the world is going through big changes and things can be pretty scary there's a lot of uncertainty with things like house prices and cost of living some people are feeling really uneasy about what to do next therefore we need to be financially prepared for rough times in today's video I'm going to share Warren Buffett five rules you need to know for successful investing in today's economy I will teach you how to find a good value stock how to buy stocks with a margin of safety and how to never lose money keep watching by the end
of this video you will learn all of this you don't need to be an economist to know that a recession can cause problems the last big one was in 2007-2009 and if you've already been through it then you'll already have a fair idea of how bad it will be generally recessions cause unemployment to Surge in stock markets to dip the world is living through uncertain times as income and spending are struggling to prices have been skyrocketing the Federal Reserve has tried to reduce prices but it's been hard what happens during a recession even though the
economy is not doing well right now and bills are increasing it can get worse people may have to make difficult decisions such as not paying rent in order to buy food for their families and when things get worse you get a recession the National Bureau of economic research defines a recession as a significant decline in economic activity that is spread across the economy and that lasts more than a few months the recession in 2008 was a perfect example the stock market crashed the U.S suffered one of its worst recessions since World War II and the
unemployment rate Rose from 4 to 10 percent a recession is usually caused by an economic downturn or an external shock like a financial crisis or War with the economy still depressed now and no sign of turning around anytime soon we're well overdue for another one you need to be financially prepared for rough times because you're going to want to hang on to your horses it's about to get real I want you to be empowered in this challenging time ahead and I want to provide you with the tools and guidelines to make it easier the reason
I feel like I'm able to do that is because this ain't my first recession I've been there before when this happened I had just finished studying thinking about jobs there was a recession it was the 2008 recession everything was crashing and I was looking for jobs in marketing and then this was happening I was very very nervous I was pretty naive I didn't actually know what a recession meant for me and I was lucky enough to not really have any debt imagine having a student loan debt which nobody cared about so bearing in mind recessions
happen they come and go all you want to be able to do is kind of weather and hang on through the storm it is therefore beneficial to learn these five rules of Warren Buffett as they help you keep your money safe by investing it in a more sustainable way if you ever been in a recession before comment below because I'd love to hear your thoughts with that being said who is Warren Buffett Warren Buffett is an American investor a highly successful investor and philanthropist he is worth over 100 billion dollars and has been a business
tycoon for decades many people consider Warren Buffett to be the world's best investor with a net worth of billions investing one thousand dollars in Berkshire Hathaway when it was created would make you worth an estimated 30 million dollars Buffett has gives many interviews on how he did it he understands most people haven't and sticks to just a few key principles to invest in this video you will find all of these lessons so that you can become one of those people who will be able to generate wealth in the stock market in this challenging economy applying
these rules when investing what is important for you to know Buffett is a legendary investor who has been investing in stocks since the 1950s his investment strategy is based on long-term Investments which means that he doesn't trade often and he doesn't try to predict the market he focuses on buying good companies at a reasonable price with a margin of safety when learning how to invest it is important to learn from the best but it also pays to learn from the worst the following are his five rules for successful investing the first rule of Warren Buffett
five rules you need to know to invest successfully in today's economy is this invest in what you know and never lose money investing in what you know is a good idea because it provides you with knowledge about the industry and its competitive landscape this reduces risk for investors because they are familiar with their investment decision-making process because there are five common mistakes made by beginners while investing the first mistake that beginners make is not understanding the basics this is a problem because you'll be losing money if you don't have a firm grasp on what the
market is doing and how to invest in it the second mistake that beginners make is not diversifying their portfolio this can lead to them having all of their eggs in one basket and then losing everything if that basket Falls the third mistake that beginners make is thinking they have to be perfect at investing which leads to them making bad traits or buying stocks just because they think they're hot the fourth mistake that beginners make is believing in the hype of certain stocks which can lead to them buying stocks when they're at an all-time high the
final mistake that beginners make is not paying attention to the fundamentals of stocks which can lead to them investing in companies with bad fundamentals and then losing money when those companies values plummet Warren Buffett's has made it his philosophy never to lose money he is a strong believer in the idea of value investing which means that he invests in stocks that are undervalued he believes that if you invest in shares at the right price then you will make money even if the market goes down he often says it is far better to buy a wonderful
company at a fair price than a fair company at a wonderful price moving on to the next Rule and that is don't invest in something you don't understand Buffett's investment philosophy is based on value investing buying stocks at less than their intrinsic value which are underpriced by the market this strategy has led to him being called the greatest investor of all time he is also known for his adherence to Value investing principles such as by when others are despondently selling sell when others are greedily buying and never invest in a business you cannot understand in
fact he has gone as far as to say that it's better to be approximately right rather than precisely wrong Buffett's advice to not invest in something you don't understand can be applied to your career as well if you don't understand what you're doing or why it's important then it may not be a good idea to invest your time into it in conclusion never invest in something that you simply don't understand there may be underlying risks that can wipe out your investment completely like these crazy leveraged volatility products before I move on to Warren Buffett next
rule if you're looking to invest in the stock market I will recommend one of the best online brokers etoro.com etoro's platform is intuitive and easy to use even for beginners I personally use etoro.com there's a link to sign up in the description box below by the way if you're enjoying the tips so far and want more videos like this hit the like button so I know now with that out of the way let's move on to the next rule of Warren Buffett's five rules you need to know for successful investing in today's economy and that
is have patience and wait for the right opportunity this advice from Warren Buffett is one that many people find themselves repeating it encourages patients when it comes to investing in a company or stock the idea behind the advice is that you should buy stocks when they are below their intrinsic value and wait until they are at their intrinsic value before selling them this type of investment strategy can be very profitable if done correctly but it requires a lot of patience he said the time to buy stocks or anything else is when there's blood in the
streets this mean when markets crash and there's economic and social turmoil stocks are likely to have already sold off and be on their way to recovery this is where timing is important if investors can predict when the market will go up and down they can make trades to turn that market move into a profit timing the market is often a key component of actively managed investment strategies and it is almost always a basic strategy for Traders you might be wondering how long the recession will last and when it will end to be able to time
and invest in the stock market you'll need a good idea about when it'll bottom out a lot of research shows that the cost of waiting for the perfect moment to invest typically exceeds the benefit of even perfect timing and because timing the market perfectly is nearly impossible the best strategy for most of us is not to try to Market time at all instead make a plan and invest as soon as possible in fact I have invested in the stock market if you want to know which stocks I invest in comment below the word stock I
will talk about it in my next video and share my strategies to buy the next rule of Warren Buffett's is look for Value over time Warren Buffett has used a strategy of buying stocks that are trading at a low price and selling them when they reach a high price this strategy is called value investing he recommends this strategy to investors because it has historically shown to be more profitable than other strategies Buffett use value over time to make money in the stock market by looking at his three basic principles one be greedy when others are
fearful two don't follow the crowd three value stocks over time the first principle that Warren Buffett uses is be greedy when others are fearful this means that he looks for stocks that are not performing well and buys them because he believes they have potential to do better than other stocks that are doing well at the moment even if it means taking a risk with his money in other words he does not follow what others do or what other investors think about a certain stock but instead uses his own judgment Warren Buffett uses the same principle
for investing his own money the following rules of Warren Buffett's five rules you need to know for successful investing in today's economy are be patient be disciplined wait for your opportunities to come to you and avoid trading too much and take on minimal let's try to understand why Warren Buffett advises patients to all investors he said that investing with patients is one of the most important things you can do as an investor patience is a core tenet in his personal philosophy and he advocates for it with all of his clients he recommits to his strategy
of having a long-term Horizon when it comes to investing while also warning against using too much leverage or trading too often Warren Buffett said the stock market is a device for transferring money from the inpatient to the patient to invest responsibly in today's market it is important to pick Investments that are a good fit for your overall asset allocation and diversify based on your needs goals time frames and ability to handle risk that's the key for having discipline when investing Buffett's most famous quote wait for your opportunities to come to you is a great example
of this he believes that if you are constantly looking for an opportunity then it will never find you instead he encourages people to be patient and wait for their opportunities to come instead Buffett's advice is to avoid trading too much and take on minimal risk his reasoning behind this is that it minimizes the chance of human error as well as reduces volatility at this point in the video you may be wondering how to find a good value stock the stock market is a huge complex and sometimes intimidating place one of the most important things to
do to find a good value stock is to have patience and time the best way to find a good value stock is by looking for companies that have low p e ratios price to earnings ratio which means that the company's share price is not too high relative to its earnings it also helps if the company has a steady growth in revenue and earnings as well as positive cash flow now if you are someone who wants to know how to buy stocks with a margin of safety you need to understand that buying stocks with a margin
of safety is the most important rule in investing it can be achieved by buying stocks at discounted prices or stocks that are currently undervalued that's also one of Warren Buffett's five rules you need to know for successful investing in today's economy here are some tips on how to buy stocks with a margin of safety one find out what the company's prospects are worth and compare it with its current price two determine whether the stock is overpriced undervalued or correctly priced three compare the company's financials against its competitors the current economic situation is a difficult one
many people are struggling to make ends meet and are unable to afford basic necessities the economy is not doing well and the unemployment rate is high the people who will build wealth during this recession are those who have a high risk tolerance and can invest in stocks bonds real estate and other assets so far I've shared Warren Buffett five rules you need to know for successful investing in today's economy I also share stories from my own Journey during the recision time and a few tips I hope these will be useful as guiding principles for your
own life for those who are looking for another alternative way of earning income during the recession you can start a business and make money online if you're someone who wants to learn the online business that earn good money today watch my next video where I cover the best online business to start with no money from home please subscribe to the channel and leave a comment about your thought on today's video thanks for watching this video and I'll see you in my next one [Music]
