How To Make Money & Invest During Quarantine

What's up everybody? This is Ryan Daniel Moran with capitalism.com in this video, we're going to talk about profiting during times of crisis. And most importantly, we're going to talk about looking for opportunities right now. And I'm going to share with you how I'm approaching this crisis and also what is probably an upcoming recession. We're going to talk about looking for opportunities during times like right now. Over the last few days, I've gotten some flack for even talking about optimism or looking for opportunities during times like these. Warren Bu has been sitting on over $100 billion in cash for the last several years waiting for opportunities like this. Is it unethical for the world's greatest investor to have money on the side and wait for the next opportunity? No. When Warren Buffett jumps in, it's actually going to be a sign to the rest of the economy, to the rest of the investment community that this is going to be short lived. Investors who are buying the fear right now actually provide stability for the rest of the marketplace. Making good decisions is really diffic when you're in a sense of fear if you're in that state right now. First of all, don't make big decisions. It's of no use to focus on what your investment account looked like a month ago. It only makes sense to think about what you have now and what you can use in order to move forward. Now, before I jump into anything, I need to give my full disclosure that I'm only sharing my own experience and I am not qualified to talk about this stuff. You shouldn't listen to anything that I say. In fact, you should probably do the opposite of what I say because I've made a lot of stupid mistakes as an investor and as an entrepreneur. So this is for entertainment and education purposes only. And really not even educational purposes because I'm still learning all this stuff too. I'm just some dude on the Internet and you shouldn't listen to anything that I say when it comes to investing. Talk to somebody who has done this before and is qualified to give real advice based on your situation. A lot of conversations among my peer group about where's the bottom going to be, when what are we going to level out. And that's kind of a fool's game to try and guess. I have my predictions that I make for fun. I said publicly that I think the bottom of the market is around 18,000, maybe 16,000. But between that level, I think we're going to level out. But that's really just for fun to play that game. If you're picking good companies at good prices, it doesn't make sense to wait for the bottom or hope that you catch things at the right time. For example, there are companies that have grown even in the last few weeks. Do you know that Kroger since coronavirus, do you know that Costco has mostly held its value? Do you know that Amazon has mostly held its value from its highs of being a trillion dollar company? Now, saying that does not mean you should go run and buy those companies. Full disclosure, I only own one of those companies. The reason I'm telling you that is because no matter what the economy is doing, there are going to be businesses that grow and businesses that fail. And most of the time it's the good companies that were doing good things beforehand that are the ones that grow and prosper during this time. So if your biggest question is where's the bottom of the market, you're kind of missing the point. A much more effective, useful question is are the companies that are doing things well on sale, are they undervalued or are they overvalued? I've been freshening up on Phil Town. He wrote rule number one. It's a fantastic book to learn about value investing from a practical point of view. And what I like about Phil's approach is his mindset is about investing in companies you understand, companies that you want to follow and companies that have good fundamentals and good leadership. For example, full disclosure, I do own a significant amount of Visa stock and I loved my Visa stock at a $200 price. This week it dropped to like $135 a share. I really like it at $135 price. I think it's a great company with a great track record with great numbers behind its operations. So yes, I'm going to be buying more Visa. And it doesn't really matter if the dow is at 10,000 or if the Dow is at 20,000. Is this a company with well run operations? Is this a company with good management? Is this a company that has strong fundamentals and is going to be around 10, 20 or 30 years from now? Those are the types of decisions that we have to consider rather than asking are we at the bottom? Are things going to go up in value? We're down in value. Remember a couple of years ago when bitcoin was at 16,000 and people were justifying buying Bitco Bitcoin because it had gone up so much. And I made the argument that if you're buying because of its growth in value, you're trying to catch the pass. You can only make decisions on what is happening moving forward. And the best predictor of what is happening moving forward is the fundamentals of the business or the investment. And that's things like cash flow, it's things like earnings per share, it's things like the cash that it has on hand. And if you don't know those numbers and you're only basing your decisions based on what the paper value is of something, it probably would be a better idea for you to not invest at all. Instead, it might be a better decision for you to just buy index funds or ETFs in sectors that you understand. Trying to pick stocks that you think are going to go up or down in value is like throwing darts. That's why I like Phil Towne's approach, because he looks at a few basic numbers and looks at growth to see whether or not a stock is worth pursuing. And then he starts to look at the price. After re reading rule number one, I went and looked back at some of the oil companies that I've been considering investing in because ExxonMobil and Chevron are down like 50% from their highs. But after looking at their balance sheets, I go a little bit concerned. And if the primary goal of investing is to not lose money, then we don't want to invest in sectors or businesses that have poor fundamentals. And after looking at their fundamentals, I'm taking a second look to pause and reconsider if oil companies need to be in my investment portfolio at all. If you are just measuring things on the paper value of an asset based on where it was at its high, you're probably better off waiting or not doing anything. Right now you make money by buying assets that you're going to hold for a really long time. Buying something at the bott bottom of the market is not as important as buying a really good company. You can try and time this to get the bottom of the market or you can say this is a really good company that I'm going to own for a very long time. Now I have shared in the past how I am investing right now, but a quick recap. When I want to be extra conservative, I use a strategy called selling naked puts. And what that means is you sell an option on a stock that you want to buy and you get an upfront payment for it and so it reduce overall cost of the stock should you decide to buy it in the future. Now I've done full videos about selling naked puts and it's a strategy that I use to be a little bit more conservative during times like this. It allows me to buy stocks at the price that I want without acting in fear. So that's a strategy that you can consider and see if it meets the mindset that you want to take as an investor. Now, if you don't understand this stuff, if you're asking questions like what's a good stock to buy, if you are looking at other people's stock picks for any other reason than to kick off your research, this is probably not a good time to invest. And you might not ever have a good time to invest. You're probably much better off buying books about business, buying books about making money, starting a blog and writing about things that interest you, selling things on Amazon and starting real businesses, studying mentors, building your network. These are all things that have higher rates of return than buying stocks in the vast majority of cases. In fact, I have a new student inside the tribe. The tribe is where I work with people to build physical products businesses. Build seven figure businesses that you can sell. We have a new member in there who's made over $100,000 a year for the last few years just talking about products that she uses as a mom and that's how she's made a full time income as an affiliate marketer. Now she's going to use that audience to launch other physical products to and have seven figure businesses that she can sell. Doing stuff like that is going to be way more valuable for you in the short and long term than trying to pick stocks. If you're listening to this and you're like, yeah, but the whole world is melting and there's no opportunities right now, I actually understand. I can sympathize with that. I've had moments of fear during this crisis myself. But look, you can find evidence for whatever it is that you're looking for. Some people have accused me of having my head in the sand, of being so optimistic during times like this. But you know what I call putting your head in the sand? Watching the news and playing over doomsday scenarios over and over and over again. So what kind of sand do you want to put your head in? We're all filling our heads with our attention. Put on something. So I just choose to put my attention on where there's opportunity, where there is a chance to serve others, where there is a chance to grow, where there's a chance to profit, where there's a chance to be an example to other people. And that's what I'm encouraging you to do however that looks in your own life. So a quick summary if you're going to invest again. I brushed up on my Phil Town recently and the 32nd overview of his strategy is make a list of companies that are meaningful to you, that you're interested in, that you're genuinely going to follow because you're a fan of theirs and they're publicly traded. Number two, look at their management and see what their values are. Do they align with yours? Are they the type of company that you want to back? Number three, look at their fundamentals. What is their balance sheet? Do they have cash on hand? Can they weather this storm? Do they have a plan moving forward? Have they succeeded in recessions in the past? And then number four, wait for them to come to your price. We're not trying to chase numbers here, we're waiting for the number to make sense to us. And based on some of his recommendations, I've reevaluated a few of the companies that I was eyeing. Seriously, like oil companies. I fell into the own mistake of looking at oil companies and saying, wow, they're down 50, 60%. But looking under the hood and seeing that they don't have really strong foundations, I've decided to pause my investments on those types of companies, even though they had healthy dividends that were really sexy. Double down on where you do have opportunities and you do have control. Start a business. And a business can be as simp as building an email list or a social media following and blogging about the products that you like. That's how I started my first business and I made $100,000 a year. That was back in 2006. There's way more opportunities now. I would suggest that you start making YouTube videos and you start writing posts about products that you are testing and products that you're interested in. And just start to flex that muscle about talking about products, talking about whatever it is that interests you the most. If you're not a good writer, then start a podcast or do videos and get them transcribed and then put them on a blog and open up an account on semrush.com and just start to track where your blog starts to show up. For the love of everything, please use this time as a way to make connections. One of the smartest things that you can do with your time right now is if you're making content, reach out to the people who are also talking about the same topics that you are. Make content for their audience, do collaborations with them. Your audience will grow so fast right now, if you take a leadership position during this time of crisis. So it doesn't matter what's going on in the economy, what's going on in the stock market, there's always opportunities. Some of the world's most famous companies were started during hard times. So yes, you can profit during this time. Yes, you can create new opportunities, you can start new businesses. And yes, if you're smart, you can make smart investment decisions that are going to pay literal dividends for a very long time. I know this is a scary time for a lot of people. It's been scary for me and my family, too. And when you're watching the news, when you're looking at graphs, it's really easy to be afraid. It's really hard to stay positive when you are consuming negativity all the time. So what sand do you want to put your head in? You have a strategic opportunity right now to start something, to grow something, to be something, to create the change that you want to see in this world. Listen, it's entrepreneurs and capitalists and opportunistic people. They're going to pull us out of this. And if you're one of them, then you are leading the change. You're creating opportunities for other people. It's capitalism and entrepreneurs that are the ones that are going to create the greatest change right now. The world is looking for opportunity, and the world is looking to support people who are going in new directions. And you have the chance to be among that change. Thanks for watching this video. Let me know what you thought in the comments. And if you're looking to start a new opportunity, I have a whole bunch of videos and resources for you here on the channel. I've also made the decision that I'm going to go live on YouTube more often and take more Q and A from you. So make sure you subscribe and you ring the bell so that you know when I go live. And I'd love to interact with you on the next Q and A. Thanks so much for watching and I'll see you guys next time.