it’s sure to continue increasing in value over time what’s interesting is that part of Gold’s value while it’s sort of viewed as a sort of formulaic thing um it is in part a social phenomenon uh there are actually other precious

metals like Platinum for example that are rarer than gold and harder to come across with many of the same properties that actually have more industrial applications and yet trade at a lower price with Platinum trading at half the price per troy ounce of gold and the reason why gold has dominated

other precious metals is really just sort of social inertia and social phenomenon there’s actually a great book by Anthropologist David Graber called Debt the first 5,000 years it was actually suggested to me by Yuri over at money and macro so thanks for that but in this book

he argues that gold societal value actually stems from its use in religion and how it was used to Adorn temples and paid as tribute uh due to its uh shiny non-corrosive properties and that over time that’s just translated into its use for financial purposes especially because historically

temples were sort of de facto financial institutions for the societies built around them and we gain a little loss in the tangent here but it just goes to argue that uh while some people might view the the increase in value of these precious metals as formulaic and based entirely off of scarcity

you know because something’s Limited in Supply therefore its price will increase there’s more to it uh and predicting the price of a precious metal is same as trying to predict recessions and human behavior it’s it’s near impossible to do it’s why I like to focus on

producing Assets where instead of just hoping that something will uh see its price increase uh I will invest in a company or something that I actually hope will improve over time I generate more and more Profits and grow its operations which should lead to its

price increasing as a result of that rather than just scarcity finishing off with another gr Cardone CashNews.co like I mentioned Treasure Trove of content every 15-year-old kid should be doing this right now if you’re getting an allowance of 300 bucks a month buy a piece of Real

Estate that pays you 30 bucks a month but how would a young normal person get money allowance sad jobs sad hustles I was 14 years old I was working every weekend I was mowing lawns I’m doing whatever I could to get some extra money so seemingly the lessons from Gran Cardone here are

become a literal bank and buy Real Estate When You’re 15 easy enough now obviously there’s nothing wrong with kids trying their hand on entrepreneurship uh if say they want a bit of extra cash there’s stuff they can learn by doing that but assuming that a kid

doesn’t need to work to support themselves I don’t see a crazy amount of value in in pushing 15-year-olds to work every weekend there’s stuff to be learned by doing that but the money is not going to be significant compared to say your first career Income that

you’re going to earn if you focus on schooling and say develop your skills and you need to leave room for being a kid right these are formative years there needs to be time to be a kid and and develop your soft skills and your social skills skills obviously this can come down to difference of

opinion but I don’t like CashNews.cos that can convince a younger impressionable crowd uh that they should be spending every waking hour hustling on their weekends to make a little bit of extra cash oh and I haven’t even gone to the Real Estate part uh telling kids to

buy Real Estate I don’t know if you legally can uh but I wouldn’t recommend it it’s a lot stress for for a child um and a lot of money we we have people with careers struggling to purchase properties I don’t think a lawn mowing weekend practice is going to

cut it maybe if you start investing your Rich parent allowance as a baby uh you’ll have enough for down payment by the time you’re 15 but that’s about it uh math doesn’t really check out here anyway just my twoin a lot more to life especially for kids than just chasing

dollars anyway that’s the CashNews.co thank you for joining me today for another Tik Tok review as I mention every time there are great CashNews.cos out there giving good information on none;">Finance and investing uh but there’s also a lot of noise you have to cut through so hopefully this CashNews.co helped a bit with that if you thought it did please do make sure to like subscribe all that good stuff it does help the channel tremendously and let me know in

the comments down below your thoughts on any of the uh bits of information covered today thanks again for joining and as always be safe out there