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because in this video I'm going to share
00:00:01
with you three dangers three
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reservations that I have on the market
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stew and something that I think as smart
00:00:09
and student investors should be aware
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and be prepared to be able to undertake
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actions to counter it should it actually
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happen Now this three present danger is
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something that you the investor should
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be fully aware and know how to
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counteract should it actually happen to
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protect your portfolio as terrorists
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continue to terrify the markets Take
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note as you can see this ladies and
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gentlemen from this chart the Dow has
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had been the wildest swing in the last
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two weeks For example we on the 3rd of
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April and 4th of April they collapsed
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almost 4,000 points only to recover
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substantially almost 3,000 points on 9th
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of April And guess what ladies and
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gentlemen the 9th of April has an
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amazing recovery the ninth sharpest
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recovery in the history of the DRS and
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it holds significant value which I will
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share with you later on And more
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importantly if we look at the intraday
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swings on the various days that is
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actually on April 7th April 8th and
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April 9th they actually rank because of
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the intraday swing from draw downs to
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maximum up by almost 10% They rank as in
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the history of S&P one of the top 20
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widest trading range And what does this
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implication means for you let's look on
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the first danger you know that I want to
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highlight in this week's video and that
00:01:47
is one is that the havoc in the bond
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market has not settled even though the
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equities market
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seemingly seems to be settling down Look
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at that bond market ladies and gentlemen
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You know
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the blue line is indicative of how the
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bond market basically you know perform
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and essentially the red line that is
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from April 11 onwards You can see ladies
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and gentlemen that the long rates have
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steepen much sharper That means compare
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the red line versus the blue line versus
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the yellow line You can see that the
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sharp end has steepened sharply And this
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is quite scary because the implications
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on the mortgage market in the US has
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skyrocketed the mortgage rates to above
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7% Last which was seen during the global
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financial crisis Now you see that the
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short end of the market you know
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essentially is doing an inversion and in
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this case you can see that it's actually
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down 42 basis points which it means that
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essentially the bonds basically have
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actually cooked up Now the second thing
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ladies and gentlemen that you want to be
00:03:10
aware is the soaring bond yields which
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actually before liberation day was below
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4% And now it shot up to 4.5% Yes it has
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pulled back a little bit to below 4.4%
00:03:25
but still nearer 4.5% as opposed to
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nearer 4% A level that investors would
00:03:33
be most comfortable of Now the second
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thing ladies and gentlemen I want to
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show you is the fact that if indeed in
00:03:41
any crisis as has happened before you
00:03:44
notice that bond yields normally go down
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in this case it go up because there's a
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flight to quality there's a flight to
00:03:52
the US market hencefor that sends the US
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dollar up not down in this case we have
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the reverse so we have two worries now
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ladies and gentlemen one is that
00:04:05
interest rates have actually gone up
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when they should be coming down and
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secondly the US dollar instead of going
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up which is a traditional safe haven as
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as it has been the case in the last 200
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years is actually coming down So
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theiration day the euro has surged
00:04:27
substantially as shown in the blue line
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versus the US dollar whereas the rem the
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UN you know because the PBOC's measure
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to actually enhance that the trade
00:04:38
measures that they have with the US is
00:04:41
and be able to prepare So you can see
00:04:44
the UN the Chinese has not appreciated
00:04:46
much safety of having the Swiss Frank
00:04:51
Now the third thing that I'm worried
00:04:53
about and I think investors that that as
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sharp as you and Stu you know are
00:04:58
worried about is the heightened
00:04:59
volatility and guess what ladies and
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gentlemen the high volatility you know
00:05:03
can be seen from huge inflows you know
00:05:06
into leverage ETFs years ago when I
00:05:09
started in the market there's no such
00:05:10
thing as ETF let alone a leverage ETF in
00:05:13
this times this time around we have
00:05:16
leverage inverse ETFs meaning that this
00:05:19
ETFs basically magnify your gains or
00:05:22
losses by two times three times or even
00:05:24
more you know and some of these li uh
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ETFs are even leverage up meanings they
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use the futures they go on low they go
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on margin and that actually exemplify
00:05:35
the huge volatility and this is not and
00:05:39
not surprising to me because
00:05:41
the zero DTE that is actually the zero
00:05:46
day expiration options basically
00:05:49
together with leverage ETF has magnify
00:05:51
volatility in the market Now what this
00:05:54
uh zero day options does ladies and
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gentlemen as the name suggests is that
00:05:58
this options expire at the end of the
00:06:00
day So whether you buy a put or a call
00:06:04
uh you will notice that you will realize
00:06:06
you know whether it actually
00:06:08
materializes into a profit or the loss
00:06:10
based on the pre that you paid for the
00:06:12
particular day If anything ladies and
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gentlemen this actually exemplify the
00:06:16
gambling that you undertake on a daily
00:06:19
basis of the various stocks or of the
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various in so you may ask ladies and
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gentlemen you know how does one prepare
00:06:27
for markets like this well in my past
00:06:30
video as you can see just last week I've
00:06:32
shared that I basically have been able
00:06:35
to buy 3 million worth of shares in this
00:06:39
huge sellout in the markets Why do I do
00:06:42
so do look at my last video Um one of
00:06:44
the key things that I have been able to
00:06:47
do especially since our last lecture for
00:06:49
GCP global investors which include the
00:06:51
index fund managers family officers and
00:06:54
high net worth individual is that since
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March we have been selling off you know
00:06:58
a lot of real estate investment trust
00:07:00
chief of which is actually Main Street
00:07:02
Trust and in last week's videos I've
00:07:05
showed that essentially I've sold uh in
00:07:07
this case you know uh I raised almost
00:07:10
200,000 from the sale of uh Maple
00:07:15
three Then on the 20th of March I
00:07:19
actually sold you know and raised almost
00:07:22
100,000 from the so sale of my ML at uh
00:07:27
$12 And then on the 1 of April yes just
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two weeks ago I sold at 133 raising
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50,000 All in all I saw NLD raising
00:07:37
almost a million dollars The other two
00:07:39
and a half $ one and a half million
00:07:42
dollars came from the sale of other real
00:07:43
estate investment trusts Look gentlemen
00:07:46
the sale price I have got for NLP is 133
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That's almost a 30% higher than the
00:07:52
current share price that closed on
00:07:54
Friday So one of the key thing ladies
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and gentlemen as we always prepare
00:07:57
investors is to be prepared you know
00:08:00
meaning to be able to raise sufficient
00:08:02
money before the sell off come That's
00:08:04
number one And that's what we have shown
00:08:05
with our real estate investment trust
00:08:08
portfolio Secondly is that the thing
00:08:12
about the performance of the 9th of
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April market is very very um eye opening
00:08:20
I would say So if you look at the rate
00:08:22
arrow or rather the orange arrow we
00:08:24
notice that it came down for the 3,000
00:08:28
points increase you know on the single
00:08:31
day was actually the nine largest best
00:08:34
performing day in the history of the US
00:08:38
market Now the history of this is that
00:08:40
it actually holds forth that if you look
00:08:42
at the last few uh times in which the uh
00:08:47
Dow Jones and if you actually go even
00:08:50
longer be it 6 months you 70% of the
00:08:54
time the markets up after 6 months and
00:08:58
after 12 months it's almost 100% that's
00:09:01
91% So essentially ladies and gentlemen
00:09:04
as I said in my last video why I
00:09:07
continue to buy you know up to three
00:09:10
million you know in this huge sell off
00:09:12
you know it's my last video it's because
00:09:14
of that now mind you that amazing day on
00:09:18
9th of April threw up a few things one
00:09:20
of the stock that I mentioned last
00:09:21
week's video that I bought was Apple and
00:09:25
one of the key thing is that
00:09:28
amazing they threw up amazing Apple
00:09:31
because Apple is the for the first time
00:09:34
below 170 is one of the lowest price
00:09:38
I've seen for a long long time and
00:09:40
that's the reason why I bought it plus
00:09:42
other fundamental reason now mind you
00:09:45
the other things that you want to bear
00:09:46
in mind these gentlemen is the fact that
00:09:49
the amazing days two days you know uh
00:09:52
that we've seen you know it's only very
00:09:55
apparent in the last 75 years in only
00:09:58
three other occasions the first of which
00:10:01
is during as you can see from the red
00:10:03
dot after two days of decline during the
00:10:06
87 crash when I first started trading in
00:10:09
the market Secondly during the 08
00:10:11
financial global financial crisis and
00:10:14
then again during the uh 2020 sell that
00:10:19
that's during the pandemic and the
00:10:21
fourth rate dot is the one that we're
00:10:22
experiencing You can see ladies and
00:10:24
gentlemen that in all instances the
00:10:27
markets actually were much higher you
00:10:30
know one month three month 6 months and
00:10:33
12 months into the future right so in
00:10:37
this case that's one of the reasons why
00:10:38
I continue to buy up to 3 million you
00:10:42
know of my shares on the way uh during
00:10:46
because of the amazing day that's been
00:10:48
created on the 9th of April So the
00:10:50
significance of the bounce you know is
00:10:53
very very important And one of the key
00:10:55
things on Apple was that I've drawn in
00:10:58
my last video was the fact that it's
00:11:00
almost the first time that I've seen
00:11:02
that Apple basically collapsed by 23% in
00:11:06
just four trading days As I've
00:11:08
highlighted in my last video the last
00:11:10
time in which it collapsed 202% it was
00:11:13
over a period of one month and that was
00:11:16
during the uh crisis in the global
00:11:18
financial crisis in
00:11:21
20009 Now the other thing about the 9th
00:11:24
of April amazing day is that they have
00:11:28
brought you amazing prices for some of
00:11:30
them In my last video I also shared that
00:11:32
I bought into one of our core holding
00:11:35
Hermes Now the other thing um that that
00:11:39
I want to highlight to you is LVMH
00:11:41
that's Louis Vuitton Tennessee you can
00:11:45
see that yes the prices and because the
00:11:48
results were bad this in the beginning
00:11:51
of the week you know LVMH actually has
00:11:54
fallen back down to 485 which is close
00:11:57
to its 5year low so amazing day or night
00:12:00
of April has brought amazing prices in
00:12:03
this case not only for Hermes or Apple
00:12:06
but also the LBMH And just in case
00:12:09
ladies and gentlemen that you are
00:12:10
trading Nvidia You notice that Nvidia
00:12:13
now is been brought down to earthly
00:12:17
valuations It is for the very first time
00:12:19
ladies and gentlemen that Nvidia is now
00:12:21
trading closer towards 20 times PE as
00:12:25
opposed to 65 times speed as you can see
00:12:28
from this chart over here So an amazing
00:12:31
day may actually bring in amazing market
00:12:34
and that's where you want to position in
00:12:36
and to be buying at way in advance and
00:12:40
mind you ladies and gentlemen tariffs is
00:12:42
it going to go away the answer is no Am
00:12:45
I buying near the lows i certainly hope
00:12:47
so Are bad news going to be hitting the
00:12:50
markets even further the answer is yes
00:12:53
So why am I still buying ahead well it's
00:12:56
for these reasons that I've told you
00:12:58
before that markets tend to discount the
00:13:00
worst way in advance before EPS before
00:13:04
GDP essentially bottom And guess what
00:13:08
ladies and gentlemen come next week the
00:13:09
first of the magnificent seven that's
00:13:12
Alphabet will start reporting results
00:13:13
and let's see because that is going to
00:13:16
be the next benchmark that will move
00:13:18
markets So until next week we'll catch
00:13:21
up again
